Tuesday saw Flutter Entertainment – parent company of Paddy Power Betfair – release financial results for Q1 2024, demonstrating a 16% revenue increase, equivalent to $3.4 billion (€3.2 billion). Recently relocating its primary listing to the United States from Dublin, this change had a negative effect on its revenue growth by approximately five percentage points, due to less favourable sports results within the quarter ending March 31st.
The company attributes its revenue boost to impressive performances from its US and iGaming operations from within the UK and Ireland, with American revenue up 32% and the group’s total revenue across the UK and Ireland seeing a 17% rise. Additionally, the inclusion of Serbian sports betting business MaxBet added $47 million or two percentage points year-on-year to the Flutter’s overall group revenue.
However, the quarter concluded with a noteworthy net loss of $177 million, attributed to non-cash expenses. The increased losses resulted in a decrease in earnings per share (EPS), dropping from $0.59 to $0.10, while increasing loss per share to $1.10.
Flutter attributed 310 basis point expansion on its adjusted EBITDA margin to its ‘transforming’ earnings, which was 46% higher at $514 million. This was mainly due to increased operational efficiency within their US and international marketing and sales expenses.
There was a significant increase, $386 million, in the net cashflow from operating activities, totalling $337 million due to impressive operation performance and notable changes in the US player deposits year-on-year.
The previous adjusted free cash flow improved by $207 million, which was due mostly to the growth in adjusted EBITDA and working capital movements, recording at $157 million.
Expressing satisfaction with the company’s promising start to the year, Flutter’s CEO, Peter Jackson, revealed that the strong top line momentum of FanDuel within the US equates to a substantial increase in US adjusted EBITDA and market share. According to Jackson, the company is fully committed to expanding its player base and market share while securing future profitability with comprehensive investment policies.
Mr Jackson announced that our dedication to offering superior products to our customers outside the United States is yielding promising results, particularly in fundamental markets such as the UK. Notably, the release of Super Sub on Paddy Power has been our most triumphant introduction of a product yet. Additionally, the group marked a historically high market share in Italy’s online sports betting and iGaming market during April.
As for the stakeholders’ resolution to move the main company listing to the United States, he deemed it the “natural home” for the group, with the shift slated for May 31st. Anticipating that a growing percentage of the group’s future earnings will come from the United States, we have relocated our functional headquarters to New York showcasing the US’s significance in sports betting and iGaming to our business operations.
Despite adverse sporting outcomes in the US during the final fortnight of March, Flutter remains optimistic about its earlier predictions for the upcoming year, which continue to hold steady. Debt has been trimmed down to $6.8 billion from its $7.1 billion standing at the previous year’s conclusion, while net debt was roughly on par at $5.7 billion, compared to $5.8 billion previously.
Furthermore, the company successfully refinanced its existing debt by securing over $1 billion in senior notes on April 29th, which are set to mature nine years later in 2029.