Paddy Power Betfair PLC (PDYPF) CEO Peter Jackson on Q3 2018 Results - Earnings Call Transcript

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Paddy Power Betfair PLC (OTCPK:PDYPF) Q3 2018 Earnings Conference Call November 2, 2018 4:30 AM ET

Executives

Peter Jackson - Chief Executive Officer

Jonathan Hill - Chief Financial Officer

Analysts

Ed Young - Morgan Stanley

Monique Pollard - Citigroup

Patrick Coffey - Barclays Investment Bank

Gavin Kelleher - Goodbody Capital Markets

Alistair Ross - Investec

Tal Grant - Credit Suisse

Michael Mitchell - Davy

Operator

Hello and welcome to the Paddy Power Betfair Q3 Figures Update hosted by Peter Jackson, CEO of Paddy Power Betfair. My name is Nigel. I'm your event coordinator. During the presentation, your lines will be on listen-only. [Operator Instructions] I would like to advise all parties that this conference is being recorded.

And I would like to hand the call over to Peter. Peter, please go ahead.

Peter Jackson

Thank you, Nigel. Good morning and thank you all for joining me on the call. With me today is Jonathan Hill, our new CFO, who started last week. And I hope you've all read the announcement release this morning, so I won't go through the results in detail, but I will just highlight a few key things before we open up for questions.

Reported Q3 revenues are up 12% on a constant currency basis or up 8% on a pro forma basis, with FanDuel fantasy sports incorporated within the comparative.

In our online division, the positive trading momentum we saw in the second quarter accelerated further across both of our brands, with revenue up 15% in quarter three. The encouraging progress on [setting around] [ph] Paddy Power that we highlighted in August has continued in recent months. With product enhancements and good execution in promotions and marketing, meaning that Paddy Power is now starting to win back market share.

I just returned from visiting Australia, where the regulatory and tax headwinds are now coming into effect. And we're using our scale and profitability to invest in further enhancing Sportsbet's leading customer proposition.

To target additional market share gains, we are seeking to drive increased customer activity through additional investment in promotional generosity and marketing. And this investment is deliberately focused on quarter 3. And this, coupled with adverse sports results during August, meant that Q3 revenues declined year-on-year. That said, I'm very pleased with Sportsbet's momentum, as evidenced by the 25% staking growth and strong customer acquisition and retention.

This gives us continued confidence that we're well positioned to win further market share. In the U.S., Q3 was an exciting period. We saw good momentum in each of our existing businesses and the successful launch of FanDuel sportsbook. The start of the NFL season is the key customer acquisition opportunity for fantasy sports each year, and we've been very pleased of our performance this year.

Product enhancements, including new game formats and an initiative aimed at recreational players, coupled with good execution in promotions and marketing, driven good underlying growth in U.S. revenues. And whilst it is still early days in terms of development of the U.S. sports betting, we are pleased with the initial progress. The early indicators, New Jersey, highlight both the latent market opportunity and our strong relative positioning.

As with our other markets, we know that to achieve them on scale in regulating states, we need to offer customers a leading proposition. This is what we've been doing in New Jersey by our FanDuel's market-leading app, with a broadest range of betting markets, competitive pricing and generous headline promotions.

We're also leveraging our existing sports-focused customer base. To date, the customer acquisition trends that we've experienced in New Jersey have confirmed to us the value of our fantasy sports player base, both in terms of players who've been active with FanDuel recently, and perhaps more encouragingly, with respect to dormant customers reengaging with the brand.

Fully capitalizing in the U.S. opportunity will require substantial investment in promotions and marketing, and we'll be not shy about investing, but we will do so in a disciplined manner that focuses on returns generated from spend. Again, the initial indicators in New Jersey are encouraging, with initial acquisition economics indicating good returns on investment.

