8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): May 14, 2024

 

 

Flutter Entertainment plc

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Ireland   001-37403   98-1782229

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification Number)

290 Park Ave South, 14th Floor

New York, New York

  10010
(Address of Principal Executive Offices)   (Zip Code)

Registrant’s Telephone Number, Including Area Code: (646) 930-0950

Belfield Office Park, Beech Hill Road

Clonskeagh, Dublin 4, Ireland

D04 V972

(Former Name or Former Address, if Changed Since Last Report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Ordinary Shares, nominal value of

€0.09 per share

  FLUT   New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On May 14, 2024, Flutter Entertainment plc (the “Company”) issued a press release announcing the Company’s financial results for the quarter ended March 31, 2024, and the availability of the Company’s first quarter 2024 financial supplement on the Company’s website. The press release is furnished as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.

 

Item 9.01

Financial Statements and Exhibits.

 

(d)

Exhibits

 

Exhibit No.   

Description

99.1    Press Release dated May 14, 2024


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    Flutter Entertainment plc
    (Registrant)
Date: May 14, 2024     By:  

/s/ Edward Traynor

    Name:   Edward Traynor
    Title:   General Counsel and Company Secretary
EX-99.1

Exhibit 99.1

 

LOGO

Flutter Entertainment Releases First Quarter 2024 Financial Results

May 14, 2024: Flutter Entertainment (NYSE:FLUT; LSE:FLTR), the world’s leading online sports betting and iGaming operator, today announced results for Q1 20241.

Key financial highlights:

 

In $ millions except percentages and average monthly players    Three months ended March 31  
     2024     2023     YOY  

Average monthly players (AMPs) (‘000s)2

     13,722       12,349       +11

Revenue

     3,397       2,918       +16

Net loss

     (177     (111     (59 %) 

Adjusted EBITDA 3,4

     514       352       +46

Adjusted EBITDA Margin 3

     15.1     12.1     +310bps  

Net loss per share ($)

     (1.10     (0.58     (92 %) 

Adjusted earnings per share ($)3

     0.10       0.69       (85 %) 

Net cash provided by/(used in) operating activities

     337       (49  

Adjusted Free Cash Flow 3

     157       (50  

Leverage ratio (December 2023 3.1x)3,4

     2.8x      

 

   

Group strategy delivering continued strong growth with revenue +16%

 

   

US produced another excellent quarter; AMPs2 +15% and revenue +32%, despite unfavorable sports results in the second half of March:

 

   

FanDuel #1 brand in both sportsbook (net gaming revenue (NGR) share 52%; gross gaming revenue (GGR) share 46%) and iGaming (record GGR share of 27%) in Q1 20245

 

   

Very successful launch in North Carolina with 5.3% adult population signed up to FanDuel in first 45 days; new player acquisition in pre-2022 states +12%; projected payback in line with historic trends6

 

   

Product enhancements driving iGaming player (AMPs2 +34%) and revenue (+49%) growth

 

   

FanDuel a founding member of the Responsible Online Gaming Association (ROGA)

 

   

Group Ex-US AMPs2 +10% and revenue +8% benefitting from strong performance in iGaming (revenue +15%) and the acquisition of MaxBet in January:

 

   

Improved iGaming cross-sell rates in UKI driven by product improvements

 

   

In International, Sisal delivered market share gains in Italy, with iGaming performance mitigating the impact of unfavorable sports results

 

   

US primary listing expected to become effective on May 31, 2024

Q1 2024 financial overview

 

   

Net loss of $177m, $66m higher year on year, after non-cash charges of $356m due to (i) $172m acquired intangibles amortization; and (ii) $184m (Q1 2023 $64m) fair value change in Fox Option liability

 

   

Group Adjusted EBITDA3 of $514m, +46%:


   

US Adjusted EBITDA3 of $26m (Q1 2023 -$53m), driven by strong revenue growth and significant operating leverage; Adjusted EBITDA margin3 +680bps, despite continued disciplined US player acquisition investment

 

   

Group Ex-US Adjusted EBITDA3 of $488m +20%, reflecting increased revenue and Adjusted EBITDA margin3 expansion of 260bps, primarily driven by sales and marketing leverage and a one-off credit from the settlement of historic litigation

 

   

Group’s financial growth algorithm driving Adjusted EBITDA Margin3 accretion, +310bps to 15.1%

 

   

Net loss per share and adjusted earnings per share decreases of $0.52 and $0.59 primarily due to the Fox Option charge (-$1.04), offsetting improved financial performance

 

   

Net cash provided by operating activities increased $386m to $337m primarily driven by the strong operational performance converting into cash and year on year movement in US player deposits

 

   

Adjusted Free Cash Flow3 of $157m (Q1 2023 -$50m) and leverage ratio3,4 of 2.8x at March 31, 2024 based on last 12 months Adjusted EBITDA3 (December 31, 2023 3.1x), both benefitting from improved financial performance year on year

2024 Outlook

 

   

Remain confident in financial year 2024 guidance7 provided at financial year 2023 results announcement on March 26, 2024, despite unfavorable US sports results in the last two weeks of March

Peter Jackson, CEO, commented:

“We have had an excellent start to the year. In the US, FanDuel’s top line momentum is translating into strong growth in US Adjusted EBITDA and market share gains. We are focused on continuing to expand our player base, market share, and embedding future profits within our business through disciplined investment. Outside of the US, our focus on delivering the best products for our players is driving good momentum in key markets such as the UK where the launch of Super Sub on Paddy Power has been our most successful product launch to date, and in Italy where we have been taking online sports betting and iGaming market share during Q1 and reached an all-time record in April. We are proud to be one of the founding members of the US Responsible Online Gaming Association whose goal is to develop and advance responsible gaming practices. We are a strong advocate for building a sustainable sector in the US. We believe that our global experience positions us well to help lead the way.

On May 1, shareholders voted to move our primary listing to the US. We believe a US primary listing is the natural home for the Group and we look forward to this becoming effective on May 31. With a greater proportion of the Group’s future profits expected to be generated in the US, we have moved our operational headquarters to New York reflecting the importance of the US sports betting and iGaming market to our business.”

 

2


Q1 24 Operating Review:

US:

FanDuel has started the year strongly by consolidating its leadership position in sports with a 52% online NGR market share (GGR share 46%) for Q1 2024, while FanDuel Casino was the number one iGaming brand5. We had a record 27% iGaming GGR share in Q1, a four percentage point increase year on year. FanDuel’s total AMP growth of 15% included a record 2.6 million players for Super Bowl LVIII, the culmination of a highly successful NFL season.

