Flutter Entertainment Plc · NYSE:FLUT

Flutter Entertainment — Paddy Power Betfair — Investor Day (March 2019)

96 slides from Flutter Entertainment's investor day presentation, Mar 28, 2019

1. Slide 1: Paddy Power Betfair plc U.S. Business Overview

   PADDY POWER BETFAIR PLC U.S. BUSINESS OVERVIEW MARCH 28, 2019

2. Slide 2: FanDuel Group in context of Paddy Power Betfair plc

   FANDUEL GROUP (“FDG”) IN CONTEXT OF PADDY POWER BETFAIR PLC (PPB) PBB PLC EUROPE AUSTRALIA U.S. (PPB) (SPORTSBET) (FDG)  FDG formed in July 2018 through the merger of PPB U.S. assets with FanDuel fantasy sports business  PPB owns 58% of FDG today  PPB has operational control with minority shares

3. Slide 3: Responsible for delivering on a key Group strategic pillar

   RESPONSIBLE FOR DELIVERING ON A KEY GROUP STRATEGIC PILLAR  Becoming a market leader in the U.S. is the fourth pillar of our Group strategy  PPB’s focus is on creating long-term value by building a sustainable podium position in the U.S. market  FDG management & minority shareholders are incentiv

4. Slide 4: Key messages we want you to take away from today

   KEY MESSAGES WE WANT YOU TO TAKE AWAY FROM TODAY  Established, well-positioned business in the U.S. already  Our success to date in the sports betting market give us confidence in the opportunity and demonstrates the power of our positioning  The market opportunity for sports (& casino) is very l

5. Slide 5: Agenda

   AGENDA 1. OVERVIEW MATT KING CHIEF EXECUTIVE OFFICER 2. REGULATORY LANDSCAPE CHRISTIAN GENETSKI CHIEF LEGAL OFFICER 3. PRODUCT & TECHNOLOGY ANDY GIANCAMILLI MANAGING DIRECTOR 4. BRAND & MARKETING MIKE RAFFENSPERGER CHIEF MARKETING OFFICER BREAK 5. HORSE RACING ENRICO RUSI GENERAL MANAGER OF RACING 6

6. Slide 6: Overview

   OVERVIEW MATT KING CHIEF EXECUTIVE OFFICER

7. Slide 7: FanDuel Group overview

   FANDUEL GROUP OVERVIEW HORSE RACING FANTASY SPORTS SPORTS BETTING ONLINE CASINO  $313m Net Revenue in 2018  >8.5m Customers  >800 Employees 7

8. Slide 8: Nationwide footprint; only operator with 4 key products

   NATIONWIDE FOOTPRINT; ONLY OPERATOR WITH 4 KEY PRODUCTS Horse Fantasy Racing Sports 33 states 41 states (paid) / 50 states (F2P) 3 states (NJ, WV & PA) 1 state (NJ) 8

9. Slide 9: FDG is already the largest online sports gaming operator in the U.S.

   FDG IS ALREADY THE LARGEST ONLINE SPORTS GAMING OPERATOR IN THE U.S. U.S. ONLINE SPORTS / GAMING REVENUE (2018) $285 ~$210m ~$140m ~$75m OTHERS Group Note: Financials per Company filings and research estimates for 2018 NGR. FanDuel Group excludes retail sportsbook and television revenue. DraftKings

10. Slide 10: So how big is the prize for U.S. sports betting?

    SO HOW BIG IS THE PRIZE FOR U.S. SPORTS BETTING? U.S. sport betting is a huge market opportunity:  Proven consumer demand: as evidenced by size of illegal sports betting market (estimated Handle of ~$150bn)1  Early signs in New Jersey are confirming regulation will rapidly tap into this demand: $2

11. Slide 11: The FanDuel Group approach to growth

    THE FANDUEL GROUP APPROACH TO GROWTH 11

12. Slide 12: Deep management team with U.S. & international experience

    DEEP MANAGEMENT TEAM WITH U.S. & INTERNATIONAL EXPERIENCE MATT KING C H I E F E X E C U T I V E O F F I C E R PAUL KIP ANDY NIALL MIKE CHRISTIAN RUSHTON LEVIN GIANCAMILLI CONNELL RAFFENSPERGER GENETSKI CHIEF FINANCIAL PRESIDENT & COO, MANAGING GENERAL MANAGER CHIEF MARKETING CHIEF LEGAL OFFFICER CEO

