TIDMFLTR
RNS Number : 1933K
Flutter Entertainment PLC
04 May 2022
4 May 2022
Q1 2022 Trading Update
Strong US momentum continues, ex-US performance in line with
market expectations
Flutter Entertainment plc (the "Group") announces a trading
update for three months ended 31 March 2022.
Unaudited GBPm Q1 2022 Q1 2021 YoY % YoY % CC(1)
Average monthly players(2)
('000s) 8,855 7,672 +15%
Sports revenue 930 896 +4% +5%
Gaming revenue 636 589 +8% +9%
------- ------- ----- -----------
Total revenue 1,566 1,485 +5% +6%
--------------------------- ------- ------- ----- -----------
All commentary within this trading update refers to constant
currency (1) growth rates. Any differences due to rounding.
-- Group: Revenue growth of 6% driven by continued strong
recreational player momentum with average monthly players ("AMPs")
up 15%
-- US: excellent execution delivering revenue growth of 45% to
$574m with continued strong customer economics
-- Group ex-US: 3% decline in revenue or 2% higher excluding
known safer gambling and regulatory headwinds driven by strong
performance in Australia, Canada, Brazil and India
-- Sustainability: Positive Impact Plan progress in Q1 included
roll out of mandatory deposit limits to under 25s in the UK and
Ireland, and the launch of our Play Well advertising campaign with
US ambassador Craig Carton
Peter Jackson, Chief Executive, commented:
"Flutter delivered a positive Q1 performance with revenue growth
of 6%. The quarter saw us launch our new global sustainability
strategy, the Positive Impact Plan, aligning commercial goals with
our commitment to support our customers, colleagues and the
communities in which we operate.
In the US we had another exciting quarter as FanDuel continued
to deliver unparalleled scale, with the US accounting for over half
of all stakes for the Flutter Group in Q1. We launched our FanDuel
sportsbook in New York and Louisiana in January and also expanded
into Ontario in April. We beat a number of FanDuel records in the
quarter; Super Bowl Sunday was the single biggest day ever for new
customers and we had over 1.5m active customers on the day. March
Madness this year also proved our most popular season yet
attracting 19m wagers across the tournament.
Outside of the US, our business performed well, adapting to the
evolving regulatory and trading environment and reflecting the
benefits of our global diversification. In the UK and Ireland we
launched several new products in the quarter. I look forward to the
imminent release of the UK Government's White Paper on its review
of the Gambling Act. In Australia, Sportsbet delivered good growth
from ongoing customer driven momentum, with excellent retention of
players acquired in 2021. Our International business benefitted
from strong performance in focus markets and we hope to complete
the Sisal acquisition in Q3.
With our enlarged recreational customer base, winning position
in the US and ongoing focus on sustainable growth, our business
remains well placed for the future."
Divisional analysis
Unaudited revenue Total Sports Gaming Average monthly
GBPm players(2)
Q1 2022 Q1 2021 YoY % YoY % YoY % Q1 2022 YoY%
CC CC CC (000s)
------- ------ ------ ----------
US 429 288 +45% +50% +34% 2,359 +43%
UK & Ireland 519 568 -8% -21% +15% 3,627 +15%
- UK & Ireland
Online 453 568 -20% -32% +4% 3,627 +15%
- UK & Ireland
Retail 65 - +100% +100% +100%
Australia 291 279 +8% +8% 915 +10%
International 327 351 -5% -3% -5% 1,954 -4%
------------------ ------- ------- ----- ------ ------ ----------
Group 1,566 1,485 +6% +5% +9% 8,855 +15%
------------------ ------- ------- ----- ------ ------ ----------
US
In the US, FanDuel delivered another excellent performance with
2.4m customers and revenue of GBP429m ($574m). We remained the
number 1 US sportsbook with a 37% online sports betting share. We
acquired over 1.3m new customers in the quarter and similar to the
trends seen in Q1 2021, some of our key promotional mechanics led
to reduced market share particularly around the SuperBowl. Our
iGaming share was 20% in Q1(3) .
Revenue grew by 45% driven by a 43% growth in AMPs, with a
number of factors driving performance:
-- Excellent execution delivered record customer acquisition and engagement with:
Compelling customer economics as cumulative CPAs remain at
c.$290 and average paybacks within 12-18 month range(4)
Strong SuperBowl/March Madness campaigns with FanDuel the most
downloaded sportsbook app across the events
Successful launches in New York and Louisiana, with New York
exceeding expectations representing the fastest penetration of our
daily fantasy sports player base to date
-- This strong player momentum more than doubled stakes to
GBP5.7bn ($7.7bn). Sportsbook revenue was up 89% with net revenue
margin 30 basis points lower at 4.1%. Customer friendly results
cost GBP98m ($132m)(5) or 175 basis points versus expected margin
in Q1, however, structural margin gains delivered by our leading
product proposition drove additional revenue firepower to offset
most of this year-on-year results impact
-- iGaming growth reflects the launch of Connecticut in Q4 and
good cross-sell to SuperBowl and March Madness players. We
continued to improve our customer proposition with FanDuel rated
the number 1 casino app in Q1
UK & Ireland
Online
UK&I online AMPs grew 15% while revenue declined 20% (pro
forma for Tombola AMPs +2%, revenue -26%) due to the expected
impact of:
-- Safer gambling measures introduced over the last 12 months
(incremental year-on-year impact GBP30m in Q1)
-- Favourable sports results in the comparable period with
sportsbook net revenue margin 100 basis points lower year-on-year
at 9.6%
-- Peak in player engagement during Q1 2021 from Covid-related restrictions
We continue to sharpen our sports product with the launch of
'Buildabet' and 'Acca Assist' in SkyBet. On the gaming side, Sky
Vegas launched 'The Vault' and we continue to see good recreational
player growth with gaming AMPs up 9% on a pro forma basis. We
believe that our increased focus on product and efficiency will set
the division up well for the future.
