Flutter Entertainment, owners of Paddy Power, Betfair, and PokerStars, is the world’s largest online betting group. In 2020, they reported an increase in total group revenue of 23% to $6.27 billion. This represents an increase in earnings before interest, tax, depreciation, and amortization (EBITDA) of $1.68 billion.
This is higher than the $1.54 billion – $1.62 billion predicted in November. The figures reported do not include an EBITDA loss of $205 million in the USA. This is a growing market for sports betting expected to double its previously estimated size. In May, the company merged with The Stars Group (TSG) and increased its holding in its US FanDuel brand in November.
Gaming Market Leaders
Flutter Entertainment continued to lead the US market with 40% sports betting and 20% market shares in the 4th quarter (Q4). The US market is expected to be worth more than $17 billion by 2025, resulting from an increase in estimated sportsbook value. The number of states with legalized gambling is expected to increase too.
The company reported a 106% increase in revenue in 2020. This strong financial performance is impressive considering the problems caused by the COVID-19 pandemic. Flutter Entertainment’s revenue in Australia grew by 59% to about $1.2 billion; there was an adjusted EBITDA growth of 98%. Australia was the market least affected by the COVID-19 pandemic. In Britain, the market grew by 8%.
According to the company CEO, Peter Jackson, the US market experienced the most growth in 2020. In his words, “Nowhere has our growth been more evident than in the US, where we have consolidated our number one position in this crucial market, with customer economics that continues to exceed our expectations. “
He went on to say, that “We finished the year as the first US online operator to reach over $1.1 billion in gross gaming revenue. While the global outlook remains uncertain, our momentum remains strong, and we look forward to the future with confidence”.
That is certainly something to look forward to for their customers.
Revenue in 2020
In the United States, revenue increased by a whopping 81% to $839 million. This increase resulted from the TSG merger and the increase in the number of states where online betting is legal over the last year. In 2020, Flutter Entertainment launched the FanDual online sportsbook in an additional four (4) states.
These states are Colorado, Illinois, Iowa, and Tennessee. Online gaming was also launched in Pennsylvania. Sports revenue increased by 42%, resulting from the sportsbook growth of 101% and combined daily fantasy sports and racing growth of 15%. According to Flutter Entertainment, adjusted EBITDA in its PPB Retail division decreased to $2.4 million from $91.7 million in 2019. This decrease came after the disruptions in its retail estates as a result of COVID-19 restrictions.
It is reported that the division’s shops were closed for about 38% of 2020, leading to a 36% decline in revenue. The PPB Retail division includes Paddy Power Shops. According to the company, they kept on paying staff even when the shops were closed, and they have promised to continue that for as long as the shops remain closed.
At Flutter entertainment’s PPB online division, revenue increased by about 8% to $1.32 billion. This increase resulted from a 6% monthly growth in average monthly players to 1.4 million; this increase was more evident in the second half of the year. The increase is most likely due to the closure of PPB retail shops resulting from the COVID-19 pandemic. In the United Kingdom and Ireland, the company expects an EBITDA loss of £9 million each month that retail estates in these countries remain closed.
The year 2021 has seen Flutter entertainment experience a strong start. The company’s group revenue in the first seven (7) weeks of 2021 increased by 36% year on year, and the increase has been listed as being due to a growth in player volume in all the company’s divisions. During the recent Super Bowl, the company gained 350,000 new sportsbook and gaming customers.
Contextually, the record-breaking number is greater than the operator’s entire 2019 customer acquisition numbers. Apart from that, sports betting operations experienced a 25% year-on-year constant currency rise. There was also a gaming revenue rise of 32% year on year to $2.8 billion. All in all, it’s looking pretty rosy for Flutter Entertainment and their gaming customers.