13. Slide 13: We are incredibly well positioned for success in the U.S.

    WE ARE INCREDIBLY WELL POSITIONED FOR SUCCESS IN THE U.S. BRAND / PEOPLE / PRODUCT & SCALE MARKETING RESOURCES TECHNOLOGY National footprint with $400m+ invested in 800+ employees; Heritage of proprietary >8.5m customers FanDuel as a sports c.300 in Product tech from the fantasy brand Developmen

14. Slide 14: Substantial progress & success since PASPA repeal

    SUBSTANTIAL PROGRESS & SUCCESS SINCE PASPA REPEAL  Successful Integration: FanDuel & Betfair U.S. / TVG teams came together  Launched Sportsbook: Reached a leadership position within months of opening  Increased Market Share in Each Existing Business vertical (Horse Racing, Fantasy Sports & Onlin

15. Slide 15: Regulatory landscape

    REGULATORY LANDSCAPE CHRISTIAN GENETSKI CHIEF LEGAL OFFICER

16. Slide 16: Legal and regulatory overview by product

    LEGAL AND REGULATORY OVERVIEW BY PRODUCT States have the right to regulate these verticals with Sportsbook opening after PASPA repeal HORSE RACING FANTASY SPORTS SPORTS BETTING ONLINE CASINO  Light regulation of  Some state regulation,  Heavily regulated  Heavily regulated advanced deposit focus

17. Slide 17: Overview of the U.S. state legislative process

    OVERVIEW OF THE U.S. STATE LEGISLATIVE PROCESS No two states have the exact same calendar, process, or power dynamics. Each can dramatically impact both the timing and outcome of legislation. Generally speaking, the stages of the process are: 1. Bill Introduction: there can be multiple bills introdu

18. Slide 18: Variety of stakeholders influencing laws in each state

    VARIETY OF STAKEHOLDERS INFLUENCING LAWS IN EACH STATE ONLINE / RETAIL LAND-BASED TRIBES RACETRACKS LEAGUES OPERATORS CASINOS FANDUEL GROUP LEGISLATIVE PRIORITIES  Our objective is pragmatic: Find a path to open markets in which we can participate on reasonable commercial terms  Full online/mobile

19. Slide 19: Upcoming sports betting states

    UPCOMING SPORTS BETTING STATES Pennsylvania and West Virginia are currently open for retail; both are expected to be online in 2019 with PA coming soon % OF U.S. STATE ACCESS PRODUCTS (TODAY) COMMENTARY POPULATION • State expanded gambling in October 2017 to include sports betting if PASPA was repea

20. Slide 20: Prospective, major sports betting states

    PROSPECTIVE, MAJOR SPORTS BETTING STATES There are currently bills to legalize sports betting circulating in 20+ states; these four major states represent the largest near-term opportunities STATE % OF POP. ACCESS PRODUCTS (TODAY) COMMENTARY • 2013 constitutional amendment (Retail in four commercial

21. Slide 21: Other potential sports betting states

    OTHER POTENTIAL SPORTS BETTING STATES STATE % OF POP. ACCESS PRODUCTS (TODAY) STATE % OF POP. ACCESS PRODUCTS (TODAY) FL 6.4% NOT YET MD 1.9% YES* (Exploring) (MGM / Other) OH 3.6% YES MO 1.9% YES (Boyd) (Boyd) LIKELY CT NOT YET TN 2.1% (Direct license 1.1% (Exploring) probable) IN 2.0% YES IA 1.0%

22. Slide 22: Focused on sustainability with strong regulatory compliance

    FOCUSED ON SUSTAINABILITY WITH STRONG REGULATORY COMPLIANCE We are focused on building a long-term business and take compliance efforts and responsible gaming initiatives very seriously, leveraging the global practices of PPB OVERVIEW OF KEY ITEMS  Compliance with regulations on reporting, KYC, mar

23. Slide 23: Product & Technology

    PRODUCT & TECHNOLOGY ANDY GIANCAMILLI MANAGING DIRECTOR

24. Slide 24: Product & technology overview

    PRODUCT & TECHNOLOGY OVERVIEW In-house development team introducing best-in-class, proprietary product features 24

