Paddy Power owner sees profit surge 221% as live sport returns

Flutter Entertainment, which owns Paddy Power, SkyBet and Betfair, has praised the success of its ‘complement and compete’ strategy in helping it deliver a “differentiated proposition” and boosting revenue in the UK.

PaddyPowerThe return of sport following a Covid-induced hiatus caused group revenue to surge 99% to £3.1bn at Paddy Power owner Flutter Entertainment during the six months to 30 June. Over the same period the company, which also owns SkyBet and Betfair, experienced a 221% rise in pre-tax profit to £77m.

In the UK and Ireland alone, revenue grew by 30% to £1.1bn, despite Paddy Power stores being closed for the entirety of the first quarter and a proportion of Q2.

Online revenue rose by 37% across the UK and Ireland business, with the Euros tournament helping to drive a 44% increase in average monthly players across the SkyBet, Betfair and Paddy Power brands.

Flutter says its gaming business also performed well, despite the fact such products typically claim a lower share of consumer spend during summer football tournaments.

The company praises SkyBet, Paddy Power and Betfair for continuing to deliver a “differentiated proposition to recreational and more engaged customers alike”, with the team pursuing a ‘complement and compete’ strategy.

Flutter claims targeted marketing campaigns have helped to enhance the SkyBet in-play experience, while Paddy Power and Betfair have benefitted from improved ‘Bet Builder’ products. The popularity of the ‘Bet Builder’ functionality has allowed the business to reinvest in enhanced rewards to acquire and retain customers.

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Product development

Improvements to the product offering across the three brands have been brought about by creating “centres of excellence”, sharing insights on areas like pricing and risk management. As a result of the improvements, all three brands achieved “record high engagement” during the six months to 30 June, with sports betting average monthly players up 24% compared to 2019.

Flutter also claims to have improved the proposition of its gaming products over the past 12 months, leveraging the expertise of the Sky Vegas team to successfully launch daily engagement products such as ‘Paddy’s Wonder Wheel’ and ‘Betfair’s Prize Pinball’. The business says these changes have led to improved customer engagement and retention.

The results show the integration of the SkyBet, Paddy Power and Betfair brands is “progressing well” and benefits are being found from shared learnings across product and operations, according to Flutter Entertainment chief executive Peter Jackson.

He describes the company’s first half performance as exceeding expectations, indicating “substantial progress” is being made towards the group’s strategic objectives.

“Our global sports businesses benefitted from further enhancements to our products and the return to more normalised sporting calendars while we sustained our strong performance in gaming despite the challenging comparatives set last year,” he says.

He adds that the business is committed to promoting “safer” gambling and ensuring customers do not go beyond their means.

“Taking a lead on safer gambling remains a key priority for the group as we continue investment across our brands and step up our activity to promote safer gambling awareness and tools. In markets where our campaigns are most advanced we are already seeing a positive impact on customer engagement and usage of safer gambling tools,” he says.

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