Shares in gambling company Paddy Power Betfair (LON:PPB) sunk nearly 5 percent in early trading, despite posting a better-than-expected rise in annual earnings for the 2017 financial year.
The group’s earning were boosted by favourable sporting results and further investment in its online platforms. Underlying Ebtida rose 18 percent to £473 million, well above the company’s previous guidance of between £450 million and £465 million.
Underlying operating profit increased by 19 percent to £392 million, with revenue up 13 percent to £1.75 billion. The company declared a final dividend of 135p per share.
Chief executive Peter Jackson said: “The new financial year has started as 2017 ended, with sporting results favouring bookmakers.”
“This sustained period of bookmaker friendly results has, however, significantly affected customer activity, including reduced re-cycling of customer winnings.
“We are focused on building a business that can sustainably generate profits over the long-term.
“The group’s strong balance sheet allows us to make substantial investment in the customer proposition and marketing, whilst maintaining flexibility for strategic investments and delivering increasing returns for shareholders.”
The figures come just one day after chief financial officer Alex Gersh announced his decision to leave the company. Gersh joined in 2012 and has been a significant part of the group’s transformation. His announcement comes just a month after the high-profile resignation of CEO Breon Corcoran, was replaced by Peter Jackson.
Shares in Paddy Power Betfair are currently trading down 4.14 percent on the news at 7,880.00 (0854GMT).
