54% in y-o-y revenue highlights Flutter Q1 2023 financials. However, the company warns of huge costs to implement white paper rules! (Image by Island Works on Pixabay)
Flutter Entertainment reported its latest Q1 2023 financial report. This report is as per the rules of the London Stock Exchange and FTSE 100 on which the online casino and sports betting giant must report transparent earnings to its shareholders.
Although all is well with an impressive increase in revenue of 54% in Q1 2023 up to £2.4 billion, the company was pessimistic about future earnings. Flutter big wigs, as have I too, had time to let the new UK gambling white paper sink in. And one of the remarks made was that the current rules could cost Flutter somewhere in the region of £50 to £100 million.
Is that a number large enough to worry investors and affect the company’s share price and value? Well, I’m no expert when it comes to such matters, but when you look at the group’s revenue of £2.4 billion, you could be forgiven for seeing £50 to £100 million. However, that’s a sizeable chunk of change where percentages for large market companies are concerned.
With that being said, the company is in a great position early doors this year thanks to its huge year-on-year revenue upswing of £800 million on last year’s Q1 2022’s £1.6 billion.
Source of Revenue Increase: Flutter attributed its revenue year-on-year revenue growth as large thanks to the company increasing its US operations two-fold. On top of this, its operations in the UK and in the Republic of Ireland recovered amicably from the down-slide caused by the pandemic.
Flutter Q1 2023 Financial Report Figures Vs Q1 2022
Metric | Q1 2023 (£) | Q1 2022 (£) | % Increase |
---|---|---|---|
Group Revenues | 2.4 billion | 1.6 billion | 54% |
US Unit (FanDuel) Revenue | 2.3 billion | 1.2 billion | 92% |
UKI Division Revenue | 720 million | 615 million | 17% |
International Division | 165 million | 97 million | 69% |
Australia Revenue | 380 million | 396 million | -4% |
Positive from the Quarterly Figures
Looking deeper into where revenues and positive results come via Flutter’s many brands. Right now, the group is in charge of operating Adjarabet, Betfair, FanDuel, FOX Bet, Junglee Games, Paddy Power, PokerStars, Sky Betting & Gaming, Sisal, Sportsbet, tombola, and TVG.
- FanDeal (+92% Revenue): Continues to be the dominant player in the US sports betting market with a 50% share of the spoils. It has recorded 92% revenue boosts year-on-year as the brand grows into new markets legalising online sports betting. The company also operates sports book and online casino platforms in Ontario Canada, Michigan, West Virginia, and Pennsylvania.
- UKI Division (+17 Revenue): Reported 17% year-on-year growth and the number of players online rose 11%.
- International (+69% Revenue): Flutter’s presence across Europe is one you can’t help but notice. The FTSE 100 company recently purchased Sisal in Italy to add to its armoury.
Negatives of the Quarterly Figures
As mentioned, one of the worries for Flutter is the new rules suggested in the recently drafted UK white paper. Also, another market where restrictions on gambling entertainment are fierce is Australia where the company didn’t perform so well on a year-on-year on basis.
- New UK Gambling Act White Paper Concerns: As with all gambling companies in the UK, the white paper has some serious cost implications. The estimate is between £50 and £100 million pounds in lost revenue from 2024. However, Flutter’s report does not state specifically where these costs will come from, but I assume:
- Implementing technology for affordability check measures (an to avoid UKGC) fines
- Affordability checks pushing UK players into the black market
- Advertising and sponsorship bans
- Reduction of ‘speed’ game and the time it takes for games to deliver results
- The possibility of abolishing free bets (although this is not a focus of the white paper)
- Australian Sports Betting Market: In Australia where only online sports betting and no online casinos, Flutter’s revenue fluttered down to 4% (forgive the pun, I couldn’t help it).
Who are Flutter’s Main Competitors? In Australia, the company is up against TabCorp and 888Sports. It is also up against the 888 Holdings group, in Canada, the UK and across Europe. 888’s brands include William Hill, 888Casino, 888Poker, 888 Sports, 777 Casino, and Royal Panda Casino – these are lists on our page listing the best and safest online gambling sites under UKGC, MGA, and AGCO iGaming licensing.
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