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(Sharecast News) - Flutter Entertainment on Thursday announced an equity placing to help accelerate its US strategy, as it posted a jump in second-quarter revenue thanks to a solid performance from its online gambling segment.
The Paddy Power owner said that since the respective first-quarter trading updates from Flutter and The Stars Group last month, "combined group momentum has improved".
Pro-forma group revenue rose 10% year-on-year in the second quarter-to-date despite widespread ongoing disruption to global sports.
Flutter said its performance reflects the newly combined group's enhanced product and geographic diversification, with a good online poker and gaming performance offsetting reduced sports revenue. In addition, strong momentum in Australia and the US helped to partially mitigate the impact of national lockdowns, particularly in Europe.
Revenue in Australia increased 56%, while US revenue was 61% higher.
The company also said it was planning to raise equity via a non-preemptive placing of 8 million new shares to institutional investors, with Davy acting as joint global coordinator and joint corporate broker, along with Goldman Sachs International.
"The group believes that the current operating environment is likely to result in longer-term changes to the sector landscape which will lead to further opportunities," it said. "The placing will better position the group to move quickly to capitalise on such opportunities should they arise, accelerating its four-pillar strategy and consolidating its market leadership positions."
In particular, it pointed to its US expansion, saying that one potential consequence of the Covid-19 pandemic is that the pace of regulation in the US could accelerate as more states look for new ways to raise additional sources of tax income.
"Flutter is determined to give its US business the best possible platform for future success and to replicate the leadership position it has achieved in the states that have regulated to date" it said. "To do so, the group will look to invest to secure additional market access deals in individual US states."
7 Nov 2022 08:55
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