Flutter Entertainment chief hopes government and regulator will 'take time to understand customers' concerns'

The chief executive of the parent company of Sky Bet and Paddy Power said he hoped the governments in both the UK and Ireland would understand concerns about changes to regulation of the industry.

Peter Jackson was speaking after Flutter Entertainment unveiled its trading update for the third quarter of the year on Thursday morning.

Flutter's gambling industry rival Entain, the home of Coral and Ladbrokes, had noted the financial impact of regulatory changes, such as affordability checks, when it announced its trading update last week.

Punter-friendly sports results had been a bigger factor for Flutter, although the company still managed to report a 13 per cent increase in third-quarter revenues.

The Gambling Commission recently closed a consultation on what the government calls financial risk checks, which British racing fears could cost the industry £250 million over the next five years.

Jackson said Flutter had emphasised the importance of the proposed checks being frictionless and that they would protect at-risk customers without interfering with the majority.

He told the Racing Post: "The government has actually stated this time and time again and I found it heartening to read [culture secretary] Lucy Frazer's recent column when she said that checks would only apply to the very highest spenders, not apply on racetracks and betting shops, and noting the government is not in the business of telling people how they can and can't spend their own money.

"I hope that the government and Gambling Commission are going to take time to understand customers' concerns, that is the whole point of a consultation, and I think it's important that this is done in the right way. I trust that is what is going to happen."

Regulation is also an issue in Ireland where the consequences of the Gambling Regulation Bill's proposed advertising watershed have been described this week as "catastrophic for the horseracing industry in Ireland" by fellow operator BoyleSports.

Peter Jackson: "There are a small number of words which are potentially going to cause some unintended consequences"

Jackson said: "It's remarkable that out of 67,000 words in the bill there are a small number of words which are potentially going to cause some unintended consequences.

"Advertising is particularly an area of focus and if we get to a point where broadcasters will be prevented from screening sporting events from overseas with gambling-related messages advertised pitchside or on sports gear, such as racing or football, I think it is going to cause some real issues.

"We are working hard to try to make sure this small number of words can be addressed because in the main we think the bill has been drawn on lots of qualitative experience from around the world, and we think it is very good."

Shares in Flutter fell sharply on Thursday despite what the company described as a "strong" performance.

Issues including customer-friendly sports results meant the group's earnings for 2023 outside the US were set to be at the lower end of previous guidance.

Flutter also announced plans to delist from the Dublin stock market when it adds a listing in New York in the first quarter of next year.

The company said group revenue for the third quarter had increased by 13 per cent to more than £2 billion in the period, with growth in gaming revenue helping to offset a 12 percentage point impact caused by sports results.

Flutter said its US arm FanDuel had the number one position in sports betting with a 40 per cent market share. However, outside the US, earnings for the year were now forecast to be at the bottom of the previous guidance of £1.44bn to £1.6bn, after a £50m hit from sports results in September and October, as well as £30m from adverse movements in foreign exchange rates.

Nevertheless, Jackson said: "Overall, the significant potential for US growth and ability to leverage scale benefits across our diversified portfolio outside of the US, underpins our confidence in our significant and sustainable long-term earnings growth potential."

Analysts at Davy said the underlying trends at Flutter remained strong in all divisions except Australia, but David Brohan, gaming and leisure analyst at stockbrokers Goodbody, described Flutter's announcement as a "disappointing update".

Flutter's share price was down 10.22 per cent late on Thursday afternoon at 12,300p.

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