Flutter counts $1.2bn loss completing its 2023 transformation 

Flutter Entertainment Plc has declared corporate losses of $1.21bn after completing a transformative year for its business, which achieved the headline objective of becoming global gambling’s most valued Plc. 

Publishing its full-year 2023 accounts, the joint FTSE-&-NYSE-listed gambling group reported revenues of $11.7bn, a 24% increase over the FY2022 results of $9.4bn. 

Headline growth shows Flutter delivering on the goals of its localised strategy across core markets, as its global brand portfolio serviced an average of 12.3m monthly players (FY2022: 10.2m). On group KPIs, Flutter emphasised that “product innovations have generated 3.7 million new customers with attractive projected payback periods”.

Year-end accounts revealed Flutter’s corporate adjusted EBITDA to be $1.87bn, a 45% increase from FY2022’s $1.29bn. Key objectives included the positive contribution of FanDuel, which generated “an adjusted EBITDA of $65m and a Further Adjusted EBITDA of $167m despite significant Q4 2023 customer-friendly sports results”.

Corporate net losses of $1.21bn were incurred due to Flutter recognising non-cash charges of $1.68bn. The FY2023 impairments are broken down as a “$725m impairment on the PokerStars trademark in alignment with the enhanced focus on the ‘local hero’ strategy; $791m in amortisation of acquired intangible assets; and a $165m adjustment in the fair value of the Fox Option liability, resulting in an IFRS net loss of $981m”.

Group CEO, Peter Jackson, stated that Flutter had achieved its heightened objectives, “underpinned by a localised approach to technology and product, coupled with the unique scale advantages of the Flutter Edge.” 

He noted: “As expected, our number one position in the US has transformed the Group’s earnings profile in 2023, with FanDuel posting a positive US full-year Adjusted EBITDA for the first time.

“Beyond the US, we’ve made excellent progress integrating Sisal into our international business, a sterling example of our ‘local hero’ strategy at work, capturing market share in the UK & Ireland.”

Excluding US FanDuel performance, Flutter Entertainment generated revenues of $7.06bn (FY2022: $6.2bn) with an adjusted EBITDA of $1.6bn (FY2022: $1.48bn). 

Outside North America, Flutter bolstered its “Consolidate & Invest” strategy, highlighted by the expanded international unit that achieved revenues of $2.8bn (+34%) and an EBITDA contribution of $592m (+41%).

International growth was driven by “a full year of consolidating the Sisal business acquired in 2022, which generated $1,218m in revenue compared with $465m in 2022”.

In the UK & Ireland, Flutter maximised operational efficiencies to benefit its recreational customer base, with AMPs increasing by 5%. Leveraging operational efficiencies from regulatory adjustments, Flutter’s UK & Ireland brands saw a 13% rise in FY2023 revenues to $3bn (FY2022: $2.7bn) and an EBITDA contribution of $888m (FY2022: $757m).

Despite challenges in the UK market, Flutter’s “strong UKI performance added 2 percentage points to its GGR market share, reaching 30%”.

FY2023 results in Australia were less positive, with Flutter registering a 7% decline in revenues to $1.4bn (FY2022: $1.51bn) and a 23% EBITDA decline to $348m (FY2022: $477m). 

The downturn reflects a year of softer trading against COVID-enhanced revenue metrics and new POC taxes, which weakened the EBITDA performance of Sportsbet Australia – the flagship brand which “grew AMPs by 1.9% to 1.1m.”

Peter Jackson remarked on Flutter’s non-US results: “Outside the US, revenue grew by 6.3% as the market-driven decline in Australia was more than offset by growth in our UKI and other international businesses. 

“We believe that our strategy and competitive advantages well position us to continue growing the business through both organic and inorganic opportunities.”

Flutter provided preliminary guidance for full-year2024 targets, wherein the FTSE/NYSE-listed company “anticipates a 17.5% increase in revenue and a 30.2% growth in Further Adjusted EBITDA at the midpoint”.

The Guidance carries expectations of US Revenues to be between $5.8bn to $6.2bn (up 36.3%) and Further Adjusted EBITDA between $635m to $785m (up 206.1%).

Outside of the US revenue is projected at $7.65bn to $8.05bn (a 6.3% increase), with Further Adjusted EBITDA expected to be $1.63bn to $1.83bn (up 5.4%), prompting an update of the medium-term leverage ratio target to 2-2.5x, reflecting Flutter’s earnings and cash flow potential.

Year trading was concluded by Flutter confirming that it would move its primary shareholding onto the NYSE in 2024, as explained by Peter Jackson: “I was proud to see Flutter shares trading for the first time on the NYSE on January 29 2024 and we have been encouraged by the increased focus from new US investors as a result of our US listing. We are working towards a shareholder vote on May 1, 2024 to approve our primary listing move to NYSE.”