Global sports betting and gaming business Flutter entertainment has revealed a cut to its full year guidance following a string of “unfavourable” sports results, despite strong quarterly results.
The “customer-friendly” sports results over the course of the first 24 days of October, combined with the halt of its operations in the Netherlands, resulted in Flutter downgrading its EBITDA expectations for 2021 to £1.24bn – £1.28bn. Its previous forecast was between £1.27bn – £1.37bn.
Shares in the betting group fell 8.5 per cent this morning following the news.
However total revenue for the group for the third quarter, published today, stood at £1.4bn, up 9 per cent compared to the same period last year.
Flutter, which also owns Betfair and Fanduel, saw a 13 per cent boost to its group online revenue and its average monthly players also increased 13 per cent, to 7.3m.
“Flutter delivered a strong third quarter performance,” said chief executive Peter Jackson in a statement.
“While a run of customer-friendly results in October have resulted in win margins being below expected levels in the quarter to date,” he continued, “the underlying strength of our business is clear.”
The company, Jackson said, looks forward to “sustainably growing our global player base further in 2022.”
Harry Barnick, Senior Analyst at Third Bridge, said: “The US market continues to be a strategic growth area for Flutter with success in this market looking pivotal to the future of the company. As regulation opens up on a state-by-state basis, Flutter will be singularly focused on picking up licenses and growing market share in the US.”
Barnick believes that customer acquisition costs in the US may be a challenge, but said: “The land grab is in full swing as Flutter and its competitors spend big to win share in this growing market. As the market matures, demonstrating profitability to investors will become increasingly important. In Flutter’s home market, increased scrutiny into online regulation poses a threat to top-line and profitability – and Investors are anxiously waiting to hear what could be in-store for the sector. Affordability checks and bet-per-spin limits are the headline factors that could damage revenue and profit in the long-term.”