The gaming behemoth Flutter Entertainment is eyeing significant expansion in the vibrant US market, as evidenced by the recent developments concerning its stock listings. Darting forward with strategic precision, the company first planted the seed for a secondary US listing back in February. Flutter confidently announced its intention to foster broad US growth, sparking interest among investors and industry watchers alike. With the green light from the shareholders during the company’s Annual General Meeting in April, the wheels were in motion for this new chapter in Flutter’s story.
The coveted New York Stock Exchange (NYSE) emerged as the chosen arena for Flutter’s stateside debut, a selection made after a comprehensive tender process. Flutter has engaged in diligent preparations since the announcement, placing it on course to have its shares listed on the final Monday of January 2024, assuming the successful filing of its Form 20-F Registration Statement with the US Securities and Exchange Commission.
A significant repercussion of this move is the impending end of Flutter’s trading presence on Euronext Dublin. The company made its plans crystal clear when, during the announcement of its Q3 results last month, it confirmed a strategy to simplify operations by maintaining a mere duo of listings, thus minimizing regulatory complexities and streamlining processes. The Dublin chapter is set to close, with Flutter formally notifying Euronext Dublin of its intention to cancel its secondary listing effective 29 January.
Shareholders and market participants should take note that the curtain will fall on Flutter’s ordinary shares trading in Dublin on 23 January. A suspension of trading will follow, allowing for the orderly settlement of outstanding trades and the necessary repositioning instructions. Nevertheless, Flutter’s presence remains solid on the London Stock Exchange (LSE), where it proudly takes its place in the prestigious FTSE 100 Index.
Reassurances have been made that this new US venture will not ruffle the feathers of its FTSE 100 status on the LSE. In London, Flutter will continue to be known by its existing “FLTR” ticker symbol, while its NYSE counterpart will bear the “FLUT” moniker once the US listing becomes effective.
Prior to taking this transatlantic financial leap, Flutter will release a trading update on 18 January, revealing the intricacies of its financial journey through the 2023 fiscal year. A comprehensive report of the year’s financial results is set to follow on 26 March.
In the pursuit of growth and profitability, Flutter has witnessed a surge in US operations, spearheaded by the impressive performance of FanDuel. Originally acquired in May 2018 as a daily fantasy sports operator, FanDuel sprinted ahead in the race to become a dominant force in sports betting and online casino services across the US landscape.
Such is the success of Flutter’s US endeavors that it now stands as the company’s flagship revenue generator. In the third quarter alone, US revenues hit a towering £668 million, marking an 11.7% incline, and surpassing Flutter’s UK and Ireland business contribution by a staggering £100 million.
At the helm, CEO Peter Jackson champions the belief that the US segment of Flutter’s business not only can but must continue on this growth trajectory. He proudly pointed out that Flutter was the trailblazer in achieving structural profitability in the US online sector, an accomplishment reached in the first half of the year.
The US arm contributed 32.8% to the company’s overall Q3 revenue, which saw a 7.6% increase to £2.04 billion. While there was a slight 1.9% dip in sports betting revenue, this was more than compensated for by a sharp 22.2% uptick in gaming revenue, which reached £914 million.
US sports betting revenue itself climbed by 10.0% on a constant currency basis, reflecting a staggering increase in stakes of 40.0%. However, a marginal dip in net revenue margin did little to dampen the broader picture, with net revenue growth standing firm at 12.0%.
The igaming sector had its moment in the sun too, boasting a 52.0% revenue increase on the same constant currency measure, and a remarkable rise in market share for FanDuel’s igaming brand to 23.0% in the third quarter. This success was propelled by a 42.0% increase in average monthly players, a clear indicator of the company’s growing appeal and market penetration.
Flutter Entertainment, by bolstering its American dream with a secondary listing on the NYSE, aims to cast a wider net across the lucrative US market. With a strong financial performance beckoning, and a strategic refocusing of its listing profiles, Flutter is poising itself for an even more robust future in an industry where the stakes are as high as the potential rewards.
