Flutter Announces Fiscal Year 2023 Earnings
- Strong fiscal year 2023 results announced by Flutter Entertainment with 17.5% revenue growth and fiscal year 2024 guidance introduced.
- US business showed remarkable revenue growth of 40.7% and achieved positive Adjusted EBITDA, expanding into new states.
- Group Ex-US revenue increased by 16.4%, led by UKI and International markets.
- Flutter reported a net loss of $1,211m, attributed to non-cash charges, but demonstrated Further Adjusted EBITDA growth of 45.4%.
- The company improved its leverage ratio to 3.1x, showcasing financial strength and stability.
- CEO Peter Jackson highlighted the company's strong performance and strategic direction for future growth.
- Net loss of $1,211m reported by Flutter Entertainment for fiscal year 2023 due to non-cash charges.
- Reduction in net cash provided by operating activities by 19.4% primarily from Sisal's record lottery jackpot win.
- Challenging market conditions in Australia expected to impact profitability further in 2024.
- Increase in net debt to $5,795m at the end of December 31, 2023 compared to $5,674m in 2022.
Insights
The financial performance of Flutter Entertainment reflects a significant year-over-year growth, with notable increases in revenue and average monthly players. The expansion in the US market is particularly striking, where the company has reported a substantial increase in revenue and has achieved a positive Adjusted EBITDA for the first time. This indicates a strong execution of their growth strategy in a highly competitive market. The leverage ratio improvement suggests a healthier balance sheet, which could enhance the company's ability to invest and grow further. However, the net loss driven by non-cash charges raises concerns about the long-term sustainability of current growth rates and the potential need for strategic adjustments, especially considering the trademark impairment charge related to the PokerStars brand.
Flutter Entertainment's strategic 'local hero' approach seems to be paying dividends, as evidenced by their market share gains in various regions. This localized strategy, coupled with the acquisition of Sisal, has allowed the company to deepen its footprint in international markets. The reported growth in UKI and 'Consolidate and Invest' markets indicates a successful differentiation in these regions. However, the decline in the Australian market could signal a need for a reassessment of strategies in markets facing regulatory changes or reduced customer engagement. The emphasis on product innovation and customer acquisition in the US points to a focus on long-term market dominance, despite the high costs associated with these initiatives.
The reported financials indicate a proactive approach by Flutter Entertainment in addressing the evolving regulatory landscape, particularly in the US market. The increase in corporate overhead, partly attributed to new compliance requirements as a US-listed company, reflects the company's commitment to adhering to stringent regulatory standards. The trademark impairment of PokerStars suggests a strategic pivot that aligns with regulatory expectations and market dynamics. Investors should be aware of the potential for further regulatory changes that could impact the company's operations and profitability, especially in regions like Australia where increased regulatory costs are anticipated.
DUBLIN, IRELAND & TORONTO, ON / ACCESSWIRE / March 26, 2024 / Flutter Entertainment (LSE:FLTR)(NYSE:FLUT), the world's leading online sports betting and iGaming operator, today announced results for fiscal year ended December 31, 2023. Guidance for fiscal year ending 31 December 2024 introduced, with Group revenue growth of
Key financial highlights: | ||||
In $ millions except percentages and AMPs | Fiscal yearended December, 31 | |||
2023 | 2022 | YOY | ||
Average monthly players ('000s)1 | 12,325 | 10,245 | + | |
Revenue | 11,790 | 9,463 | + | |
Netloss | (1,211) | (370) | ( | |
Further AdjustedEBITDA2 | 1,874 | 1,289 | + | |
Further Adjusted EBITDAMargin2 | +230bps | |||
Net loss per share | ( | |||
Adjusted Earnings per share ($)2 | + | |||
Net cash provided by operating activities | 937 | 1,163 | ( | |
Adjusted Free CashFlow2 | 938 | 576 | + | |
Leverage ratio2,3 | 3.1x | 4.4x | (1.3x) | |
- Excellent delivery against Group strategy drove AMPs +
20.3% and revenue +24.6% year on year - US business rapidly scaling with revenue +
40.7% and first year of positive Adjusted EBITDA: - Product innovation helped add 3.7m new customers at attractive projected payback periods4
- Continued #1 sportsbook position with sports net gaming revenue (NGR) share
53.4% ; (Gross gaming revenue (GGR) share43.2% ) in Q4 20235 - FanDuel #1 iGaming brand as of January 2024; US GGR share
25.7% in Q4 20235 - Outside of the US, diversified portfolio delivered AMPs +
15.0% and revenue +16.4% year on year: - Strong UKI performance added 2 percentage points of GGR market share6 to
30% - "Local hero" strategy drove growth in International "Consolidate and Invest"7 markets, while division also benefited from full year consolidation of Sisal acquisition
- This strong growth more than offset a softer Australian racing market in 2023, and the unwind of the prior year benefit from increased player engagement following Covid related restrictions
2023 financial overview
- Net loss of
$1,211m reflected strong performance described above, but after non-cash charges of$1,681m due to (i)$725m PokerStars trademark impairment reflecting greater emphasis on revised "local hero" strategy; (ii)$791m acquired intangibles amortization; and (iii)$165m fair value change on Fox Option liability,(IFRS net loss$981m ) - ·Group Further Adjusted EBITDA2 (excl. share based payments) of
$1,874m , +45.4% year on year: - US Adjusted EBITDA of
$65m , Further Adjusted EBITDA of$167m despite significant Q4 2023 customer friendly sports results - Group Ex-US Adjusted EBITDA2 of
$1,613m , which on an IFRS basis was £1,444m in line with previous IFRS guidance8, Group Ex-US Further Adjusted EBITDA of$1,707m +10.0% year on year - Group Further Adjusted EBITDA Margin2 accretion +230bps to
15.9% , despite ongoing US investment - Net cash provided by operating activities -
19.4% to$937m primarily from Sisal's record lottery jackpot which accrued in 2022 and resulted in a payment when won in February 2023 - Strong cash conversion and balance sheet position with Adjusted Free Cash Flow2 +
62.8% year on year and leverage ratio2,3 at December 31, 2023 of 3.1x compared with 4.4x at December 31, 2022
2024 trading to date
- Strong trading year to date with Group revenue growth of
23.4% from January 1, 2024 to March 17, 2024 versus prior comparable period - US revenue growth of
55.6% , with sportsbook +63.7% driven by staking growth and a 230bps improvement in sportsbook net revenue margin driven by structural margin improvements and higher promotional spend in the prior year on new state launches; iGaming +50.3% carrying product driven momentum into 2024 - Group Ex-US revenue growth of
6.3% benefited from diversified geographic portfolio with UKI +17.3% , International +3.0% impacted by unfavorable sports results and Australia -8.8%
2024 Outlook
- Guidance for the full year 2024 introduced with implied Group revenue growth of
17.5% and Further Adjusted EBITDA growth of30.2% at midpoint: - US revenue
$5.8b n to$6.2b n, +36.3% year on year at midpoint - US Further Adjusted EBITDA
$635m to$785m , +206.1% year on year at midpoint - Group ex US revenue
$7.65b n to$8.05b n, +6.3% year on year at midpoint - Group ex US Further Adjusted EBITDA
$1.63b n to$1.83b n, +5.4% year on year at midpoint - Medium-term leverage ratio target updated to 2-2.5x(from previous target of1-2x)2,3to reflect Group earnings and cashflow potential
Peter Jackson CEO commented:
"Flutter delivered a strong 2023 performance as we continued to deliver on our strategy. This was underpinned by a localized approach to technology and product coupled with the unique scale advantages of the Flutter Edge.As anticipated, our number one position in the US has transformed the Group's earnings profile during 2023 as FanDuel delivered a positive US full year Adjusted EBITDA for the first time. Outside of the US we made excellent progress integrating Sisal into our International business, a business which is a great example of our "local hero" strategy at work, and took market share in UKI.We also made further progress on our sustainability strategy with an increase in Play Well safer gambling tool usage, investment of over
I was proud to see Flutter shares trading for the first time on the NYSE on January 29, 2024 and we have been encouraged by the increased focus from new US investors as a result of our US listing. We are working towards a shareholder vote on May 1, 2024 to approve our primary listing move to NYSE.
