Paddy Power, the Irish online gambling group, reported that its online gambling operations were responsible for more than half of its 2005 revenues. 2005 marked a very disappointing twelve-month period for the group, but its online gambling operations showed remarkable growth and were the biggest contributor to the group’s bottom line. The pre-tax profit for 2005 was down by two and half percent to Euro 31.3 million on revenues that saw only a slight increase over eighteen percent to Euro 1.37 billion. Paddy Power’s online operations were responsible for 56 percent of that, contributing Euro 577 million and the online operating profits grew a substantial 93 percent to Euro 21 million. According to a Paddy Power spokesperson, the accelerated activity in the group’s online gambling operation was due, at least in part, to the addition of Paddy Power’s online poker product. Paddy Power’s total online active customers numbered 46,703 in 2004, but that number has since increased to 73,661. The biggest growth in gaming only membership saw a noticeable increase from 2,338 to 11, 227, which is well ahead of sportsbook-only clients. Paddy Power’s CEO, Patrick Kennedy, said that the group has plans to expand its European market for 2006, but will take a more cautious approach with the U.S. market: “There is an obvious temptation to take a brand such as ours to places such as New York and Chicago. But we need to manage our growth and the legal situation there remains a gray area.” The CEO was also quick to point out that Paddy Power’s online gambling business continued to demonstrate impressive growth and was an increasingly important part of overall operations, adding that: “The growth in the past few years in our non-retail (online) channel has been truly impressive. In addition to our sportsbook offering through both telephone and Internet channels, we have successfully introduced casino products, gaming products and poker.” Kennedy said a bad run of results and the structural change in the company’s home market caused the fall in profits. Posted on: March 6, 2006
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