Slide 1: Preliminary Results 2021
Flutter Entertainment Plc Preliminary Results 2021 1 March 2022 1
Slide 2: Introduction
Introduction Peter Jackson, Group CEO 2
Slide 3: Agenda
Agenda • Overview of 2021 • Strategy and Positive Impact Plan • Financial Review • Business Update • Conclusion 3
Slide 4: Overview of 2021
Overview of 2021 • Good progress made on operational and strategic objectives; recreational customer focus • US: FanDuel continuing to win; key milestone on path to profitability • UK&I: Significant safer gambling progress; adverse sports results and market slow down reduced momentum • Australia: Sp
Slide 5: Delivered against 2018 strategy
Delivered against 2018 strategy FY 2021 UK&I Australia International US Revenue by geography 21% Market 35% UK&I position Australia US 23% ROW Online market 29% 50% n/a 31% 21% share1 AMPs2 3.2m 1.0m 1.9m 1.6m 91% Regulated3 Global opportunity remains significant as more countries and US states regu
Slide 6: Refreshed Flutter strategy to deliver and defend gold medals
Refreshed Flutter strategy to deliver and defend gold medals Build on our network and Grow our gold medal invest for leadership 1 positions in our core 2 Invest to win in the US 3 positions across markets International markets 4 Take early positions to realise potential in future spaces Powered by k
Slide 7: Sustainability key to strategy with Positive Impact Plan
Sustainability key to strategy with Positive Impact Plan Global principles supporting positive change: Leverage global skill, Empower local teams to Deliver local initiatives with Build on existing success insight and capabilities adapt to local contexts maximum impact Global targets across three ke
Slide 8: Play Well safer gambling strategy crucial for sustainability
Play Well safer gambling strategy crucial for sustainability Global principles inform overall strategy: Lead progress: Promote positive play: Effectively interact: Support and protect: through research and through platforms and prompting players to make those who need targeted collaboration products
Slide 9: Financial Review
Financial Review Jonathan Hill, Group CFO 9
Slide 10: Key financial highlights
Key financial highlights Pro forma1 FY FY YOY • Revenue growth driven by recreational 2021 2020 CC customer growth Sports revenue £3,774m £3,000m +27% Revenue Gaming revenue £2,262m £2,264m +4% • YoY profitability impacted by: – Significant investment in US Total revenue £6,036m £5,264m +17% – Regul
Slide 11: Statutory Group P&L
Statutory Group P&L £m Reported FY 2021 FY 2020 YOY • 12-month contribution from TSG in 2021 with ~8 months in 20201 Revenue 6,036 4,414 +37% – Primary driver of YoY increases Gross profit 3,727 2,872 +30% EBITDA 723 772 -6% • P&L includes £909m loss from SDIs2 Depreciation & amortisation (254) (213
Slide 12: Customer volumes significantly above historic levels
Customer volumes significantly above historic levels Pro forma AMPs H1’19 – H2’21 (millions) • Group AMPs +23% YoY (Ex-US 3.5 2 year H2 CAGR +15%) +13% 3.0 • UK&I player volumes moderating post-Covid, recreational base 2.5 Q4 2021 significantly bigger than 2019 2m AMPs 2.0 +10% • Continued strong mo
Slide 13: Revenue: US now second largest division
Revenue: US now second largest division Pro forma revenue H1’20 – H2’21 (CC, £bn) • Group revenue +17% YoY 1.4 1.4 1.4 FY’21 • UK&I sports results combined with 1.2 £2.1bn 1.2 1.2 SG measures in H2 2021 • Sportsbet in-line with customer 1.0 1.0 1.0 momentum 0.8 0.8 £1.3bn £1.3bn 0.8 £1.4bn • Interna
Slide 14: UK&I online: Growth offset by several key factors
UK&I online: Growth offset by several key factors EBITDA, £m Revenue +3% EBITDA: flat • Growth driven by: – Gaming AMPs +22% despite Covid 266 46 comparatives – Normalised calendar driving staking 79 (232) growth; expected margin increase reflects (93) (6) growing recreational base Normalised sporti
Slide 15: International sustainability significantly improved
International sustainability significantly improved EBITDA £m, constant currency – 2 year bridge • Improving sustainability; £123m EBITDA impact Improvements to 574 sustainability -£123m • Guided German and Netherlands cost of £85m (£140m annualised) 512 (61) (8) • Investment made in key areas: (65)
Slide 16: Divisional EBITDA reshaped over last two years
