The group generated pre-tax profits of just £24m (€27m) for the first six months of 2020, 70% down on the same period last year. However, revenues rose by 49% to £1.52bn. It said the second half of the year has started well, helped by the newly condensed sporting calendar.
However, the group said the outlook remains “highly uncertain” given the potential for further Covid-related disruptions and further regulatory changes in international markets.
For this year, as a whole, Flutter is anticipating earnings of between £1.2bn and £1.32bn. That excludes the US, where a loss of £140m-£160m is anticipated.
Lockdown boosted online poker custom and online usage in Australia and the US. However, first half online revenues fell 8%, while the Paddy Power retail business – with shops closed for much of the duration – saw a loss of £10m in the first half.
Chief Financial Officer Jonathan Hill said the US is Flutter’s “single biggest growth opportunity” and the group hopes to have a presence in nine states by the end of this year. At the start of last year, it only had a presence in the New Jersey market. Flutter is confident of turning a profit in each state in the US roughly two years after entry.
Chief executive Peter Jackson said Flutter’s diversification – across its various online and retail betting, US sports betting, betting exchange, and gaming products - allows it to “approach the future with confidence”.
Its recently completed mega takeover of North American online gambling group Stars – which owns the likes of Sky Bet and Full Tilt Poker – is set to help Flutter mitigate further COVID hardships. That deal created the world’s single biggest gambling business.
But Flutter will continue to search out further international expansion opportunities, according to Hill. Growth in the further loosening German market is planned, along with expansion in Brazil and Argentina. Latin America, as a whole, is “a big opportunity” being explored by Flutter, Mr Hill said, adding that smaller bolt-on acquisitions in international markets are under consideration.
Outside of the US, UK and Ireland, Europe and Latin America will be the “two key areas of international expansion" for the group, he said.
However, Hill said Flutter is largely “done” with acquisition activity in Ireland and Britain, but is happy with its 620 shops and remains committed to its retail business in both countries.
He said while the migration of customers from retail to online continues, still only around 12% of global customers are solely online users, with retail still having a huge part to play.
Source: GMB / Irish Examiner