The year has started well with very good momentum continuing into Q1.Record Super Bowl engagement contributed to US revenue growth of
FY 23 Operating Review:
US:
FanDuel had another excellent yea ras we consolidated our position as America's number one online sportsbook, with NGR market share of
FanDuel acquired over 3.7m new sports betting and iGaming players in 2023,
FanDuel launched compelling new product features during the recent NFL season which increased player engagement. The Parlay Hub drove over 1.5m pre-packaged Same Game Parlays ('SGP) on Super Bowl 2024 alone. The Pulse improved our live betting experience, and contributed to a near three-fold year on year increase in the proportion of live SGP bets during Super Bowl 2024.
In iGaming, we launched
Group Ex-US:
Performance in UKI was strong during 2023, taking share across both retail and online channels, with our estimated 2023 online UK market share growing by 2 percentage points to
In Australia, Sportsbet grew AMPs by
The effectiveness of our International strategy to buy and build podium positions was evident from our strong 2023 performance with growth across both revenue and AMPs. We continued to focus on targeted investment and a "local hero" strategy in key "Consolidate and Invest" markets while optimizing the PokerStars business which has a greater presence in our "Optimize and Maintain" geographies.In Italy, Sisal is the #1 online brand across the combined sports, iGaming and lotterymarket9and helped deliver
FY 2023 financial highlights: Group
In $ millions | Revenue | Adjusted EBITDA | Further Adjusted EBITDA | |||||||||
2023 | 2022 | YOY | YOY CC | 2023 | 2022 | YOY | YOY CC | 2023 | 2022 | YOY | YOY CC | |
US | 4,484 | 3,187 | 65 | (347) | 167 | (263) | ||||||
UKI | 3,047 | 2,664 | 888 | 757 | 911 | 777 | ||||||
Australia | 1,447 | 1,558 | ( | ( | 348 | 477 | ( | ( | 356 | 485 | ( | ( |
International | 2,812 | 2,055 | 592 | 395 | 627 | 417 | ||||||
Unallocated corporate overhead11 | (215) | (141) | (187) | (127) | ||||||||
Group Ex-US | 7,306 | 6,277 | 1,613 | 1,489 | 1,707 | 1,552 | ||||||
Group | 11,790 | 9,463 | 1,678 | 1,142 | 1,874 | 1,289 | ||||||
The Group delivered strong revenue growth for 2023 up24.
Group Ex-US revenue growth of
The Group reported a net loss for 2023of
The Group delivered Further Adjusted EBITDA2 growth of
Loss per share increased to
The Group net cashflow provided by operating activities in 2023 decreased
Total debt increased from
FY 2023 financial highlights: Segments
US revenue increased
UK Istrong revenue growth of
Australia revenue was
International grew AMPs by
Q1 2024 to date trading update
January 1 to March17, 2024 compared withJanuary 1 to March17, 202312 | ||||||
Period on period growth rates | ||||||
Sportsbook net revenue margin | Sportsbook net revenue margin | Sportsbook revenue | iGaming revenue | Other revenue | Total revenue | |
US | +230bps | ( | ||||
UKI | +30bps | |||||
Australia | +160bps | ( | ( | |||
International | (420bps) | ( | ||||
Group ex-US | (20bps) | ( | ||||
Group | +110bps | |||||
The Q1 trading update is based on how segments will be reported in 2024. PokerStars US will be reported in the International segment, having been included in the US segment for 2023, in line with how the business is now managed. In the above table, 2023 comparative numbers are on a 2024 comparable basis.
- US: trading has been strong with total revenue growth of
55.6% : - Strong sportsbook revenue growth of
63.7% driven by sportsbook staking +19.6% , combined with a 230bps sportsbook net revenue margin improvement. The higher sportsbook net revenue margin is driven by ongoing structural margin improvements and significant prior year promotional spend on customer acquisition on launches in Ohio (January 1, 2023) and Massachusetts (March, 10 2023). This was partly offset by an unfavorable year on year sports results impact. The current year period includes seven days of North Carolina trading following launch on March 10, 2024. - iGaming revenue growth of
50.3% , benefitting from our larger player base and continued product improvements. - Excluding revenue from new state launches in both periods, total revenue increased by
34.1% .
