PADDY POWER OPERATING PROFIT/(LOSS) IN EURO H1 2010
Online (ex Australia) Online Australia Irish Retail UK Retail
Telephone (ex Australia) Total operating profit
9,040,000 11,697,000 2,956,000
CONSTANT CURRENCY % CHANGE IN
29,034,000 21,815,000 +28% 7,856,000
n/a -22% 568,000 (446,000)
460,000 +339% na
49,454,000 33,526,000 +43%
Record turnover for Bwin
Vienna-based online bookmaker Bwin has reported record turnover for sports betting due to a successful World Cup. However, the company recorded a 22.7 per cent drop in profit after tax to 14.7m euro (£12.3m) for the first half of the year because of its ‘intensive prepa- rations and start-up costs’ ahead of deregulating European markets.
Star Sports snaps up Vickers Bookmakers
Paddy Power’s innovative marketing such as its massive sign at Cheltenham has sign the bookmaker with a 69 per cent recognition rate among online bettors
Paddy Power on track for 150 UK LBOs
The UK market is becoming ever more important for Paddy Power, especially with more growth opportunities in the retail market. Andrew McCarron reports.
addy Power has revealed that it makes more money from UK customers than those from Ireland. 43 per cent of the bookmaker’s operating profit is from UK customers, with only 39 per cent from Irish cus- tomers and 16 per cent from its growing operations in Australia.
The Dublin-based firm has seen a six-fold increase in UK Retail operating profit to 3m euro (£2.5m) for the first six months of the year with like-for-like EBITDA per shop in Great Britain up 27 per cent to £71,000 and with 22 shops opened in the year to date.
Chief executive Patrick Kennedy said: “The group’s strengths - product innovation, better value for customers and brand differentiation - position us well for further growth. We have signif- icantly strengthened our online market position, ending the period with greater scale, more customers and enhanced capabilities, as well as substantially higher profits, compared to a year pre- viously. At the same time, we contin- ued to expand internationally, whilst increasing market share in retail.” Paddy Power said that it continues to grow its UK retail estate ‘selectively and steadily’, with 14 shops opened in the first half of the year. The firm com- mented: “Given the economic down- turn, we continue to benefit from an exceptional choice of locations for organic openings and on occasion, attractive acquisition opportunities, with six shops bought over two trans- actions in the year to date. We remain on track to achieve our target of at least 150 shops in the UK in 2011.”
04 BettingBusinessInteractive • SEPTEMBER 2010
In constant currency, turnover on the UK retail estate grew 41 per cent to 132m euro (£110.1m), while gross win increased by 38 per cent, mainly because of the new shop openings, but like-for-like gross win grew six per cent in constant currency. This comprised machine growth of 14 per cent and over- the-counter growth of 0.4 per cent on like-for-like OTC turnover up 6 per cent. The average OTC stake per bet was broadly unchanged in constant cur- rency at 15.82 euro (£13.20). The average gross win per machine per week including VAT was £992, an increase of 17 per cent compared to the first six months of 2009.
The bookmaker enjoyed a good
World Cup making 18m euro (£15.0m) on stakes of 86m euro (£71.8m), although the profits were dented by poor results at Royal Ascot. However, a general improvement in sports results contributed to increased profit online, which enjoyed a 28 per cent increase in profit in constant cur- rency. Sportsbook stakes and gaming gross win also grew substantially by 23 per cent and 36 per cent respec- tively in constant currency. However, online costs have increased by 61 per cent because of increased investment in streamed live sports online, terrestrial TV advertising in the UK and enhanced gaming pro- motions; investigating potential from pay-per-click advertising, smart phone usage and newly regulating geogra- phies; and people costs linked to direct volume growth, a step-up in infrastruc- ture in areas such as B2B and IT, and per- formance related pay.
ONLINE ACTIVITIES ACCOUNT FOR APPROXIMATELY THREE QUARTERS OF PADDY POWER’S OPERATING PROFIT, WITH SPORTSBOOK LEADING THE WAY. THE AMOUNTS STAKED ON THE SPORTSBOOK
INCREASED BY 23 PER CENT IN CONSTANT CURRENCY TO 506M EURO (£422M). WITHIN THIS, BET VOLUMES GREW 46 PER CENT TO 30.8M WHILE THE AVERAGE STAKE PER BET DECREASED BY 16 PER CENT IN CONSTANT
CURRENCY TO 16.45 EURO (£13.72). SPORTSBOOK GROSS WIN INCREASED BY 49 PER CENT IN CONSTANT
CURRENCY A FIGURE HELPED BY A REBOUND IN THE GROSS WIN PERCENTAGE TO 8.0 PER CENT. A 41 PER CENT INCREASE IN ACTIVE CUSTOMERS SUGGESTS THAT FIGURES WILL
IMPROVE EVEN MORE FOR THE SECOND HALF OF THE YEAR.
Greek government weighs up options
fter months of hints and suggestions, the Greek government finally published draft legislation for liberalisation of its gaming market on its website on 26 August with specific proposals for opening up Greece’s markets for online sports betting and for poker, as well as allowing slots and VLTs outside of casinos for the first time.
The Finance Ministry has produced a regulatory framework which aims to recoup most of the estimated 5bn euro (£4.2bn) worth of illegal gambling in the country and produce substantial tax revenues for the hard- pressed treasury.
The Finance Ministry document, which will be open for consultation until midnight on 12 September, indicates that initially only sports betting and poker would be offered online, via mobile or interactive TV, whilst betting on horse racing and casino type games may be subject to future consultation. The proposals suggest three possible scenarios for the new regime. The first would involve a competitive market with an unlimited number of licences available. The selection would be made based on the operator sat- isfying specific requirements set out by the government. It would be compulsory to host servers within the country and launch a dedicated .gr site. A second option would involve a public tender for a limited number of online licences - possibly five - with operators again being required to satisfy specific requirements but only the highest bidders being successful. The final, more contentious option, would see OPAP maintaining its current monopoly, but a limited number of additional licences available for operators, who would act as sub- contractors and pay royalties to OPAP.
outh coast telephone bookmaker Star Sports has announced the acquisition of Vickers Bookmakers. The deal will see the transfer of all 5,000 Vickers credit clients and their balances to Star Sports for an undisclosed fee. Current Vickers’ clients will be able to con- tinue to use their existing account numbers, while the existing telephone number will remain in service.
Star Sports managing director Ben Keith com- mented: “We are delighted to have acquired a business with the heritage of Vickers. They have been a leading credit bookmaker for over sixty years and we have had our eyes on a sleeping giant of their size for some time now - it is very exciting to be able to add them to our existing portfolio. These are extremely exciting times and I look forward to per- sonally welcoming all former Vickers clients.” Bruce Peterson, manag- ing director of Vickers Bookmakers, added: “It was important to us that
we left the business in good hands and we are delighted to have found the team at Star Sports. They have behaved like gentlemen throughout the process and I’m sure our clients will relish betting with them. They definitely seem to be heading in the right direc- tion as a business and have an exciting youthful energy about them.”
Ben Keith’s Star Sports is branded as the
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