Flutter eyes NYSE listing amid FanDuel growth

Article by : Erik Gibbs Nov 13, 2023

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In its third-quarter trading update, Flutter Entertainment highlighted the strong performance of its FanDuel unit and informed investors about its plan to proceed with a US share listing in the first quarter of 2024.

Similar to DraftKings last week, Flutter raised its 2023 guidance, anticipating that its US operations will generate 2023 earnings before interest, taxes, depreciation and amortization (EBITDA) of $180 million on revenue of $4.7 billion.

Surpassing the initial estimate with a solid performance, Flutter underscored FanDuel’s achievements in the third quarter.

The figures exceeded expectations, with EBITDA ranging from $110.4 million to $233.2 million, considering current exchange rates and sales totaling between $4.4 billion and $4.7 billion.

The report noted a sports gross revenue share of 40% (47% net revenue share) and a strong leading position. The NFL season saw an outstanding start with a record-breaking acquisition of new players during the season launch, marking a growth of +37%.

These results confirm the anticipation that FanDuel will attain annual profitability this year, marking it as the first US online sportsbook operator to achieve this milestone.

Earlier this year, Flutter announced plans to list its shares in New York, a move approved by shareholders. Originally targeted for the second half of this year, the listing has been postponed to the first quarter of 2024.

Flutter intends to list its shares on the New York Stock Exchange (NYSE) and will “delist from Euronext Dublin simultaneously, or shortly prior” to the NYSE move while retaining its listing on the London Stock Exchange (LSE).

The company has indicated that, in the future, it might shift its primary listing to New York, which could affect the LSE’s position as a preferred listing venue.

This move is expected to provide Flutter with increased access to capital and a broader investor base and could influence shareholder demands related to FanDuel’s potential spin-off, which the company indicated would be secondary to the US listing.

Despite positive remarks about FanDuel, which included data indicating the operator holds the second-largest share of the US iGaming market, Flutter’s over-the-counter US-listed stock experienced a 12.39% decline on Thursday, with trading volume more than double the average daily volume.

The sell-off was attributed in part to a significant revenue decline in Australia.

The statement from the Irish gaming company indicated that the persistently challenging racing market observed in Q2 extended into Q3, leading to a 9% decrease in sportsbook stakes. Despite this, revenue declined by 7%, with the sportsbook net revenue margin increasing by 20 basis points to 11.3%.

Despite FanDuel having a 40% share of the US online sports wagering market at the end of the third quarter (down from 42% a year earlier), its iGaming share increased to 23% from 19%.