Irish betting operator Paddy Power posted record profits in 2014 thanks to a strong performance by its Australian online division. Paddy’s group revenue rose 18% to €882m in 2014, while profit before tax rose 21% to €167m.
The 2014 FIFA World Cup helped boost Paddy’s turnover to a record €7b although the company says hold was negatively affected by sports results that had “more ups and downs than Taylor Swift’s love life.” Paddy said there were three separate weeks last year in which nearly all the favorites won, causing bookies to pay out “gazillions” on accumulators.
Paddy’s online operations (including Italy but excluding Australia) saw sportsbook turnover rise 25% as the ranks of online customers grew 21%. But sportsbook revenue rose just 7% to €194.2m as hold dipped one point.
Mobile was again a star performer, responsible for 55% of online revenue. Mobile turnover grew 38% to €1.6b and Paddy says 77% of sportsbook customers made a mobile transaction in December. Paddy suggested mobile betting adoption is now “not far behind using it for setting up one night stands on Tinder!”
Online gaming and ‘other’ revenue rose 18% to €140m despite only 6% growth in active customers. Gains in casino, bingo and B2B offset a decline in poker. Mobile gaming revenue rose 58%, representing 40% of overall online gaming (rising to 45% in December).
Paddy lags its competitors in gaming revenue per active customer, but is taking steps to remedy this “historic under penetration.” Paddy credited its Bulgarian game development base for providing it with new proprietary content, including the Santa’s Spins product, which “beat every game ever launched on the site for month one revenue.”
Paddy’s Italian-facing site saw revenue rise 85% but the division posted a net loss of €14.7m as overall market growth remains “slower than expected.” Paddy says it will complete a review of its Italian operation over the coming months to “position our business better for this market reality.”