We launched our sportsbook product in Vermont (January 11, 2024) and North Carolina (March 11, 2024). Consistent with our long-term strategy, we are investing behind the excellent returns being generated from our player promotions and marketing spend, with projected paybacks on customers acquired in the quarter in line with historic trends6. North Carolina has been our second most successful launch to date, with 5.3% of the adult population signed up to be a FanDuel customer in the first 45 days.

Total new sportsbook and casino player volumes were lower in the quarter, due to a full quarter of significant Ohio acquisition volumes in the comparative period. However, new players acquired in states that launched before 2022 were 12% higher than last year, demonstrating the strong demand for our products well after the initial launch period (pre-2022 states staking +19%). We believe the combination of our high structural sportsbook revenue margin and significant scale result in more efficient payback periods for FanDuel. Where payback periods indicate compelling returns on our customer acquisition spend, we will continue to make disciplined investment to drive future profitability.

FanDuel added more innovations to its market leading sportsbook product in the quarter. Ahead of the new Major League Baseball (“MLB”) season we increased the range of betting markets available to players. This helped drive a four-percentage point increase in the proportion of handle on Same Game Parlays across the first three weeks of the MLB season.

In iGaming, we continue to deliver on our strategy. Our focus on direct casino players and best-in-class customer experiences is generating results. We have gained exclusive online access to one of retail casinos’ most popular slot titles and launched the first in a series of online versions, which immediately became our most played game. We expect further slots-based innovation and exclusive content to drive our leadership in iGaming.

Group Ex-US:

Our diversified Ex-US business grew AMPs2 by 10% and added another podium position during Q1 with the acquisition of MaxBet, a leading omnichannel operator in Serbia.

We continued to deliver a very strong performance in the UKI with AMPs2 +2% despite the strong prior year quarter, which benefitted from a halo effect from the FIFA 2022 World Cup. iGaming growth was particularly strong driven by further product improvements with over 100 new games launched during Q1 and improved cross-sell rates. In sportsbook we leveraged the Flutter Edge and launched Super Sub for Paddy Power, replicating the popular Duo feature first introduced in our International division. This feature swaps a substitute player into a parlay bet and early engagement has been positive with over 80% of football customers engaging with the product in March.

We are seeing the benefit of product improvements in key International Consolidate and Invest8 markets. In Italy, Sisal delivered all-time record levels of AMPs2 in March, +22% in March compared with March 2023, together with Q1 market share gains and extending its lead as the market leading brand in the Italian market in April8. This was achieved through our new Sisal betting app, launched in Q3 2023, which continued to help drive high levels of engagement on sportsbook with online staking +24% year on year. In addition, expanded casino content, including a free-to-play “Bonus Wheel”

 

3


feature drove increased cross-sell rates to iGaming. In Georgia and Armenia, a redesigned app with more personalized content helped deliver market share gains and a clear number one position8. We saw good momentum in Spain and Brazil with continued focus on localization of our product and optimized generosity offerings. Junglee Poker was launched in India, in line with our local hero strategy, with encouraging levels of player engagement since launch.

 

4


Q1 2024 financial highlights: Group

 

     Three months ended March 31  
     Revenue     Adjusted EBITDA  
     2024      2023      YOY     YOY CC     2024     2023     YOY     YOY CC  
In $ millions                                                   

US

     1,410        1,071        32     32     26       (53    

UKI

     861        736        17     12     268       206       30     24

International

     797        760        5     6     173       149       16     20

Australia

     329        351        (6 %)      (2 %)      83       85       (2 %)      2

Unallocated corporate overhead9

               (36     (35     1     (3 %) 

Group Ex-US

     1,987        1,847        8     7     488       406       20     21

Group

     3,397        2,918        16     16     514       352       46     47

The Group delivered an excellent performance in Q1 with an 11% increase in AMPs2 delivering revenue growth of 16% to $3.4bn. The impact of sports results, calculated as the difference between our expected net revenue margin and actual net revenue margin, had an approximate five percentage point negative impact on Group revenue growth. The increase in revenue reflects the continued growth of our US business, where revenue increased 32%, and strong iGaming momentum in UKI. The addition of MaxBet in Q1 added $47m or two percentage points to Group revenue growth year on year.

The Group reported a net loss for the quarter of $177m after recording non-cash expenses including (i) a loss of $184m relating to a change in the fair value of the Fox Option liability (Q1 2023: $64m loss) due to a higher valuation of FanDuel; and (ii) amortization of acquired intangibles charge of $172m (Q1 2023: $192m). The increases in the net loss and the net loss margin during Q1 2024 compared with Q1 2023, were primarily due to the improved financial performance outlined above being more than offset by an associated tax charge and the change in the fair value of the Fox Option liability.

The strong revenue momentum, combined with a 310bps expansion on our Adjusted EBITDA margin3, is driving a transformation of Group earnings with Adjusted EBITDA3 46% higher at $514m. The margin growth was primarily driven by operating leverage in our sales and marketing expenses in the US and International segments. Unallocated corporate overhead increased 1% (-3% on a constant currency basis10) to $36m reflecting investment in Flutter Edge capabilities and new compliance requirements as a U.S. listed company9, offset by an $18m credit from the settlement of historic litigation.

The higher loss in the current period increased loss per share by $0.52 to $1.10, and decreased adjusted earnings per share3 by $0.59 to $0.10. Both metrics include the $184m loss on the fair value of the Fox Option, which equates to $1.04 per share.

The Group’s net cashflow provided by operating activities in Q1 2024 increased $386m to $337m driven by the strong operational performance and the year on year movement in US player deposits. Adjusted Free Cash Flow3 of $157m was $207m higher than the prior year due to Adjusted EBITDA growth and working capital movements.

 

5


Q1 2024 financial highlights: Segments

US revenue increased 32% in Q1 with strong growth in both sportsbook (+30%) and iGaming (+49%). This reflects total revenue growth of 56% in the period from January 1, 2024 to March 17, 2024, as reported in our 2023 full year results on March 26, 2024, and -51% in the remainder of the quarter. The performance over the last two weeks of the quarter reflects the significant swing in sports results on the March Madness college basketball tournament, from favorable in the prior year to unfavorable in the current year. Sports results for this two-week period were 320bps ($76m) unfavorable, while sportsbook stakes were 46% higher.

