Paddy Power Betfair group to change name to Flutter Entertainment
Paddy Power Betfair plan to change their name and are set to step up their focus on the burgeoning US sports betting market, the company revealed on Wednesday along with their annual results for 2018.
The group is set to be renamed Flutter Entertainment plc, subject to shareholder approval, a name harking back to the early days of exchange betting when Betfair merged with rival Flutter. The group's brands will continue as they are.
Chief executive Peter Jackson said: "It's a historical name we've owned for a long time. We don't intend to use it for our customers and we didn't have to spend any money acquiring it or the domain, which should be good news for shareholders."
Group revenue rose by nine per cent to £1.9 billion in 2018, but underlying Ebitda (earnings before interest, taxation, depreciation and amortisation) was down five per cent at £451 million once £24m worth of investment in the US sports betting market was taken into account.
Nevertheless, it is the US which Jackson described as "the market we are most excited about at the moment".
The group operates the FanDuel brand there, which has achieved a 35 per cent online market share in New Jersey in its first five months of operation, Jackson said.
He added: "We're very pleased with the start we've made in the US. The opening of the market has the potential to be the most significant development to occur within our sector since the advent of online betting, and initial market dynamics are encouraging."
Jackson acknowledged that challenges from higher taxes and stricter regulation were going to continue but is confident the company will cope.
One of those headwinds is the £2 stake for FOBTs which comes into force on April 1, but Paddy Power was unusual in calling for the government to take action on the controversial issue and Jackson said they did not intend to close any of their betting shops as a result, which numbered 362 at the end of 2018.
"We're ready, as you'd expect us to be, for the changes that come into place next month," said Jackson.
"We don't plan on closing any shops, and with the right types of opportunities we would love to continue to grow and expand our business."
Jackson, who revealed he planned to back Clan Des Obeaux in the Magners Cheltenham Gold Cup next week, said the new financial year had started in line with expectations.
Analyst Gavin Kelleher at Goodbody Stockbrokers said that "broadly speaking" it was a good update from the company.
He added: "In online the group delivered better year-on-year outcomes, particularly in gaming. Paddy Power is back taking share. In terms of Betfair, its sportsbook and gaming appear to have performed well in 2018, and there is a strategy to grow its international revenues more aggressively."
However, Paddy Power Betfair shares finished Wednesday down 2.65 per cent at 6,065p.
Flutter name a blast from the past
The name Flutter brings Paddy Power Betfair back full circle to the early Noughties when the group's betting exchange was making its first tentative steps into the gambling market.
A rival exchange called Flutter, founded in 1999 by Josh Hannah and with £30 million worth of financial backing, had beaten Betfair to the punch.
Flutter offered fractional odds and a flat 2.5 per cent commission rate and was seen by some as Betfair's superior.
However Flutter, as the name suggested, was very light in look and feel and did not really resonate with regular punters, and it was swiftly overtaken by – and then eaten by – Betfair, who in effect took over their rival in December 2001.
Hannah remained on the company's board after losing out to Ed Wray for the chief executive's role at Betfair, stepping down in 2014.
The Flutter name had long since disappeared only to be resurrected now by current chief executive Peter Jackson.
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