Good morning. First up this morning is the latest trading update from Flutter where the company suggested the 'most severe’ competitive environment it has yet faced might be easing off, slightly. Meanwhile, Sportradar has signed a first-ever data deal with UEFA. Bally, Rush Street and Hard Rock are battling it out for a casino in Chicago. Gaming in Covid-affected Macau in October was still grim.

If you were forwarded this newsletter and would like to subscribe, click here:

Flutter Q3 trading statement

The top line

• Revenue up 9% YoY (12% up in constant currency); sports revenue up 13% and gaming up 1%.

• US revenue up 85% YoY, Australia up 20% but UK & Ireland down 5% and international down 3% (but up 6% ex-Germany).

• The company blamed sporting results and a £10m hit from the Netherlands exit for revised FY21 EBITDA guidance of £1.24-1.28bn, down from £1.27bn-1.37bn.

• US guidance unchanged at $1.8-2bn and loss guidance window narrowed to $250m-275m. 

Every Sunday is a Superbowl: FanDuel maintained a 42% OSB market share in Q321 with the company saying that staking levels on Sundays are matching its 2021 Superbowl performance. Gaming market share was 18%. Revenue grew to £280m ($386m) with sports-betting up 97% to £184m ($254m) and gaming up 65% to £95m ($132m). FanDuel accounted for 94% of total revenue while TVG and DFS revenues declined by an unspecified amount due to “tough comparatives”.

Pressure cooker: CEO Peter Jackson said the competitive situation in the US was “the most severe we have experienced so far”. “There was a lot of free money flowing around,” he added. During the period, Flutter went live in Arizona and Connecticut and Jackson noted that Arizona had “matured much quicker” than any other new markets. On current competitive trends, he suggested a tailing off was taking place:

“I think a lot of people really sort of used their promotional firepower at the start of the football season and are starting to run out of dry powder to some extent. They're running out of steam and we are continuing to push hard and exploit our leadership position,” Jackson said.

Even for the big casino groups “there is only so much funding… before they actually run out of it,” he added. Jackson was also keen to suggest Flutter has a product advantage.

“We believe we can maintain our leadership from a customer experience perspective,” Jackson said. “It’s easy to acquire third-party products to catch up, but they give away all the upside. Just sticking a single game parlay on the side of the app does not make it a seamless experience, we have many in-house engineers working on our own product.”

Storm warning: In the UK & Ireland, the picture was far less positive with the company blaming a reduction in staking levels on a tough sports activity comparative, greater leisure options with the easing of lockdowns and more proactive responsible gambling measures. The government’s Gambling Act review is now likely a 2022 event, but Jackson warned that next year was still likely to be negative for the UK sector overall. “It’s hard to imagine the market in the UK will experience any real growth next year,” he said.

Junglee is massive: International suffered from the tightening of the German regulations. Ex-Germany, casino was up 21% and sports up 25% but poker was down 16% as the Covid-related mini-poker boom faded. Flutter gave mention to Junglee Games, the majority-owned Indian-facing business which it said added five percentage points of growth YoY. Flutter snapped up a 50%-plus stake in Junglee, which operates a popular rummy game, in April this year for £48m.

DraftKings and Fanduel vie for The Athletic

In it to win in: The Information reported yesterday that both DraftKings and FanDuel have submitted bids to buy subscription-led sports news site The Athletic. The loss-making business is being touted by investment house LionTree, previous M&A talks with the New York Times Co. and Axios failed to materialize. The Athletic, whose investors include Founders Fund, Courtside Ventures and Powerhouse Capital, is reportedly seeking a price of ~$750m and expects to be profitable next year with revenues of $120m. DraftKings already produces sports-betting content, notably through Las Vegas-based VSiN, while FanDuel recently led a funding round in Minute Media (publisher of The Players’ Tribune) to continue their work on a sports betting content site called The Duel.

*** A message from our sponsors: Venture capital firm Yolo Investments continues to build one of gaming’s most dynamic portfolios as it eyes up seed and A-stage opportunities across the sector. Its 28-company, €135m AUM gaming fund already houses holdings in fast-growing suppliers and operators, including Green Jade Games and Casino Days. Yolo Investments is also on the lookout for LPs as it looks to scale new concepts, including its high-roller live casino brand, Bombay Club.

As a proud sponsor of Earnings+More from Wagers.com, Yolo Investments wants to hear from readers of this newsletter. Get in touch with your pitch, or for a chat.

Sportradar UEFA data deal

Just Champion: Sportradar has secured the exclusive rights to distribute UEFA Champions League and European Championships data as part of its new official betting data partnership with the European governing body. Sportradar will collect and distribute the data to more than 500 matches per season as of this week’s round of European competitions and it runs until the end of the 2023/24 season. The move follows on from UEFA announcing bwin as its first-ever betting partner for the Europa League.