For 2018, this investment means we expect to record an EBITDA loss of around £25 million relating to U.S. sports betting, with £4 million of this incurred in quarter 3. As you would expect, we'll not be giving guidance on expected investment levels for 2019 at this point. Relevant factors that will determine the scale of investment include how the New Jersey market evolves and the timeline of additional markets legislating, regulating, and ultimately, going live.

Turning to group profitability, excluding U.S. sports betting, Q3 pro-forma EBITDA was up 6% in constant currency after adjusting for U.S. sports betting and tax increases. This is slightly lower than our pro-forma revenue growth in the quarter, reflecting adverse sports results in Australia and the deliberate phasing of our marketing spend in online in Australia.

The key profitability update we are providing this morning relates to our full-year profit guidance. Notwithstanding adverse sports results in Australia, which persisted in October, our profit guidance has increased marginally, reflecting the good momentum in online. We now expect underlying EBITDA, pre-U.S. sports betting, to be between £465 million and £480 million for the full year.

Finally, following the U.K. budget on Monday, we now have clarity on the timings and quantum of tax and regulatory headwinds facing the industry in our key markets. On the basis of current revenue levels, we estimate that the full year impact will be £115 million of taxes, clearly very material to our group's profitability over next 2 years. However, we continue to believe our scale, strong balance sheet, leading brands and market position means we are relatively well-positioned to capitalize on the long-term growth opportunities.

And Jonathan and I are now happy to take your questions. But breaking the tradition, I'm going to ask the first question. Jonathan, what are your first impressions?

Jonathan Hill

Well, first thing to say is I'm delighted to have joined, and it is a very exciting time to be joining the business. I joined the business for three reasons: the people; the brands; and the prospects. And what I've seen in the first couple of weeks absolutely backs up those three reasons. I've met some fantastic people across the business. I think we can all see the underlying economics of this industry, and particularly, what's evolving in the U.S; thirdly, the great brands and the scale that we have.

And I think what's become even more prevalent and obvious to me is the need for podium positions, and the fact that when we have those podium positions, our ability to deal with the headwinds that we see in terms of regulation and taxation are greater.

And finally, I think the group is really well placed to take on the challenges that we have ahead of us. And I look forward to meeting hopefully everybody on the call in due course.

Peter Jackson

Thank you, Jonathan. Nigel, we'll now open the lines for the Q&A.

Question-and-Answer Session

Operator

Certainly, Peter. [Operator Instructions] Thank you. The first question is from Ed Young from Morgan Stanley. Please go ahead.

Ed Young

Good morning, and thank you for taking my questions. I've got four if you'll indulge me please. I'll ask them one at a time. First of all, on FY 2018 guidance, ex-U.S. investment, the midpoint of the guidance is now £472 million or so. That implies £155 million of EBITDA for Q4, which make about a 17% year-on-year increase. That seems quite strong given the 20% revenue headwinds, roughly revenue headwinds from sports results on normalized margins. So can you help us understand the phasing of that?

Is it DFS losses which are un-quantified now or is there anything else going on that gives you confidence for that impressive Q4 number?

Peter Jackson

Ed, we've put out the guidance today. We're clearly mindful of the sports results we're seeing in Australia, which have not been helpful. Notwithstanding my efforts to try and put some money back into market, when I was visiting. But you're right in terms of the DFS losses, they are concentrated in Q3. And we have got strong margin comps to deal with from 2017, but we're confident in the guidance we've given you all today.

Ed Young

Thanks. And my second question was, I was struck by your comment about market share gains for Paddy Power. So how do you define that? You obviously don't break out brand performance, but if I look at what's disclosed by peers, Ladbrokes Coral grew sort of 23% to 29% in Q3. Do you mean that sort of level, because that would imply Betfair is sort of flattish? Or do you mean against sort of average annual market growth, because obviously the whole quarter performance helped by weaker margin comps? I'm just trying to understand really what you meant by the market share comment.

