Paddy Power profits under pressure as punters place fewer bets ahead of government crackdown

Bookmaker said race cancellations due to bad weather also hit results

The betting firm is preparing for a government crackdown on rules around FOBTs (REUTERS)

Paddy Power Betfair saw first-quarter profits come under pressure when punters slowed down their betting after enduring a four-month losing streak.

The group booked flat revenue at £408m in the three months to 31 March while underlying earnings dipped 8 per cent to £102m.

This, Paddy Power said, was down to customer activity in the UK being "adversely affected by the sustained period of bookmaker-friendly sports results from November to February".

Bookmakers cashed in over Christmas when a large number of bets were placed on Arsenal and Liverpool, who then went on to underperform over the festive period.

Paddy also flagged a "high level of racing fixture cancellations" - linked to the extreme weather in March - as dragging on its performance.

It expects full-year underlying earnings to come in between £470m and £495m.

Boss Peter Jackson said: "We have made good progress against our strategic priorities.

"In Europe, the successful completion of our platform integration has resulted in a meaningful improvement to the Paddy Power product.

"This has seen the brand's gaming revenue returning to growth from February."

The group is also returning £500m of cash to shareholders, which it said represents a step towards a "more efficient capital structure".

It comes as bookmakers brace for the impact of state intervention in the sector this month.

The government is to cut the maximum stake for fixed-odds betting terminals to £2, with betting firms braced for a profits hit as a result of the change.

PA