25. Slide 25: We leverage a blend of proprietary & 3rd party technology

    WE LEVERAGE A BLEND OF PROPRIETARY & 3RD PARTY TECHNOLOGY FanDuel Group will continue increasing the proportion of proprietary technology in key areas 25

26. Slide 26: Proprietary technology is key to succeed in the U.S.

    PROPRIETARY TECHNOLOGY IS KEY TO SUCCEED IN THE U.S. U.S. CHALLENGES HOW OUR TECHNOLOGY WILL SOLVE THIS State by state requirements /  One app across states, supported by one infrastructure / Wire Act wallet per customer  Flexibility to develop features on betting Customer preferences and platform

27. Slide 27: Product development resources for the U.S. business

    PRODUCT DEVELOPMENT RESOURCES FOR THE U.S. BUSINESS Strong and experienced team dedicated to the U.S. business + access to shared global resources c.300 People  Fantasy business built on full proprietary (Product & Technology) technology developed over many years  Access to shared PPB global resou

28. Slide 28: Utilizing engineering principles that allow us to move faster

    UTILIZING ENGINEERING PRINCIPLES THAT ALLOW US TO MOVE FASTER FanDuel Group develops using best-in-industry Continuous Development and Agile software engineering principles, allowing us to build what our users want, quicker STREAMS MODEL FOSTERS …WITH AGILE DEVELOPMENT DRIVING FASTER COLLABORATION…

29. Slide 29: FDG product development throughput

    TO CREATE & DELIVER NEW FEATURES WITH A HIGH FREQUENCY FDG PRODUCT DEVELOPMENT THROUGHPUT BY VERTICAL KEY STATS Q3 ‘18 Q4 ‘18 Q1 ‘19 New TVG OTT App Race Replays Inline Form & Replays  50 app releases across Racing TVG Streaming in App New Racing Content Refer-a-friend platforms since sportsbook Pr

30. Slide 30: Recent new features deployed

    RECENT NEW FEATURES DEPLOYED We are customer obsessed, rapidly responding to user pain points FINDING ENTRY POINT FOR SIMPLIFYING THE DRAFTING PROCESS (FANTASY) NOVICES (SPORTS BETTING)  Created Guru tool that offers an in-line visual interface to  Built a simple, free-to-play bracket help users s

31. Slide 31: Our compelling products are recognized throughout the industry

    OUR COMPELLING PRODUCTS ARE RECOGNIZED THROUGHOUT THE INDUSTRY Our process of including a product designer, UX researcher and interaction designer in the product development stream process has resulted in a differentiated product that customers love 31

32. Slide 32: Near-term product priorities

    NEAR-TERM PRODUCT PRIORITIES  Integrate products with singular, proprietary account / wallet technology  Finalize development of multi-state capabilities  Leverage global position to deliver best-in-class product across verticals  Drive engagement through content, streaming, F2P and social  Uti

33. Slide 33: Brand & Marketing

    BRAND & MARKETING MIKE RAFFENSPERGER CHIEF MARKETING OFFICER

34. Slide 34: Exciting our customers with a compelling value proposition

    EXCITING OUR CUSTOMERS WITH A COMPELLING VALUE PROPOSITION VIDEO 34

35. Slide 35: FanDuel is very valuable as a U.S. sports gaming brand

    FANDUEL IS VERY VALUABLE AS A U.S. SPORTS GAMING BRAND  Significant brand equity: Over $400m spent over last 5 years  Large, existing sports-focused customer base of >8.5 million players  Proven ability to drive growth particularly amongst millennial sports fans  Established marketing team who h

36. Slide 36: Delivering billions of impressions across thousands of assets

    DELIVERING BILLIONS OF IMPRESSIONS ACROSS THOUSANDS OF ASSETS 36

37. Slide 37: Established marketing assets & history in the market

    ESTABLISHED MARKETING ASSETS & HISTORY IN THE MARKET AND A BRAND THAT RESONATES EXISTING MARKETING ASSETS WITH SPORTS BETTORS NATIONWIDE  Established team of 80+ Marketing employees with  Daily Fantasy Sports (DFS) players experience in U.S. market 3.5x more likely to bet on Sports with ~80% claim