Divisional EBITDA reshaped over last two years Adjusted EBITDA (£m) • Online ex-US EBITDA margin of 28%, 4pp FY FY FY Yo2Y CAGR lower due to International investment and Pro forma 2021 2020 2019 CC challenging comparatives UK & Ireland Online 626 629 492 12% UK & Ireland Retail (10) 2 76 • Excellent
Slide 17: Cash flow
Cash flow Pro forma £m FY 2021 FY 2020 • Adjusted free cash flow pre-tax of £763m compares to Adjusted EBITDA 1,001 1,231 Capex (308) (252) Adjusted operating profit of £746m, converting at 102% Working capital 119 310 Corporation tax (138) (93) • Adjusted free cash flow lower due to: Lease liabilit
Slide 18: Group outlook provides future financial flexibility
Group outlook provides future financial flexibility Tombola Sisal Pro forma for 31 December £’m, leverage ratio1 2021 (Acquired (Expected Tombola & • Leverage 2.6x at 31 December 2021 Jan 2022) Q2 2022) Sisal Gross debt 3,599 - - 3,599 • Leverage excluding US losses of 2.1x, Cash (excl. customer bal
Slide 19: Financial guidance
Financial guidance Current • Group revenue in line with expectations over the first 7 weeks, up 2% year-on-year trading/ • Expect phasing of growth to accelerate across the Group in H2 Outlook • Russia/Ukraine impact: £60m contribution in 2021, with £41m from Russia and £19m from Ukraine Tax • Effec
Slide 20: Business Update
Business Update Peter Jackson, Group CEO 20
Slide 21: US: Significant scale generated over last two years
US: Significant scale generated over last two years Flywheel effect continues in H2… …driving unparalleled US scale AMPs ‘000 Revenue $’m • Revenue +84% • Marketing spend +50% • Sportsbook and but 11.6pp lower as a % Q4 2021 gaming AMPs of revenue vs. H2’20 2m AMPs doubled 1,557 CAGR +97% 1,911 High
Slide 22: US: Doubling down on competitive advantages
US: Doubling down on competitive advantages Market leading product driving superior win margins FanDuel brand • Further evolution of market leading Same • Multi-year extension to NBA Game Parlay ™ (‘SGP’): and Pat McAfee partnerships – Combined SGPs on multiple different events – SGP in-play on cert
Slide 23: US: Delivering continued market share leadership
US: Delivering continued market share leadership 40% sports share - #1 in 9 of 12 states covering 87% of market… …while operating more efficiently Q4 online sportsbook GGR1 and market share, Q4 GGR FY 2021, $’m Bubble size proportionate to size of state market $’m 1,911 250 NJ 1,296 200 850 150 IL P
Slide 24: US: New states expected to be contribution positive sooner
US: New states expected to be contribution positive sooner Indicative monthly contribution by month post state launch, $ Previous guidance Updated view • Previously guided (March 2019) expect NJ sportsbook to generate positive contributions 18-30 months post Positive launch in-month contribution • N
Slide 25: US: FanDuel sportsbook and gaming contribution positive
US: FanDuel sportsbook and gaming contribution positive Breakdown of FY21 US EBITDA loss of $333m1 Customers acquired in- ($’m) year will become smaller % of overall • Pre 2021 customers funding % of customers base - key driver of further acquisition 38% 62% future profitability 388 • Positive contr
Slide 26: UK&I: Key drivers of Q4 and full year performance
UK&I: Key drivers of Q4 and full year performance Adverse sports results… …Safer gambling impacts… …and market declines drove challenging quarter Year-on-year sports results impact1 Quarterly minimum estimated revenue cost in 20212 (Revenue £m) (Revenue £m) • Market: Momentum slowed in Q43 37 – Fewe
Slide 27: UK&I: Significant progress on sustainability
UK&I: Significant progress on sustainability A focus on recreational growth… …Has positioned Flutter well Flutter UK & Ireland AMPs (millions) and revenue1 (£bn) Proportion of revenue from top 2 year 2 year value tier • Significant reshaping of player base and revenue mix CAGR CAGR +13% 3.0 +6% 15.7
Slide 28: UK&I: through evolving Affordability Triple Step strategy
UK&I: through evolving Affordability Triple Step strategy New Customers “Always on” protections Backstops • Proprietary AI technology to monitor 250+ behaviours • Tailored affordability • Robust registration checks (age backstops are being put in What • Effective engagement with in-person interactio
Slide 29: Australia: scale of business transformed over two years