In sportsbook, revenue growth was driven by strong engagement with our leading product proposition with AMPs2 +19% and staking +24%. Sportsbook net revenue margin increased 40bps to 7.3%. This reflected continued expansion of our structural margin, driven by our market leading product offering, partly offset by a 150bps adverse impact from unfavorable sports results versus the comparable period (sports results: Q1 2024 130bps unfavorable, Q1 2023 20bps favorable11, twelve months to March 31, 2024 90bps unfavorable). Promotional spend levels were in-line with the comparable prior year quarter.

iGaming revenue growth reflects the improvements in our product proposition noted above and our successful player acquisition driving AMPs2 34% higher. Within iGaming, slots performed exceptionally well with new content helping drive slots revenue up 73% versus the prior year.

Adjusted EBITDA3 increased by $79m to $26m due to revenue growth combined with operating leverage across all cost categories. This drove a 680bps expansion in Adjusted EBITDA margin3 to 1.8%. Cost of sales as a percentage of revenue declined 140bps to 59.0%, higher than our guidance for full year 2024 due to new state launches in the quarter, but in line with our expectations. Sales and marketing expenses reduced by 410bps as a percentage of revenue, despite continued disciplined player acquisition investment, with significant operating leverage in existing states being partly offset by new state launches.

UKI revenue increased by 17% (12% on a constant currency basis10) with AMP2 growth of 2% despite lapping an enlarged post World Cup recreational customer base and more congested sporting calendar in the prior year period. The strong revenue performance was primarily driven by iGaming +27% with sportsbook +9%. Sportsbook revenue growth reflected an increase in net revenue margin of 100bps year on year to 12.6%. This was driven by continued expansion of our structural margin as penetration of higher margin bet types such as Build A Bet increase. We also benefited from 40bps of favorable sports results year on year (Q1 2024: 40bps favorable, Q1 2023: in line with expected margin). Adjusted EBITDA3 grew 30% with Adjusted EBITDA margin3 310bps higher reflecting the strong revenue performance and operating leverage, particularly in sales and marketing.

International delivered AMP2 growth of 20% including a step up in recreational customer growth in Junglee Daily Fantasy Sports due to the earlier start to the Indian Premier League in Q1 2024. Revenue grew by 5% (6% on a constant currency basis10) driven by iGaming +8%. Sportsbook revenue declined 12% despite strong staking growth of 21%, due to an adverse year on year swing in sports results of 280bps (Q1 2024: 150bps unfavorable, Q1 2023: 130bps favorable), primarily in Sisal Italy.

Consolidate and Invest8 markets grew 8% reflecting the acquisition of MaxBet in January which contributed $47m in revenue during the quarter, as well as the benefit of our diversified geographic and product portfolio. Excluding MaxBet, growth in Consolidate and Invest8 markets was flat driven by:

 

   

Strong revenue growth in Georgia and Armenia (+20%), Spain (+13%) and Brazil (+8%), as well as good momentum in Turkey (+1%, +66% on a constant currency basis10)

 

6


   

Revenue declines in (i) India (-25%) due to tax changes introduced in Q4 2023 where product innovation to mitigate the impact has helped to sequentially improve performance, and (ii) Sisal Italy (-1%) driven by the impact of unfavorable sports results year on year which had an approximate 12 percentage point impact on total Sisal Italy revenue growth. This offset Sisal Italy iGaming revenue growth of 24% despite challenging prior year comparatives which included engagement driven by the record SuperEnalotto jackpot.

Sales and marketing expenses reduced as a percentage of revenue by 420bps to 13.0%. This was driven by increasingly targeted investment to support the key market growth described above, as well as the reduction in marketing resulting from the closure of FOX Bet in August 2023. This was partly offset by investment to support our expanding International portfolio resulting in an increase in Adjusted EBITDA3 of 16% and Adjusted EBITDA margin3 of 210bps year on year.

Australia revenue declined 6% (-2% on a constant currency basis10) with AMPs2 in line year on year. Sportsbook net revenue margin increased 180bps to 12.9% primarily due to 140bps of more favorable sports results in the quarter (Q1 2024 170bps favorable; Q1 2023 30bps favorable). This mostly offset the impact of the softer racing market environment noted at our FY23 earnings announcement, which remains in line with our expectations, and drove total staking 19% lower (-16% on a constant currency basis10). Lower racing streaming costs partly offset the revenue decline to result in Adjusted EBITDA3 3% lower (2% higher on a constant currency basis10) at $83m.

 

7


FY 2024 outlook

We remain confident in our financial year 2024 guidance7 provided at the financial year 2023 results announcement on March 26, 2024, despite unfavorable US sports results in last two weeks of March and there is therefore no change to previously communicated ranges:

 

   

US: Revenue and Adjusted EBITDA3 mid-points of $6.0bn and $710m, representing year on year growth of 36.3% and 206.1% respectively.

 

   

Group Ex-US: Revenue and Adjusted EBITDA mid-points of $7.85bn and $1.73bn, representing year on year growth of 6.3% and 5.4% respectively.

Guidance7 is provided (i) on the basis that sports results are in line with our expected margin for the remainder of the year, (ii) at current foreign exchange rates, and (iii) on the basis of a consistent regulatory and tax framework.

A reconciliation of our forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measure cannot be provided without unreasonable effort. This is due to the inherent difficulty of accurately forecasting the occurrence and financial impact of the adjusting items necessary for such a reconciliation to be prepared of items that have not yet occurred, are out of our control, or cannot be reasonably predicted.

Capital structure

Total debt decreased to $6,836m from $7,056m at December 31, 2023 while net debt3 was broadly in line at $5,684m from $5,795m. On April, 29 2024, we refinanced existing debt with the successful placement of over $1bn in secured senior notes, which mature in 2029. The Group’s leverage ratio3 reduced to 2.8x at March, 31 2024, based on last 12 months EBITDA from 3.1x at the end of December, 31 2023 due to growth in Adjusted EBITDA. The Group’s medium term leverage target is 2.0-2.5x.

Listing update

On May 1, shareholders voted to move our primary listing to the US. With a greater proportion of the Group’s future profits expected to be generated in the US, we believe a US primary listing is the natural home for the Group. The transition is expected to become effective on May 31, 2024. We have also moved the Group’s operational headquarters to New York reflecting the importance of the US sports betting and iGaming market to our business.

Conference call:

Flutter management will host a conference call today at 6:30 a.m. ET (11:30 a.m. BST) to review the results and be available for questions, with access via webcast and telephone.

A public audio webcast of management’s call and the related Q&A can be accessed by registering here or via www.flutter.com/investors. For those unable to listen to the live broadcast, a replay will be available approximately one hour after conclusion of the call. This earnings release and supplementary materials will also be made available via www.flutter.com/investors.

Analysts and investors who wish to participate in the live conference call must do so by dialing any of the numbers below and using conference ID 48775. Please dial in 10 minutes before the conference call begins.

