Paddy Power blames Irish Sports success for lower profits

The success of Irish sports stars is being blamed for the drop in pretax profits at Paddy Power. Reporting profits down from €49.8 to €34.1 in the 6 months to June 30^th Chief Executive Patrick Kennedy said “It’s definitely been a winning period for the punters.” “It’s an occupational hazard”. The Irish rugby union team won their first grand slam in more than 60 years, Leinster won the Heineken Cup whilst at the Cheltenham Festival Ruby Walsh rode an unprecedented 7 winners and 9 Irish trained horses also came in first. With tongue in cheek Paddy Power said “after eight Irish trained winners over the first two days we were considering going to the government for a bail-out but we knew they had no money left”. The biggest day for gamblers however came when Aidan O’Briens Yeats won the Gold Cup at Royal Ascot. It was not all bad news however; the group said stakes by punters was at a record level of €1.1 billion and its share of the Irish market increased from 26% to 29% helped by closures of betting shops by competitors while Paddy Power has not closed any. In fact in the UK market the bookmaker has opened 15 shops this year and is targeting 150 by 2011. The online business which accounts for over 60% of profits had a 32% rise in turnover reflecting the change in punters habits to bet from the comfort of their own home. When questioned about recent moves by competitors to relocate online operations overseas, Mr Kennedy said his Tallaght based division would not be moving to an offshore tax haven. The shares closed up 6% at €20.20 helped no doubt by a 5% increase in the interim dividend to 9.5 cents.