Paddy Power Rises After Saying Will Beat Estimates
Paddy Power Plc (PWL), Ireland’s biggest bookmaker, rose in Dublin trading after a “strong” first-half performance by its online and U.K. retail units led it to say it will beat analysts’ full-year estimates.
The company expects underlying diluted earnings per share to grow as much as 30 percent in 2010 from 2009, it said in a Regulatory News Service statement. The stock climbed 2.5 percent after earlier rising as much as 8.2 percent.
Paddy Power is expanding its Internet and U.K. operations to compensate for tougher trading conditions in its home market. U.K. retail profits increased sixfold, to 3 million euros ($3.8 million), as new outlets were opened. The company said it’s likely to open at least 150 shops in the U.K. by 2011. First- half net income rose 46 percent to 43.2 million euros.
“Paddy Power has reported a very strong set of first-half numbers,” analyst David Jennings at Dublin securities firm Davy said in a research note. “The trends in U.K. retail are very encouraging.” Davy has an “outperform” rating on the stock.
Paddy Power rose 66 cents to 26.66 euros in Dublin trading, giving the company a market value of 1.28 billion euros.
The first-half dividend payment was raised by 28 percent to 25 cents.
“U.K. retail has been less of a challenge than the Irish market and that reflects a less severe recession,” Paddy Power Finance Director Jack Massey said in a telephone interview. “Ireland continues to be challenging.”
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