+1 646 307 1963 (United States)

+44 20 3481 4247 (United Kingdom)

+353 1 582 2023 (Ireland)

+61 2 8088 0946 (Australia)

 

8


Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements reflect our current expectations as to future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. In some cases, you can identify these forward-looking statements by the use of words such as “outlook”, “believe(s)”, ”expect(s)”, “potential”, “continue(s)”, “may”, “will”, “should”, “could”, “would”, “seek(s)”, “predict(s)”, “intend(s)”, “trends”, “plan(s)”, “estimate(s)”, “anticipates”, “projection”, “goal”, “target”, “aspire”, “will likely result”, and or the negative version of these words or other comparable words of a future or forward-looking nature. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Such factors include, among others: Flutter’s ability to effectively compete in the global entertainment and gaming industries; Flutter’s ability to retain existing customers and to successfully acquire new customers; Flutter’s ability to develop new product offerings; Flutter’s ability to successfully acquire and integrate new businesses; Flutter’s ability to maintain relationships with third-parties; Flutter’s ability to maintain its reputation; public sentiment towards online betting and iGaming generally; the potential impact of general economic conditions, including inflation, rising interest rates and instability in the banking system, on Flutter’s liquidity, operations and personnel; Flutter’s ability to obtain and maintain licenses with gaming authorities, adverse changes to the regulation of online betting and iGaming; the failure of additional jurisdictions to legalize and regulate online betting and iGaming; Flutter’s ability to comply with complex, varied and evolving U.S. and international laws and regulations relating to its business; Flutter’s ability to raise financing in the future; Flutter’s success in retaining or recruiting officers, key employees or directors; litigation and the ability to adequately protect Flutter’s intellectual property rights; the impact of data security breaches or cyber-attacks on Flutter’s systems; and Flutter’s ability to remediate material weaknesses in its internal control over financial reporting.

Additional factors that could cause the Company’s results to differ materially from those described in the forward-looking statements can be found in Part I, “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 as filed with the Securities and Exchange Commission (SEC) and other periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company’s filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

About Flutter Entertainment plc

Flutter is the world’s leading online sports betting and iGaming operator, with a market leading position in the US and across the world. Our ambition is to leverage our significant scale and our challenger mindset to change our industry for the better. By Changing the Game, we believe we can deliver long-term growth while promoting a positive, sustainable future for all our stakeholders. We are well-placed to do so through the distinctive, global competitive advantages of the Flutter Edge, which gives our brands access to group-wide benefits to stay ahead of the competition, as well as our clear vision for sustainability through our Positive Impact Plan.

 

9


Flutter operates a diverse portfolio of leading online sports betting and iGaming brands including FanDuel, Sky Betting & Gaming, Sportsbet, PokerStars, Paddy Power, Sisal, tombola, Betfair, MaxBet, Junglee Games and Adjarabet. We are the industry leader with $11,790m of revenue globally for fiscal 2023, up 25% YoY, and $3,397m of revenue globally for the quarter ended March 31, 2024.

Contacts:

 

Investor Relations:    Media Relations:
Paul Tymms, Investor Relations    Kate Delahunty, Corporate Communications
Ciara O’Mullane, Investor Relations    Rob Allen, Corporate Communications
Liam Kealy, Investor Relations    Rupert Gowrley, Corporate Communications
Email: investorrelations@flutter.com    Email: corporatecomms@flutter.com

 

LOGO

 

10


Notes

 

1.

Growth rates throughout this release are Q1 2024 versus Q1 2023, unless otherwise stated.

 

2.

Average Monthly Players (“AMPs”) is defined as the average over the applicable reporting period of the total number of players who have placed and/or wagered a stake and/or contributed to rake or tournament fees during the month. This measure does not include individuals who have only used new player or player retention incentives, and this measure is for online players only and excludes retail player activity. In circumstances where a player uses multiple product categories within one brand, we are generally able to identify that it is the same player who is using multiple product categories and therefore count this player as only one AMP at the Group level while also counting this player as one AMP for each separate product category that the player is using. As a result, the sum of the AMPs presented at the product category level is greater than the total AMPs presented at the Group level. See “—“Item 5. Operating and Financial Review and Prospects—Key Operational Metrics” of the Company’s Amendment No. 1 to the Registration Statement on Form 20-F as filed with the Securities and Exchange Commission (“SEC”), on January 18, 2024 for additional information regarding how we calculate AMPs data, including a discussion regarding duplication of players that exists in such data.

 

3.

Adjusted EBITDA, Adjusted EBITDA Margin, Group Ex-US Adjusted EBITDA, Adjusted Free Cash Flows, Net Debt, Leverage Ratio, Constant Currency, Adjusted Net Profit Attributable to Flutter Shareholders and Adjusted Earnings Per Share are non-GAAP financial measures. See “Definitions of non-GAAP financial measures” and “Reconciliations of Non-GAAP Financial Measures” sections of this document for definitions of these measures and reconciliations to the most directly comparable financial measures calculated in accordance with GAAP. Due to rounding, these numbers may not add up precisely to the totals provided.

 

4.

Beginning January 1, 2024, the Group revised its definition of Adjusted EBITDA, which is the segment measure used to evaluate performance and allocate resources. The definition of Adjusted EBITDA now excludes share-based compensation as management believes inclusion of share-based compensation can obscure underlying business trends as share-based compensation could vary widely among companies due to different plans in place resulting in companies using share-based compensation awards differently, both in type and quantity of awards granted.

 

5.

US market position based on available market share data for states in which FanDuel is active. Online sportsbook market share is the gross gaming revenue (GGR) and net gaming revenue (NGR) market share of our FanDuel brand for the three months to March 31, 2024 in the states in which FanDuel was live (excluding Tennessee as they no longer report this data), based on published gaming regulator reports in those states. iGaming market share is the GGR, market share of FanDuel and PokerStars US (which is reported in the International segment) for the three months to March 31, 2024 in the states in which those brands were live, based on published gaming regulator reports in those states. Number one iGaming brand based on FanDuel and peer GGR for the three months to March 2024 based on published gaming regulator reports and external estimates by Eilers and Krejcik for competitor market share.

 

6.

Payback is calculated as the projected average length of time it takes players to generate sufficient Adjusted gross profit to repay the original average cost of acquiring those players. Customer acquisition costs include the marketing and associated promotional spend incurred to acquire a customer. The projected Adjusted gross profit is based on predictive models considering inputs such as staking behavior, interaction with promotional offers and gross revenue margin. Projected Adjusted gross profit includes associated variable costs of revenue as well as retention generosity costs.

