Interim Report - Announcement Title Replacement

Companies

Flutter Entertainment (CDI) (FLTR)

UK 100

Latest directors dealings

1 day ago Savannah Energy
1 day ago Buccaneer Energy PLC
1 day ago Savannah Energy
1 day ago Carclo
1 day ago Schroder Japan Growth Fund

All directors dealings today

-	Substantially increased online scale: Gross win up 28% to €143m. Operating profit up 25% to €45.3m;
-	Very strong paddypower.com growth: Active customers up 48%. Gross win up 35% to €101.1m. Operating profit up 26% to €36.5m;
-	Strong Australian profit growth and initiatives to drive further growth: Operating profit up 25% (15% in constant currency) to €9.8m;
-	Large share of rapidly growing mobile market: paddypower.com mobile sportsbook turnover up 279% with 35% of active customers transacting via mobile, generating 22% of stakes.

Patrick Kennedy	Jack Massey
Chief Executive	Finance Director
Paddy Power plc	Paddy Power plc
Tel: + 353 1 404 5912	Tel: + 353 1 404 5912
Billy Murphy / Anne-Marie Curran	Jon Earl / Rob Greening
Drury	Powerscourt Group
Tel: + 353 1 260 5000	Tel: + 44 20 7250 1446
Mobile: +353 87 286 4079 (AC)	Mobile: + 44 7809 698 259 (RG)

	Six months ended 30 June 2011 (unaudited)	Six months ended 30 June 2010 (unaudited)	% Change

	€m	€m
Amounts staked by customers *
Online (ex Australia)	771	540	+43%
Online Australia **	642	593	+8%
Irish Retail	483	476	+2%
UK Retail	177	132	+34%
Telephone (ex Australia)	152	151	+1%
Total amounts staked	2,225	1,892	+18%

Income *
Online (ex Australia)	101.1	74.9	+35%
Online Australia **	47.7	41.8	+14%
Irish Retail	51.0	55.5	(8%)
UK Retail	32.7	24.0	+36%
Telephone (ex Australia)	9.5	9.4	+1%
Total income	242.0	205.6	+18%

Operating profit
Online (ex Australia)	36.5	29.0	+26%
Online Australia **	9.8	7.9	+25%
Irish Retail	5.1	9.0	(44%)
UK Retail	4.7	3.0	+59%
Telephone (ex Australia)	0.2	0.6	(66%)
Total operating profit	56.2	49.5	+14%

Adjusted diluted earnings per share ***	97.1c	82.2c	+18%

*	Amounts staked by customers (or 'turnover') represents bets placed on sporting events that occurred during the period and net winnings, commission income and fee income earned on gaming and other activities. Income (or 'gross win') represents the net gain on sports betting transactions (stake less payout) plus the gain or loss on the revaluation of open positions at period end plus net winnings, commission income and fee income earned on gaming and other activities.
**	Australia also includes legacy telephone operations accounting for less than 10% of its gross and operating profit.
***	H1'10 excluding gains re Sportsbet buyout call option valuation (€3.1m) and UK deferred tax asset recognition (€0.9m).

-	Substantially increased online scale: Gross win up 28% to €143m. Operating profit up 25% to €45.3m;
-	Very strong paddypower.com growth: Active customers up 48%. Gross win up 35% to €101.1m. Operating profit up 26% to €36.5m;
-	Strong Australian profit growth and initiatives to drive further growth: Operating profit up 25% (15% in constant currency) to €9.8m;
-	Large share of rapidly growing mobile market: paddypower.com mobile sportsbook turnover up 279% with 35% of active customers transacting via mobile, generating 22% of stakes.

-	Underlying profit before tax up 15% to €56.8m and diluted EPS up 18% to 97.1 cent, notwithstanding the 2010 World Cup comparative and adverse sporting results during the period;
-	A 20% increase in the interim dividend to 30.0 cent per share, supported by a strong balance sheet with net cash of €91m at period end;
-	81% of Group operating profit from online activities. 73% from international activities.

