7th Aug 2019 09:28
(Alliance News) - Paddy Power and Betfair parent Flutter Entertainment PLC on Wednesday said investment in the nascent US sport-betting market and an increase in gaming taxes and duties resulted in a 24% year-on-year fall in first-half profit.
The bookmaker said annual guidance is in line with market expectations. It predicts 2019 underlying earnings before interest, taxes, depreciation and amortisation, excluding US operations, to be between GBP420 million and GBP440 million, on IFRS 16 basis.
The US division is expected to post a GBP55 million Ebitda loss for 2019 due to customer acquisition investments.
Shares in Flutter were trading 2.0% higher at 6,350.00 pence each in London on Wednesday morning.
For the six months to June-end, the company recorded pretax profit of GBP81 million, down 24% from the year-ago period, on revenue of GBP1.02 billion, up 18% year-on-year.
Underlying Ebitda for the interim period fell 10% year-on-year to GBP196 million from GBP217 million.
"All divisions are performing strongly on an underlying basis and have responded well to the challenges faced. In the US, our FanDuel brand and product proposition enabled us to take 50% of the sports-betting market in New Jersey in the first half. We are delighted with this performance and have been encouraged by the regulatory momentum that has seen 10 states regulate online sports betting since the repeal of PASPA," said Chief Executive Peter Jackson.
The bookmaker also said switching off operations in markets such as Switzerland, Serbia, Slovakia and Albania will impact earnings. The company estimates the combined impact of market closures to reduce 2019 revenue by GBP14 million and Ebitda by GBP11 million.
Flutter declared an interim dividend of 67p per share, unchanged from last year.
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