38. Slide 38: FDG is the early leader in sportsbook

    FDG IS THE EARLY LEADER IN SPORTSBOOK UNPROMPTED AWARENESS (NOV’18 – JAN’19) 45% 42% 7% 7% 5% 2% 1% 1% 1% Note: Data based on internal surveys. Average for Nov. 2018 – Jan. 2019). N = 1,504. Survey data is from individuals in legalized sports betting states or adjoining states (Delaware, Kentucky, M

39. Slide 39: Supported by strong partnerships with leagues, teams & media

    SUPPORTED BY STRONG PARTNERSHIPS WITH LEAGUES, TEAMS & MEDIA MEDIA COMPANIES LEAGUES TEAMS (& CURRENT SHAREHOLDERS) SPORTS BETTING  Exclusive, official fantasy sports partner since 2014  Official sports betting partner FANTASY SPORTS  Exclusive, official fantasy sports partner  Official sports b

40. Slide 40: Leveraging content to generate earned impressions

    LEVERAGING CONTENT TO GENERATE EARNED IMPRESSIONS EDITORIAL / BLOG  Content has reach of 400m+ impressions  Searchable inventory with Google indexed FanDuel pages up 14x YoY VIDEO /  Top10 Google keywords up 3x YoY PODCAST  Top100 Google keywords up 8x YoY  TVG television network has distributi

41. Slide 41: Thoughtful approach to growth has yielded impressive results

    THOUGHTFUL APPROACH TO GROWTH HAS YIELDED IMPRESSIVE RESULTS SPORTSBOOK USER ACQUISITION BY SOURCE DRIVING SUSTAINED GROWTH  Disciplined investment of marketing dollars  Diverse & innovative digital portfolio  High levels of user referrals Direct Cross-sell  Agile approach to acquisition offer –

42. Slide 42: Cross-sell is creating a virtuous circle of engagement

    CROSS-SELL IS CREATING A VIRTUOUS CIRCLE OF ENGAGEMENT 42

43. Slide 43: Horse Racing

    HORSE RACING ENRICO RUSI GENERAL MANAGER OF RACING

44. Slide 44: Horse racing overview

    HORSE RACING OVERVIEW BUSINESS OVERVIEW  Advanced deposit wagering (“ADW”) across over 150 tracks in the U.S. for almost two decades  Product offered in 33 states; pools betting market  Only TV Network fully dedicated to Horse Racing with exclusive content  ~33% online wagering market share; top

45. Slide 45: TVG Networks supports the racing business with live content

    TVG NETWORKS SUPPORTS THE RACING BUSINESS WITH LIVE CONTENT EXISTING TELEVISION DISTRIBUTION & CONTENT  Acquire and retain bettors # of Homes 45 MILLION as the only dedicated horse racing network in Content TOP TIER RACING & PROGRAMMING the U.S. (plus an accompanying betting Live Broadcast AVERAGE

46. Slide 46: Consistently delivering strong growth ahead of the market

    CONSISTENTLY DELIVERING STRONG GROWTH AHEAD OF THE MARKET RACING REVENUE & GROWTH BUSINESS HIGHLIGHTS (GGR in $, growth y/y %)  Increased market share in last two years +12% +6% $131m  ~60% online market share in California $110m $117m (home state)  Exclusive operator in New Jersey  Strong posit

47. Slide 47: Best-in-class product for wagering on racing

    BEST-IN-CLASS PRODUCT FOR WAGERING ON RACING LEADING MOBILE APP FOR U.S. RACING WAGERING KEY DIFFENTIATORS  Leverage PPB European product resources  Cross platform TV network streaming offering the most tracks in U.S. market  TV talents picks & alerts  Built for fast bet placement  Easy, intuit

48. Slide 48: Bringing the European playbook & promotions to the U.S.

    BRINGING THE EUROPEAN PLAYBOOK & PROMOTIONS TO THE U.S. DIFFERENTIATED PROMOS & COMPELLING ACQUISITION EXCLUSIVE TV CONTENT CRM OFFERS 48

49. Slide 49: Cross-sell from Fantasy can expand racing audience

    CROSS-SELL FROM FANTASY CAN EXPAND RACING AUDIENCE  Initial cross-sell campaigns commenced in Jan’19 including home page skin and email offer  Major push planned for Kentucky Derby / Triple Crown in Q2’19  >25% of new customer registrations on TVG for 1st big Racing day of 2019 (Pegasus Cup) was