UKI: revenue +
Australia: revenue reduced by
International: revenue increased by
FY 2024 outlook
FY 2023 | 2024 guidance13 | ||
Low | High | ||
US revenue | |||
US FurtherAdjusted EBITDA | |||
Group Ex-US revenue | |||
Group Ex-US FurtherAdjustedEBITDA | |||
Australia Further Adjusted EBITDA | Approximately | ||
Depreciation and amortization excl. acquired intangibles | Approximately | ||
Interest expense, net | Approximately | ||
Capital expenditure14 | Approximately | ||
Cash transaction, restructuring and integration costs | Approximately | ||
The outlook above is based on how segments will be reported in 2024. PokerStars US will be reported in the International segment, having been included in the US segment for 2023, in line with how the business is now managed. In the above table, 2023 numbers are shown on a 2024 comparable basis.16
We are introducing 2024 guidance with the following expectations:
- US: Revenue and Further Adjusted EBITDA mid-points of
$6.0b n and$710m , representing year on year growth of36.3% and206.1% respectively. The phasing of revenue is expected to be broadly in line with the prior year, allowing for the prior year impact of sports results being favorable in Q2 and unfavorable in Q4. We expect cost of sales as a percentage of net revenue to be approximately56.5% in 2024 and approximately30.0% of Further Adjusted EBITDA to be generated in H1, with Q2 being higher than Q1 due to the timing of new state openings. - Group ex-US: Revenue and Further Adjusted EBITDA mid-points of
$7.85b n and$1.73b n, representing year on year growth of6.3% and5.4% respectively. This includes a Further Adjusted EBITDA expectation of approximately$250m in Australia, reflective of the current market softness and increased taxes.
Guidance is provided (i) on the basis that sports results are in line with our expected margin for the remainder of the year, (ii) at current foreign exchange rates, and (iii) on the basis of a consistent regulatory and tax framework.
A reconciliation of our forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measure cannot be provided without unreasonable effort. This is due to the inherent difficulty of accurately forecasting the occurrence and financial impact of the adjusting items necessary for such a reconciliation to be prepared of items that have not yet occurred, are out of our control, or cannot be reasonably predicted.
Capital structure update
In August 2023, we outlined that we would consider the appropriate level of leverage for the Group given our plans to become US listed, as well as the positive cash flows and future profitability profile expected for the Group. Following extensive discussions with shareholders, the Board has confirmed that our medium-term target leverage ratio will increase to 2.0-2.5x (from previously disclosed1.0x-2.0x3). In line with our approach in the past and given the expected improvement in Adjusted EBITDA profile of the Group, the Board will also allow flexibility for the leverage ratio to be higher than this range in support of value-creating acquisition opportunities.
Listing update
We were pleased to announce on January29, 2024that Flutter shares commenced trading on the NYSE under the ticker symbol: "FLUT" (CUSIP No.: G3643J 108). Flutter shares continue to trade on the London Stock Exchange ("LSE") under the existing ticker symbol: "FLTR". We announced our proposal to move our primary listing to the NYSE to the market here. We believe that this will unlock long-term strategic and capital market benefits. Plans are on track for this proposal to be put to shareholders as a Special Resolution at the 2024 AGM on May 1, 2024. Subject to shareholder approval, the transition is expected to become effective on May 31, 2024.
Conference call:
Flutter management will host a conference call today at 10:30 a.m. GMT (6:30 a.m. ET) to review the results and be available for questions, with access via webcast and telephone.
A public audio webcast of management's call and the related Q&A can be accessed by registering here or via www.flutter.com/investors. For those unable to listen to the live broadcast, a replay will be available approximately one hour after conclusion of the call. This earnings release and supplementary materials will also be made available via www.flutter.com/investors.
Analysts and investors who wish to participate in the live conference call must do so by dialing any of the numbers below and using conference ID 53722. Please dial in 10 minutes before the conference call begins.
+1 646 307 1963 (United States)
+44 20 3481 4247 (United Kingdom)
+353 1 582 2023 (Ireland)
+61 2 8088 0946 (Australia)
Forward-Looking Statements
This press release contains information that is forward-looking, including within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, and which reflects the Company's current views with respect to, among other things, its operations, its financial performance and its industry. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify these forward-looking statements by the use of words such as "outlook", "believe(s)", "expect(s)", "potential", "continue(s)", "may", "will", "should", "could", "would", "seek(s)", "predict(s)", "intend(s)", "trends", "plan(s)", "estimate(s)", "anticipates", "projection", "goal", "target", "aspire", "will likely result", and or the negative version of these words or other comparable words of a future or forward-looking nature. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Such factors include, among others, risks related to Flutter's business, operations and financial performance, including its ability to effectively compete in the global entertainment and gaming industries, its ability to retain existing customers and to successfully acquire new customers, its ability to develop new product offerings, its ability to successfully acquire and integrate new businesses, its ability to maintain relationships with third-parties, its ability to maintain its reputation, and public sentiment towards online betting and iGaming generally; market and global conditions and economic factors beyond Flutter's control, such as the potential impact of general economic conditions, including inflation, rising interest rates and instability in the banking system, on Flutter's liquidity, operations and personnel; risks related to licensing and regulation, including Flutter's ability to obtain and maintain licenses with gaming authorities, adverse changes to the regulation of online betting and iGaming, the failure of additional jurisdictions to legalize and regulate online betting and iGaming, and Flutter's ability to comply with complex, varied and evolving U.S. and international laws and regulations relating to its business; Flutter's ability to raise financing in the future; Flutter's success in retaining or recruiting officers, key employees or directors; litigation and the ability to adequately protect Flutter's intellectual property rights; the impact of data security breaches or cyber-attacks on Flutter's systems; and Flutter's ability to remediate material weaknesses in its internal control over financial reporting.
Additional factors that could cause the Company's results to differ materially from those described in the forward-looking statements can be found under the section entitled "Risk Factors" of the Company's Amendment No. 1 to the Registration Statement on Form 20-F as filed with the Securities and Exchange Commission ("SEC"), on January 18, 2024, as such factors may be updated in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 and other periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company's filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
About Flutter Entertainment plc
Flutter is the world's leading online sports betting and iGaming operator, with leading positions in markets across the world, including the US. Our ambition is to leverage our significant scale and our challenger mindset to change our industry for the better. By Changing the Game, we believe we can deliver long-term growth while promoting a positive, sustainable future for all our stakeholders. We are well-placed to do so through the distinctive, global competitive advantages of the Flutter Edge, which gives our brands access to group-wide benefits to stay ahead of the competition, as well as our clear vision for sustainability through our Positive Impact Plan.
Flutter operates a diverse portfolio of leading online sports betting and iGaming brands including FanDuel, Sky Betting & Gaming, Sportsbet, PokerStars, Paddy Power, Sisal, Tombola, Betfair, MaxBet, Junglee Games and Adjarabet. We are the industry leader with
Contacts:
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Liam Kealy, Investor Relations | Rupert Gowrley, Corporate Communications | ||||
Email: corporatecomms@flutter.com | |||||
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Notes
1. Average Monthly Players ("AMPs") is defined as the average over the applicable reporting period of the total number of players who have placed and/or wagered a stake and/or contributed to rake or tournament fees during the month. This measure does not include individuals who have only used new player or player retention incentives, and this measure is for online players only and excludes retail player activity. In circumstances where a player uses multiple product categories within one brand, we are generally able to identify that it is the same player who is using multiple product categories and therefore count this player as only one AMP at the Group level while also counting this player as one AMP for each separate product category that the player is using. As a result, the sum of the AMPs presented at the product category level is greater than the total AMPs presented at the Group level. See "-" Item 5. Operating and Financial Review and Prospects-Key Operational Metrics" of the Company's Amendment No. 1 to the Registration Statement on Form 20-F as filed with the Securities and Exchange Commission ("SEC"), on January 18, 2024 for additional information regarding how we calculate AMPs data, including a discussion regarding duplication of players that exists in such data.
2. Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA Margin, Group Ex-US Adjusted EBITDA, Group Ex-US Further Adjusted EBITDA, Segment Further Adjusted EBITDA, Segment Further Adjusted EBITDA margin, Adjusted Free Cash Flows,Net Debt, Leverage Ratio, Constant Currency, Adjusted Net Profit Attributable to Flutter Shareholders and Adjusted Earnings Per Share are non-GAAP financial measures. See "Definitions of non-GAAP financial measures" and "Reconciliations of Non-GAAP Financial Measures" sections of this document for definitions of these measures and reconciliations to the most directly comparable financial measures calculated in accordance with GAAP. Due to rounding, these numbers may not add up precisely to the totals provided.
3. Leverage ratio target as previously disclosed of 1-2x was calculated as IFRS Net Debt divided by IFRS Adjusted EBITDA.
4. Payback is calculated as the projected average length of time it takes players to generate sufficient Adjusted gross profit to repay the original average cost of acquiring those players. Customer acquisition costs include the marketing and associated promotional spend incurred to acquire a customer. The projected Adjusted gross profit is based on predictive models considering inputs such as staking behavior, interaction with promotional offers and gross revenue margin. Projected Adjusted gross profit includes associated variable costs of revenue as well as retention generosity costs.
5. Online sportsbook market share is the gross gaming revenue (GGR) and net gaming revenue (NGR) market share of our FanDuel brand for the three months to December 31, 2023 in the states in which FanDuel was live (excluding Tennessee as they no longer report this data), based on published gaming regulator reports in those states. iGaming market share is the GGR, market share of FanDuel and PokerStars US for the three months to December 31, 2023 in the states in which those brands were live, based on published gaming regulator reports in those states. Number one iGaming brand is based on GGR for January 2024 in published gaming regulator reports and external estimates by Eilers and Krejcik for competitor market share.
6. Estimated UKIGGR market share of UK and Ireland for 2023.
7. Consolidate and Invest markets within our International segment are Italy, Spain, Georgia, Armenia, Brazil, India, Turkey and Virtual Reality.
8. IFRS Adjusted EBITDA Guidance of approximately £1,440m was issued November 9, 2023 for the Group Ex-US. See Reconciliations of non-GAAP financial measures for a breakdown of Adjusted EBITDA performance on an IFRS basis by segment.
9. Estimated Australia market share GGR sportsbook share of Australian market for 2023.
10. References to pro forma, refer to performance as if Sisal had been acquired as of January 1,2022. The proforma financial information is for informative purpose only and is not indicative of the results of operations that would have been achieved if the Sisal acquisition has taken place as of January 1, 2022.
11. Unallocated corporate overhead includes shared technology, research and development, sales and marketing, and general and administrative expenses that are not allocated to specific segments.
12. The net revenue margin and revenue information presented for the period from January 1 to March 17, 2024 as compared to the period from January 1 to March 17, 2023 should not be taken as an indication of expected results for the three months ended March 31, 2024, which may differ materially.
13. Foreign exchange rates at March 20, 2024 assumed in our 2024 guidance were USD:GBP of 0.790, USD:EUR of 0.920 and USD:AUD of 1.530.
14. Capital expenditure is defined payments for the purchase of property and equipment, the purchase of intangible assets and capitalized software.
15. The cash impact of transaction fees and restructuring and integration costs, represents costs associated with (i) transaction fees related to the listing of Flutter's ordinary shares in the U.S. and proposed primary listing move, (ii) advisory fees in connection with acquisitions, and (iii) costs arising from strategic initiatives to integrate acquisitions within the Group.
16. See "PokerStars US 2024 Reporting reconciliation" section below for a reconciliation of US revenue, US Further Adjusted EBITDA, Group Ex-US revenue and Group Ex-US Further Adjusted EBITDA as reported in 2023 with PokerStars US within the US segment to the 2024 reporting basis with PokerStars US within the International segment which will be reflected in Q1 reporting.
Definitions of non-GAAP financial measures
This press release includes Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA Margin, Group Ex-US Adjusted EBITDA, Group Ex-US Further Adjusted EBITDA, Adjusted Net Profit Attributable to Flutter Shareholders, Adjusted Earnings Per Share ("Adjusted EPS"), Segment Further Adjusted EBITDA, leverage ratio, Net Debt, Adjusted Free Cash Flow, constant currency and IFRS Adjusted EBITDA which are non-GAAP financial measures that we use to supplement our results presented in accordance with U.S. generally accepted accounting principles ("GAAP"). These non-GAAP measures are presented solely as supplemental disclosures to reported GAAP measures because we believe that these non-GAAP measures are useful in evaluating our operating performance, similar to measures reported by its publicly-listed U.S. competitors, and regularly used by analysts, lenders, financial institutional and investors as measures of performance. Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA Margin, Adjusted Net Profit Attributable to Flutter Shareholders, Adjusted EPS, Segment Further Adjusted EBITDA, leverage ratio, Net Debt and Adjusted Free Cash Flow, are not intended to be substitutes for any GAAP financial measures, and, as calculated, may not be comparable to other similarly titled measures of performance of other companies in other industries or within the same industry.
Constant currency reflects certain operating results on a constant-currency basis in order to facilitate period-to-period comparisons of our results without regard to the impact of fluctuating foreign currency exchange rates. The term foreign currency exchange rates refer to the exchange rates used to translate our operating results for all countries where the functional currency is not the U.S. Dollar, into U.S. Dollars. Because we are a global company, foreign currency exchange rates used for translation may have a significant effect on our reported results. In general, our financial results are affected positively by a weaker U.S. Dollar and are affected negatively by a stronger U.S. Dollar. References to operating results on a constant-currency basis mean operating results without the impact of foreign currency exchange rate fluctuations. We believe the disclosure of constant-currency results is helpful to investors because it facilitates period-to-period comparisons of our results by increasing the transparency of our underlying performance by excluding the impact of fluctuating foreign currency exchange rates. We calculate constant currency revenue, Further Adjusted EBITDA and Segment Further Adjusted EBITDA by translating prior-period revenue, Further Adjusted EBITDA and Segment Further Adjusted EBITDA, as applicable, using the average exchange rates from the current period rather than the actual average exchange rates in effect in the prior period.
