Company merging with owner of Leeds-based Sky Bet sees profits fall
The company behind Paddy Power and Betfair has said that pre-tax profit dropped 70% to £24 million in the first half of the financial year as the Covid-19 crisis took hold.
Flutter Entertainment, which is in the process of integrating its £10 billion acquisition of The Stars Group which owns Leeds-based Sky Bet, said that revenue had jumped 49% to £1.52 billion.
So far, the second half of the year has been “encouraging,” the company said, as football came back onto the sporting calendar.
It warned the outlook is still “highly uncertain” because Covid-19 may disrupt the market even further.
Earlier this year, the Competition and Markets Authority cleared the merger between gambling companies Flutter and Stars.
The companies are two of the main online betting brands in the UK, with a combined revenue of £1.5 billion. Flutter owns Paddy Power and Betfair, and Stars owns Sky Bet.
Fluttter's chief executive Peter Jackson said: “The group’s first-half financial performance exceeded expectations as we benefited from geographic and product diversification.
“In the period prior to Covid-19 related disruption, our businesses performed well with strong customer growth and favourable sports results. In the period thereafter, the cancellation of sports and closure of our shops led to reduced sports revenues in the UK and Ireland.
“However, this was more than offset by an increase in the number of recreational customers playing our poker and gaming products globally as people sought new forms of home entertainment. In Australia and the US, the continuation of horse racing meant that overall sports revenues grew in both regions.”