Flutter Entertainment Plc shares fell as much as 6.6% in London after the sports betting company missed 2022 earnings estimates due to customers’ winning wagers in December and competitive challenges in Australia.
(Bloomberg) — Flutter Entertainment Plc shares fell as much as 6.6% in London after the sports betting company missed 2022 earnings estimates due to customers’ winning wagers in December and competitive challenges in Australia.
Adjusted earnings before interest, taxes, depreciation and amortization rose to £1.05 billion ($1.3 billion), the Dublin-based company said in a statement Thursday, compared to the £1.07 billion average estimate from analysts in a Bloomberg survey.
Shares fell as much as 6.6%, the most in a year. They traded down 3.7% to 12,990 pence at 8:50 a.m. in London.
Flutter’s miss came amid a boom in sports betting. Gaming firms have benefited from a constellation of lucrative sporting events and a surge in online gambling last year, with peers Entain Plc’s and DraftKings Inc.’s most recent financial reports beating analysts’ estimates.
The business took a £40 million hit in December from “customer-friendly results” in the English Premier League and FIFA football World Cup, Chief Executive Officer Peter Jackson told reporters.
“Whilst the World Cup final was a real spectacle to watch, and very entertaining, I was watching it through my fingers, because it was a very expensive event for us, with goal scoring and Argentina winning,” he said. “It was compounded when the Premier League came back and we saw a flurry of the favorites winning, so that cost us a lot of money at the back end of last year.”
Results in Australia were “softer than expected,” Goodbody analyst David Brohan wrote in a note to clients. The company said its business there faced a challenging environment due to falling engagement post-pandemic and more competition.
Flutter’s overall revenues jumped 27%, driven by a 67% surge in sales at US unit FanDuel. The division has 50% market share in online sports betting and is on track to become profitable this year, according to the statement.
It added 2 million new monthly customers in 2022, fueled by acquisitions and as more US states legalize sports betting.
Early shareholder feedback has been “supportive” about a potential secondary stock listing in the US, according to the statement. Jackson said that if Flutter goes ahead with a listing there, “it would be very unlikely that we would then proceed with the IPO of a small stake in FanDuel,” which it had previously considered.
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