Peter Jackson

So I mean, there are different ways you can look at that. I mean, we are very pleased with the performance in our European businesses, both the Paddy Power and the Betfair, which both grew in double digits. I think from a Paddy Power perspective, we have seen sort of a good turnaround in the performance of that business, I think particularly around gaming. When we look at the metrics around the business in terms of actives and things like that. We're very confident to that business is taking share.

Ed Young

Okay. And then the third question was on Australia The 8.5% margin is obviously lower and you flagged the - sort of 90 basis points of that was from the sports results, which you kind of said were weak in October. So it's suggestive of 140-ish from the investment you're making, and obviously you've just been out there reinforcing that. Does that mean that we should be expecting new normal margins on Australia to be sort of 9%-ish or below in the next few years given the long run average previously being 10% or 10.5%? Or how should we think about Australia margins potentially over the next year or two?

Peter Jackson

We made an additional investment in generosity in quarter three to take advantage of some of the changes that are happening. And you'd be aware that a couple of our competitors rebranded, and we also wanted to reposition ourselves ahead of the important Spring Racing Carnival. We've done that, and we're very pleased with the additional market share that we're gratefully taking. I mean, clearly - I mean, we talked about the margins being adverse in October, at some point these things do revert back to the mean.

Ed Young

So does that mean we should be expecting lower levels of investment going forward from - for the margins, just so I'm clear?

Peter Jackson

We're not going to be guiding on margins in individual parts of our business, Ed.

Ed Young

Okay. And then my final question was just on guidance. So you previously said on the interim call you don't expect to grow profit next year, that's for U.S. investment and before the Irish betting duty. So just mathematically, does that mean we should be expecting EBITDA sort of in and around 45, 47 plus or minus? Obviously, I understand you're not guiding for U.S. sports losses or investment, but sort of - that sort of range, plus or minus any change that you do see in [investment and losses, are you reasonably close to that] [ph]?

Peter Jackson

We don't - we're not giving guidance for next year.

Ed Young

All right. Thanks very much.

Operator

Thank you. The next question is from Monique Pollard from Citi. Please go ahead.

Monique Pollard

Hi, good morning, everyone. Three questions from me, if that's all right. The first one is just on the U.S. Obviously, you point out really strong market share gains in New Jersey in September. I'd just be interested to hear how positioning has evolved and competition has changed in October with a couple more competitors on the app store, and I guess, marketing budgets being sold out more broadly

Peter Jackson

Yeah, Monique, we're very pleased with the performance of the business in September. I mean, you'll get to see results for our business month-on-month, because the DG would publish them. We shared some snippets on that today as we talked about the amounts of staking that we're seeing in our retail shop, up to sort of $1.5 million a day at the moment, and we're very proud of that. I think it must be one of the busiest shops in the world. But our online business is bigger.

So yeah, I think the market may well have grown into October, it's a very busy month in the U.S., but our business has as well. So I think we're very pleased with our positioning, and I can't comment on what other people are doing, but our strategy seems to be working.

Monique Pollard

Great. And then just on the exchange performance, obviously, we've reverted to growth in the third quarter, up 1%. I'm just interested, I know at the half year you had talked about the adverse impact that you were seeing from Bet365 and they're very aggressively low on horseracing. Has that continued into the third quarter?

Peter Jackson

I don't think there's been any sort of reduction in market competitiveness into the third quarter. What I mean to say is we're continuing to see people like 365 push harder. I think the point now is that we just operate in a very competitive market for customers. And yeah, within our Betfair business, which spans both the exchange and the sportsbook and gives us - we're unique in being able to do that. And we're fighting for those customers in the same way, that 365 or someone like William Hill is.

Monique Pollard

Okay. Yeah. Very good. And then just a final question. Have you seen Australia, obviously, you said a couple of competitors are changing branding. You invested in the third quarter ahead of the busy season. Are you seeing, do you think, particularly increased competitive pressures ahead of the tax increases next year? Everyone is trying to sort of juggle for position.

