Paddy Power Betfair blames bad results on bad results

Paddy Power Betfair has said the lack of a major football tournament and unfavourable sports results were to blame for a slowdown in growth in the first half of the year.

Shares in the betting group fell sharply for a second day, after the bookmaker surprised investors on Monday with the revelation that Breon Corcoran had resigned as chief executive.

The company was the biggest faller on the FTSE 100 on Tuesday, down 5%, after it revealed revenue growth over the first six months had fallen to 9% from 18% in the same period a year earlier. First-half revenue of £827m included a £40m boost from the weakness of the pound since the Brexit vote, which flattered overseas sales.

The slowdown in growth reflected a weak second quarter, with revenues down 2%, was partly due to a tough comparable period, with the bookmaker cashing in last year from Euro 2016.

The company said it also lost out as customers backed winning favourites in April and May in the Premier League and Champions League football, and at events such as the Grand National and the US Masters.

In the first quarter, revenue rose by 23% as the company benefited from more favourable sports results, particularly at Cheltenham Festival. Underlying earnings in the first half overall increased by 21% to £220m.

Corcoran said the company was investing to improve its position in a “highly competitive market”, spending more on promotional offers and slashing odds for customers.

“Our customers and shareholders are already seeing benefits from efficiencies and investments. In the first half alone, customers enjoyed approximately £30m of extra value through better odds, more generous offers and new loyalty benefits,” he said.

Paddy Power Betfair said on Monday that Corcoran would be replaced by Peter Jackson, a non- executive director at the gambling firm and chief executive of the UK business of Worldpay, which handles 40% of all card payments at tills in Britain.

The company said Jackson’s start date would be confirmed “in due course”.

“Breon [Corcoran] will continue to lead the group in the meantime, completing the integration of the Paddy Power and Betfair businesses, and ensuring the delivery of an orderly transition,” the company said.

Corcoran was instrumental in the £5bn merger of Paddy Power and Betfair in 2015, which created one of the world’s largest online gambling businesses.