(Sharecast News) - Gambling conglomerate Flutter Entertainment reported a 13% increase in revenue in its third quarter on Thursday, driven by continued robust performance in the US market.
The FTSE 100 company said its average monthly number of players reached 11.14 million, marking a significant year-on-year increase of 16% from 9.6 million in the third quarter of 2022.
Regarding the revenue breakdown, sports revenue was £1.12bn, a slight decline of 2% compared to the prior year.
However, there was a 4% year-on-year increase when adjusting for constant currency.
On the other hand, gaming revenue showed substantial growth of 22% to £914m, or 26% at constant exchange rates.
Total revenue for the third quarter stood at £2.04bn, representing a 9% year-on-year rise, or 13% when considering constant currency.
Flutter put its performance to its growth strategy, including the addition of Sisal, which was reportedly driving significant player growth across all divisions.
Looking ahead, Flutter anticipated revenue and adjusted EBITDA in the US market to be approximately £3.75bn and £140m, respectively.
Despite ongoing investments in customer acquisition, the company said it expected to achieve a structural profit for the whole year.
In markets outside the US, adjusted EBITDA was expected to be around £1.44bn, with underlying strength in the UK and Ireland and international segments offsetting challenges such as customer-friendly sports results and adverse foreign exchange rate movements.
Flutter Entertainment noted that it had submitted an application to the US Securities and Exchange Commission for listing on the NYSE and expected to add a listing in the first quarter of 2024 while simultaneously delisting from Euronext Dublin.
"The group had another strong quarter, and even in this seasonally quieter period, the power of our diversified business is clear with revenue growth of 13% to over £2bn," said chief executive officer Peter Jackson.
"We remain the number one choice for sports betting and gaming customers globally, and our 16% growth in average monthly players augurs well for our continued growth and market leadership.
"We are particularly pleased by the great progress we are making in the US."
Jackson claimed Flutter was the first online operator to achieve structural profitability, adding that the strong ramp in EBITDA during 2023 would continue into 2024 and beyond as its profit margins materially expanded.
"The NFL season is off to an excellent start with our product leadership driving average monthly player growth of 38% to 2.6 million in the quarter.
"I am excited about our plans heading into the sports-rich months of November and December as we execute on our winning strategy, which, combined with the FanDuel Advantage, keep us leading the industry.
"Outside of the US, our strategy ensures we can capitalise on the many growth opportunities which exist across our global markets."
Peter Jackson said that Flutter's diversified portfolio of brands was well-positioned to adapt to challenges and opportunities in their respective markets.
"In the third quarter, our UK & Ireland brands continued to take share across online and retail channels through our winning product offering.
"In addition, our consolidate and invest markets drove strong momentum within our international business.
"We were pleased to add MaxBet to the Flutter portfolio, in line with our strategy for acquiring 'local hero' brands in attractive markets."
While market conditions in Australian racing remained challenging, Jackson said that as "the clear market leader" with a player base 1.8 times that in 2019, the firm was confident that Sportsbet was the best-positioned brand in the lucrative market.
"We are making good progress towards our US listing, which will bring the group significant benefits from accessing the world's deepest and most liquid capital markets.
"Overall, the significant potential for US growth and ability to leverage scale benefits across our diversified portfolio outside of the US, underpins our confidence in our significant and sustainable long-term earnings growth potential."
At 0815 GMT, shares in Flutter Entertainment were down 8.8% at 12,495p.
Reporting by Josh White for Sharecast.com.
Flutter Entertainment (FLTR)