Peter Jackson

No. We will still generate positive EBITDA, notwithstanding the very significant levels of point consumption tax all coming from the January 1. And clearly, the Queensland board were introduced it beginning of October. For some of our smaller competitors, they won't. And so they're desperately trying to get some additional scale to ensure that they can make a profit. And I think, we should therefore expect to see continued levels of very strong competition up to and in to next year.

Monique Pollard

Okay, wonderful. Thanks very helpful. Thank you.

Operator

Thank you. The next question is from Patrick Coffey from Barclays. Please go ahead.

Patrick Coffey

Yeah. Good morning, everyone. Thanks for taking my question. Just following on everyone else, I've got three as well. Ex the World Cup, what was the growth in the exchange, please? And you also say that it grew in line with your expectations. Can you help us out to understand what your expectations were in the quarter? So that's the first one. And then within that, a second kind of part A and B.

Second question was just on the margin of the exchange, obviously, the Betfair, is that it's extremely high. Is there anything you can do to reassure us that the exchange margin isn't materially higher than the group margin? Just start with that one.

Peter Jackson

Do you want to give me your third question now Patrick or…

Patrick Coffey

Yeah. Well, actually I've got two more, because that was A and B. Second question was UK TV advertising. How much do you spend on UK TV advertising at the moment? And then the final question with reference to the commentary around kind of podium positions, just kind of thoughts on the - your exposure to Italy, and is that a market that you're committed to or that you would consider pulling out of it? Thanks.

Peter Jackson

Okay. Thanks, Patrick. Well, look on the exchange I can tell you that when we look at the performance of the exchange, excluding the World Cup, I mean, there weren't many matches actually that happened in quarter three. So it's not particularly material to the exchange, which is of course driven by volumes of events. We don't break out the margins, but I think hopefully people are beginning to realize that actually the Betfair business is in good health. And we do look at it across both the sportsbook and the exchange we don't actually break it out like that.

With regards to UK TV advertising, look, there is - there has been quite a lot of sort of commentary from people about it. I think, we - I mean, it was interesting having been in Australia, we're - I think, we're able to operate reasonably effectively with a whistle-to-whistle band of an advertising down there.

But I think we need to wait and see if we can get to sort of consensus on where the UK market could get to. But from my perspective, if there was a - if there's a reduction, I don't think that would be a bad thing. And we spend about £50 million to £60 million on that, this is important for us.

And then with regard to podium positions, now look, we're not very happy about the advertising situation in Italy, where in Italy - for the moment, it looks like advertising has been banned, it was the market, where we're operating. We don't have a retail presence there, and so clearly, advertising is an important way to get to market.

We're assessing what we do in the market. Obviously, we had to stop a lot of our advertising. Fortunately, we do operate through the Betfair business in a number of - a significant number of markets around the world, and so we can just redirect our marketing spend elsewhere.

Patrick Coffey

Thank you. And do you mind if I just follow-up with one quick one? You say that you're doing $1.5 million of stake per day in October at the Meadowlands, that seems to be quite an acceleration from sort of $1 million or so about one month ago, certainly when I was out there. Is that what's happening? Are we seeing a big step-up in October in terms of staking in the retail position there?

Peter Jackson

Look, it's really difficult for us to understand, I mean, right now what the sense - what the seasonality is going to be around the performance of the retail business. I mean, October is a big month for sports in the U.S. and so we would have expected a degree of step up. But I think, this is going to be a sub-maturity of the market and it's going to take some time before it's fully mature. I mean, we've got some exciting plans, what we do with the Meadowlands.

And it's a - I mean, as you know, Patrick, actually from having been there, it's a pretty unique sort of location for us. But actually our business is all about online in America. And when we look at the strength of our online performance, which I think we - the reference was up sort of 40% on top of those very strong results in the Meadowlands, we don't expect that to accelerate over time.

Patrick Coffey

Thank you very much.