-	UK Retail operating profit up 59% to €4.7m. Like-for-like sportsbook stakes up 6%. Like-for-like machine gaming revenue up 16%;
-	UK Retail estate now 151 shops with 27 shops opened in the year to date and an expectation going forward of opening 35 to 40 shops annually;
-	Irish Retail operating profit down 44% to €5.1m, driven by adverse sports results. Like-for-like stakes down 1%. Direct operating costs per shop down 4%.

€m	H1 2011	H1 2010	% Change
Sportsbook gross win	99.7	77.3	+29%
Gaming & other gross win	43.3	34.4	+26%
Total gross win	143.0	111.7	+28%
Operating profit	45.3	36.1	+25%
% of Group operating profit	81%	73%
Active customers	833,347	588,050	+42%
(Active customers are defined as those who have bet in the reporting period, excluding indirect B2B customers)

Online Channel Active Customers	H1 2011	H1 2010	% Change
UK	542,416	343,811	+58%
Ireland and Rest Of World	161,625	132,330	+22%
Total	704,041	476,141	+48%

Online Customers Product Usage	H1 2011	H1 2010	% Change
Sportsbook only	421,169	286,686	+47%
Gaming only	85,702	52,609	+63%
Multi product customers	197,170	136,846	+44%
Total	704,041	476,141	+48%
(Active customers are defined as those who have bet in the reporting period, excluding indirect B2B customers)

Telephone Channel Active Customers	H1 2011	H1 2010	% Change
UK	39,251	36,260	+8%
Ireland and Rest Of World	19,530	19,025	+3%
Total	58,781	55,285	+6%
(Active customers are defined as those who have bet in the reporting period)

-	Sporting results over the short term and/or the performance of the Group in managing bookmaking risk affecting the achievement of expected gross win margins;
-	Changes in tax law, interpretation or practice, or payment obligations to racing and sporting bodies;
-	The intensity of competition in the Group's markets and the Group's ability to successfully compete;
-	Disruption to the sporting calendar or broadcasting of major sporting events;
-	The regulatory or legislative environment, interpretation and practices applicable to the Group's activities and related litigation and reputational risks;
-	Social, media or political sentiment towards the Group, its brands and its businesses;
-	Changes in the exchange rates between the euro and the pound sterling and Australian dollar;
-	The ability of the Group to avoid disruption to its key information systems and protect customer and other key data;
-	Relationships with, and performance by, key suppliers, particularly those supporting the Group's core activities;
-	The ability of the Group to attract and retain key employees;
-	Economic, technological, consumer behaviour and other macro factors affecting demand for the Group's products.

i)	Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

ii)	Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

		Six months ended 30 June 2011 (unaudited)	Six months ended 30 June 2010 (unaudited)	Year ended 31 December 2010 (audited)
	Note	€'000	€'000	€'000

Amounts staked by customers		2,225,477	1,892,154	3,834,316

Income		241,984	205,607	443,527
Direct betting costs	5	(33,240)	(29,122)	(60,256)
Gross profit		208,744	176,485	383,271
Employee costs		(67,103)	(55,451)	(129,883)
Property expenses		(16,684)	(14,697)	(30,432)
Marketing expenses		(28,962)	(24,754)	(50,358)
Technology and communications		(15,047)	(10,351)	(22,259)
Depreciation and amortisation		(11,823)	(11,293)	(24,278)
Other expenses		(12,894)	(10,485)	(22,312)
Total operating expenses		(152,513)	(127,031)	(279,522)
Operating profit		56,231	49,454	103,749
Financial income - on financial assets at amortised cost	6	1,004	693	1,779
Financial income - on derivative financial instruments at fair value through profit or loss (Sportsbet buyout call options)	6	-	3,106	7,116
Financial expense	6	(472)	(761)	(1,344)
Profit before tax		56,763	52,492	111,300
Income tax expense	7	(8,139)	(6,913)	(14,566)
Profit for the period		48,624	45,579	96,734

Attributable to:
Equity holders of the Company		47,375	43,213	90,005
Non-controlling interest		1,249	2,366	6,729
		48,624	45,579	96,734

Basic earnings per share	8	€0.999	€0.926	€1.927
Diluted earnings per share	8	€0.971	€0.906	€1.874

