Acquisitions pay out for Flutter

The owner of Paddy Power and Betfair said revenues in the year to 31 December rose 27% to £7.69bn, while average monthly players increased 26% to 10.2m.

Earnings before interest, tax, depreciation and amortisation rose 27% to £918m. Pre-tax loss narrowed to £275m from £288m a year previously.

The blue chip said earnings had benefited from the acquisitions of online bingo operator Tombola and Italian gaming firm Sisal at the end of 2021, as well as an "exceptional" US performance.

US revenues were at the upper end of guidance at £2.6bn, which helped trim losses by 6% to £250m.

Peter Jackson, chief executive, said: "Flutter delivered a strong performance in 2022.

"2023 is off to a pleasing start, driven by positive momentum from the end of last year. With our combined US business on track to deliver a positive EBITDA for the full year for the first time, the group is currently at an earnings transformation point, and we look forward to delivering future growth."

Richard Hunter, head of markets at Interactive Investor, said: "Investor excitement continues to build around prospects for Flutter, with the US becoming an increasingly important engine of growth.

"The UK market has also seen progress, boosted by the Word Cup and product improvements. The UK is one of the areas in which there is some caution, however, mainly driven by regulatory change."

Greg Johnson, analyst at Shore Capital, said the results were "consistent with our expectations, but towards the bottom-end of the guidance range".

"Valuation wise, at the current price we see an implied value of 9x EBITDA for the underlying business and a $20bn valuation for [US business] FanDuel. Neither valuation metric looks stretched, but arguably better value elsewhere."

As at 0830 GMT shares in Flutter were down nearly 5% at 12,875p.