 

7.

Foreign exchange rates assumed in our 2024 guidance were USD:GBP of 0.790, USD:EUR of 0.930 and USD:AUD of 1.540.

 

8.

Consolidate and Invest markets within our International segment are Italy, Spain, Georgia, Armenia, Serbia, Brazil, India, Turkey, Morrocco, Bosnia & Herzegovina and the US. International market positions reflect company estimates using a variety of methods depending on the data sources available for the relevant market, and include data releases by the relevant regulatory body, market research and aggregated banking deposit information. Italian market position and share based on regulator GGR data from Agenzia delle dogane e dei Monopoli.

 

9.

Unallocated corporate overhead includes shared technology, research and development, sales and marketing, and general and administrative expenses that are not allocated to specific segments.

 

10.

Constant currency growth rates are calculated by retranslating the non-US dollar denominated component of Q1 2023 at Q1 2024 exchange rates. See reconciliation on page 19.

 

11.

The Q1 2023 impact of sports results has been updated from the 80bps of favorable sports results per our Q1 2023 trading update published on May, 3 2023, following a reassessment of the expected revenue margin being generated from parlay bets.

 

11


Definitions of non-GAAP financial measures

This press release includes Adjusted EBITDA, Adjusted EBITDA Margin, Group Ex-US Adjusted EBITDA, Adjusted Net Profit Attributable to Flutter Shareholders, Adjusted Earnings Per Share (“Adjusted EPS”), leverage ratio, Net Debt, Adjusted Free Cash Flow, and constant currency which are non-GAAP financial measures that we use to supplement our results presented in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP measures are presented solely as supplemental disclosures to reported GAAP measures because we believe that these non-GAAP measures are useful in evaluating our operating performance, similar to measures reported by its publicly-listed U.S. competitors, and regularly used by analysts, lenders, financial institutional and investors as measures of performance. Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Profit Attributable to Flutter Shareholders, Adjusted EPS, leverage ratio, Net Debt, Adjusted Free Cash Flow, and Adjusted Depreciation are not intended to be substitutes for any GAAP financial measures, and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.

Constant currency reflects certain operating results on a constant-currency basis in order to facilitate period-to-period comparisons of our results without regard to the impact of fluctuating foreign currency exchange rates. The term foreign currency exchange rates refer to the exchange rates used to translate our operating results for all countries where the functional currency is not the U.S. Dollar, into U.S. Dollars. Because we are a global company, foreign currency exchange rates used for translation may have a significant effect on our reported results. In general, our financial results are affected positively by a weaker U.S. Dollar and are affected negatively by a stronger U.S. Dollar. References to operating results on a constant-currency basis mean operating results without the impact of foreign currency exchange rate fluctuations. We believe the disclosure of constant-currency results is helpful to investors because it facilitates period-to-period comparisons of our results by increasing the transparency of our underlying performance by excluding the impact of fluctuating foreign currency exchange rates. We calculate constant currency revenue, Adjusted EBITDA and Segment Adjusted EBITDA by translating prior-period revenue, Adjusted EBITDA and Segment Adjusted EBITDA, as applicable, using the average exchange rates from the current period rather than the actual average exchange rates in effect in the prior period.

Adjusted EBITDA is defined on a Group basis as net profit/(loss) before income taxes; other (expense)/income, net; interest expense, net; depreciation and amortization; transaction fees and associated costs; restructuring and integration costs; impairment of PPE and intangible assets and share based compensation expense.

Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of revenue, respectively.

Group Ex-US Adjusted EBITDA is defined as Group Adjusted EBITDA excluding our US Segment Adjusted EBITDA.

Adjusted Net Profit Attributable to Flutter Shareholders is defined as net profit/(loss) as adjusted for after-tax effects of transaction fees and associated costs; restructuring and integration costs; gaming taxes dispute, amortization of acquired intangibles, accelerated amortization, loss/(gain) on settlement of long-term debt; impairment of PPE and intangible assets; financing related fees not eligible for capitalization; gain from disposal of businesses and share-based compensation.

Adjusted EPS is calculated by dividing adjusted net profit attributable to Flutter shareholders by the number of diluted weighted-average ordinary shares outstanding in the period.

Adjusted EBITDA, Adjusted EBITDA Margin, Group Ex-US Adjusted EBITDA, Adjusted net profit attributable to Flutter shareholders and Adjusted EPS are non-GAAP measures and should not be viewed as measures of overall operating performance, indicators of our performance, considered in isolation, or construed as alternatives to operating profit/(loss), net profit/(loss) measures or earnings per share, or as alternatives to cash flows from operating activities, as measures of liquidity, or as alternatives to any other measure determined in accordance with GAAP.

Management has historically used these measures when evaluating operating performance because we believe that they provide additional perspective on the financial performance of our core business.

 

12


Adjusted EBITDA has further limitations as an analytical tool. Some of these limitations are:

 

   

it does not reflect the Group’s cash expenditures or future requirements for capital expenditure or contractual commitments;

 

   

it does not reflect changes in, or cash requirements for, the Group’s working capital needs;

 

   

it does not reflect interest expense, or the cash requirements necessary to service interest or principal payments, on the Group’s debt;

 

   

it does not reflect shared-based compensation expense which is primarily a non-cash charge that is part of our employee compensation;

 

   

although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements;

 

   

it is not adjusted for all non-cash income or expense items that are reflected in the Group’s statements of cash flows; and

 

   

the further adjustments made in calculating Adjusted EBITDA are those that management consider not to be representative of the underlying operations of the Group and therefore are subjective in nature.

Net debt is defined as total debt, excluding premiums, discounts, and deferred financing expense, and the effect of foreign exchange that is economically hedged as a result of our cross-currency interest rate swaps reflecting the net cash outflow on maturity less cash and cash equivalents.

Leverage ratio is defined as net debt divided by Adjusted EBITDA. We use this non-GAAP financial measure to evaluate our financial leverage. We present net debt to Adjusted EBITDA because we believe it is more representative of our financial position as it is reflective of our ability to cover our net debt obligations with results from our core operations, and is an indicator of our ability to obtain additional capital resources for our future cash needs. We believe net debt is a meaningful financial measure that may assist investors in understanding our financial condition and recognizing underlying trends in our capital structure. The Leverage Ratio is not a substitute for, and should be used in conjunction with, GAAP financial ratios. Other companies may calculate leverage ratios differently.

