Paddy Power Betfair lifts earnings forecast as profit soars after strong Euro 2016 display

Shares in Paddy Power Betfair rose over 3% early on Friday (4 November), after the bookmaking giant lifted its profit forecast for the full year, boosted by currency tailwinds and by a strong performance during Euro 2016.

The group said it expects its core earnings to be in a range between £390m and £405m, compared with initial guidance of between £365m and £385m.

In addition, expected synergies from the merger of Paddy Power and Betfair, which was completed in February, are expected to be £35m rather than £30m.

The company reported a 25% year-on-year increase in sales to £404m in the third quarter, which received a £28m boost from the translation of non-UK revenue due to the weakness of the pound in three months after the Brexit referendum.

Underlying operating profits soared 68% to £95m, while on a constant currency basis revenues rose 15% year-on-year, with net revenue from the sporting division also up 15% to £316m and revenue from the gaming business 14% higher than in the corresponding period last year to £88m.

The company added its performance at Euro 2016 was also responsible for the upbeat figures, with a "strong conclusion" to the tournament helping the group to bring its total revenue to £38m for the whole tournament.

"This was another good quarter for Paddy Power Betfair," said group chief executive Breon Corcoran.

"Work is underway to combine the best of Betfair and Paddy Power's technology into a multi-brand, multi- channel, multi-jurisdictional platform that will start to unlock the full potential of the group's scale and will lead to increased pace of development and faster roll out of new products."