Having completed a year of corporate integrations and co-synergies, FTSE100 Paddy Power Betfair (PPB) is looking forward to the Cheltenham Festival 2017, in which the company will display its combined corporate efficiencies.
This morning PPB governance published its ‘Preliminary Results’ for full-year 2016, which outlined a proforma ‘double-digit growth across all four operating divisions’, with PPB group revenues hitting £1.5 billion.
Further top-line metrics published by the operator saw proforma EBITDA up 35% to £400 million aided by an operating margin increase to 26%. PPB governance would report an underlying group operating profit of £330 million (331p per share respectively).
For statutory purposes, PPB would post a group loss of £5.7 million as the company absorbed 2016 merger costs and expenses. The enlarged enterprise would disclose that it had paid out £116 million in cash expenses during 2016.
Despite the merger costs incurred, PPB governance remains confident of its future performance as it would declare a 165p per share dividend payback to its investors.
Looking forward, PPB governance stated that group integration would continue throughout 2017, as it seeks to bring out the best dynamics out of the two legacy firm’s operations.
In its strategic update to investors, PPB governance would present three core group focuses for 2017 which it believes will help the group achieve long-term success. PPB governance outlined
- Capitalising on the PBB groups enhanced scale. Both internally for its combined operations and externally for customer products and pricing.
- Combining best individual Legacy assets. Continuing its ongoing group review, PPB will integrate best individual technologies, operational processes and capabilities for group’s combined strategy.
- Optimising its brand position within the UK & Ireland. PPB seeks to cement its place a UK market leading bookmaker group.
Breon Corcoran, Paddy Power Betfair Chief Executive, commented on 2016 corporate performance
“2016 was a transformational year for Paddy Power Betfair with much of the integration of the businesses completed sooner and more efficiently than expected.”
“The integration of our technology platforms is on track and customers are already seeing some benefits, including more markets and better odds. In keeping with our dual brand strategy, we are serving different parts of the market with distinct value propositions.”
“For instance, at Cheltenham next week Paddy Power has a generous money back offer for second place and Betfair will reward winners with a free bet offer and exceptional odds.”
” We have created a business with considerable scale that is stronger and better able to compete than either of the individual legacy companies. The Group is well positioned to deliver sustainable, profitable growth”.