Adjusted EBITDA is defined on a Group basis as net profit/(loss) before income taxes; other (expense)/income, net; interest expense, net; depreciation and amortization; transaction fees and associated costs; restructuring and integration costs; legal settlements (loss contingencies), and impairment of PPE and intangible assets.
Further Adjusted EBITDA is defined as Adjusted EBITDA excluding share-based compensation.
Adjusted EBITDA Margin and Further Adjusted EBITDA Margin is Adjusted EBITDA and Further Adjusted EBITDA as a percentage of revenue, respectively.
Segment Further Adjusted EBITDA is defined as segment Adjusted EBITDA which is our segment measure of profit or loss excluding share-based compensation. Segment Further Adjusted EBITDA Margin is segment Adjusted Further Adjusted EBITDA as a percentage of revenue. From January 1, 2024, Adjusted EBITDA will exclude the cost of share-based compensation. We believe that this presentation is common practice in our industry and improves comparability of our results with those of our peers.
Group Ex-US Adjusted EBITDA is defined as Group Adjusted EBITDA excluding our US Segment Adjusted EBITDA.
Group Ex-US Further Adjusted EBITDA is defined as Group Ex-US Adjusted EBITDA excluding share-based compensation.
Adjusted Net Profit Attributable to Flutter Shareholders is defined as net profit/(loss) as adjusted for after-tax effects of transaction fees and associated costs; restructuring and integration costs; legal settlements (loss contingencies), gaming taxes dispute, amortization of acquired intangibles, accelerated amortization, loss/(gain) on settlement of long-term debt, impairment of PPE and intangible assets, financing related fees not eligible for capitalization, gain from disposal of businesses and share-based compensation.
Adjusted EPS is calculated by dividing adjusted net income attributable to Flutter shareholders by the number of diluted weighted-average ordinary shares outstanding in the period.
Adjusted EBITDA, Further Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA Margin, Segment Further Adjusted EBITDA, Group Ex-US Adjusted EBITDA, Group Ex-US Further Adjusted EBITDA, Adjusted net profit attributable to Flutter shareholders and Adjusted EPS are non-GAAP measures and should not be viewed as measures of overall operating performance, indicators of our performance, considered in isolation, or construed as alternatives to operating profit/(loss), net profit/(loss) measures or earnings per share, or as alternatives to cash flows from operating activities, as measures of liquidity, or as alternatives to any other measure determined in accordance with GAAP.
IFRS Adjusted EBITDA is defined on a Group basis as net profit/(loss) before income taxes; financial income; financial expense; depreciation and amortization; transaction fees and associated costs; restructuring and integration costs and impairment of PPE and intangible assets.
Management has historically used these measures when evaluating operating performance because we believe that they provide additional perspective on the financial performance of our core business.
Adjusted EBITDA and Further Adjusted EBITDA has further limitations as an analytical tool. Some of these limitations are:
- they do not reflect the Group's cash expenditures or future requirements for capital expenditure or contractual commitments;
- they do not reflect changes in, or cash requirements for, the Group's working capital needs;
- they do not reflect interest expense, or the cash requirements necessary to service interest or principal payments, on the Group's debt;
- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA and Further Adjusted EBITDA do not reflect any cash requirements for such replacements;
- they are not adjusted for all non-cash income or expense items that are reflected in the Group's statements of cash flows; and
- the further adjustments made in calculating Adjusted EBITDA and Further Adjusted EBITDA are those that management consider not to be representative of the underlying operations of the Group and therefore are subjective in nature.
Net debt is defined as total debt, excluding premiums, discounts, and deferred financing expense, and the effect of foreign exchange that is economically hedged as a result of our cross-currency interest rate swaps reflecting the net cash outflow on maturity less cash and cash equivalents.
Leverage ratio is defined as net debt divided by Further Adjusted EBITDA. We use this non-GAAP financial measure to evaluate our financial leverage. We present net debt to Further Adjusted EBITDA because we believe it is more representative of our financial position as it is reflective of our ability to cover our net debt obligations with results from our core operations, and is an indicator of our ability to obtain additional capital resources for our future cash needs. We believe net debt is a meaningful financial measure that may assist investors in understanding our financial condition and recognizing underlying trends in our capital structure. The Leverage Ratio is not substitute for, and should be used in conjunction with, GAAP financial ratios. Other companies may calculate leverage ratios differently.
Adjusted Free Cash Flow is defined as net cash provided by operating activities excluding changes in operating assets and liabilities related to player deposits, investment and player deposit liabilities, cash paid for transaction fees and associated cost, restructuring fees and integration cost less payments for property and equipment, intangible assets and capitalized software. We believe that excluding these items from adjusted free cash flow better portrays our ability to generate cash, as such items are not indicative of our operating performance for the period. This non-GAAP measure may be useful to investors and other users of our financial statements as a supplemental measure of our cash performance, but should not be considered in isolation, as a measure of residual cash flow available for discretionary purposes, or as an alternative to operating cash flows presented in accordance with GAAP. Adjusted Free Cash Flow does not necessarily represent funds available for discretionary use and is not necessarily a measure of our ability to fund our cash needs. Our calculation of Adjusted Free Cash Flow may differ from similarly titled measures used by other companies, limiting their usefulness as a comparative measure.