50. Slide 50: Growth drivers for racing business

    GROWTH DRIVERS FOR RACING BUSINESS  Broaden target audience for U.S. horse racing through cross-sell  Add incremental markets (i.e. new states)  Expand TVG networks distribution with more carriage (particularly of TVG2)  Transition more distributors from SD to HD broadcast to improve viewing exp

51. Slide 51: Fantasy Sports

    FANTASY SPORTS ANDY GIANCAMILLI MANAGING DIRECTOR

52. Slide 52: Fantasy sports overview

    FANTASY SPORTS OVERVIEW Paid, “daily” Fantasy Sports was a ~$3.5bn entry fee market in 2018 BUSINESS OVERVIEW  Operating largely nationwide since 2009  Revenue earned on a commission basis (~11% average) for hosting contests  ~40+% market share in the U.S. with major competitor being DraftKings 

53. Slide 53: Fantasy is a simple, unique & captivating experience

    FANTASY IS A SIMPLE, UNIQUE & CAPTIVATING EXPERIENCE SELECT A CONTEST BUILD A LINEUP FOLLOW IT LIVE COLLECT WINNINGS 53

54. Slide 54: Performance reinvigorated by new product and improved marketing

    PERFORMANCE REINVIGORATED BY NEW PRODUCT AND IMPROVED MARKETING FANTASY (FD) VOLUME AND GROWTH 2018 GROWTH HIGHLIGHTS (GGR in $, growth y/y %)  Introduction of single game contents Prospective FD / DK merger in review from Nov’16 to Jun’17 limited results 17% $163m  Added several new sports (NASCA

55. Slide 55: Product innovations continuing to drive player engagement

    PRODUCT INNOVATIONS CONTINUING TO DRIVE PLAYER ENGAGEMENT CREATE NEW FORMATS / INVENTORY DEVELOPED RESEARCH TOOLS  Simpler contests (i.e. single game) plus options  Injury notifications & expert picks for shorter duration (i.e. 2nd half only) UNDERLYING PRINCIPALS OF: 1) MORE VARIETY, 2) QUICKER T

56. Slide 56: Adding more casual & F2P games expands the addressable market

    ADDING MORE CASUAL & F2P GAMES EXPANDS THE TOTAL ADDRESSABLE MARKET  Widens the acquisition funnel and promotes new user retention  Drove registrations up materially, further expanding player database  Creates future monetization opportunities Note: F2P = Free-to-play. 56

57. Slide 57: Growth drivers for Fantasy

    GROWTH DRIVERS FOR FANTASY  Further innovate game formats, add sports and create more F2P games  Continue work on personalization to differentiate the user experience  Expand Fantasy internationally leveraging PPB’s distribution  Open new markets (i.e. states)  Add incremental content (incl. st

58. Slide 58: Sports Betting

    SPORTS BETTING NIALL CONNELL GENERAL MANAGER OF SPORTSBOOK

59. Slide 59: Sports betting overview

    SPORTS BETTING OVERVIEW Launch of sportsbook has been hugely successful with customer / market demand exceeding expectations BUSINESS OVERVIEW  Opened flagship Retail location in NJ at the Meadowlands and WV and PA  Launched Mobile in NJ; PA & WV expected to be online soon  Number one market shar

60. Slide 60: A unique, flagship retail location as our anchor property

    A UNIQUE, FLAGSHIP RETAIL LOCATION AS OUR ANCHOR PROPERTY… THE MEADOWLANDS FACILITY STRONG RETAIL PRODUCT OFFERING  >10,000 sq. ft. facility with 5 different rooms / areas  Cash in / out for online available; commencing multi-  100+ employees, 30+ teller windows, 45+ SSBT’s channel experience  L

61. Slide 61: Driving outsized retail market share

    …DRIVING OUTSIZED RETAIL MARKET SHARE NJ (RETAIL ONLY) – FANDUEL VOLUME & MARKET SHARE 100+%1 58% 62% 58% 56% 58% 58% 48% 50% 49% $53m $50m $46m 39% $44m 38% 38% 35% $38m 36% $38m $35m 17% $10m Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 FanDuel - Handle FD - Share (% Volume) FD - Share

