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Paddy Power, Betfred pull new products after warning

Bookmakers Paddy Power and Betfred have pulled new retail products following a warning from the Gambling Commission and both operators could yet face regulatory action.

A third bookmaker, also poised to launch a new product as reported in the media, has also been warned.

This week saw the introduction of a reduction to £2 from £100 of maximum stakes on FOBTs, with the regulator concerned that the new products “undermine” the changes made.

The Commission said it may also investigate key senior staff at bookmakers responsible for bringing those products to market.

The announcement follows a letter from the Commission’s chief executive Neil McArthur to bookmakers warning the industry against any attempts to circumvent the FOBT stake cut and reminding them of their responsibilities to ensure their consumers are protected. 

Richard Watson, executive director for enforcement, said: “We have been absolutely clear with operators about our expectations to act responsibly following the stake cut implementation this week. We have told operators to take down new products which undermine the changes, and we will investigate any other products that are not within the spirit and intention of the new rules.’’
Paddy Power Betfair bullish on US prospects in Q1 trading update

Betting and gaming operator group Paddy Power Betfair, parent company of the FanDuel Group, has posted a Q1 update featuring strong year-on-year growth, fueled by solid performance in a number of its key markets. The US came in for high praise from CEO Peter Jackson who cited FanDuel’s leading position in New Jersey among other stateside highlights.

Group-wise, total revenue in the quarter (unaudited) was $625m, up 17 per cent against the same period in 2018. The firm pointed to “excellent growth” in Australia, the US and across its European business, with Sportsbet, FanDuel and the recently acquired Adjarabet all credited.

Gaming performed particularly well, jumping 26 per cent year on year, to $174m, although this is barely a quarter of overall group revenue, with betting remaining dominant.

Focusing on America, Jackson noted: “In the US, FanDuel Group is making huge progress, with our unique proposition of brand, product offering, existing fantasy customer base, US market experience and global sports betting expertise driving a Q1 New Jersey sports betting market share of 50%.

“In the US, FanDuel remains well positioned to generate good returns on ongoing sports betting investment and for the rest of the group we remain on track to meet our full year profit expectations despite the adverse sports results in Q1. We remain excited about the growth opportunities that lie ahead for the group.”

Putting that into figures, Jackson added: “US revenue increased 47% with good underlying growth in our non-sportsbook businesses (up 12%), supplemented by $24m of sports betting net revenue. Betfair Casino growth (up 83%) has accelerated due to sportsbook cross-sell and as a result, our New Jersey casino market share increased to 14% in Q1 2019 from a steady 11% over the previous two years.

“Total sports betting stakes in Q1 were $598m on which we generated gross revenue of $33m, more than double the revenue generated in Q4 2018. Across the first quarter, FanDuel was the number one brand in New Jersey with 50% share of market revenues. In addition, we launched our retail sportsbook in Pennsylvania in March, with online expected to follow in the coming months.”
Paddy Power Betfair secures £250m loan facility


Paddy Power Betfair has agreed an additional £250m loan facility, the bookmaker announced on Monday.

The company said the additional term loan facility, which will run for an initial period of 18 months with an option to extend it by a further 12, provided it with "further strategic financial flexibility".

The latest agreement takes Paddy Power's total available committed bank loan facilities to £700m, as it already has a £450m five-year revolving credit facility in place.

In a statement, Paddy Power confirmed there would be "no material change to the group’s effective cost of debt" as a result of this new facility

It continued: "The group’s balance sheet remains strong and we continue to target a medium-term leverage range of between 1x and 2x net debt to earnings before interest, tax, depreciation and amortisation."

Earlier this month, Paddy Power said like-for-like first-quarter revenues had risen 17% to £478m, while total revenues in the US jumped 47% to £78m. The FTSE 100 firm was one of the first bookmakers to enter the US market after a federal ban on sports betting was lifted a year ago, and operates under the FanDuel brand. Paddy Power said it was continuing to see "good returns" on its US investment.

Paddy Power Betfair shareholders back ‘Flutter Entertainment’ rebrand

Paddy Power Betfair shareholders have backed the group’s proposition to rebrand as Flutter Entertainments, as confirmed as part of an annual general meeting for the operator.

The Paddy Power Betfair chairman, Gary McGann, has confirmed that a 99.8 per cent majority of shareholders voting by proxy backed the move to rebrand the group, as it seeks to reflect the group’s growing brand portfolio.

The notice of the annual general meeting for Paddy Power Betfair notes: “In Resolution 12, shareholders are being asked to pass a special resolution authorising the Company to change its name to Flutter Entertainment plc and amending the Memorandum and Articles of Association of the Company to reflect such change.

“We believe that the corporate name of the Group should be reflective of the broader business and not just specific brands operated by the Group. Therefore, we consider that this is the correct decision in the context of the Group operating a growing number of diverse brands and operations.”

The group has strengthened its global portfolio in recent months via a merger and acquisition drive. In February of this year, the group acquired a 51 per cent stake in Georgian operator Adjarabet for an initial cash consideration totalling £101m. While in May 2018, Paddy Power Betfair agreed to merge its Betfair U.S. division with fantasy sports operator FanDuel.

Paddy Power Betfair has previously stressed that its 2019 strategy will involve targeting a number of additional organic M&A opportunities across the world.