Paddy Power, the Irish bookmaker, announced yesterday it will decrease its operating profit outlook for the year from 82 million euros to 72 million euros, according to the company’s 2008 interim results.
“Much has happened since our last trading update three and a half months ago,” Patrick Kennedy, chief executive of Paddy Power, said in a prepared statement. “The performance of the Irish and U.K. economies has deteriorated, and the growth rates in our businesses have slowed accordingly.”
Despite the economic downturn, Paddy Power posted a growth in earnings by 17 percent per share during the first half of 2008 and online operations had a 43 percent increase in profits.
“In addition, we said last year that the old adage of 'what goes around comes around' applies to sporting results and they certainly have come back around for punters since June with a string of unfavorable results for bookmakers -- and Irish bookmakers particularly,” added Mr. Kennedy as to why the company chose to decrease its profit outlook.
According to the Financial Times, Mr. Kennedy said "a hell of a lot of damage" could be attributed to wins from Padraig Harrington, the Irish golfer, and Aidan O'Brien, whose horses won big races at Royal Ascot.