62. Slide 62: Strategic approach to the New Jersey market

    STRATEGIC APPROACH TO THE NEW JERSEY MARKET  Maximize cross-sell from Fantasy  Invest in new customer acquisition and retention  Create a product gap  Customer-first approach to pricing and promotions  Leverage Meadowlands as unique retail location  Maximize customer value through cross-sell t

63. Slide 63: Most compelling mobile betting product in the market

    MOST COMPELLING MOBILE BETTING PRODUCT IN THE MARKET HOME SCREEN IN-PLAY VISUALS STREAMING  Extensive market research informed UI and UX of mobile app  Presenting in U.S. format with focus on domestic sports  Most comprehensive payment options  Leading parlay (multiple) builder tools  Best-in-c

64. Slide 64: U.S. trading capabilities give FDG a great headstart

    U.S. TRADING CAPABILITIES GIVE FDG A GREAT HEADSTART LEVERAGING PPB GLOBAL RISK & TRADING GLOBAL HANDLE ON U.S. SPORTS PLATFORM Feeds Distribution Sports models Events & Automation Destination specific content & odds 2x FDG Markets & Probabilities Insight & Knowledge B2B Partners Trader PPB  ~450 p

65. Slide 65: Risk & trading facilitates strategic pricing with most depth

    RISK & TRADING FACILITATES STRATEGIC PRICING WITH MOST DEPTH PRICING – OVERROUNDS MONEYLINE DEPTH – NUMBER OF BETTING MARKETS Pre play In play 200 Pre play In play 106.4% 105.6% 150 105.2% 104.6% 104.6% 103.9% 100 103.2% 103.1% 50 0 Rest (avg.) Rest (avg.) COMPETITIVE PRICING + BROADEST MARKET DEPTH

66. Slide 66: Significant investment & strong early returns on customer acquisition

    SIGNIFICANT INVESTMENT & STRONG EARLY RETURNS ON CUSTOMER ACQUISITION 100k+ paid player activations for NJ Online (Sept’18 – Feb’19) with ~50% cross-sold from Fantasy, including some lapsed Fantasy customers SHARE OF VOICE PROVEN IN SIGNIFICANT INVESTMENTS AND STRONG EXECUTION GOOGLE SEARCH TRENDS B

67. Slide 67: Always on, timely and relevant promotional strategy

    ALWAYS ON, TIMELY AND RELEVANT PROMOTIONAL STRATEGY DRIVING STRONG RETENTION % customers active 3 months post-acquisition c.2x Other markets FDG in NJ (PPB) 67

68. Slide 68: Our approach has resulted in a clear leadership position online

    OUR APPROACH HAS RESULTSED IN A CLEAR LEADERSHIP POSTION ONLINE NJ (ONLINE) – FANDUEL VOLUME & MARKET SHARE OTHER NJ PARTICIPANTS 53% 54% 48% 49% 44% $163m 40% 38% 37% $141m 31% $115m 27% 27% $104m 23% $70m $28m Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 FanDuel - Handle FD - Share (% Volume) FD - Sh

69. Slide 69: Growth drivers for sports betting business

    GROWTH DRIVERS FOR SPORTS BETTING BUSINESS  Continue to invest in new customer acquisition  Drive customer retention & engagement via product differentiation and “always on” promotions  Improve key cross-sell journeys  Release new features to build on product leadership  Continue to enhance U.S

70. Slide 70: Online Casino

    ONLINE CASINO JESSE CHEMTOB GENERAL MANAGER OF CASINO

71. Slide 71: Online casino overview

    ONLINE CASINO OVERVIEW BUSINESS OVERVIEW  Launched Betfair Casino in 2013 when NJ online gaming market opened; currently only operating in NJ  Achieved consistent top 5 online market share (>10%) with clear #1 position among non-land based brands  #1 overall market share in Feb. 2019 (~15%)  Off

72. Slide 72: Consistently delivering strong growth

    CONSISTENTLY DELIVERING STRONG GROWTH CASINO REVENUE & GROWTH KEY HIGHLIGHTS (GGR in $, growth y/y %)  Strong, direct growth over last 3 years $34m 31%  Accelerated growth since launching 30% $26m sportsbook cross-sell in Dec’18 $20m  Anticipating strong cross-sell in upcoming new states like PA

