Bookmaking giant Paddy Power Betfair said on Wednesday (4 May) it was riding out the losses it incurred at the Cheltenham Festival earlier this year, as profit and revenues both climbed in the first quarter.

The Irish bookmaker, which acquired sector peer Betfair in February, paid out £20m (€25.3m, $29m) in winnings during the four-day racing festival in March, as a number of favourites stormed to victory, inflicting some severe damage on the bookies.

However, despite the hefty payout, the combined group said revenue increased 16% year-on-year to £339m in the three months up to 31 March, while operating profits surged 36% from the corresponding period a year earlier to £42.5m.

The increase in revenue was largely attributed to a strong performance from the group's international divisions, which saw the Australian business post a 25% year-on-year increase in revenue to £58m, while revenue in the US arm rose 22% to £20m.

"All four of our brands − Paddy Power, Betfair, Sportsbet and TVG — continue to trade well in a highly competitive environment," the company said in a statement.

"This good start to the financial year is a credit to our colleagues, particularly at a time when we are bringing together two businesses. Our marketing, technology and operations performed well throughout the key spring racing period and we are now focused on preparations for Euro 2016."

Paddy Power Betfair, which was also hit by new regulatory taxes in Britain and Ireland amounting to a combined £3m, said it was confident of "delivering synergy cost savings of £50m per year" by the merging of the two groups.

"The post-merger integration is on track," said Breon Corcoran, the former Betfair chief executive now in charge of the combined group.

On 5 April, the newly merged group unveiled plans to cut 650 back office jobs across its UK and Ireland operations as it seeks to cut costs. The group, which employs a combined workforce of approximately 7,200 staff, said 350 jobs will go at its sites in London and Stevenage, with a further 300 positions to be axed in Dublin.