Adjusted Free Cash Flow is defined as net cash provided by operating activities excluding changes in operating assets and liabilities related to player deposits, investment and player deposit liabilities, cash paid for transaction fees and associated cost, restructuring fees and integration cost less payments for property and equipment, intangible assets and capitalized software. We believe that excluding these items from adjusted free cash flow better portrays our ability to generate cash, as such items are not indicative of our operating performance for the period. This non-GAAP measure may be useful to investors and other users of our financial statements as a supplemental measure of our cash performance, but should not be considered in isolation, as a measure of residual cash flow available for discretionary purposes, or as an alternative to operating cash flows presented in accordance with GAAP. Adjusted Free Cash Flow does not necessarily represent funds available for discretionary use and is not necessarily a measure of our ability to fund our cash needs. Our calculation of Adjusted Free Cash Flow may differ from similarly titled measures used by other companies, limiting their usefulness as a comparative measure.

Adjusted depreciation is defined as depreciation and amortization excluding amortization of acquired intangibles.

 

13


Consolidated Balance Sheets:

($ in millions except share and per share amounts)

 

     Three
months
ended
March 31,
    Year
ended

December
31,
 
     2024     2023  

Assets

    

Current assets:

    

Cash and cash equivalents

     1,353       1,497  

Cash and cash equivalents – restricted

     22       22  

Player deposits – cash and cash equivalents

     1,782       1,752  

Player deposits – investments

     173       172  

Accounts receivable, net

     82       90  

Prepaid expenses and other current assets

     448       443  
  

 

 

   

 

 

 

Total current assets

     3,860       3,976  

Investments

     7       9  

Property and equipment, net

     478       471  

Operating lease right-of-use assets

     449       429  

Intangible assets, net

     5,787       5,881  

Goodwill

     13,678       13,745  

Deferred tax assets

     27       24  

Other non-current assets

     104       100  
  

 

 

   

 

 

 

Total assets

     24,390       24,635  
  

 

 

   

 

 

 

Liabilities, redeemable non-controlling interests and shareholders’ equity

    

Current liabilities:

    

Accounts payable

     265       240  

Player deposit liability

     1,842       1,786  

Operating lease liabilities

     128       123  

Long-term debt due within one year

     46       51  

Other current liabilities

     2,305       2,326  
  

 

 

   

 

 

 

Total current liabilities:

     4,586       4,526  

Operating lease liabilities – non-current

     362       354  

Long-term debt

     6,790       7,005  

Deferred tax liabilities

     783       802  

Other non-current liabilities

     733       580  
  

 

 

   

 

 

 

Total liabilities

     13,254       13,267  

Redeemable non-controlling interests

     1,462       1,152  

Shareholders’ equity

    

Common share (Authorized 300,000,000 shares of €0.09 ($0.09) par value each; issued March 31, 2024: 177,445,195 shares; December 31, 2023: 177,008,649 shares)

     36       36  

Shares held by employee benefit trust, at cost March 31, 2024: nil shares, December 31, 2023: nil

     —        —   

Additional paid-in capital

     1,439       1,385  

Accumulated other comprehensive loss

     (1,669     (1,483

Retained earnings

     9,694       10,106  
  

 

 

   

 

 

 

Total Flutter shareholders’ equity

     9,500       10,044  

Non-controlling interests

     174       172  
  

 

 

   

 

 

 

Total shareholders’ equity

     9,674       10,216  
  

 

 

   

 

 

 

Total liabilities, redeemable non-controlling interests and shareholders’ equity

     24,390       24,635  
  

 

 

   

 

 

 

 

14


Consolidated Statement of Comprehensive Income/(Loss):

($ in millions except per share and per share amounts)

 

     Three months ended March 31,  
     2024     2023  

Revenue

     3,397       2,918  

Cost of Sales

     (1,793     (1,541
  

 

 

   

 

 

 

Gross profit

     1,604       1,377  

Technology, research and development expenses

     (190     (168

Sales and marketing expenses

     (881     (882

General and administrative expenses

     (409     (342
  

 

 

   

 

 

 

Operating profit / (loss)

     124       (15

Other expense, net

     (174     (45

Interest expense, net

     (112     (92
  

 

 

   

 

 

 

Loss before income taxes

     (162     (152

Income tax (expense) / income

     (15     41  
  

 

 

   

 

 

 

Net loss

     (177     (111
  

 

 

   

 

 

 

Net gain/(loss) attributable to non-controlling interests and redeemable non-controlling interests

     4       (9

Adjustment of redeemable non-controlling interest to redemption value

     15       —   

Net loss attributable to Flutter shareholders

     (196     (102

Net loss per share

    

Basic

     (1.10     (0.58

Diluted

     (1.10     (0.58

Other comprehensive (loss) / income, before tax:

    

Effective portion of changes in fair value of cash flow hedges

     23       (60

Fair value of cash flow hedges transferred to the income statement

     (14     43  

Foreign exchange (loss) / gain on net investment hedges

     (21     4  

Foreign exchange (loss) / gain on translation of the net assets of foreign currency denominated entities

     (185     177  

Fair value movements on available for sale debt instruments

     (1     1  
  

 

 

   

 

 

 

Other comprehensive (loss) / income

     (198     165  
  

 

 

   

 

 

 

Other comprehensive (loss) / income attributable to Flutter shareholders

     (188     139  

Other comprehensive (loss) / income attributable to non-controlling interest and redeemable non-controlling interest

     (10     26  
  

 

 

   

 

 

 

Total comprehensive (loss) / income

     (375     54  
  

 

 

   

 

 

 

 

15


Consolidated Statement of Cash Flows

($ in millions)

 

     Three months ended March 31,  
     2024     2023  

Cash flows from operating activities

    

Net loss

     (177     (111

Adjustments to reconcile net loss to net cash from operating activities:

    

Depreciation and amortization

     297       297  

Change in fair value of derivatives

     (15     17  

Non-cash interest income, net

     (1     (8

Non-cash operating lease expense

     32       31  

Unrealized foreign currency exchange (gain) / loss, net

     8       (36

Share-based compensation – equity classified

     40       32  

Share-based compensation – liability classified

     1       14  

Other expense, net

     186       64  

Deferred taxes

     (48     (113

Change in contingent consideration

     —        (2

Change in operating assets and liabilities:

    

Player deposits – investments

     —        (7

Accounts receivable, net

     19       45  

Prepaid expenses and other current assets

     13       (73

Accounts payable

     (18     25  

Other current liabilities

     (40     (119

Player deposit liability

     73       (77

Operating leases liabilities

     (33     (28
  

 

 

   

 

 

 

Net cash generated by/(used in) operating activities

     337       (49
  

 

 

   

 

 

 

Cash flows from investing activities

    

Purchases of property and equipment

     (22     (18

Purchases of intangible assets.