Consolidated Balance Sheets:
($ in millions except share and per share amounts)
As of December 31, | |||
2023 | 2022 | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | |||
Cash and cash equivalents - restricted | 22 | 16 | |
Player deposits - cash and cash equivalents | 1,752 | 2,008 | |
Player deposits - investments | 172 | 167 | |
Accounts receivable, net | 90 | 116 | |
Prepaid expenses and other current assets | 443 | 703 | |
Total current assets | 3,976 | 3,976 | |
Investments | 9 | 11 | |
Property and equipment, net | 471 | 430 | |
Operating lease right-of-use assets | 429 | 452 | |
Intangible assets, net | 5,881 | 7,036 | |
Goodwill | 13,745 | 13,244 | |
Deferred tax assets | 24 | 47 | |
Other non-current assets | 100 | 62 | |
Total assets | |||
Liabilities, redeemable non-controlling interests and shareholders' equity | |||
Current liabilities: | |||
Accounts payable | |||
Player deposit liability | 1,786 | 2,110 | |
Operating lease liabilities | 123 | 110 | |
Long-term debt due within one year | 51 | 43 | |
Other current liabilities | 2,326 | 2,115 | |
Total current liabilities: | 4,526 | 4,626 | |
Operating lease liabilities - non-current | 354 | 384 | |
Long-term debt | 7,005 | 6,707 | |
Deferred tax liabilities | 802 | 919 | |
Other non-current liabilities | 580 | 502 | |
Total liabilities | 13,267 | 13,138 | |
Redeemable non-controlling interests | 1,152 | 929 | |
Shareholders' equity | |||
Common share (Authorized 300,000,000 shares of €0.09 ( | 36 | 36 | |
Shares held by employee benefit trust, at cost 2023: nil, 2022: 1,396 shares | - | (1) | |
Additional paid-in capital | 1,385 | 1,192 | |
Accumulated other comprehensive loss | (1,483) | (1,782) | |
Retained earnings | 10,106 | 11,590 | |
Total Flutter shareholders' equity | 10,044 | 11,035 | |
Non-controlling interests | 172 | 156 | |
Total shareholders' equity | 10,216 | 11,191 | |
Total liabilities, redeemable non-controlling interests and shareholders' equity | |||
Consolidated Statement of Comprehensive Income/(Loss):
($ in millions except per share and per share amounts)
Year ended December 31 | |||||
2023 | 2022 | 2021 | |||
Revenue | |||||
Cost of Sales | (6,202) | (4,813) | (3,881) | ||
Gross profit | 5,588 | 4,650 | 4,427 | ||
Technology, research and development expenses | (765) | (552) | (634) | ||
Sales and marketing expenses | (3,776) | (3,014) | (2,819) | ||
General and administrative expenses | (1,596) | (1,172) | (1,423) | ||
Operating loss | (549) | (88) | (449) | ||
Other (expense) income, net | (157) | 5 | 101 | ||
Interest expense, net | (385) | (212) | (215) | ||
Loss before income taxes | (1,091) | (295) | (563) | ||
Income tax expense | (120) | (75) | (194) | ||
Net loss | (1,211) | (370) | (757) | ||
Net gain/(loss) attributable to non-controlling interests and redeemable non-controlling interests | 13 | (1) | (13) | ||
Adjustment of redeemable non-controlling interest to redemption value | (2) | 63 | 179 | ||
Net loss attributable to Flutter shareholders | (1,222) | (432) | (923) | ||
Net loss per share | |||||
Basic | (6.89) | (2.44) | (5.24) | ||
Diluted | (6.89) | (2.44) | (5.24) | ||
Other comprehensive income / (loss), before tax: | |||||
Effective portion of changes in fair value of cash flow hedges | (121) | 80 | 26 | ||
Fair value of cash flow hedges transferred to the income statement | 93 | (72) | (11) | ||
Foreign exchange (loss) / gain on net investment hedges | 30 | (145) | 30 | ||
Foreign exchange gain / (loss) on translation of the net assets of foreign currency denominated entities | 357 |
|
| ||
Fair value movements on available for sale debt instruments | 5 | (4) | (1) | ||
Other comprehensive income / (loss) | 364 | (1,037) | (629) | ||
Other comprehensive income / (loss) attributable to Flutter shareholders | 299 | (926) | (627) | ||
Other comprehensive income / (loss) attributable to non-controlling interest and redeemable non-controlling interest | 65 | (111) | (2) | ||
Total comprehensive income / (loss) for the year | |||||
Consolidated Statement of Cash Flows
($ in millions)
Year ended December 31, | |||||
Cash flows from operating activities | 2023 | 2022 | 2021 | ||
Net loss | |||||
Adjustments to reconcile net loss to net cash from operating activities: | |||||
Depreciation and amortization | 1,285 | 1,075 | 1,010 | ||
Impairment Loss | 725 | - | - | ||
Change in fair value of derivatives | (7) | (152) | (141) | ||
Non-cash interest (income) / expense, net | (12) | 7 | 17 | ||
Non-cash operating lease expense | 117 | 96 | 70 | ||
Unrealized foreign currency exchange (gain) / loss, net | (225) | 196 | 101 | ||
Loss / (gain) on disposal | 5 | - | (16) | ||
Share-based compensation - equity classified | 180 | 132 | 63 | ||
Share-based compensation - liability classified | 10 | 49 | 425 | ||
Other (expense) / income, net | 163 | (89) | 69 | ||
Deferred taxes | (132) | (145) | (12) | ||
Loss / (gain) on extinguishment of long-term debt | 6 | 65 | (130) | ||
Change in contingent consideration | (2) | (6) | 7 | ||
Change in operating assets and liabilities: | |||||
Player deposits | (1) | (72) | - | ||
Accounts receivable | 23 | (12) | (17) | ||
Prepaid expenses and other current assets | 146 | (97) | (41) | ||
Accounts payable | (4) | (24) | (1) | ||
Other current liabilities | 366 | 207 | (117) | ||
Player deposit liability | (382) | 376 | 80 | ||
Operating leases liabilities | (113) | (73) | (57) | ||
Net cash provided by operating activities | 937 | 1,163 | 553 | ||
Cash flows from investing activities | |||||
Purchases of property and equipment | (159) | (122) | (122) | ||
Purchases of intangible assets. | (175) | (100) | (85) | ||
Capitalized software | (268) | (207) | (152) | ||
Acquisitions, net of cash acquired | - | (2,095) | (70) | ||
Proceeds from disposal of property and equipment | - | 7 | 175 | ||
Net cash used in investing activities | (602) | (2,517) | (254) | ||
Cash flows from financing activities | |||||
Proceeds from issue of common share upon exercise of options | 13 | 9 | 18 | ||
Proceeds from issuance of long-term debt (net of transaction costs) | 2,018 | 4,692 | 1,661 | ||
Repayment of long-term debt | (1,837) | (2,646) | (1,033) | ||
Acquisition of non-controlling interests | (95) | (251) | - | ||
Distributions to non-controlling interests | - | (7) | (23) | ||
Payment of contingent consideration | - | (11) | (10) | ||
Repurchase of common share | (212) | (3) | (252) | ||
Net cash (used in)/provided by financing activities | (113) | 1,783 | 361 | ||
Net increase in cash, cash equivalents and restricted cash | 222 | 429 | 660 | ||
Cash, cash equivalents and restricted cash - beginning of year | 2,990 | 2,681 | 2,151 | ||
Effect of foreign exchange on cash, cash equivalents and restricted cash | 59 | (120) | (130) | ||
Cash, cash equivalents and restricted cash - end of year | |||||
Consolidated Statement of Cash Flows (continued)
($ in millions)
Year ended December 31, | |||||
Cash, cash equivalents and restricted cash comprise of: | 2023 | 2022 | 2021 | ||
Cash and cash equivalents | |||||
Cash and cash equivalents - restricted | 22 | 16 | 10 | ||
Player deposits - cash and cash equivalents | 1,752 | 2,008 | 1,385 | ||
Cash, cash equivalents and restricted cash - end of year | |||||
Supplemental disclosures of cash flow information: | |||||
Interest paid | 408 | 222 | 214 | ||
Income taxes paid | 255 | 199 | 191 | ||
Non-cash investing and financing activities: | |||||
Purchase of intangible assets with accrued expense | - | 21 | - | ||
Operating lease right-of-use assets obtained in exchange of operating lease liabilities | 73 | 148 | 135 | ||
Adjustments to lease balances as a result of remeasurement | 22 | 18 | 20 | ||
Business acquisitions (including contingent consideration) | - | - | 24 | ||
Cancellation of Treasury Shares | - | - | 60 | ||
Reduction in capital | - | - | 13,631 | ||
Proceeds from issuance as part of debt restructuring | 5,267 | - | - | ||
Principal amount of extinguishment as part of debt restructuring | 4,622 | - | - | ||
Reconciliations of non-GAAP financial measures
Adjusted EBITDA reconciliation:
See below are conciliation of Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA and Further Adjusted EBITDA Margin to net loss, to the most comparable GAAP measure.