Australia: scale of business transformed over two years Delivering on product and value Customer growth and efficiency driving profitability expansion 2019 2021 EBITDA 23.7% 33.7% 2 year 2 year % CAGR CAGR 1,294 • Continuing to +27% 1,008 +38% innovate on Same 437 2 year Game Multi (“SGM”) 681 CAGR
Slide 30: International: Significant progress made in stabilising business
International: Significant progress made in stabilising business Investment in poker proposition stabilising share Improved International revenue mix Estimated poker market GGR and PokerStars share1 2 • c.78% regulated/regulating markets in Q4 1 • Positive regulatory momentum in Canada Estimated mar
Slide 31: International: Attractive runway of future growth
International: Attractive runway of future growth Case study markets demonstrate opportunity1 Market size, GGR £bn Sports • Profile of attractive regulated and regulating markets £26bn Gaming Retail and Lottery • 2026 total addressable market c.£26bn • Projected 5 year online CAGR of 10% 13.8 • Sisa
Slide 32: International: Powerful combination of local hero brands
International: Powerful combination of local hero brands Products: Poker, casino, Products: Lottery, casino Products: Exchange, Products: Casino and Products: Rummy and sports and sports sports, casino sports daily fantasy sports Top markets: Italy, Spain, Top markets: Italy, Turkey Top markets: Ita
Slide 33: Conclusion
Conclusion Peter Jackson, Group CEO 33
Slide 34: Conclusion
Conclusion • ‘Positive Impact Plan’ positions us to lead the sector on sustainability • US: FanDuel’s momentum is maintained with #1 share, key milestones in path to profitability being achieved • UK&I: Plans in place to address slowdown in momentum; important that we get UK regulatory clarity soon
Slide 35: Appendix
Appendix =lutter
Slide 36: Leveraging scale, diversification and a challenger mindset
Leveraging scale, diversification and a challenger mindset Build on our network Grow our gold medal Take early positions to and invest for leadership 1 positions in our core 2 Invest to win in the US 3 positions across 4 realise potential in future markets spaces International markets • Maintaining
Slide 37: Safer gambling initiatives
UK&I: safer gambling progress and affordability triple step Revenue £m Reduced all Introduced Lowered New Roll-out of customer, age- Safer gambling initiatives new customer, annual cumulative 6 financial based, daily age based thresholds by month alert vulnerability deposit limits alerts 150% introd
Slide 38: KPI: Average monthly players
KPI: Average monthly players Average Monthly Players1,2 Pro forma ('000s) 2021 Q1 Q2 Q3 Q4 H1 H2 FY Group 7,672 7,578 7,257 7,969 7,625 7,613 7,619 UK & Ireland 3,167 3,440 3,060 2,946 3,303 3,003 3,153 Australia 831 982 1,086 1,133 906 1,109 1,008 International 2,027 1,863 1,799 1,915 1,945 1,857 1
Slide 39: UK & Ireland
UK & Ireland ONLINE RETAIL Online Pro forma £m FY 2021 FY 2020 YOY FY 2021 FY 2020 YOY • AMPs +25%, increase in recreational base Average monthly players (‘000s) 3,153 2,532 +25% • Safer gambling measures impacting Sportsbook stakes 10,473 8,401 +25% 904 998 -9% revenue growth (£93m revenue) Sportsb
Slide 40: Australia
Australia Pro forma £m FY 2021 FY 2020 YOY YOY CC • AMP growth +27% driving revenue Average monthly players (‘000s) 1,008 794 +27% growth +20%, retaining migrated Sportsbook stakes 11,702 9,713 +20% +20% customers Sportsbook net revenue margin 11.1% 11.1% - - • Net revenue margin remained in line Re
Slide 41: International
International Pro forma £m FY 2021 FY 2020 YOY YOY CC Average monthly players (‘000s) 1,901 1,938 -2% • Revenue -8%: – Challenging comparatives due to Poker spike in Sportsbook stakes 1,592 1,368 +16% +21% Q2’20 Sportsbook net revenue margin 8.7% 8.5% +20bps +20bps – Compliance changes post TSG merg
Slide 42: US
US Pro forma £m FY 2021 FY 2020 YOY YOY CC • AMPs +71% includes a doubling of sports Average monthly players (‘000s) 1,557 910 +71% and gaming players Sportsbook stakes 11,284 4,411 +156% +167% • Sports revenue +126% reflecting: – Sportsbook AMPs +180% Sportsbook net revenue margin 6.3% 4.6% +170bps
Slide 43: Separately disclosed items
Separately disclosed items £m FY 2021 FY 2020 • Intangible amortisation reflects a 12-month charge for TSG in 2021 versus ~8 in 2020 Amortisation of acquisition related intangible assets (543) (432) Kentucky settlement and associated legal costs (163) - • Kentucky settlement for historic case with T
Slide 44: www.flutter.com
=lutter www-flutter.com