Bookie hit by punter-friendly sports results
PADDY Power owner Flutter has warned of low profits as it booked a £50m hit from punterfriendly results.
The gambling giant said it now expects profits – excluding its Us business – to reach £1.4bn for the full year.
This is at the bottom end of previous guidance of £1.6bn for the 12 months to December.
It came as Flutter, which also owns Betfair and FanDuel, notched up one of its worst days in history, with 14 out of the 17 most backed teams winning during the third weekend in september.
many of these matches saw more than three goals scored by popular players – spelling misery for bookies who were paying out more than they were taking in. arsenal’s match against manchester United on september 3 was also a major blow for Flutter, where one Paddy Power customer landed a win of £500,000 thanks to two goals scored in extra time.
The group revealed that these ‘adverse sports results’ caused a £50m blow in the three months to the end of september. This sent shares down as much as 10.2pc, or 1,400p, to 12,300p yesterday.
But the company said group revenue for the quarter had increased by 13pc to more than £2bn, with growth in gaming revenue helping to offset the poor performance in sports. Its
Us business FanDuel was also a bright spot, bringing in revenues of £668m – up 12pc on the same period last year. The group expects it to post fullyear revenues of £3.75bn and profits of £140m as it hopes to cash in on the NBa season.
It comes as Flutter is preparing for a secondary listing on the New York stock Exchange in the first quarter of 2024.
‘We are particularly pleased by the great progress we are making in the Us and towards our listing, which will bring the group significant benefits from accessing the world’s deepest and most liquid capital markets,’ Flutter chief executive Peter Jackson said.
Gambling has boomed in the Us since restrictions were loosened in 2018, which made sports betting legal in an increasing number of states.
But Russ mould, investment director at aJ Bell, warned: ‘This warning is a reminder that this is a bigger beast and if everything is not working in its favour, the consequences can be dire for investors.’