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
Net loss | |||
Add back: | |||
Income taxes | 120 | 75 | |
Other (expense)/income, net | 157 | (5) | |
Interest expense, net | 385 | 212 | |
Depreciation and amortization | 1,285 | 1,076 | |
Transaction fees and associated costs(1) | 92 | 43 | |
Restructuring and integration costs(2) | 126 | 155 | |
Legal settlements/(loss contingencies)(3) | - | (44) | |
Impairment of PPE and Intangible Assets(4) | 725 | - | |
Group Adjusted EBITDA | 1,678 | 1,142 | |
Less:US Adjusted EBITDA | 65 | (347) | |
Group ex-US Adjusted EBITDA | 1,613 | 1,489 | |
Group Revenue | 11,790 | 9,463 | |
Group Adjusted EBITDA Margin | |||
Group Adjusted EBITDA | 1,678 | 1,142 | |
Add back: | |||
Group share-based compensation expense | 196 | 147 | |
Group Further Adjusted EBITDA | |||
Further Adjusted EBITDA Margin | |||
1. Fees primarily associated with (i) transaction fees related to the proposed listing of Flutter's ordinary shares in the U.S. of
2. During the year ended December 31, 2023 costs of
3. During the year ended December 31, 2022, the settlement of two separate legacy The Stars Group ("TSG") litigation matters resulted in the release of various legal provisions and an Income Statement credit of
4. In the fourth quarter of 2023, the Group recognized an intangible asset impairment loss of
Further Adjusted EBITDA reconciliation, Segment and Group Ex-US:
See below are conciliation of Group Ex-US and segment Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA and Further Adjusted EBITDA Margin to net loss, the most comparable GAAP measure.
Group Ex-US | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
Group Ex-US Adjusted EBITDA | |||
Add back: | |||
Share-based compensation expense | 94 | 63 | |
Group Ex-US Further Adjusted EBITDA | |||
Revenue | 7,306 | 6,277 | |
Adjusted EBITDA Margin | |||
Further Adjusted EBITDA Margin | |||
US | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
US Adjusted EBITDA | |||
Add back: | |||
Share-based compensation expense | 102 | 84 | |
US Further Adjusted EBITDA | |||
Revenue | 4,484 | 3,187 | |
Adjusted EBITDA Margin | ( | ||
Further Adjusted EBITDA Margin | ( | ||
UKI | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
UKI Adjusted EBITDA | |||
Add back: | |||
Share-based compensation expense | 23 | 19 | |
UKI Further Adjusted EBITDA | |||
Revenue | 3,047 | 2,664 | |
Adjusted EBITDA Margin | |||
Further Adjusted EBITDA Margin | |||
Australia | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
Australia Adjusted EBITDA | |||
Add back: | |||
Share-based compensation expense | 8 | 8 | |
Australia Further Adjusted EBITDA | |||
Revenue | 1,447 | 1,558 | |
Adjusted EBITDA Margin | |||
Further Adjusted EBITDA Margin | |||
International | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
International Adjusted EBITDA | |||
Add back: | |||
Share-based compensation expense | 35 | 22 | |
International Further Adjusted EBITDA | |||
Revenue | 2,812 | 2,055 | |
Adjusted EBITDA Margin | |||
Further Adjusted EBITDA Margin | |||
Unallocated corporate overhead | |||
($ in millions) | Year Ended December 31, | ||
2023 | 2022 | ||
Unallocated corporate overhead | |||
Less: | |||
Share-based compensation expense | 28 | 14 | |
Unallocated corporate overhead | |||
PokerStars US 2024 reporting reconciliation
($ in millions) | FY 2023 as reported | PokerStars US | FY 2024 reporting basis | |||||
US revenue | 4,484 | (80) | 4,404 | |||||
US Further Adjusted EBITDA | 167 | 65 | 232 | |||||
Group Ex-Us | 7,306 | 80 | 7,386 | |||||
Group Ex-US Further Adjusted EBITDA | 1,707 | (65) | 1,642 | |||||
Adjusted Free Cash Flow reconciliation:
See below a reconciliation of Adjusted Free Cash Flow to net cash generated in operating activities, the most comparable GAAP measure.
($ in millions) | As of December 31, | ||
2023 | 2022 | ||
Net cash provided by operating activities | |||
Less: | |||
Change in player deposits | 1 | 72 | |
Change in player deposit liability | 382 | (376) | |
Add cash impact of: | |||
Transaction fees and associated costs | 83 | 32 | |
Restructuring and integration costs | 137 | 114 | |
Less cash impact of: | |||
Purchase of property and equipment | (159) | (122) | |
Purchases of intangible assets | (175) | (100) | |
Capitalized software | (268) | (207) | |
Adjusted Free Cash Flow | |||
Net debt reconciliation:
See below are conciliation of net debt to long-term debt, the most comparable GAAP measure.
($ in millions) | As of December 31, | ||
2023 | 2022 | ||
Long-term debt | |||
Long-term debt due within one year | 51 | 43 | |
Total Debt | 7,056 | 6,750 | |
Add: | |||
Transactions costs, premiums or discount included in the carrying value of debt | 54 | 41 | |
Less: | |||
Unrealized foreign exchange on translation of foreign currency debt1 | 182 | (151) | |
Cash and cash equivalents | (1,497) | (966) | |
Net debt | |||
1. Representing the adjustment for foreign exchange that is economically hedged as a result of our cross-currency interest rate swaps to reflect the net cash outflow on maturity.
