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Paddy Power Profits Up 55% - But Renews Offshore Threat

Jason Gorringe, Tax-News.com, London

22 February 2001

Last December's reduction in Irish betting tax and the launch of its on-line service boosted Power Leisure, the Dublin-based betting company that trades as Paddy Power, to a pre-tax profit of 11m euros for the year to last 31st December - a 55 per cent rise. Turnover was up 35% to 363m euros. The group, which has on-line betting services in both Ireland and the UK, proposed a final dividend of 1.17 cents per share, bringing the total dividend to 3.92 cents per share.

Turnover through the group's paddypower.com site - launched in June 2000 - was 8.5m euros on an average bet size of 31 euros. In mid-February paddypower.com had more than 14,000 account registrations.

"Our focus remains on developing online interactive channels in the UK and continued expansion of our telephone betting and licensed betting office business in Ireland," said chief executive Stewart Kenny.
The company expected to launch online services through the interactive digital television systems of ntl and Telewest in the next few months.

Peter O'Grady Walshe, finance director, confirmed that unless there was a material change in betting duty in either the UK or Ireland in the next few months, then it would locate its online operations to a more competitive environment for the benefit of overseas customers.

Last year, there were reports that Paddy Power, Ireland's largest bookmaker, would move a large chunk of its operations to Malta, where it has been awarded a betting licence, but the December tax reduction and the company's successful flotation seem to have postponed the move.

In London the shares, which floated at 137p, ended unchanged at 225p.

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