Retail
Our retail estate was fully open during the quarter compared to
completely closed during Q1 2021. Our UK estate has returned to
near pre-Covid levels with revenue just 6% lower than Q1 2019. Our
Irish estate was 24% lower than Q1 2019 reflecting the higher level
of societal caution with respect to Covid and is unlikely to return
to pre-Covid levels in the current year.
Australia
At Sportsbet, revenue grew by 8% despite a more challenging
market environment with Covid restrictions easing. Our strong
performance was driven by player volumes as AMP growth accelerated
to 10%. Structural improvements in margin driven by our in-house
pricing capabilities and product mix funded an increase in
promotional spend. This led to strong player engagement and good
retention of the 2021 Covid-enlarged customer base. Staking was 7%
higher as a result with net revenue margin broadly flat at
11.5%.
International
Revenue in our International division was 5% lower, reflecting
the impact of guided headwinds(6) in the quarter. Excluding these
headwinds revenue grew 6% with strong growth in focus markets of
Canada, Brazil, India, Georgia and Armenia.
We continue to improve the customer proposition by leveraging
expertise within the Group. The Group's global betting platform has
been deployed in Denmark. Junglee is bringing the concepts of
PokerStars 'Spin and Go' poker product to the Indian rummy
market.
(1) Constant currency ("cc") growth is calculated by
retranslating the non-sterling denominated components of Q1 2021 at
Q1 2022 exchange rates. Growth rates in the commentary are in local
or constant currency.
(2) Average Monthly Players represent the average number of
players who have placed and/or wagered a stake and/or contributed
to rake or tournament fees during the month in the reporting
period.
(3) Online sportsbook market share is the GGR market share of
FanDuel and FOX Bet for Q1 2022 in the states in which FanDuel was
live, based on published gaming regulator reports in those states.
During Q1 2022 FanDuel was live in 15 states; Arizona (AZ),
Colorado (CO), Connecticut (CT), Illinois (IL), Indiana (IN), Iowa
(IA), Louisiana (LA), Michigan (MI), New Jersey (NJ), New York
(NY), Pennsylvania (PA), Tennessee (TN), Virginia (VA), West
Virginia (WV) and Wyoming (WY). During Q1 FOX Bet was live in 4
states; CO, NJ, MI and PA. Market share does not include AZ for
February or AZ, IL, VA, WV and WY for March as the data has yet to
be released. Online gaming market share reflects the combined CT,
MI, NJ, PA and WV market share of our gaming brands.
(4) CPA is cost per acquisition and represents the total media
and digital marketing spend per acquired customer including those
cross-sold from daily fantasy sports. The payback period represents
the average number of months it takes to generate sufficient gross
profit to pay back the average CPA to acquire those customers. It
includes all quarterly cohorts of FanDuel sportsbook acquired
between Q3 2018 through Q1 2021.
(5) Represents the revenue impact of sports results in Q1 before adjusting for recycling.
(6) Guided headwinds in International reflect the impact of the
temporary market exit from the Netherlands, tax changes in Germany
and the effects of the ongoing war in Ukraine on our business in
Russia and the Ukraine.
Analyst briefing:
The Group will host a questions and answers call for institutional
investors and analysts this morning at 9:00am (BST). To dial into
the conference call, participants need to register here where they
will be provided with the dial in details to access the call.
Contacts:
Investor Relations:
Ciara O'Mullane, Investor Relations + 353 87 947 7862
Liam Kealy, Investor Relations + 353 87 665 2014
Press:
Kate Delahunty, Corporate Communications + 44 78 1077 0165
Lindsay Dunford, Corporate Communications + 44 79 3197 2959
Rob Allen, Corporate Communications + 44 75 5444 1363
Billy Murphy, Drury Communications + 353 1 260 5000
James Murgatroyd, Finsbury + 44 20 7251 3801
------------------------------------------------- -------------------
About Flutter Entertainment plc:
Flutter Entertainment plc (the "Group") is a global
sports-betting and gaming company reporting as four divisions:
-- UK & Ireland: includes Sky Betting and Gaming, Paddy
Power, Betfair and Tombola brands offering a diverse range of
sportsbook, exchange and gaming services across the UK and Ireland,
along with over 600 Paddy Power betting shops.
-- Australia: the Sportsbet brand offers online sport betting
and is the Australian market leader.
-- International: includes PokerStars, Adjarabet, Betfair and
Junglee operating in multiple jurisdictions around the world
offering a diverse range of sportsbook, exchange and gaming
services.
-- US: includes FanDuel, TVG, Stardust, FOX Bet and PokerStars
brands, offering regulated real money and free-to-play sports
betting, online gaming, daily fantasy sports and online racing
wagering products to customers across various states in the US.
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END
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May 04, 2022 02:01 ET (06:01 GMT)
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