Adjusted net profit attributable to Flutter shareholders:
See below are conciliation of Adjusted net profit attributable to Flutter shareholders to net loss, the most comparable GAAP measure.
($ in millions) | As of December 31, | ||
2023 | 2022 | ||
Net loss | |||
Add (Less): | |||
Transaction fees and associated costs | 92 | 43 | |
Restructuring and integration costs | 126 | 155 | |
Legal settlements/loss contingencies | - | (44) | |
Impairment of PPE and Intangible Assets | 725 | - | |
Amortization of acquired intangibles | 791 | 749 | |
Accelerated amortization | 30 | - | |
Loss on settlement of long-term debt | 6 | 65 | |
Financing related fees not eligible for capitalization | 29 | 9 | |
Share-based compensation | 196 | 147 | |
Tax impact of above adjustments1 | (150) | (199) | |
Adjusted net profit | |||
Less: | |||
Net loss attributable to non-controlling interests and redeemable non-controlling interests2 | 13 | (1) | |
Adjustment of redeemable non-controlling interest | (2) | 63 | |
Adjusted net profit attributable to Flutter shareholders | |||
Weighted average number of shares | 177 | 177 | |
1. Tax rates used in calculated adjusted net profit attributable to Flutter shareholders is the statutory tax rate applicable to the geographies in which the adjustments were incurred.
2. Represents net loss attributed to the non-controlling interest in Sisal and the redeemable non-controlling interest in FanDuel, Junglee and Adjarabet (2022).
3. Represents the adjustment made to the carrying value of the redeemable non-controlling interests in Junglee and Adjarabet (2022) to account for the higher of (i) the initial carrying amount adjusted for cumulative earnings allocations, or (ii) redemption value at each reporting date through retained earnings.
Adjusted Earnings Per Share reconciliation:
See below are conciliation of Adjusted Earnings Per Share to net loss per share, the most comparable GAAP measure.
($ in millions) | As of December 31, | ||
2023 | 2022 | ||
Net loss per Flutter shareholders | |||
Add (Less): | |||
Transaction fees and associated costs | 0.52 | 0.24 | |
Restructuring and integration costs | 0.71 | 0.88 | |
Legal settlements/loss contingencies | - | (0.25) | |
Impairment of PPE and Intangible Assets | 4.09 | - | |
Amortization of acquired intangibles | 4.46 | 4.24 | |
Accelerated amortization | 0.17 | - | |
Loss on settlement of long-term debt | 0.03 | 0.37 | |
Financing related fees not eligible for capitalization | 0.16 | 0.05 | |
Share-based compensation | 1.11 | 0.83 | |
Tax impact of above adjustments1 | (0.85) | (1.12) | |
Adjusted earnings per share | |||
IFRS Adjusted EBITDA reconciliation:
See below are conciliation of Adjusted EBITDA, Adjusted EBITDA Margin, Further Adjusted EBITDA and Further Adjusted EBITDA Margin to net loss, to the most comparable GAAP measure.
(in millions) | Year Ended December 31, |
2023 | |
Net loss | |
Add back: | |
Income taxes | (125) |
Financial income | (45) |
Financial expense | 676 |
Depreciation and amortization | 1,448 |
Transaction fees and associated costs1 | 92 |
Restructuring and integration costs2 | 126 |
Impairment of PPE and Intangible Assets3 | 708 |
IFRS Group Adjusted EBITDA | |
IFRS Group Adjusted EBITDA | £1,525 |
IFRS US Adjusted EBITDA | £81 |
IFRS Group Adjusted EBITDA ex-US | £1,444 |
IFRS UKI Adjusted EBITDA | £758 |
IFRS Australia Adjusted EBITDA | £288 |
IFRS International Adjusted EBITDA | £555 |
IFRS Unallocated corporate overhead | £(157) |
1. Fees primarily associated with transaction fees related to the proposed listing of Flutter's ordinary shares in the U.S.
2. Primarily relate to various restructuring and other strategic initiatives to drive increased synergies arising primarily from the acquisition of Sisal. These actions include efforts to consolidate and integrate our technology infrastructure, back-office functions and relocate certain operations to lower cost locations. The costs primarily include severance expenses, advisory fees and temporary staffing cost. Costs also include implementation costs of an enterprise resource planning system that could not be capitalized.
3. In the fourth quarter of 2023, the Group recognized an intangible asset impairment loss related to PokerStars trademark within the International segment. The impairment was primarily driven by an assessment of strategy and operational model aimed at maximizing the value of PokerStars' proprietary poker assets consistent with our International segment strategy to combine global scale with local presence.
Constant currency ('CC') growth rate reconciliation:
See below a reconciliation of constant currency growth rates to nominal currency growth rates, the most comparable GAAP measure.
($ in millions) | As of December 31, | |||||
unaudited | 2023 | 2022 | YOY | 2022 | 2022 | YOY |
Revenue | FX impact | CC | CC | |||
US | 4,484 | 3,187 | 3 | 3,190 | ||
UKI | 3,047 | 2,664 | 16 | 2,680 | ||
Australia | 1,447 | 1,558 | ( | (68) | 1,490 | ( |
International | 2,812 | 2,055 | 40 | 2,095 | ||
Group | 11,790 | 9,463 | (8) | 9,456 | ||
Group Ex-US | 7,306 | 6,277 | (11) | 6,266 | ||
Adjusted EBITDA | ||||||
US | 65 | (347) | - | (347) | ||
UKI | 888 | 757 | 8 | 765 | ||
Australia | 348 | 477 | ( | (24) | 453 | ( |
International | 592 | 395 | 23 | 418 | ||
Unallocated corporate overhead | (215) | (141) | (4) | (145) | ||
Group | 1,678 | 1,142 | 3 | 1,144 | ||
Group Ex-US | 1,613 | 1,489 | 3 | 1,492 | ||
Further Adjusted EBITDA | ||||||
US | 167 | (263) | 1 | (262) | ||
UKI | 911 | 777 | 8 | 785 | ||
Australia | 356 | 485 | ( | (24) | 461 | ( |
International | 627 | 417 | 23 | 440 | ||
Unallocated corporate overhead | (187) | (127) | (4) | (131) | ||
Group | 1,874 | 1,289 | 3 | 1,292 | ||
Group Ex-US | 1,707 | 1,552 | 2 | 1,554 | ||
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SOURCE: Flutter Entertainment PLC
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