Flutter upgrades non-US guidance but sees bigger US loss

(Sharecast News) - Flutter upgraded its earnings forecast for business outside the US but said the loss at its American gambling operation would be bigger than expected after it spent to acquire customers.

Third-quarter revenue rose 27%, or 30% excluding currency movements, to £1.33m as the owner of Paddy Power and Betfair benefited from the return of sporting events after Covid-19 lockdowns.

Flutter forecast 2020 earnings before interest, tax, depreciation and amortisation (Ebitda) of between £1.28bn and £1.35bn - up from earlier guidance of £1.18bn-£1.33bn.

In the US, higher spending on attracting customers will lead to an Ebitda loss of £160m-£180m compared with earlier guidance of £140m-£160m. US net revenue will be more than $850m (£650m) because of better-than-expected customer volumes, Flutter said.

Sports revenue rose 33% at constant currency in the three months to the end of September to £798m and gaming revenue increased 26% to £527m.

Peter Jackson, Flutter's chief executive, said: "Flutter's performance in the third quarter exceeded our expectations in both sports and gaming. Our strong trading continued as we grew market share in key regions while retaining our commitment to safer gambling practices."