Flutter exceeds Q3 expectations with double-digit growth across all brands

Flutter Entertainment Plc has reported a strong Q3 2020 trading update, in which the enlarged FTSE100 operator highlighted a growth in market share across its brand portfolio in addition to merger directives remaining ahead of schedule.

Driven by the return of global sports, Flutter secured double-digit growth across all core metrics as group revenues topped £1.32 billion, up 27% on corresponding 2019’s £1.04 billion.

Across the UK and Ireland, Flutter’s flagship Paddy Power Betfair and Sky Betting and Gaming brands noted revenue growth of 32% and 26% respectively. 

Meanwhile, in Australia Flutter completed its first key migration transferring BetEasy customers onto the Sportsbet Australia platform, which saw the division’s revenues jump 76% to £320 million.

Peter Jackson, Chief Executive, commented: “Flutter’s performance in the third quarter exceeded our expectations in both sports and gaming. Our strong trading continued as we grew market share in key regions while retaining our commitment to safer gambling practices. 

“During the quarter we continued to expand our recreational customer base while bringing our businesses together. This included the successful migration of the BetEasy customer base onto the Sportsbet platform in Australia.”

Gaming was the key driver for growth in the operator’s Paddy Power Betfair brand, noting a 31% increase in revenues during Q3, while sports betting grew by 12%.

In its update, Flutter stated that ‘Paddy Power performed very well’ during the period,  as the brand benefited from ‘an enhanced customer experience and optimised promotional generosity’.

Flutter was encouraged by the performance of its ‘more recreational’ gaming brands such as Paddy Power and Adjarabet, as Q3 recorded a 51% increase in average daily customers.

Paddy Power’s retail unit was the only business segment to record a lower Q3 revenue growth (-2%), citing local COVID-19 restrictions impacting trading environments across its retail estates. 

Meanwhile, PokerStars continued its strong 2020 trading momentum with Q3 revenues up 5% continuing to benefit from an expanded customer base recorded during H1 trading. 

As Flutter continued to eye new opportunities in the US market, its business in the post-PASPA market went from ‘strength to strength’ during Q3 as the operator delivered on key projects during the trading period.

During the quarter, revenue increased by 82% to £161 million while sportsbook stakes grew 155% to £1.25 billion with stakes in existing states more than doubling. 

Strong Q3 trading saw Flutter revise its 2020 forecasts with the FTSE firm anticipating its full-year  EBITDA to be in the range of £1.2-to-£1.35 billion (previous guidance: £1,175-1,325m).

Flutter stated that its improved forecast had been undertaken on the assumption that no further retail closures go beyond the respective six and four-week lockdowns currently enforced across Ireland and England.

Jackson added: “We are very pleased to have retained our position as the number 1 online operator in the US, where FanDuel has made significant progress against each of its key priorities. We have enhanced the customer experience, secured further strategic media partnerships and acquired more new customers than anticipated. 

“We are on track to generate more than $1.1 billion of GGR in the US this year, which will mark a major ‘first’ for an online operator. We are now a truly global business with significant scale. As such we are in a unique position to respond to the many opportunities we see across our growing markets. 

“Looking ahead, whilst the outlook with respect to Covid-19 remains uncertain, we are confident that our business is well positioned to capture further growth in a sustainable and responsible way.”

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