Sporting results that left punters reeling helped double profits at listed bookmaker Paddy Power to €43 million during the first six months of the year.
The group reported that operating profits for the first half of 2007 grew 108 per cent to €40.8 million from €19.6 million during the same period last year.
Pre-tax profits also increased by 108 per cent to €42.7 million, from €20.5 million, boosted by financial income of €1.9 million.
The strong growth prompted the group to predict that full-year operating profits would hit €68 million, an increase of 60 per cent on the €47.5 million it posted at the end of 2006.
Chief executive Patrick Kennedy said yesterday that "favourable sporting results" boosted profits in its three divisions - bookmakers' shops, online and telephone betting. "Favourable" results for the bookmaker during the period meant the opposite for its customers.
A succession of losing favourites in racing and sports such as rugby and golf, along with defeats for well-supported Irish horses beaten in big meetings in England such as Cheltenham, drove up betting losses and added to the bookmaker's bottom line.
Big contributors to this included Silver Birch's win in the Grand National at odds of 33/1, and Angel Cabrera's US Open golf victory at 125/1. The high odds meant that few punters supported either contender and thus the bookies had to pay out very little when they won.
Its gross win margin, the difference between the amounts staked by its customers and that handed back in winnings, was up 37 per cent in the first half at €143.8 million from €105 million during the same period last year.
The gross win percentage was 12.4 per cent against 10.3 per cent in the first half of 2006.
This meant that, on average, punters got 87.6 cent back from every €1 that they staked during the first half of 2007, compared with a return of 89.7 cent for every €1 staked during the first six months of last year.
The 12.4 per cent gross win margin is at the upper end of 10 per cent to 13 per cent range at which the company aims.
Its 168 Irish betting shops delivered an operating profit of €22.5 million, compared with €90.7 million last year.
Its UK retail business had a €500,000 loss, compared with a €3 million shortfall in 2006. The group maintains this division is at an early stage of development.
