Sunday, October 1, 2023

FanDuel’s 45% revenue increase boosts Flutter’s operations in Q1 amid slight dip in UK | Yogonet International

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Sports betting and gaming giant Flutter Entertainment has shared a trading update for the first quarter of the year. The business delivered a 15% year-on-year increase in average monthly players to 8.5 million and a group-wide revenue increase of 6% to £1.6 billion ($2 billion). Both sports revenue and gaming revenue were up: by 4% to £930 million ($1.2 billion) and by 8% to £636 million ($796.9 million) respectively.

“Flutter delivered a positive Q1 performance with revenue growth of 6%,” commented CEO Peter Jackson. “The quarter saw us launch our new global sustainability strategy, the Positive Impact Plan, aligning commercial goals with our commitment to support our customers, colleagues and the communities in which we operate.”

The business had an “exciting” quarter in the US, as its FanDuel brand continued to deliver “unparalleled scale,” with the market accounting for over half of all stakes for the Flutter Group in the quarter. The company expanded the sportsbook to New York and Louisiana during the period, and expanded into Ontario in April.

The company beat a number of records for the brand in the quarter. Super Bowl Sunday was the single biggest day ever for new customers, and the company had over 1.5 million active customers on the day. Meanwhile, March Madness this year also proved the most popular season yet, attracting 19 million wagers across the tournament.

Outside of the US, the business performed “well,” said Jackson, with Flutter adapting to the evolving regulatory and trading environment and “reflecting the benefits of global diversification.” In the UK and Ireland the company launched several new products in the quarter, while in Australia, the Sportsbet brand delivered good growth from ongoing customer-driven momentum.

“Our International business benefited from strong performance in focus markets,” added the CEO. “With our enlarged recreational customer base, winning position in the US and ongoing focus on sustainable growth, our business remains well placed for the future.”

Jackson also expressed hopes to complete the previously unveiled acquisition of Italian online gaming operator Sisal in Q3. This announcement marks a pushback from a previously announced Q2 target. Flutter is purchasing Sisal for a consideration of approximately $2.1 billion.

Breaking down revenue by market finds the US posting revenue up 45% to £429 million ($537.6 million), while UK and Ireland fell by 8% to £519 million ($650.4 million), despite the return of retail operations. Australia posted an 8% increase in revenue, while international operations dropped by 5%.

According to Flutter, FanDuel remained the number one sportsbook in the US with a 37% online sports betting share, and through the acquisition of over 1.3 million new customers. iGaming share was 20%. New York exceeded expectations, representing the fastest penetration of the company’s daily fantasy sports player base to date.

Company officials said that the cost of living crisis in the UK and Ireland market is not putting customers off gambling. While revenues for the market fell by 8%, the business attributed this to a winning streak enjoyed by punters and increased spending on initiatives to curb gambling addiction.

Paddy Power, one of Flutter's brands in the UK

At this stage, we’re not seeing anything that we would point to specifically around cost of living, and in fact we’re seeing reasonably consistent levels of engagement from customers between Q4 and Q1 compared to previous years, which reassures us to some extent,” Jackson said, according to Reuters.

Additionally, CFO Jonathan Hill said the number of days customers bet a month and the amount they spent was not much different from the corresponding period in pre-pandemic 2019. Moreover, the average number of people gambling on UK and Ireland Flutter brands rose by 15% year-on-year.

But going forward, the US is set to provide further opportunities to the business. After the successful launch in New York, Jackson said he now hopes FanDuel to go live in California by the start of 2023, a move that would “clearly be very material,” reports Reuters.


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