Flutter Entertainment shows hefty debt level despite revenue jump, says analyst

Revenue at sports gaming group Flutter Entertainment hit £3.1bn ($4.29bn) in the past six months, scoring double the cash it recorded in the first half of 2020.

Q2report

However, Flutter Entertainment’s debt level of £2.682bn ($3.72bn), is making it more difficult for the company to payout any dividends, according to analyst Neil Shah.

Providing the upcoming sporting calendar is “uninterrupted” and its retail estates remain open, the group has forecast earnings before interest, taxes, and amortisation (EBITA) to be between £1.27bn ($1.76bn) and £1.37bn ($1.90bn) for the second half of the year.

“The company has continued its expansion in the US at pace,” said Shah, Director of Research at Edison Group. “With its FanDuel product capturing 45% of the online sportsbook market share.

“This has led to a revenue growth in the market of 159% to £652m ($906m), with over 2.2 million customers having been acquired since sports betting launched at an average CPA of $291. As a result, Flutter US expects to generate positive EBITDA in 2023; however, this is mainly driven by anticipated future state openings, with Arizona and Connecticut next in line to open up.

"The company has already reported a solid start to the second half of the year. With further expansion across critical markets expected, the next six months look positive for the business and its stakeholders.”

Flutter's Chief Executive Peter Jackson said the financials "exceeded" expectations as its profits for H1 increased substantially.

The operator, which has a strong presence in the UK, has been expanding heavily into the US in recent years.

 

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