Paddy Power Betfair Plays Down ₤ 2 Stake Cut Impact
Paddy Power Betfair soft-pedals ₤ 2 stake cut impact
8 August 2018
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Gambling firm Paddy Power Betfair has said it can hold up against the government's strategy to cut the optimum bet on fixed-odds wagering terminals [FOBTs] to ₤ 2.
The company made the declaration as it reported a 4% increase in very first half revenues to ₤ 106m.
"Our shops are more successful, and outperform on sports betting, allowing them to much better hold up against the effect of lower maker stakes limits," the company said.
The stake is being cut from ₤ 100.
FOBTs create ₤ 1.8 bn in profits a year for the betting industry, according to the Gambling Commission, in addition to taxes of ₤ 400m for the government.
High tramp
"We operate in high-footfall, highly competed areas, which indicates we are well positioned to take advantage of competitor store closures," Paddy Power Betfair said.
"In the UK, we do not anticipate the government's proposed brand-new ₤ 2 stake limit for gaming makers to have a product impact on our retail technique," it included.
Rival William Hill, which produces simply over half its retail revenues from FOBTs, has cautioned 900 of its shops could become loss-making, possibly leading to job losses.
Paddy Power Betfair said the proposed FOBT cut to ₤ 2 would decrease its earnings from video gaming makers by between 33% and 43%.
Based upon its 2017 figures, this might suggest profits would fall by as much as ₤ 46m, which it said totaled up to 2.6% of its overall income.
It also offered a gauge of the government's strategy to increase remote video gaming duty to balance out some of the lost tax from FOBT. Every one percentage point increase - from the present level of 15% - would lead to an additional ₤ 2.5 m of responsibility to be paid.
Paddy Power Betfair soft-pedals ₤ 2 stake cut impact
8 August 2018
remarks
77 Comments
Gambling firm Paddy Power Betfair has said it can hold up against the government's strategy to cut the optimum bet on fixed-odds wagering terminals [FOBTs] to ₤ 2.
The company made the declaration as it reported a 4% increase in very first half revenues to ₤ 106m.
"Our shops are more successful, and outperform on sports betting, allowing them to much better hold up against the effect of lower maker stakes limits," the company said.
The stake is being cut from ₤ 100.
FOBTs create ₤ 1.8 bn in profits a year for the betting industry, according to the Gambling Commission, in addition to taxes of ₤ 400m for the government.
High tramp
"We operate in high-footfall, highly competed areas, which indicates we are well positioned to take advantage of competitor store closures," Paddy Power Betfair said.
"In the UK, we do not anticipate the government's proposed brand-new ₤ 2 stake limit for gaming makers to have a product impact on our retail technique," it included.
Rival William Hill, which produces simply over half its retail revenues from FOBTs, has cautioned 900 of its shops could become loss-making, possibly leading to job losses.
Paddy Power Betfair said the proposed FOBT cut to ₤ 2 would decrease its earnings from video gaming makers by between 33% and 43%.
Based upon its 2017 figures, this might suggest profits would fall by as much as ₤ 46m, which it said totaled up to 2.6% of its overall income.
It also offered a gauge of the government's strategy to increase remote video gaming duty to balance out some of the lost tax from FOBT. Every one percentage point increase - from the present level of 15% - would lead to an additional ₤ 2.5 m of responsibility to be paid.