Downturn in punters' luck sees Paddy Power net record profits

Paddy Power Bookmaker has announced record interim results for the six months to June 30, thanks to a turn of luck for the worse among punters.

However, a record pay-out was made to a punter on January 18, when €427,220 was paid to Catherine Egan, on going through the card in Fairyhouse.

Profit after tax soared by 158% to €16m, from €6.2m in the same period last year. In early 2003 punters had "an unprecedented run at the expense of the bookies and Paddy Power’s results for this period last year were ‘hit’ as a result", CEO John O'Reilly said today.

A lack of punters' luck in the first half of this year has gone straight to the Paddy Power bottom line, O'Reilly admitted. "It’s been an excellent six months for Paddy Power on the back of an unusually favourable set of sporting results," he said.

"We are now seeing the payback from our investment in our non-retail activities which have become significant profit contributors to the group. Our United Kingdom retail operation, while still small, is on track to meet its expansion plans and we remain confident of our ability to grow in this market," he added.

Paddy Power has 20 outlets in the UK and a further eight licences have been secured. There are 141 outlets in Ireland. The group now employs 1,100 staff, representing an increase of 14% in the past year and more than 40% in the past three years.

Finance director Ross Ivers issued a cautionary note in relation to the rest of the year, however.

"The business has benefited from an unusually strong gross win percentage in the first half of 2004 which, given normal fluctuations, is unlikely to continue through the second half of the year. We would expect gross win to move towards the midpoint of its historical range within each channel for the year as a whole," he said.

The board will pay an interim dividend of 6.2c per share, an increase of 44% on the 2003 interim dividend. This will be paid on September 24, 2004 to shareholders on the register at the close of business on September 10, 2004.