UPDATE 1-Online betting group Flutter sees profits in the US in 2023, stocks soar

* Flutter predicts US profits for the first time

* Three-fold increase in the number of US customers over the past 12 months

* EBITDA 2021 seen at 1.27-1.37 billion pounds against 1.4 billion

* Permanent change of scale observed in Australian unit (add details, CEO quotes)

By Padraic Halpin

DUBLIN, Aug. 10 (Reuters) – Paddy Power, Betfair and Poker Stars owner Flutter Entertainment expects to turn a profit in the United States in 2023 after heavy new investments in the high-growth market helped a 12% drop in first half profits across the group.

It was the first time that the world’s largest online betting group predicted when its U.S. operations would turn a profit since the lifting of the sports betting ban in 2018 and the take-off of gambling.

Flutter shares were up 6.9% to 163.1 euros at 07:45 GMT.

Flutter said it has solidified its leadership position in the U.S. online market through a threefold increase in customer numbers in the past 12 months. It expects to nearly double the number of states it operates in to 19 over the next 18 months, including New York.

“We believe the next 18 months are going to be very important for customer acquisitions,” Flutter chief executive Peter Jackson told analysts.

Revenue from its U.S. unit FanDuel jumped 159% to 652 million pounds ($ 902.89 million), making it the second division in the group where revenue rose 30%. It was the smallest division in terms of sales a year ago.

Group profit before interest, taxes, depreciation and amortization (EBITDA) fell to 597 million pounds on a pro forma basis. Excluding operating losses in the United States, the result was down 2% compared to the previous year.

Jackson said that a 52% year-over-year increase in its Australian player base also suggested that its market-leading Sportsbet unit may have seen a permanent change of scale.

The Dublin-based group said it expected full-year Adjusted EBITDA of between £ 1.27 billion and £ 1.37 billion, including a US loss of between £ 225 million and 275 million pounds, up from 1.4 billion pounds in 2020.

Jackson added that Flutter plans to appoint a new chief executive at FanDuel “pretty soon” – a prerequisite, he said, for a possible partial list of the company that remains under review. ($ 1 = 0.7221 pounds) (Report by Padraic Halpin edited by Louise Heavens and Tomasz Janowski)


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