Operator

Thank you. The next question is from Gavin Kelleher from Goodbody Capital Markets. Please go ahead.

Gavin Kelleher

Good morning, Peter. Just two for me, please. Just on the exchange, was there any kind of big changes in marketing message around the exchange in Q3 or investment there? Or are there any big product enhancements that the exchange has shown in Q3? And if not, like what's the pipeline of kind of the exchange improvements looking like in Q4 and into next year?

Peter Jackson

Yeah. Look, Gavin, I mean, I talked to some of you about this. I mean, when we look at our Betfair business, which spans both of the exchange and the sportsbook, one of the things that we introduced in Q3 is the ability for people just to toggle backwards and forwards between the exchange and the sportsbook, which is an important way of sort of bringing the products together. And so if you - those of you who've got the app, have a look and you'll see we started testing that out. There are some other things that sort of even in a small-scale, where we've been looking at in quarter three.

The big thing for us, though, to support that growth of Betfair internationally is the ability to sort of scale that internationally. And so being able to offer a broader range of languages, to be able to have jurisdictional pricing to do with different tax regimes, to be able to provide sort of content to people in local languages and accept local sort of payment mechanisms, all those things are really important. We'll deploy those together with other sort of - always just wanted a global scale projects over the course of the next nine to 12 months and that will help us to grow the business in the future.

Gavin Kelleher

Perfect. And just in terms of West Virginia, when do you expect to have your mobile app launched there? And I presume it's kind of a similar model to New Jersey in terms of unrestricted sign-up and everything.

Peter Jackson

No. We are hopeful to be able to launch in West Virginia. I think as we've sort of demonstrated it with our business in New Jersey, it's important to get a great product out there rather than just rush and go to claim success. I think people who just get a product into market just for the sake of it will find that, that isn't a good way of acquiring customers. So we're very thoughtful about the extent, which we're allowed, the interoperability between states and things like that. So we're doing a little bit of work with the regulators at the moment, but we hope we'll be in the market with a great product at some point soon.

Gavin Kelleher

Perfect. Thanks so much, Peter.

Operator

Thank you for the question. The next question is from Alistair Ross from Investec. Please go ahead.

Alistair Ross

Good morning, guys. I've got quite a few questions. Sorry, if I jump around. Just in terms of the…

Peter Jackson

Alistair, just let's try and limit them to sort of three or four, okay?

Alistair Ross

I'll try to do that, sure. Just in terms of CapEx in relation to the U.S., I mean what additional CapEx should we be assuming for the U.S.? Obviously, we're seeing OpEx increase quite dramatically, certainly above my expectation, and we're not quite sure how that's going to evolve for next year. But how should we think about CapEx?

Peter Jackson

Look, Alistair, I mean, we kind of given you our view on what we think are losses [through the year] [ph], sports betting will be today. And I would remind you, we're not a start-up in America, right, so we're having to sort of fit out offices and stuff like that. But our retail unit in the Meadowlands is a site to behold, and if you haven't been to see it, again, have a look at it. There aren't enough people working there, I'm going to deploy a whole lot of SSBTs and things, so there would be a bit of CapEx. We're doing very well. Our acquisition economics look fantastic.

We're really pleased with the way we're converting on our fantasy customers into sports-betting customers. And I think, if you look at the market share numbers, we're taking - we're very proud of the business. We're not trying to guide on the difference in OpEx and CapEx around - I wouldn't be expecting sort of massive material.

Alistair Ross

Okay. That's good news. Thanks. How should we think about the £25 million going forward in that case of OpEx?

Peter Jackson

Look, it's - we'll have been running by the end of this year for a few months. Next year, we'll have been running for 12 months, but it will be a mature business next year, right. So the customers that come into the business on the January 1, will have already paid all the acquisition costs of that and will see the revenues go through. For all the customers we acquire on the January 1, there'll be bonuses and all sorts of other mechanics that they'll be benefiting from together with the marketing costs. So it's going to work out what you think is the run rate basis of those two different dynamics.

