November 7, 2019 / 8:22 AM / 5 days ago

U.S. outlook improves at Paddy Power parent Flutter

DUBLIN (Reuters) - Paddy Power Betfair parent Flutter Entertainment FLTRF.I reported a 10% rise in third-quarter revenue to 533 million pounds ($686 million) on Thursday helped by a 67% jump in the United States where it raised its outlook.

Flutter last month agreed to buy Toronto-listed Poker Stars operator Stars Group Inc (TSG) (TSGI.TO) in a $6 billion share deal set to create the world’s largest online betting and gambling company by revenue.

It retained its full year group EBITDA guidance excluding the United States at 420-440 million pounds.

That is down from 475 million pounds last year, excluding investment in its U.S. unit.

Part of its response has been a push into the U.S. market where sports betting rules have been relaxed.

Flutter, which last year merged its U.S. unit with fantasy sports company FanDuel, said third-quarter revenue in the U.S. market rose by 67% as it pushed into five new states.

It raised its outlook for the U.S. market to a loss in earnings before interest, tax, depreciation and amortisation of 40‐45 million pounds versus a loss of 55 million forecast earlier.

Flutter said it had more than 250,000 U.S. online sportsbook customers, up from just over 200,000 at the time of the TSG merger announcement on Oct. 2.

Shares in the group were 0.2% higher at 8,042 pence by 0845 GMT.

Revenues were down 1% in its main online division dominated by the Paddy Power and Betfair brands due to the cost of implementing responsible gambling measures, tough year-on-year comparisons and the banning of online betting in some unregulated markets.

With Australia set to account for around 15 percent of combined income of the merged group, revenues at Flutter’s market leading Sportsbet brand rose by 19%.

Reporting by Padraic Halpin; editing by Jason Neely

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