The betting operator’s revenue for the year rose 27% to £7.69 billion, with most of the growth coming in the United States.
U.S. revenue increased by 87% to £2.60 billion. Almost all of it came from the FanDuel business, which it acquired for $158 million in 2018, just before the Supreme Court’s decision to legalize sports betting in US states.
Marketing costs remain high in the country, as betting companies spend big on television ads and free bets to attract customers in states that have recently legalized sports betting. But Flutter’s £250 million US loss looks much better than its US-based rivals, with rival DraftKings losing more than £600 million.
Flutter said it still expects to be the only US betting operator to be profitable for a full year in 2023.
Last month, the betting giant announced plans to list its shares in the U.S. – initially as a secondary listing but for an eventual primary listing – citing FanDuel’s rapid growth. However, CEO Peter Jackson said wider issues regarding the London and US capital markets also played a role.
“Listing in the US has several strategic and capital market benefits,” he added. “This will raise our profile in the US,” he said. There’s a huge retail component in the US, we think it helps bring in US talent, there’s no doubt the US capital markets are deep".
“When we talked to potential US shareholders they said that our shares are not trading enough and that is not unique to us.”
The entire group made a profit of £1.05 billion, with UK and Ireland profits rising by 6% to £654 million. In the UK, the acquisition of bingo site Tombola and the end of COVID-19 restrictions helped offset the impact of affordability measures introduced in anticipation of the government’s long-delayed reform of UK gambling laws.
“I hope at some point it comes out,” Jackson said. “We have taken steps to enhance our affordability measures and we expect to see adoption by the wider industry as well.”
In Q4, Flutter said that the World Cup increased revenue, but high-scoring matches in its later stages slightly diluted the tournament’s impact as punters won more than Flutter expected. Overall, the business lost £40 million in the last three months of the year to better-friendly results.
“Outside the US we grew 8% which is impressive,” he said. “We’ve got really strong diversification. We’ve got the UK, we’ve got Australia and we’ve got some really strong growth markets. We’re focusing on the whole business rather than just the US.”
Source: Yahoo Finance
