Trading Statement

Paddy Power plc
17 November 2005


Paddy Power plc


Trading Update


Turnover has continued to grow strongly across the business, in line with
expectations for the second half of 2005. Shop openings will also be in line
with expectations. Strong growth in the online division is continuing across all
product lines particularly in the gaming products.


However, the disappointing gross win percentages in the second half of 2005,
noted in our interim statement of 30 August, have continued. In particular,
gross win over the past three weeks has been some €4 million below internal
expectations, principally due to poor horse racing results. Assuming reasonable
gross win percentages for the remainder of the year, we now expect operating
profits for the year to 31 December 2005 to be approximately €30 million.


Bookmaking gross win percentages by channel have been as follows:


                     H2, 2005


Retail*               11.3%

Online*                8.3%

Telephone              6.9%


(*excluding Fixed Odds Betting Terminals ('FOBTs') and online gaming)


Future Guidance



Gross win percentages in the Irish retail division were at the mid point of
their expected annual range for the year to December 2004. However, as a
consequence of the disappointing gross win percentage in the current year, and
as part of the annual budget process, we have conducted, in the last month, a
detailed review of expected ongoing gross win percentages.



This review has resulted in a change to our expectations going forward :



4a lowering of the retail gross win range (excluding FOBTs) by approximately 1%,
offset to some extent by additional turnover growth

4an increase in the online gross win range by approximately 0.5%

4a lowering of the telephone gross win range by approximately 0.5%



While a significant element of the 2005 shortfall against expectations is due to
poor horseracing results, we are of the view that the Irish retail market is in
the process of structural change. Paddy Power will continue to lead the market
and take advantage of this change.



The levels of tax free betting and concessions we offer in the market have
increased considerably recently and may well increase further in 2006. The Irish
Government budget in December could lead to nationwide tax free betting in the
coming months and, following last week's resolution of the British Horseracing
Board legal case in Ireland, the competitiveness of the market will increase
further.



This will drive turnover growth through recycling and the increased betting
opportunities that tax free betting offers as well as transferring business from
the grey market. The growth dynamics of retail tax free betting in the United
Kingdom in recent years have been well documented.



The continued expansion of the non retail channels and their ongoing customer
and product mix changes have resulted in an overall improvement in the gross win
percentages for non retail. Expansion of the online business into the mass
market, together with improved risk management techniques and product mix
changes, have increased its expected gross win range by approximately 0.5%. As a
result of our successful policy of focusing on the higher end of the mass market
in the phone business, we believe it is prudent to reduce the expected telephone
gross win range by approximately 0.5%. In aggregate these changes represent a
net increase in non retail gross win percentages due to the greater level of
online turnover in comparison to phone turnover.



Operating Costs



Following the outcome of a legal case between Irish bookmakers and the British
Horseracing Board, Paddy Power expects in future to acquire its pre-race data at
a considerably reduced charge for its non United Kingdom customers. This should
generate a year on year saving of €2m in 2006.



-ENDS-

17 November 2005



Conference Call


There will be a conference call at 9.30am. The participants will be John
O'Reilly, Chief Executive, Ross Ivers, Finance Director and Patrick Kennedy,
Chief Executive Designate. Conference call details are as follows:


Ph 353 1 664 7602   PIN 52804


For reference:



Paddy Power Plc:


John O'Reilly                 353 1 404 5912

Patrick Kennedy               353 1 404 5912

Ross Ivers                    353 1 404 5912


Drury Communications

Billy Murphy / Oonagh Daly    353 1 2605000/353 87 231 3085



Holborn PR

David Bick                    44 207 929 5599/44 7831 381 201


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