Betting company Flutter warns over hit to profits – because the best sports teams keep winning
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Paddy Power and FanDuel owner Flutter has warned over a hit to sales and profits after a string of winning bets by customers on US sporting events.
The group revealed late on Tuesday night that the NFL American football season so far as been the “most customer friendly” since the launch of online sports betting, adding that it had seen the highest rate of favourites winning in nearly two decades.
London Stock Exchange-listed Flutter, which also owns Betfair and Skybet, said it suffered its biggest one-day loss on the NFL series in the quarter on December 30, with the Detroit Lions’ 40-34 win over the San Francisco 49ers cost the group $74m US dollars (£59m).
The firm warned it expects to see revenues knocked by around $390m (£313m) and underlying earnings by $260m (£209m) between November 12 and December 31 due to the “very unfavourable US sports results”.
It said gross gaming revenue – a key performance measure showing amount wagered less that paid out in winnings – would be around $438m (£351m) lower over the period.
Flutter cut its outlook for the US business in 2024, saying revenues would now be around $370m (£297m) lower than the previous guidance of around $5.78bn (£4.6bn) and underlying US earnings would be around $205m (£164m) lower than the $505m (£405m) previously forecast.
Shares in the firm fell 3 per cent in Wednesday morning trading.
Flutter said that across the 2024 NFL season to the end of December, there were 184 winning favourites from first 256 games of season – around 72% – with 77% of favourites winning in the final three months. It added that games had also been higher-scoring than expected.
But the group said that there was “good momentum” in the UK and Ireland business, with sports results going against customers in the Premier League in England.
The group said this meant that outside the US, 2024 revenue and underlying earnings would be around 1 per cent and 2 per cent higher than the mid-points of its previous guidance.
