Flutter enjoys jump in earnings as US growth takes off

Flutter's 2023 boosted by FanDuel's first annual profitability in US market. Strong start to 2024 with revenue increase from American segment.

Flutter enjoys jump in earnings as US growth takes off
Flutter Entertainment FLTR

Flutter Entertainment (LSE: FLTR), the parent company of popular betting platforms such as Paddy Power, SkyBet, and FanDuel, showcased robust performance in its 2023 fiscal year, marking the first time its US offering, FanDuel, achieved annual profitability.

In 2023, Flutter reported a revenue surge to $11.79 billion, a 25% increase from the previous year, while its adjusted EBITDA soared by 45% to $1.87 billion. However, despite these positive indicators, Flutter's pretax loss widened to $1.09 billion, primarily attributed to increased sales and marketing expenses, which rose by a quarter to $3.78 billion.

Shares of Flutter Entertainment were up 1.5% in London in early trade Tuesday. Year to date, shares are up 27% in London and 24.5% in New York.

Transitioning to 2024, Flutter continued its momentum with a strong start, seeing a 23% revenue jump in the first 11 weeks of the year. Notably, the US segment recorded a 56% revenue increase, driven by record engagement during the Super Bowl. Flutter's CEO, Peter Jackson, underlined the company's successful integration of FanDuel into the US market, evident in its leading position with a 43% share of the online sports betting market.

Looking ahead, Flutter anticipates further growth in 2024, projecting an 18% increase in group revenue and a 30% rise in adjusted EBITDA. This growth forecast is underpinned by expectations of continued expansion in the US, where Flutter anticipates core profits to reach $635 million to $785 million, reflecting a four-fold increase compared to the previous year. Additionally, Flutter aims to strengthen its position in other markets, including the UK, Ireland, and Australia, where it expects core profits in the range of $1.63 billion to $1.83 billion.

Despite challenges such as regulatory headwinds in Australia, Flutter remains optimistic about its future prospects, buoyed by its strong performance and market leadership across key segments.

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