Earlier this week, Paddy Power, the Dublin-Based online gambling group, reported an eleven percent increase in its first-half net profits. This was in addition to the promising growth the company saw in its Internet, telephone and over-the-counter gambling markets.

According to Paddy Power, they saw a January to June net profit increase to Euro 17.5 million (US$22.4 million) from Euro 15.8 million over the same period in 2005. Up 27 percent from last year's Euro 690.1 million, Paddy Power’s total take in bets this year for the same period came to Euro 877.6 million (US$1.12 billion). Paddy Power can attribute a great deal of this increase in profit to World Cup football returns.

A spokesperson for Paddy Power, Ireland’s top bookie group, said that the company had opened another 27 traditional-style betting shops in Britain and Ireland in the last year where most of their revenue continued to be collected, taking the total to 205. The company’s three web sites, which run books on sports and current affairs, casino-style games and poker, however, achieved even stronger growth. In an effort to attract more female gamblers and to capitalize on the World Cup in Germany, the company also launched online bingo this year as well as a German-language site.

Commenting on the profit target regarding the World Cup, Paddy Power’s chairman Fintan Drury said: “In the World Cup, we achieved our absolute profit target, but on higher than expected turnover, as the punters won a fortune early on with 18 of the first 22 matches being won by the favorites”.

Patrick Kennedy, Chief Executive of Paddy Power, said the company was anticipating the liberalization of betting rules in Britain next year, especially when it came to the ability of betting shops to stay open as needed.

Cash reserves over the six-month period rose 30.6 percent to Euro 68.3 million (US$87.4 million). This amount includes Euro 12.9 million (US$16.5 million) in deposits made by customers into their accounts for placing bets online or over the phone.

While Paddy Power does offer Internet betting accounts denominated in several currencies including U.S. dollars, the company is finding it difficult to establish a U.S. customer base because of U.S. anti-online gambling laws, which prevent gamblers with U.S.-based credit cards from depositing or withdrawing money from gambling Web sites.

Posted on: September 11, 2006

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