Paddy Power Betfair is returning £500m in cash to shareholders, amid first-quarter results that show a dip in revenue.
The company said that it expects its full-year underlying EBITDA to be between £470m and £495m, with the return of cash forming part of a strategy to achieve a “more efficient capital structure, whilst retaining substantial strategic flexibility”.
Underlying profits were at £80m during the opening quarter of 2018, a 12 per cent drop year-on-year from £91m, with the group stating that punters in the UK were turned off by bookmaker-friendly sporting results.
In Australia, positive growth was offset partially by “adverse sports results” in a market that has seen increased advertising restrictions.
Paddy Power Betfair’s overall revenue was £408m in Q1 2018, compared to £416m in the same period 12 months earlier. Underlying profits stood at £102m, compared to £111m, with the underlying EBITDA margin down to 24.9 per cent from 26.6 per cent in Q1 2017.
"We have made good progress against our strategic priorities,” said chief executive Peter Jackson. “In Europe, the successful completion of our platform integration has resulted in a meaningful improvement to the Paddy Power product. This has seen the brand's gaming revenue returning to growth from February and a significant uplift in ‘cash out’ usage and in-running betting during the Cheltenham Festival.
“In Australia, Sportsbet continues to perform well and is targeting further market share growth, with additional investment planned to take advantage of any disruption arising from market consolidation and the introduction of increased taxes.
“In the USA, TVG and Betfaircasino.com have good momentum and we are continuing to make preparations for any positive regulatory changes.”
