2023 marked a remarkable year for Flutter Entertainment, as the gaming giant reported a substantial increase in revenue climbing to $11.79 billion. The company’s CEO, Jackson, lauded the growth seen in nearly all segments, said Flutter. Notably, the US, UK, Ireland, and International segments all exhibited growth, with Australia being the only region to experience a slight decline.
Flutter’s preliminary results revealed in January showed that the US was the primary catalyst for its financial triumph. The company’s market-leading position in the US via FanDuel resulted in a positive annual adjusted EBITDA for the first time in the 2023 fiscal year.
The corporation’s UK and Ireland ventures also witnessed robust performance, along with continued expansion of its International business. Despite the minor drawback in Australia, there remains optimism for future growth prospects. Flutter has set a positive forecast, predicting double-digit growth in both group revenue and adjusted EBITDA for 2024, with expectations of a 17.5% revenue increase and a 30.2% rise in adjusted EBITDA at the midpoint.
According to Jackson, the company’s robust 2023 performance stems from a diligent commitment to their strategic approach, a mix of technology localization, product customization, and the unique scale advantages offered by the Flutter Edge. They have solidified their leading position in the US, thanks in part to FanDuel’s profitability in the country.
Outside the US, Flutter has made significant strides in weaving Sisal into its International business tapestry, a testament to their “local hero” strategy that has garnered more market share in the UKI.
Flutter’s attention isn’t confined to operations but extends to the financial realm. January marked the onset of Flutter trading on the New York Stock Exchange (NYSE), concluding its secondary listing on Euronext Dublin. Nonetheless, the company will maintain its trading presence on the London Stock Exchange (LSE) and retain its premium listing.
Flutter shares marked a closing price of $221.99 on 25 March.
Jackson expressed pride in the commencement of Flutter shares trading on the NYSE on January 29 and is buoyed by the attention from new US investors following the US listing. Flutter is now gearing up for a shareholder vote on May 1 to approve the relocation of its primary listing to the NYSE.
The US operations stood out remarkably, with a 40.6% revenue increase year-over-year, amounting to $4.48 billion. Sportsbook and igaming revenues climbed significantly, boosted by expansions and strong player volumes, despite a limited market size.
Meanwhile, in the UK and Ireland, revenues swelled by 13.7% to $3.05 billion. New betting products and enhanced igaming features contributed to this success, with the estimated overall market share climbing to an impressive 30.0%.
The International business, encompassing other markets outside the US, UK, Ireland, and Australia, reported a 34.2% revenue upsurge to $2.81 billion. Growth was particularly notable in Italy through Sisal and bolstered by higher market shares in various countries. The recent acquisition of a majority stake in Serbia’s MaxBet is expected to push future growth further.
In stark contrast, the Australian segment reported a 7.1% revenue dip to $1.45 billion. Nevertheless, Sportsbet’s formidable market share and product leadership hold promise for eventual rebound.
Expenditures climbed across the board, with notable increases in cost of sales, marketing, administrative expenses, and R&D. Among these was a significant impairment charge related to the PokerStars trademark dispute.
Despite reporting a pre-tax loss of $1.09 billion and a net loss of $1.21 billion—attributable to heightened exceptional costs, the impact of foreign currency translation offered some financial respite. Furthermore, adjusted EBITDA surged by 45.4% to $1.87 billion, with an improved margin of 15.9%.
The company’s current performance in 2024 seems to be off to a good start, with Jackson boasting about record engagement at the Super Bowl and continued revenue growth outside the US.
Analysts, such as Edison Group’s Russell Pointon, perceive the results as nuanced, emphasizing the combination of revenue growth and the reported net loss due to substantial exceptional costs. Even so, Flutter’s prospects look favorable with expectations set high for continued growth in the 2024 fiscal year, reflecting steadfast confidence in future earnings and cash flow potential.