		30 June 2011 (unaudited)	30 June 2010 (unaudited)	31 December 2010 (audited)
			Restated (Note 3)
	Note	€'000	€'000	€'000
Assets
Property, plant and equipment		80,301	74,483	77,798
Intangible assets		54,204	51,210	51,510
Goodwill	9	75,251	69,924	76,967
Financial assets	11	2,262	4,413	9,735
Deferred tax assets		2,505	5,264	2,591
Total non current assets		214,523	205,294	218,601
Trade and other receivables		19,658	21,342	15,574
Restricted cash	12	16,422	18,034	21,081
Cash and cash equivalents	12	72,311	105,863	139,581
Total current assets		108,391	145,239	176,236

Total assets		322,914	350,533	394,837

Equity
Issued share capital	14	5,042	4,981	4,995
Share premium		34,449	18,682	20,876
Treasury shares		(34,177)	(34,177)	(34,177)
Shares held by long term incentive plan trust		(23,774)	(31,474)	(33,890)
Other reserves		28,548	21,014	33,699
Retained earnings		158,257	201,478	236,936
Total equity - attributable to equity holders of the Company		168,345	180,504	228,439
Non-controlling interest		-	10,371	15,798
Total equity		168,345	190,875	244,237

Liabilities
Trade and other payables		9,668	3,830	7,354
Derivative financial instruments		1	22	16
Provisions		1,632	1,611	1,876
Borrowings	15	-	7,047	2,633
Deferred tax liabilities		7,178	9,567	5,774
Total non current liabilities		18,479	22,077	17,653

Trade and other payables		121,254	109,343	115,336
Derivative financial instruments		8,821	14,432	8,586
Provisions		502	1,096	278
Borrowings	15	7	7,900	1,885
Current tax payable		5,506	4,810	6,862
Total current liabilities		136,090	137,581	132,947

Total liabilities		154,569	159,658	150,600

Total equity and liabilities		322,914	350,533	394,837

		Six months ended 30 June 2011 (unaudited)	Six months ended 30 June 2010 (unaudited)	Year ended 31 December 2010 (audited)
	Note	€'000	€'000	€'000
Cash flows from operating activities
Profit before tax		56,763	52,492	111,300
Financial income		(1,004)	(3,799)	(8,895)
Financial expense		472	761	1,344
Depreciation and amortisation (including impairments)		11,823	11,293	24,278
Cost of employee share-based payments		6,805	4,448	13,427
Other adjustments		568	80	177
Foreign currency exchange (gain) / loss		(89)	395	(12)
Loss on disposal of property, plant and equipment and intangible assets		99	122	123
Cash from operations before changes in working capital		75,437	65,792	141,742
(Increase) / decrease in trade and other receivables		(4,490)	(4,187)	1,886
Increase in trade and other payables and provisions		3,885	23,806	29,776
Cash generated from operations		74,832	85,411	173,404
Income taxes paid		(6,940)	(6,393)	(13,159)
Net cash from operating activities		67,892	79,018	160,245

Cash flows from investing activities
Purchase of property, plant and equipment		(13,024)	(9,427)	(16,431)
Purchase of intangible assets		(2,502)	(2,644)	(7,278)
Purchase of businesses, net of cash acquired	10	(261)	(680)	(10,460)
Acquisition expenses paid	10	-	(172)	(212)
Proceeds from disposal of property, plant and equipment and intangible assets		45	91	208
Interest received		1,026	680	1,902
Net cash used in investing activities		(14,716)	(12,152)	(32,271)

Cash flows from financing activities
Proceeds from the issue of new shares		325	1,026	3,186
Purchase of shares by long term incentive plan trust		-	(6,586)	(9,048)
Purchase of non-controlling interest	10	(85,311)	(8,561)	(8,561)
Dividends paid - equity holders of the Company	13	(24,340)	(18,750)	(30,769)
Dividends paid - non-controlling interest	13	(9,244)	-	-
Movements in current and non current restricted cash balances		4,695	(8,713)	(12,808)
Repayment of non-controlling shareholder loans		(1,038)	(750)	(3,067)
Repayment of secured non-recourse bank loan		(2,197)	(2,288)	(10,906)
Finance lease repayments		(1,264)	(444)	(961)
Interest paid		(319)	(576)	(1,229)
Net cash used in financing activities		(118,693)	(45,642)	(74,163)

