Paddy Power sees strong underlying growth despite 'unfavourable' sports results
Irish betting chain Paddy Power said it grew quarterly sales strongly despite suffering a run of results that favoured punters.
The business said punters have made gains from domestic and European football in recent weeks, while September was a good month for horse racing fans.
However, it said at its shops like-for-like betting stakes grew by 7% and like-for-like revenues lifted by 1% in the 19 weeks to November 15, compared to a year ago. It added that online betting stakes jumped by 23%, while revenue rose by 7% in the same period.
Paddy Power and online rival Betfair agreed to merge in August, creating one of the world's largest online gambling operations valued at £5 billion, as consolidation in the industry hots up.
It said it expected to publish shareholders' documents relating to the merger "in the coming weeks".
The Irish group said: "While sports results in the period were unfavourable across the sector, for Paddy Power this has been offset by strong underlying growth."
It added that it expects full-year operating profit to be a mid-to-high single-digit percentage increase above last year's result.
The business said earlier this month in the Champions League, favourites such as Manchester United, Bayern Munich, Barcelona and Juventus all won, which helped punters betting on accumulators.
It added that in the Premier League earlier this month, favourites Chelsea and Liverpool lost, while Manchester City drew, helping punters betting against the odds.
It added that September was a poor month for bookmakers in horse racing. The firm pointed out that on St Leger Day, Simple Verse was disqualified, then reinstated 11 days later in favour of well-backed Bondi Beach, which saw the chain pay out on both horses.
Paddy Power said during the period it opened seven shops in the UK and one in Ireland.
Analysts at Peel Hunt said: "In what was a challenging period versus a very strong 2014, Paddy has emerged in pretty good shape."
A combination of new taxes on online gambling around the world and the need to invest in marketing and technology has led to consolidation across the industry this year.
In September, FoxyBingo owner bwin.party spurned suitor 888 Holdings in favour of a £1.1 billion (1.6 billion euro) cash-and-shares offer from Sportingbet owner GVC after a protracted takeover tussle.
Meanwhile in July, Ladbrokes and Gala Coral agreed a merger to create a £2.3 billion (3.2 billion euro) gambling giant that is expected to overtake William Hill, the UK's biggest bookmaker.