73. Slide 73: Competitive landscape online in NJ

    COMPETITIVE LANDSCAPE ONLINE IN NJ Strong execution garnered the Betfair Casino the top spot amongst non-land based casino brands in NJ; market share gains now being propelled by cross-sell from FanDuel Sportsbook BETFAIR CASINO – NJ ONLINE MARKET SHARE COMPETITORS Started FD Sportsbook to Casino cr

74. Slide 74: Product + marketing capabilities drove historical success

    PRODUCT + MARKETING CAPABILITIES DROVE HISTORICAL SUCCESS UNIQUE MARKETING & OPERATIONAL STRONG PRODUCT OFFERING CAPABILITIES  Leveraged in-house TV production capabilities to efficiently produce high quality TV ads  Smart media buying and iteration on attribution model delivered increasingly effi

75. Slide 75: Sports to casino cross-sell driving accelerated growth

    SPORTS TO CASINO CROSS-SELL DRIVING ACCELERATED GROWTH…  Leveraging shared account/wallet between FanDuel Sportsbook, cross-sell activity began in December 2018 Sportsbook contribution to Casino in 2019: 28% of casino revenue in 2019 YTD has come from Sportsbook customers  Just 7% of sportsbook c

76. Slide 76: With embedded gaming content in sportsbook to come

    …WITH EMBEDDED GAMING CONTENT IN SPORTSBOOK TO COME Embedded content has driven accelerated growth in Europe and we expect the same in the U.S. 76

77. Slide 77: Growth drivers for casino business

    GROWTH DRIVERS FOR CASINO BUSINESS  Expand and enhance cross-sell  Leverage dual-brand strategy in NJ protecting/growing Betfair market share and adding incremental growth with a FanDuel Casino branded product  Launch in Pennsylvania with cross-sell led strategy given experience in NJ  Add incre

78. Slide 78: Financial Summary & Outlook

    FINANCIAL SUMMARY & OUTLOOK PAUL RUSHTON CHIEF FINANCIAL OFFICER

79. Slide 79: Topics to cover

    TOPICS TO COVER  Revenue models: How we generate revenue  Existing businesses contribution and operating cost base  Economics of sports betting  Long-term sports betting opportunity 79

80. Slide 80: Revenue models (by product)

    REVENUE MODELS (BY PRODUCT) Revenue margin and volatility depends on the product vertical HORSE RACING FANTASY SPORTS ONLINE CASINO SPORTS BETTING Stakes x Net takeout % Entry Fees - Prizes Stakes x Hold % Stakes x Gross win % Return-to- Prizes to Winnings to Winnings to customer c.80% customers cus

81. Slide 81: Existing businesses contribution

    EXISTING BUSINESSES CONTRIBUTION (RACING, FANTASY & ONLINE CASINO) P&L SUMMARY (EXISTING BUSINESSES) KEY HIGHLIGHTS $m 2018 2017 YoY%  Double digit revenue growth across all verticals Gross revenue 334 290 15%  Revenue growth and synergies led to a $35m Bonuses -35 -25 improvement in contribution

82. Slide 82: Operating cost base

    OPERATING COST BASE OPEX BREAKDOWN KEY HIGHLIGHTS  Sportsbook specific costs includes risk & trading, retail c.25% Specific to Sportsbook staff, customer support  c.50% of OpEx is leveraged across all verticals, including: Shared by all c.50% – Product & technology verticals – Legal, regulatory &

83. Slide 83: Economics of sports betting

    ECONOMICS OF SPORTS BETTING Returns are a function of CPA relative to Customer Value, which will be determined by both state specific and operator specific factors STATE SPECIFIC FACTORS OPERATOR SPECIFIC FACTORS  Size of market (i.e. population, disposable  Scale income level and/or gambling prop

84. Slide 84: Sportsbook customer economics: cost per acquisition

    SPORTSBOOK CUSTOMER ECONOMICS: COST PER ACQUISITION (CPA) We have important CPA advantages which are allowing us to invest more efficiently at scale CPA DRIVERS OUR DISTINCT ADVANTAGES Brand  >$400m invested over last 5 years  Highest unprompted brand recognition Cross-sell (particularly from  c.