	As previously reported	Adjustment	As restated
	€'000	€'000	€'000
Goodwill	68,514	1,410	69,924
Trade and other receivables	21,542	(200)	21,342
Foreign exchange translation reserve	(6,275)	4	(6,271)
Retained earnings	(201,547)	69	(201,478)
Non-controlling interest	(10,643)	272	(10,371)
Current liabilities - trade and other payables	(109,307)	(36)	(109,343)
Current liabilities - current tax payable	(3,291)	(1,519)	(4,810)

	Online (ex Australia)	Australia	Irish retail	UK retail	Telephone (ex Australia)	Total reportable segments
	€'000	€'000	€'000	€'000	€'000	€'000
Income from external customers, being total income	101,063	47,738	50,976	32,747	9,460	241,984
Direct betting costs	(12,379)	(11,166)	(4,935)	(4,701)	(59)	(33,240)
Gross profit	88,684	36,572	46,041	28,046	9,401	208,744
Depreciation and amortisation	(2,140)	(2,358)	(4,185)	(2,690)	(450)	(11,823)
Other operating costs	(50,067)	(24,429)	(36,802)	(20,647)	(8,745)	(140,690)
Reportable segment profit	36,477	9,785	5,054	4,709	206	56,231

	Online (ex Australia)	Australia	Irish retail	UK retail	Telephone (ex Australia)	Total reportable segments
	€'000	€'000	€'000	€'000	€'000	€'000
Income from external customers, being total income	74,911	41,824	55,475	23,999	9,398	205,607
Direct betting costs	(9,758)	(10,805)	(4,901)	(3,603)	(55)	(29,122)
Gross profit	65,153	31,019	50,574	20,396	9,343	176,485
Depreciation and amortisation	(1,509)	(1,619)	(4,701)	(2,968)	(496)	(11,293)
Other operating expenses	(34,610)	(21,544)	(36,833)	(14,472)	(8,279)	(115,738)
Reportable segment profit	29,034	7,856	9,040	2,956	568	49,454

Note (see below)	IAS acquisition balance sheet (1)	Acquisition of 9.8% non-controlling interest in Sportsbet (2)	Total
	€'000	€'000	€'000
Goodwill	1,410	-	1,410
Current assets - other receivables	(200)	-	(200)
Total assets	1,210	-	1,210
Foreign exchange translation reserve	4	-	4
Retained earnings	-	69	69
Non-controlling interest	341	(69)	272
Current liabilities - trade and other payables	(36)	-	(36)
Current liabilities - current tax payable	(1,519)	-	(1,519)
Total equity and liabilities	(1,210)	-	(1,210)

	Six months ended 30 June 2011	Six months ended 30 June 2010	Year ended 31 December 2010
	€'000	€'000	€'000
Income
Total income from reportable segments, being total Group income (1)	241,984	205,607	443,527

Profit or loss
Total profit or loss from reportable segments	56,231	49,454	103,749
Unallocated amounts:
Financial income - non-Australia (2)	282	151	411
Financial income - Australia	722	542	1,368
Financial income - Australia - Sportsbet buyout call options (3)	-	3,106	7,116
Financial expense - non-Australia (2)	(128)	(135)	(235)
Financial expense - Australia	(344)	(626)	(1,109)
Total profit before tax	56,763	52,492	111,300

Non current assets
	30 June 2011	30 June 2010	31 December 2010
		Restated
	€'000	€'000	€'000
UK	67,829	63,009	64,491
Australia	88,697	78,379	86,829
Ireland and rest of world	53,230	54,229	54,955
Total	209,756	195,617	206,275

