First Half Profits Up - Says Paddy Power

Ireland's top bookie group, Paddy Power PLC, reported an 11 percent gain in first-half net profit this week, aided by good World Cup football returns. 

Growth in the group's Internet, telephone and over-the-counter gambling markets was also encouraging.

Paddy Power offers Internet betting accounts denominated in several currencies including U.S. dollars, but faces difficulties building an American customer base because of current U.S. law which prevents gamblers with U.S. based credit cards from depositing or withdrawing money from gambling Web sites.

Paddy Power said its net profit from January to June rose to €17.5 million ($22.4 million) from €15.8 million over the same period in 2005. It turned over a total of €877.6 million ($1.12 billion) in bets from all over the period, a figure up 27% from last year's €690.1 million.

A company spokesman said that over the past year Paddy Power had opened 27 more traditional betting shops in Ireland and Britain, where it continues to collect most of its revenues, taking the total number of betting shops to 205.

Growth was stronger on its three Web sites, which run books on sports and current affairs, casino-style games and poker. The company launched online bingo this year to appeal to female gamblers and a German-language site to capitalize on the World Cup in Germany.

Chairman Fintan Drury said in a statement, “We achieved our absolute profit target in the World Cup, but on a 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, the Chief Executive, said the company was looking forward to the liberalization of betting rules in Britain next year, particularly the ability of betting shops to stay open as required.

Cash reserves over the six-month period rose 30.6% to €68.3 million ($87.4 million), which includes €12.9 million ($16.5 million) in deposits in customers' accounts used for placing bets online or over the phone.

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