A data first: The deal represents the first time UEFA has done an official rights deal for the data related to the competitions which take place under its banner. “(Soccer) remains the world’s most popular sport and we’re extraordinarily pleased that UEFA selected Sportradar in their competitive process,” said Carsten Koerl, CEO at the recently-floated Sportradar. The deal also incorporates an extension to UEFA and Sportradar’s long-standing integrity cooperation agreement. 

Further watching: Koerl explains the importance of the UEFA deal on Cheddar News.

Chicago casino bidding

Build-a-bet: Bally has joined Rush Street Gaming and Hard Rock in the bidding to build a new casino in Chicago. Bally’s plans for a $1.6bn facility in one of two potential locations would include as part of its first phase up to 2,700 slots and 95 table games as well as a hotel and outdoor music venue. Analysts at Jefferies noted that OSB and igaming licenses (as and when it becomes legalized) would be included as part of the license. The bid winner will be announced early next year.

Further reading: Mayor Lori Lightfoot, a strong backer of the casino, has pitched the project as integral to the city’s growth.

Macau GGR October

On hold: Analysts pointed out that October’s poor numbers - GGR of MOP4.4bn ($547m), down 26% MoM and 83% off Oct19 - should be a low point for Macau. However, with Covid infections again picking up in recent days, they expect monthly trends to remain “subdued”, according to Macquarie.

“We believe improved visitation trends remain the primary driver of the Macau recovery, but given China’s zero tolerance policy towards rising coronavirus figures, a “normalized” Macau market is likely more of a ‘22/’23 story, in our view,” Macquarie analysts said.

Risk-off: The team added that the risk is that further outbreaks will impact any recovery though they noted that China’s top epidemiologist has said that 80% of Chinese citizens will be vaccinated by the end of this year. Still, analysts at Jefferies remain cautious. “Our conservatism for the Macau market remains, due to the lingering COVID uncertainty, zero-tolerance policy, and the concession overhang which could be resolved in the coming weeks.”

Datalines

Virginia: Sports-betting handle in Virginia in September reached $293.9m, a 61% MoM increase, with a hold of 10.53% and GGR of $30.9m. Bonuses were worth $17.4m of the total and with $3.1m of other deductions it meant adj. gross revenue (AGR) came in at $10.3m. Of the nine operators so far licensed in the state, only four had a positive AGR. The lottery didn’t break out which operators.

New Hampshire: Sports bettors wagered $68m in September, the largest handle recorded by the state since regulating sports betting in 2019. Mobile apps recorded $50.4m of the total, retail outlets collected the remaining $17.6m. NFL and college football accounted for around half the bets placed in September, the MLB making up c30% of the total. 

Newslines

Crossing the Rubico: Caesars and VICI Properties have completed the sale of the Louisiana Downs racino to Rubico Acquisition Corp, for $22m. The proceeds of the transaction were split $5.5m to VICI and $16.5m to Caesars.

Diamond dogs: Kambi has announced a deal to provide online and land-based sportsbook backend provision to the Desert Diamond Casinos & Entertainment, run by the Tohono O’odham Nation in Arizona. Land-based betting will launch first at the West Valley, Sahuarita, and Tucson, Arizona properties in Q4 with an online sportsbook to follow shortly.

High flyers: The NFL and Sport 24 have renewed their partnership for a further five years. Sport 24 is part of the IMG data group and the “only live 24/7 sports channel for the inflight industry”. It will broadcast 100 live NFL games per season, including the playoffs and Super Bowl, to passengers on airlines such as JetBlue, Emirates and Etihad.

MASN mash up: DraftKings-owned VSiN will deliver sports-betting content to the Mid-Atlantic Sports Network (MASN), the TV platform for the Baltimore Orioles and Washington Nationals. MASN broadcasts across seven states on the East Coast and reaches more than 75 million households. 

Some like it hot: IGT has signed a multi-year licensing agreement with the management company for the Marilyn Monroe estate Authentic Brands Group (ABG) to gain the rights to develop and distribute Marilyn Monroe-themed lottery games, instant tickets and other draw-based games and mobile and interactive games.

What we’re reading

A history of Flutter on via the Net Interest newsletter.

On social

Hello Ryan.

Ryan Butler @ButlerBets

Excited to announce today I start with Wagers.com, continuing to cover sports betting and gaming news, legislation and regulation, plus the industry at large. We're now offering our @earnings_and newsletter with much (much) more to come in the near future.Earnings + More – Wagerswagers.com

November 1st 2021

2 Retweets84 Likes

Calendar

• 2/3 Nov: Reputation Matters, London, Caesars Entertainment, Red Rock Q3s

• 3 Nov: Everi, Golden Entertainment, MGM Resorts International Q3s

• 4 Nov: Aspire Global, Penn National Gaming, Gaming & Leisure Partners Q3s

Contact us

• Scott Longley scott@clearconcisemedia.com

• Jake Pollard jake@openmediaservices.com