Paddy Power Betfair to meet FY guidance on underlying strength

Paddy Power Betfair estimated yesterday that its full-year earnings hit the mid-point of its guidance despite a run of adverse sports results at the end of the year, pointing to the underlying strength of the recently merged business. The gambling company in November raised its full-year core earnings (Ebitda) forecast to a range of £390-405 million from a previous range of £365-385 million citing a boost in the sterling value of its euro revenue, last year's merger and favourable sporting results. However, results favoured punters across the industry in the fourth quarter, which the Dublin-headquartered firm said cost it around £40 million before gamblers bet with any winnings, including a £5 million loss on the US presidential election. "This outcome disguises a better underlying performance than we were forecasting," Davy Stockbrokers analyst David Jennings, who had expected Ebitda of £408.8 million, wrote in a note. "From analysing the statement, we estimate that had results been "normal", Ebitda for the year would have landed north of £420 million." Online betting exchange Betfair and Paddy Power, which has a chain of shops as well as an online business – including a...

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