	Six months ended 30 June 2011 €'000	Six months ended 30 June 2010 €'000	Year ended 31 December 2010 €'000
Recognised in profit or loss:
Financial income
On financial assets at amortised cost:
Interest income on short term bank deposits	1,004	693	1,779
	1,004	693	1,779
On derivative financial instruments at fair value through profit or loss:
Increase in fair value of Sportsbet buyout call options	-	3,106	7,116
	-	3,106	7,116
Financial income	1,004	3,799	8,895
Financial expense
On financial liabilities at amortised cost:
Bank loans	270	425	783
Bank guarantees	64	73	132
Finance leases	66	110	198
Unwinding of the discount on provisions and other non current liabilities	72	153	231
Financial expense	472	761	1,344

	Irish retail €'000	UK retail €'000	Australia €'000	Total €'000
Balance at 1 January 2010	7,067	8,248	48,196	63,511
Arising on acquisition (Note 10)	1,140	1,517	-	2,657
Foreign currency translation adjustment	-	231	10,568	10,799
Balance at 31 December 2010	8,207	9,996	58,764	76,967
Arising on acquisition	-	152	-	152
Foreign currency translation adjustment	-	(347)	(1,521)	(1,868)
Balance at 30 June 2011	8,207	9,801	57,243	75,251

	€'000
Purchase consideration - cash	84,749
Purchase consideration - Paddy Power plc ordinary shares (Note 14)	13,438
Contingent deferred consideration	2,989
Sportsbet buyout call options (Note 11)	6,978
Total purchase consideration	108,154
Net assets acquired from non-controlling interest	(7,271)
Decrease in retained earnings	100,883

Net cash outflow from purchase of non-controlling interest for the purposes of the statement of cash flows
Purchase of non-controlling interest before acquisition expenses	84,743
Acquisition expenses paid	568
Purchase of non-controlling interest	85,311

	€'000
Purchase consideration - cash	8,481
Net assets acquired from non-controlling interest	(1,952)
Change in Group share of discount on loans from non-controlling shareholders	39
Decrease in retained earnings	6,568

Net cash outflow from purchase of non-controlling interest for the purposes of the statement of cash flows
Purchase of non-controlling interest before acquisition expenses	8,481
Acquisition expenses paid	80
Purchase of non-controlling interest	8,561

	Total fair values 31 December 2010
	€'000
Identifiable net assets acquired:
Property, plant and equipment	1,046
	1,046
Goodwill arising on acquisition - Irish retail	1,140
Goodwill arising on acquisition - UK retail	1,517
Goodwill arising on acquisition - total	2,657
Consideration	3,703

Satisfied by:
Cash consideration	3,353
Contingent deferred consideration	350
	3,703

Net cash outflow from purchase of businesses for the purposes of the statement of cash flows
Purchase of businesses, net of cash acquired	3,353
Acquisition expenses paid	43
	3,396

	30 June 2011 €'000	31 December 2010 €'000
Derivative financial assets:
Embedded derivatives - Sportsbet buyout call options	-	6,978
	-	6,978
Other financial assets:
Restricted cash (Note 12)	2,262	2,757
	2,262	2,757
Total	2,262	9,735

	Sportsbet buyout call options	Restricted cash	Total
	€'000	€'000	€'000
Balance at 1 January 2011	6,978	2,757	9,735
Acquisition of 39.2% of Sportsbet	(6,978)	-	(6,978)
Other movements	-	(422)	(422)
Foreign currency translation adjustment	-	(73)	(73)
Balance at 30 June 2011	-	2,262	2,262

	30 June 2011 €'000	31 December 2010 €'000
Loans from Sportsbet non-controlling shareholders	-	974
Finance leases	7	911
	7	1,885

	30 June 2011 €'000	31 December 2010 €'000
Secured non-recourse bank loan	-	2,284
Finance leases	-	349
	-	2,633

-	amounts of €148,000 (AUD200,000) (31 December 2010: €305,000 (AUD400,000)) guaranteed to the Northern Territory Racing and Gaming Authority; and
-	guarantees of €1,001,000 (AUD1,350,000) (31 December 2010: €1,310,000 (AUD1,722,000)) outstanding in respect of rental and other property commitments and a merchant facility guarantee of €1,113,000 (AUD1,500,000) (31 December 2010: €1,142,000 (AUD1,500,000)).