Following the release of its H1 2023 interim results, Flutter held a conference call hosted by Flutter CEO, Peter Jackson and Head of Investor Relations Paul Tymms.
Jackson started off the call by saying: “The first half marks a pivotal moment for Flutter; our US business has reached a profitability inflection point, with FanDuel delivering adjusted EBITDA of $100m – a first for a US operator and six months ahead of schedule!
“This has transformed our earnings profile and significantly strengthened our financial flexibility.”
The H1 report proved to be positive, with a 42% growth in revenue totalling £4.8bn ($6.1bn) and a 76% growth in EBITDA.
Notably, Jackson affirmed in that call that “the US business is structurally profitable” now
Jackson explained: “In the US, FanDuel delivered another exceptional performance, with our continued product innovation attracting over 2m new players and driving revenue growth of 63%.
“We maintained our position as the #1 online sportsbook operator with 47% share of the market, whilst increasing our share in iGaming to 23%.
“After five years of investment, our US customer base is now of sufficient scale to more than offset the cost of future customer acquisition, which will continue to compound and drive significant profit growth.”
This is reflected in a few different statistics from FanDuel, primarily the fact that in this H1 period alone, the platform accepted over two million new players, an 18% increase year-on-year.
FanDuel launched in two more states, Ohio and Massachusetts, as well as pushing a range of National Basketball Association (NBA) betting markets.
He continued: “This further validates our decision to seek an additional US listing in late Q4, or early next year.”
We’re excited to see what we can do with our products, we’re a fast-moving target – Peter Jackson
However, despite the confidence in the call, especially surrounding the number of players FanDuel had managed to acquire this H1, Jackson still emphasised how at Flutter, “we remain paranoid to retain our posture of product leadership.”
This may be due in part to the recent closure of Fox Bet, the sports betting platform project between Flutter-owned The Stars Group and Fox Corporation.
During the call, Jackson noted that Flutter had reported $91m in losses between Fox Bet and PokerStars, but he expected further US poker legislation to balance out losses in the long term.
After all, PokerStars is a well-established brand worldwide, with plans to launch Bragg Gaming titles to US players in the next coming weeks.
Of course, the ESPN Bet launch was discussed too, its mega project alongside Penn Entertainment.
When asked for comment on the ESPN deal, Jackson replied: “We do what we want to do, and we leave the others to do what we don’t want to do”
The challenges faced in the US aren’t the only ones Flutter is having to deal with at the moment, either.
The Australian betting landscape has seen a significant impact from Covid-19 in the last few years, resulting in changes in retail and online spending trends.
Due to the “regulatory headwinds and challenging Covid comparatives in Australia”, Flutter explained in the conference call that it would be expecting a more moderate H2 from the country, due to lower spending.
Australia wasn’t the only international market that Flutter discussed.
Jackson addressed the global markets by saying: “Our International division is now at a growth inflection point, underpinned by the strong performance of our consolidate and invest markets, (including Italy, Turkey, Brazil and India) which grew revenues by 19% and now represents 77% of divisional revenue.
“With an addressable market of £227bn in 2022 – of which over £120bn is currently regulated – there is a clear pathway to meaningful further growth.”
The emerging sports betting market in India was something that was discussed in the conference call, with a lot of attention in this region in particular.
While Jackson explained that the model for operating in India was based on the US one, he did also emphasise how “you need real scale to win in the Indian market”
Of course, the attention around India wasn’t just coincidence; there are a number of proposed tax changes that have been announced in the country recently, which Flutter has admitted it is “exceptionally well positioned to navigate”.
Through its Flutter Edge project, the company reported a 54% increase in revenue alone in India.
There were also particular mentions of both Italy and Turkey in Flutter’s H1 report, which the latter was reported to hold “higher growth opportunities”.
Jackson concluded: “Looking ahead, the second half of the year has started well, with trading in line with expectations.
“Our business is in good shape, with podium positions in the world’s most-exciting betting and gaming markets, and we are well-placed to capitalise on the significant opportunity ahead, both in the second half of the year and beyond.”
