Paddy Power Betfair plc (LON:PPB) saw its shares fall back on Wednesday after the merged betting giant reported a 6% fall in first-quarter earnings to £102mln due to new betting taxes, levies and start-up losses in the US.
In a trading update, the FTSE 100-listed firm also guided for a full-year underlying earnings (EBITDA) of £470mln to £495mln, which compares to last year’s outcome of £473mln.
The bookmaker said that excluding a one-off annualisation of taxes and start-up costs, its core earnings would have been flat in the first three months of 2018.
The group said its first-quarter revenue fell by 2% to £408mln as customer activity in its main market of the UK and Ireland was adversely affected by a sustained period of bookmaker friendly sports results and a high level of racing fixture cancellations.
The firm - formed by the 2016 tie-up between online UK betting exchange Betfair and Irish firm Paddy Power - announced plans to return £500mln to shareholders over the next 12 to 18 months in a share buyback programme to be initiated shortly.
Paddy Power Betfair’s chief executive, Peter Jackson, who took over in January, commented: "We have made good progress against our strategic priorities."
He added: "In Europe, the successful completion of our platform integration has resulted in a meaningful improvement to the Paddy Power product.
“In Australia, Sportsbet continues to perform well and is targeting further market share growth.”
In early morning trading, Paddy Power Betfair shares were down 7.7% at 6,695p.