     (57     (43

Capitalized software

     (73     (66

Acquisitions, net of cash acquired

     (107     —   
  

 

 

   

 

 

 

Net cash used in investing activities

     (259     (127
  

 

 

   

 

 

 

Cash flows from financing activities

    

Proceeds from issue of common share upon exercise of options

     14       1  

Proceeds from issuance of long-term debt (net of transaction costs)

     639       609  

Repayment of long-term debt

     (834     (608
  

 

 

   

 

 

 

Net cash (used in)/provided by financing activities

     (181     2  
  

 

 

   

 

 

 

Net decrease in cash, cash equivalents and restricted cash

     (103     (174

Cash, cash equivalents and restricted cash – beginning of the period

     3,271       2,990  

Foreign currency exchange on cash and cash equivalents

     (11     25  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash – end of the period

     3,157       2,841  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash comprise of:

    

Cash and cash equivalents

     1,353       821  

Cash and cash equivalents – restricted

     22       28  

Player deposits – cash and cash equivalents

     1,782       1,992  
  

 

 

   

 

 

 

Cash, cash equivalents and restricted cash – end of the period

     3,157       2,841  
  

 

 

   

 

 

 

Supplemental disclosures of cash flow information:

    

Interest paid

     123       97  

Income taxes paid

     29       52  

Non-cash investing and financing activities:

    

Operating cash flows from operating leases

     38       32  

Right-of-use assets obtained in exchange of operating lease liabilities

     20       20  

Adjustments to lease balances as a result of remeasurement

     (2     6  

Business acquisitions (including contingent consideration)

     26       —   

 

16


Reconciliations of non-GAAP financial measures

Adjusted EBITDA reconciliation:

See below a reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin to net loss, the most comparable GAAP measure.

 

($ in millions)    Three months ended March 31,  
     2024     2023  

Net loss

     (177     (111

Add back:

    

Income taxes

     15       (41

Other expense, net

     174       45  

Interest expense, net

     112       92  

Depreciation and amortization

     297       297  

Share-based compensation expense

     41       46  

Transaction fees and associated costs1

     29       3  

Restructuring and integration costs2

     23       21  
  

 

 

   

 

 

 

Group Adjusted EBITDA

     514       352  
  

 

 

   

 

 

 

Less: US Adjusted EBITDA

     26       (53
  

 

 

   

 

 

 

Group Ex-US Adjusted EBITDA

     488       406  
  

 

 

   

 

 

 

Group Revenue

     3,397       2,918  

Group Adjusted EBITDA Margin

     15.1     12.1

 

1.

Comprises advisory fees of $25 million related to implementation of internal controls, information system changes and other activities related to the anticipated change in the primary listing of the Group for the three months ended March 31, 2024

2.

During the three months ended March 31, 2024, costs of $23 million (three months ended March 31, 2023: $21 million) primarily relate to various restructuring and other strategic initiatives to drive synergies. These actions include efforts to consolidate and integrate our technology infrastructure, back-office functions and relocate certain operations to lower cost locations. The costs primarily include severance expenses, advisory fees and temporary staffing cost.

Adjusted Free Cash Flow reconciliation:

See below a reconciliation of Adjusted Free Cash Flow to net cash generated/ (used) in operating activities, the most comparable GAAP measure.

 

($ in millions)    Three months ended March 31,  
     2024     2023  

Net cash provided by/(used in) operating activities

     337       (49

Less:

    

Change in player deposits

     —        7  

Change in player deposit liability

     (73     77  

Add cash impact of:

    

Transaction fees and associated costs

     25       18  

Restructuring and integration costs

     20       24  

Less cash impact of:

    

Purchase of property and equipment

     (22     (18

Purchases of intangible assets

     (57     (43

Capitalized software

     (73     (66
  

 

 

   

 

 

 

Adjusted Free Cash Flow

     157       (50
  

 

 

   

 

 

 

 

17


Net debt reconciliation:

See below a reconciliation of net debt to long-term debt, the most comparable GAAP measure.

 

($ in millions)    As at
March 31,
2024
    As at
December 31,
2023
 

Long-term debt

     6,790       7,005  

Long-term debt due within one year

     46       51  
  

 

 

   

 

 

 

Total Debt

     6,836       7,056  

Add:

    

Transactions costs, premiums or discount included in the carrying value of debt

     52       54  

Less:

    

Unrealized foreign exchange on translation of foreign currency debt1

     149       182  

Cash and cash equivalents

     (1,353     (1,497
  

 

 

   

 

 

 

Net debt

     5,684       5,795  
  

 

 

   

 

 

 

 

1.

Representing the adjustment for foreign exchange that is economically hedged as a result of our cross-currency interest rate swaps to reflect the net cash outflow on maturity.

Adjusted net profit attributable to Flutter shareholders:

See below a reconciliation of Adjusted net profit attributable to Flutter shareholders to net loss, the most comparable GAAP measure.

 

($ in millions)    Three months ended March 31,  
     2024     2023  

Net loss

     (177     (111

Add (Less):

    

Transaction fees and associated costs

     29       3  

Restructuring and integration costs

     23       21  

Amortization of acquired intangibles

     172       192  

Share-based compensation

     41       46  

Tax impact of above adjustments1

     (51     (37
  

 

 

   

 

 

 

Adjusted net profit

     37       114  

Less:

    

Net loss attributable to non-controlling interests and redeemable non-controlling interests2

     4       (9

Adjustment of redeemable non-controlling interest3

     15       —   
  

 

 

   

 

 

 

Adjusted net profit attributable to Flutter shareholders

     18       123  
  

 

 

   

 

 

 

Weighted average number of shares

     177,757,967       177,325,483  
  

 

 

   

 

 

 

 

1.

Tax rates used in calculated adjusted net profit attributable to Flutter shareholders is the statutory tax rate applicable to the geographies in which the adjustments were incurred.

2.

Represents net loss attributed to the non-controlling interest in Sisal and the redeemable non-controlling interest in FanDuel and Junglee.

3.

Represents the adjustment made to the carrying value of the redeemable non-controlling interests in Junglee to account for the higher of (i) the initial carrying amount adjusted for cumulative earnings allocations, or (ii) redemption value at each reporting date through retained earnings.

 

18


Adjusted Earnings Per Share reconciliation:

See below a reconciliation of Adjusted Earnings Per Share to net loss per share, the most comparable GAAP measure.