Jonathan Hill

And then the second overlay is the timing of the legislation and the go live in the other states and we clearly don't know that yet. And will only know that as we progress into - and through next year.

Alistair Ross

Sure. Thank you. And then, look, I'll just - I'll limit it to one more. Just in terms of exchange growth, I mean, we keep hearing that competition from Matchbook and Smarkets has increased. We heard about your commission cut on the exchange post the football World Cup, it looks like you have commissions for some customers. Exchange growth of 1%, obviously, includes the football World Cup element. So back to sort of Monique's point, how should we think about that evolving going forward?

I know you talk about sort of cross-selling between the exchange and the sportsbook, et cetera, but it's something that's difficult to model, just given the competitive nature of the market.

Peter Jackson

Look, Alistair, I wouldn't - yeah, I don't think it's right to sort of keep going back to Smarkets and Matchbook as the competitors. I think an important thing is to remember that the Betfair business is focused on acquiring what we describe as core betters. Yeah. And so the competitors there are any of the other sorts of high street or online bookmakers, who are focused on the same sort of segments. Clearly, there are some businesses who describe themselves as exchanges that are doing that.

The World Cup was not a significant driver of business for us in quarter 3. And we are doing things to sort of look at the performance of Betfair. One of the things that we've been trialing are some changes to the sort of commission structure. But actually, part of that is around just bringing together the exchange and the sportsbook. So, look, we're pleased with the performance of Betfair in quarter 3, and I think the - I think there are some exciting plans we've got. But it's going to take us time to deliver the international scale of what we need to do to really allow us to grow Betfair on an international basis as a reference with Gavin earlier.

Alistair Ross

Sorry, just a follow-up to that, I mean, the football World Cup was a 5% tailwind to your total net revenue in Q3.

Peter Jackson

So the exchange is driven by, from an exchange perspective, which is what you're asking about, the exchange is driven by the number of matches or events, right? And so, there weren't actually that many events. It would have - there were 14 games, I think, that occurred in quarter 3.

Alistair Ross

Okay, okay, very helpful. Thank you very much. I appreciate it.

Operator

Thank you. The next question is from Tal Grant from Credit Suisse. Please go ahead.

Tal Grant

Hi, guys. Hi, Peter, and welcome, Jonathan, best of luck in the new role. I also have 3 questions, if I could. The first one is just on the U.S. As you talked about, a significant number of your new customers coming from the kind of the daily fantasy sports back-book. Just wondering if you could give us a percentage, instead of just saying significant, what percentage of your customers in New Jersey are coming for the daily fantasy sports? And excluding those customers, what's the sort of average customer acquisition cost of a customer in New Jersey?

Peter Jackson

We're not going to give a commentary on the acquisition costs so far, customers in different markets. But please be reassured that when we compare the expected first-year revenues with the acquisition cost, we're very happy with those unit economics. There are a large number of our customers are coming, as you'd expect. The business is called FanDuel, with it a large database of customers in New Jersey are coming from that business, both existing sort of active FanDuel customers, but also some lapse customers.

We're not going to give the breakdowns, but it clearly gives us a real advantage in the market.

Tal Grant

Yeah, definitely, okay. And then, second question actually also on FanDuel. Given the recent ruling in New York, are you guys going to have to pull out of New York? And is there any guidance on timing of that? And if you are going to have to pull out, what's the sort of annual EBITDA profit or loss that you guys generate in New York with FanDuel on the daily fantasy sports side?

Peter Jackson

I mean, we're not overly concerned about the ruling that we've seen in New York, Tal. It's - this is an issue which we - we're not involved in the court case, so we can't necessarily sort of comment on whether there'll be appeals. But I suspect the Attorney General will. We're pretty confident even if they don't, we're about to continue operating our fantasy business in New York.

