Merger pays out for Paddy Power Betfair

Merger pays out for Paddy Power Betfair

Paddy Power Betfair said it showed "strong trading momentum" as the bookmaker posted its first set of results since completing its £5bn merger.

It said its pre-tax profits lifted 8% to 179.7 million euro (£139.1m) in the year to the end of December, helped by a robust online performance.

The newly enlarged business said online revenues jumped 23% during the period, while the unit's operating profit rose 11% to 152 million euro (£118m).

Dublin-based Paddy Power completed its merger with online rival Betfair last month, amid increasing consolidation in the industry.

The merger gives the group a much larger digital operation, and leaves it with 341 shops in the UK, after opening 20 stores last year.

The group will also enter the FTSE 100 Index by the end of the month.

It added the merger gave it the chance of "leveraging our enlarged scale and capabilities as we integrate two leading businesses".

Chief executive Breon Corcoran said: "These results show that both businesses entered this merger on the back of strong trading momentum.

"Our belief in the strategic rationale for the deal has only been strengthened following our early days as a combined operator."

Last month the UK's largest bookmaker William Hill saw its annual profits tumble after a "challenging year" which saw it hit by almost £90m of new taxes.

It said its pre-tax profit in the 12 months to December 29 fell by 21% to £187.4m after new online and gaming machine levies set it back around £87m during the year.

A combination of new taxes on online gambling around the world and the need to invest in marketing and technology has led to consolidation across the industry this year.

In September, FoxyBingo owner spurned suitor 888 Holdings in favour of a £1.1bn cash-and-shares offer from Sportingbet owner GVC after a  protracted takeover tussle.

Meanwhile in July, Ladbrokes and Gala Coral agreed a merger to create a £2.3bn gambling giant that is expected to overtake market leader William Hill.

Shares in Paddy Power Betfair slipped 2% to 9430p in morning trading.