 

($ in millions)    Three months ended March 31,  
     2024     2023  

Net loss per Flutter shareholders

     (1.10     (0.58

Add (Less):

    

Transaction fees and associated costs

     0.16       0.02  

Restructuring and integration costs

     0.13       0.12  

Amortization of acquired intangibles

     0.97       1.08  

Share-based compensation

     0.23       0.26  

Tax impact of above adjustments

     (0.28     (0.21
  

 

 

   

 

 

 

Adjusted earnings per share

     0.10       0.69  
  

 

 

   

 

 

 
  

 

 

   

 

 

 

Constant currency (‘CC’) growth rate reconciliation:

See below a reconciliation of constant currency growth rates to nominal currency growth rates, the most comparable GAAP measure.

 

($ in millions)    Three months ended March 31,  
unaudited    2024     2023     YOY     2023     2023     YOY  

Revenue

           FX impact       CC       CC  

US

     1,410       1,071       32     —        1,071       32

UKI

     861       736       17     30       766       12

International

     797       760       5     (11     749       6

Australia

     329       351       (6 %)      (13     337       (2 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Group

     3,397       2,918       16     5       2,923       16
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Group Ex-US

     1,987       1,847       8     5       1,853       7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

            

US

     26       (53       (2     (55  

UKI

     268       206       30     10       216       24

International

     173       149       16     (5     144       20

Australia

     83       85       (2 %)      (4     81       2

Unallocated corporate overhead

     (36     (35     1     (1     (36     (3 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Group

     514       352       46     (3     350       47
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Group Ex-US

     488       406       20     (1     404       21
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

19


Segment KPIs:

 

($ in millions)    Three months ended March 31,     YoY  
Unaudited    US     UKI     Intl     Aus     US     UKI     Intl     Aus  

Average monthly players (‘000s)

     3,898       4,096       4,738       991       +15     +2     +20     —   

Sportsbook stakes

     13,484       3,263       1,567       2,546       +24     +1     +21     (19 %) 

Sportsbook net revenue margin

     7.3     12.6     10.2     12.9     +40bps       +100bps       (370bps     +180bps  

Sportsbook revenue

     986       411       160       329       +30     +9     (12 %)      (6 %) 

iGaming revenue

     358       406       600       —        +49     +27     +8     —   

Other revenue

     66       44       37       —        (7 %)      +7     +42     —   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

     1,410       861       797       329       +32     +17     +5     (6 %) 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

     26       268       173       83       N/A       +30     +16     (2 %) 

Adjusted EBITDA margin

     1.8     31.1     21.7     25.2     +680bps       +310bps       +210bps       +100bps  

Additional information: Segment cost of sales and operating expenses

                

Cost of Sales

     833       314       374       174       +29     +19     +5     (7 %) 

Technology, research and development expenses

     55       40       51       9       +14     +12     +16     (10 %) 

Sales and marketing expenses

     422       166       104       47       +16     +8     (21 %)      (11 %) 

General and administrative expenses

     74       73       95       17       +15     (5 %)      +17     2

Reconciliation of supplementary non GAAP information: Adjusted depreciation and amortization

 

($ in millions)    Three months ended March 31, 2024     Three months ended March 31, 2023  
Unaudited    US     UKI     Intl     Aus     Corp      Total     US     UKI     Intl     Aus     Corp      Total  

Depreciation and Amortization

     29       101       146       15       6        297       25       101       159       14       —         297  

Less: Amortization of acquired intangibles

     (4     (70     (93     (4     —         (172     (5     (76     (106     (6     —         (192
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

Adjusted depreciation and amortization1

     25       31       53       11       6        125       20       25       53       8       —         106  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

 

 

1.

Adjusted depreciation and amortization is defined as depreciation and amortization excluding amortization of acquired intangibles.

 

20


US GAAP – Consolidated Group income statement update

Note: Income tax (expense)/benefit for Q1 2021 – Q4 2023 has been updated as compared to the data published in the IFRS to US GAAP conversion materials on February 29, 2024 and the FY 2023 KPI pack published on 26 March 2024. The updates are confined to allocation of the tax (expense)/benefit between quarters and does not impact the income tax (expense)/benefit for FY 2021, 2022 or 2023.

 

($ in millions)    Q1
2021
    Q2
2021
    Q3
2021
    Q4
2021
    FY
2021
    Q1
2022
    Q2
2022
    Q3
2022
    Q4
2022
    FY
2022
    Q1
2023
    Q2
2023
    Q3
2023
    Q4
2023
    FY
2023
    Q1
2024
 

Sportsbook

     1,055       1,212       1,105       1,140       4,512       1,111       1,341       1,215       1,649       5,316       1,667       1,725       1,288       1,906       6,585       1,886  

iGaming

     813       796       736       770       3,115       853       798       879       1,043       3,573       1,113       1,122       1,135       1,251       4,621       1,364  

Other

     179       184       150       169       682       144       148       133       150       574       139       154       136       155       584       147  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

     2,047       2,191       1,992       2,079       8,308       2,108       2,287       2,227       2,842       9,463       2,918       3,000       2,559       3,312       11,790       3,397  

Cost of sales

     (918     (970     (962     (1,031     (3,881     (1,085     (1,100     (1,176     (1,452     (4,813     (1,541     (1,490     (1,386     (1,784     (6,202     (1,793
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     1,129       1,221       1,030       1,047       4,427       1,023       1,186       1,051       1,390       4,650       1,377       1,510       1,173       1,528       5,588       1,604  

Technology, research and development expenses

     (133     (215     (129     (156     (634     (133     (156     (109     (154     (552     (168     (176     (214     (207     (765     (190

Sales & marketing expenses

     (726     (706     (653     (735     (2,819     (751     (685     (681     (897     (3,014     (882     (667     (700     (1,527     (3,776     (881

General and administrative expenses

     (157     (547     (476     (244     (1,423     (272     (236     (349     (315     (1,172     (342     (444     (394     (415     (1,596     (409
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating profit / (loss)

     113       (246     (229     (87     (449     (133     109       (88     24       (88     (15     223       (135     (621     (549     124  

Other (expense) income, net

     88       (16     97       (68     101       91       (27     31       (91     5       (45     11       (44     (80     (157     (174

Interest expense, net

     (53     (54     (107     (0     (215     (41     (35     (52     (84     (212     (92     (83     (92     (117     (385     (112
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Profit/(loss) before tax

     148       (316     (239     (156     (563     (84     48       (109     (150     (295     (152     152       (271     (818     (1,091     (162

Income tax (expense) / benefit

     (46     (128     (2     (19     (194     1       (48     (52     24       (75     41       (86     10       (85     (120     (15
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net profit / (loss)

     102       (444     (241     (175     (757     (83     —        (161     (126     (370     (111     66       (261     (903     (1,211     (177

 

21