Paddy Power has reported pre-tax profits of €67.2m for the year ending December 2009, a decrease of 15% from the €79m reported in 2008 in what the company called a 'cracking year for punters'.
Total amounts staked by customers in the year rose by 31% to €2.75 billion from €2.1 billion as the group faced a number of 'headwinds' in 2009 as further contractions in the UK and Irish economies impacted the company's customers.
However, its customers saw an 'exceptionally punter-friendly' run of sporting results, especially compared to 2008. Paddy Power said this reduced the gross win percentage by a further 1.5% compared to 2008 and 0.9% below the company's normal expectations.
It said that a run of adverse results in a normal occupational hazard for bookmakers and accounted for much more than the €9m reduction in operating profit to €67m.
Paddy Power said that trading in the year to date has been 'satisfactory'. Adverse weather in January led to racing cancellations and impacted turnover, but the company said this was offset by favourable sports results.
It said it increased its market share in Ireland from 26% to 32%, but its Irish operating profits fell to €16.3m.
During the year the company expanded substantially on several fronts - it bought Sportsbet and IAS in Australia, opened 25 new shops in the UK and seven in Ireland and also set up a new business to business revenue stream with PMU.
Online operations generate 85% of trading profits
Paddy Power said its online operations has grown rapidly in recent years and generated 85% of trading profits in the second half of 2009 after the acquisitions in Australia.
The online division saw operating profits rise by 7% to €45.7m, despite a worse run of sporting results and a negative impact from currency fluctuations. Its online customers rose by 18% to 446,401 during the year and its said that both its sportbook and gaming grew strongly.
Operating profits at Paddy Power's Irish retail division fell by 42% to €16.3m while the amounts stake rose by 1% to €949.1m. Its UK retail division saw operating profits rise by 5% to €1.3m with amounts staked rising to €198.3m - up 14%.
However, the group's telephone division saw an operating loss of €1.2m for the year, due to adverse results, a weak sterling rate and recessionary headwinds. The amounts staked were flat at €297.4m.
Paddy Power's chief executive Patrick Kennedy said that looking to 2010 and beyond, the company will continue to invest in its brand, its product and in enhanced value for its customers. He said this in turn will lead to continued growth in the market share of its businesses.
Paddy Power shares closed seven cent, or 3%, higher at €23.76 in Dublin this afternoon.
