Paddy Power plummets as punters win
THE owner of Paddy Power took a £60m hit as punters cashed in on favourites coming out on top in football and boxing last month.
Flutter Entertainment warned ‘customer-friendly results’ and a £10m knock from the closing of its Dutch operations would result in lower than expected profits.
Shares in the company, which also owns Betfair and Sky Bet, fell 7.7pc or 1080p to 12,995p.
Among results to hit the company last month was Tyson Fury’s heavyweight title win over Deontay Wilder. The British boxer, pictured, was backed to win by fans, costing bookmakers a fortune.
In football, Liverpool’s 5-0 victory over Manchester United and a string of favourites winning in the Champions League and recent international results took their toll.
Flutter expects its profits for the year to be between £1.24bn and £1.28bn, having previously targeted £1.27bn to £1.37bn. The hit in october followed a strong third quarter when revenues rose 12pc to £1.4bn and monthly customer numbers increased 13pc to nearly 7.3m.
It has 3.1m online customers in the UK and Ireland – up 19pc in a year. But third-quarter revenues in the UK and Ireland fell 5pc to £491m.
Flutter said that the drop was in part due to the end of Covid lockdowns which had boosted online gambling earlier in the pandemic.
It also noted the impact of protection for gamblers. It became the first bookie to cap how much young gamblers can lose. Customers under 25 will be limited to a £500-a-month loss from next year.
Harry Barnick, senior analyst at investment research firm Third Bridge, said: ‘In Flutter’s home market, increased scrutiny into online regulation poses a threat to top line and profitability. Investors are anxiously waiting to hear what may be in store for the sector.’ Its closure in the Netherlands will knock £10m off Flutter’s profits this year and another £40m in 2022, it said. The Netherlands was until last month an unregulated market where Flutter did business as Poker Stars. But the country’s gambling authority said betting firms would need to be licensed so it has pulled out while it applies. It said it will be active again in the second half of 2022. Chief executive Peter Jackson said the firm delivered a ‘strong’ performance but analysts at investment bank Citi said the update was ‘slightly disappointing’.