SBC News Voice of the Sports Betting Industry
Flutter Entertainment Plc reports on a very positive opening to 2023 trading, as corporate governance prepares the FTSE100 gambling group for its dual listing in the US to be executed by Q4 2023.
Headline Q1 trading results saw Flutter’s enlarged global brand portfolio service over 12.3m average monthly players (AMPs), as group revenues stood at £2.4bn up 46% on corresponding Q1 2022 results of £1.56bn.
Revenue growth reflected a 61% increase in group sports betting revenues to £1.49bn (Q12021: £930m), combined with a 44% increase in iGaming to £916m (Q12021: £636m) – results attributed to continued stellar US growth and the enlargement of its International unit.
FanDuel: Unstoppable US Growth
Maintaining its pledge to deliver full-year 2023 profitability in the US, the FanDuel division experienced continued growth, with a 92% increase in revenue to £908m, underscored by a 147% growth in sportsbook revenues alone as FanDuel serviced over 1.5m new customers during the quarter.
Of significance, FanDuel’s US sports betting handle of $10.9bn represented almost 60% of the group’s total sportsbook stakes. Furthermore, the US division successfully launched in Ohio and Massachusetts, securing the number one position in both markets as “sustainable advantages delivered sportsbook market share gains of 14 percentage points versus the prior year to 50%”.
Group CEO Peter Jackson cited: “In the US, the combination of the FanDuel Advantage and the Flutter Edge drove further market share gains. We added over 1.5m customers in the quarter and we remain the clear market leader. Our US sports betting handle of $10.9bn represented almost 60% of the Group’s total sportsbook stakes.”
Industry analysts predict that due to the exponential growth of local betting, Fanduel in Illinois will experience strong revenue growth in the state, strengthening its podium position.
Recreational gains within a saturated UK market
At home, Flutter’s UK-&-Ireland brands continue to outperform saturated market expectations, maintaining an AMP activity of 4m customers, to help achieve a 17% revenue increase to £608m.
Flutter continues to reshape its UK-&-Ireland online business focused on servicing recreational customers, which corresponded to an online sports revenue growth of 16% and igaming revenue growth of 17%.
Of significance, the Paddy Power retail unit saw 15% increase in revenue to £77m, attributed to post-COVID behaviour normalisation and strong customer engagement driven by leading products and customer propositions.
“In the UK, the publication of the White Paper has vindicated the proactive actions we have taken to further embed safer gambling across our organisation through our Play Well strategy. The changes will bring consistency to safer gambling protections for customers and make responsible play a priority across all operators, which we strongly support. ”
Sisal brings new Italian and Turkish Delights…
Q1 trading saw Flutter report on the performance of a refreshed International Unit, attributed to the M&A integration of Italian gambling group Sisal as of August 2022. As such, International revenue grew by 69% to £605m (Q12022: £327m), results reflecting Sisal’s acquisition as performance revenue rose by 6%, driven by a 14% increase in AMPs to 3.9m.
A breakdown of Sisal’s contribution saw the new unit achieve a 19% revenue increase in Italy, driven by the conversion of retail customers to online products. Sisal’s market-leading proposition and a record SuperEnalotto jackpot contributed to increased player volumes.
Record cross-selling rates boosted average player value, and Flutter expanded its presence in high-growth markets like India and Turkey, with revenue growth of 65% and 107% respectively. Flutter cited that Regulatory issues in Russia and Ukraine had limited impact, with growth at 8% excluding unique factors.
Outside of Europe and the US, the group’s Sportsbet Australia brand continues to drag against post-COVID challenges in which the unit reflected a pro-forma 4% decline in revenues to £289m – yet Flutter is positive of its core underlining Australian KPIs as the Sportsbet brand caters a peak of 1m customers.
CEO Peter Jackson expressed satisfaction with the company’s strong Q1 performance, emphasising the importance of Flutter’s diversified portfolio and its strategic positioning for future growth.
“The Group delivered a very strong Q1 performance with pro forma revenue growth of 29% achieved through continued execution against the Group’s strategic priorities,” he said.
“We continued to take share across our UK & Ireland and International businesses while in Australia we did an excellent job defending our leadership position. We remain delighted with the progress of Sisal since the acquisition in August 2022.
“We were also very pleased to receive overwhelming support among our shareholders for the addition of a Flutter US listing. The strategic and capital markets benefits this will bring to Flutter will position the Group well for its next phase of growth.”