Clearly, our fantasy business scales in the sort of way with the sort of population. This is something that's around sort of 10% of our fantasy business in the U.S., so from a group perspective. Even if it were to be stopped, which I don't think it would be. It's not material.

Tal Grant

Okay. And then, going back to Italy, it sounds like you guys might have to buy a retail player or exit the market potentially. Just wondering what's at stake. I mean, could you give us a sort of rough idea of the EBITDA generated in the Italian market, please?

Peter Jackson

Yeah, I mean, we don't give all those specifics of all of these markets we operate in. But actually, it's pretty small for us from a revenue perspective and it's not a significant driver of EBITDA.

Tal Grant

Sub-£10-million?

Peter Jackson

As I said, we're not going to give numbers.

Tal Grant

Okay, I'm sorry. If I'd just get one last one in, just on the £2 maximum stake stuff. Just wondering if you've trialed that in any of your shops at all to see what the impact is and if that lines up with your guidance on the impact.

Peter Jackson

We've got a very good retail business. If you look at the performance of that compared with any of our competitors, I think we're very proud of it. And so, now I'm very confident in the numbers I shared with you around what we expect to happen when that change is introduced. We haven't actually tried it. Our technology for our FOBT machines is run by a third-party. And we can't get them to introduce differential limits for us.

Tal Grant

Okay. Thanks very much, guys.

Peter Jackson

Thanks, Tal.

Operator

Thank you. The next question - next question comes from Michael Mitchell from Davy. Please go ahead.

Peter Jackson

Yeah, we'll take this last question. I'm conscious of everyone's time.

Michael Mitchell

Okay. Good morning, gents. Thanks for taking the questions. Just a couple on my side then in that case, both actually on online. On the sportsbook side, I mean, just wondering could give a little bit of color in terms of actually what's driving the management from a customer perspective. I mean, is this about customer acquisition? Is it about percentage of existing customer wallet or otherwise? And, I guess, what I'm trying to figure out is, how sustainable the kind of mid-teens pace of growth is going forward given you're coming from a, you're now lapping kind of a period of some share losses over the last couple of years.

And then secondly and on a similar vein, just in terms of the sportsbook margin of 90 basis points year-over-year, and I think I'm right in saying that the sports results in both the Q3 2018 and Q3 2017 periods were line with expectations. So that 90 basis points, is that an improvement in product mix? And again, I'm really just trying to understand how sustainable it is going forward. Thank you.

Peter Jackson

Hello, thanks, Michael. So let me just take these on. From a sort of margin perspective, I mean, we have seen some positive changes to mix, obviously launched things like Same Game Multi. We also made some changes to remove some customers those had bonus abuses and things like that.

So I think we're confident in terms of where we've got to in terms of the [supply share] [ph] at the moment. From a sportsbook core perspective, in terms of how sustainable that is, clearly, we launched our customers onto the new product, the - at the beginning of this year. So compared with this time last year, they're seeing significant improvements. From a Paddy Power perspective, I think the advertising is in a much better place. We are seeing - customers are seeing a product that's much easier to use and much faster.

I think the thing we got to get right with Paddy Power is you basically sort of scale that in a way that really makes sense. So it's obviously very easy to acquire customers that they make you money, but it's harder to make them [indiscernible] do making money.

I think from a Betfair perspective, I think that we haven't seen a starker contrast from a product perspective for those customers. But we still have been able to deliver some improvements and we've got some further product enhancements to come over the balance of this year.

Michael Mitchell

I'm sorry. Just that preempts follow-up then, just in terms of the kind of the ongoing improvements on both - across both brands, is it?

Peter Jackson

Yes, yeah.

Michael Mitchell

Super, great, okay. Thank you.

Peter Jackson

Yes, look, thank you very much, everybody. I appreciate all of your time. And clearly, if you got some follow-ups, please reach out to us directly.

Operator

Thank you. That does conclude the conference call for today. You may now disconnect. Thanks for joining. Enjoy the rest of your day.

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