FTSE100 betting group Paddy Power Betfair (PPB) has published its preliminary full-year 2018 results, detailing that the firm has made progress on its global agenda, whilst navigating UK home market complexities.
PPB maintains its corporate revenue growth at £1.87 billion (FY2017: £1.74bn), with the betting group detailing robust digital revenues of £948 million (FY2017: £898m), combined with an underlying digital EBITDA of £316 million (FY2017: £306m).
Publishing its results, PPB details that it has achieved a corporate objective outlined by governance, in returning the flagship Paddy Power brand to growth, as a recreational property.
Peter Jackson, PPB Group Chief Executive, commented: “I’m really pleased with the way that the Group performed in 2018 in what was a challenging year for the sector with regulatory and tax changes. Our collection of challenger brands are well positioned in their local markets. Paddy Power has regained its mojo, taking share following product improvements and some of our “classic” marketing”.
Closing 2018 accounts, PPB reports an underlying EBITDA of £451 million, missing its corporate EBITDA target range of £465-480 million, due to significant US investments, where it seeks to gain a ‘stateside podium position’.
“The opening of the US online sports betting market has the potential to be the most significant development to occur within the sector since the advent of online betting,” added Jackson. “Rather than announcing our plans, we have moved quickly to give ourselves the best chance to win in that market.
“We are confident that FanDuel’s nationally recognised sports brand, 8 million customers, our Group betting expertise, and our market access partnerships position us very well. Our success to date supports this view, with FanDuel achieving a 35% online market share in New Jersey in its first 5 months of operation, and Meadowlands becoming a marquee venue for sports betting.”
Entering 2019, Peter Jackson and PBB’s executive team maintain full confidence in the firm’s global growth strategy, targeting organic and M&A led opportunities. PPB’s global portfolio will be further strengthened by the strategic investment of the firm in leading Georgian CIS market bookmaker Adjarabet (transaction £100m – 1 February 2019).
PPB’s international expansion will be led by four strategic pillars: (i) Maximise profitable growth in our core markets – (ii) Grow Betfair in the rest of the world – (iii) Attain podium positions in additional regulated markets – (iv) Pursue the US opportunity rigorously.
“Betfair, our unique combination of product that appeals to customers around the world, will be improved by our ongoing investments in languages and localisation,” Jackson continued. “In Australia, recent tax changes favour the largest operators and we are determined to maintain our leadership position amongst the online bookies, using Sportsbet’s leading customer proposition and generosity to continue to take market share.
“The new financial year has started in line with our expectations. The acquisition of Adjarabet is further evidence that we are delivering against our strategy, and whilst there will inevitably be further regulatory challenges, we are excited about the growth opportunities ahead of us.”