85. Slide 85: Sportsbook customer economics: value

    SPORTSBOOK CUSTOMER ECONOMICS: VALUE We have important advantages that will increase customer value and profitability VALUE DRIVERS OUR DISTINCT ADVANTAGES Product Quality  History of product excellence  Substantial in-house development supported by global resources Risk & Trading Capability  Acc

86. Slide 86: Sportsbook customer economics: illustrative payback

    SPORTSBOOK CUSTOMER ECONOMICS: ILLUSTRATIVE (CURRENT) PAYBACK We are acquiring customers at scale with highly attractive payback periods  Algorithms used to predict customer ILLUSTRATIVE CUSTOMER CONTRIBUTION PROFILE value (based on global models adjusted for observed U.S. behavior) Month from acqu

87. Slide 87: Sportsbook customer economics: online revenue profile

    SPORTSBOOK CUSTOMER ECONOMICS: ONLINE REVENUE PROFILE FANDUEL NJ ONLINE – MONTHLY REVENUE  Reported net revenue was diluted by Gross revenue Net revenue c.$10m acquisition bonuses in early months $8m  Bonus % of gross revenue reduces c.$7m as customer base is established $5m $6m o Reduced from ove

88. Slide 88: Sportsbook customer economics: total revenue profile

    SPORTSBOOK CUSTOMER ECONOMICS: TOTAL REVENUE PROFILE FANDUEL SPORTSBOOK (ONLINE + RETAIL) – QUARTERLY REVENUE  Revenue is significantly ahead of c.$30m plan o Market size larger than initial expectations c.$20m o Market share of 47% in 2019 YTD1 $15m  Strong growth trajectory o Q1 2019 revenue exp

89. Slide 89: Sportsbook opportunity at maturity: additional states

    SPORTSBOOK OPPORTUNITY AT MATURITY: POTENTIAL FROM ADDITIONAL STATES Group States % U.S. Pop’n Implied # of Existing Pop’n (vs NJ) market size1 FDG Customers Today 1 2.8% 1.0x $0.6bn 0.4m2 (NJ) Upcoming 2 4.5% 1.6x $0.9bn 0.4m (PA + WV) Prospective Major 4 15.1% 5.4x $3.0bn 1.6m (IL, MA, MI, NY) Oth

90. Slide 90: Sportsbook opportunity at maturity: path to 10x NJ

    SPORTSBOOK OPPORTUNITY AT MATURITY: PATH TO 10X NJ ILLUSTRATIVE MARKET EVOLUTION – PATH TO 10X NJ Weighted # Weighted Weighted Group # of states Probability of states Multiple of NJ market size1 Today 1 100% 1 1.0x $0.6bn Upcoming 2 100% 2 1.6x $1.0bn Prospective Major 4 50% 2 2.7x $1.6bn Other Pote

91. Slide 91: Sportsbook opportunity: illustrative contribution

    SPORTSBOOK OPPORTUNITY: ILLUSTRATIVE CONTRIBUTION PATH TO DELIVERING CONTRIBUTION SIMILAR TO PPB ONLINE $bn Comment Sports Market GGR at 10x New Jersey ~6.0 Illustrative size at maturity with further upside1 Potential Market Share 20% Currently 47% in NJ Gross Revenue 1.2 Bonuses at 20% (0.2) Expect

92. Slide 92: Summary

    SUMMARY  Strong profit improvement in existing businesses in 2018, with more to come  Substantial resources in place for sports betting to leverage, leading to favorable operational gearing  Business has distinct strategic advantages leading to favorable customer economics in sports betting  Des

93. Slide 93: Conclusion

    CONCLUSION MATT KING CHIEF EXECUTIVE OFFICER

94. Slide 94: Key messages we hope you took away from today

    KEY MESSAGES WE HOPE YOU TOOK AWAY FROM TODAY  Established, well-positioned business in the U.S. already  Our success to date in the sports betting market give us confidence in the opportunity and demonstrates the power of our positioning  The market opportunity for sports (& casino) is very larg

95. Slide 95: Appendix

    APPENDIX

96. Slide 96: Presenter biographies

    PRESENTER BIOGRAPHIES MATT KING PAUL RUSHTON MIKE RAFFENSPERGER CHRISTIAN GENETSKI CHIEF EXECUTIVE OFFICER CHIEF FINANCIAL OFFICER CHIEF MARKETING OFFFICER CHIEF LEGAL OFFICER ANDY GIANCAMILLI NIALL CONNELL ENRICO RUSI JESSE CHEMTOB MANAGING DIRECTOR GENERAL MANAGER OF GENERAL MANAGER GENERAL MANAGE

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