Sportsbet Has 50% Market Share in Australia

Gambling giant Flutter Entertainment released preliminary financial results to the London Stock Exchange and it showed good news for Sportsbet. The Australian online bookmaker increased its market share to 50%, making it the largest sportsbook in the country.

Sportsbet is a major money earner for Flutter. The company increased its market share thanks, in part, to a 27% increase in its average monthly players. There were 794,000 average monthly players in 2020 but 1,008,000 during 2021. An increased number of players resulted in a 20% increase in both sportsbook sales and total revenue. Australians placed $21.32 billion worth of bets during 2021 up from $17.69 billion. Those wagers resulted in $2.35 billion of revenue up from $1.96 billion last financial year. What about profit? Operating profit soared 43% to $748.77 million.

Flutter merged Sportsbet and BetEasy following the mega-merger with The Stars Group. The pair enjoyed approximately 26% market share heading into 2021. However, joining forces allowed them to concentrate fully and increase that market share to an impressive 50%.

Increasing Market Share Came With Its Own Problems

Increasing market share was a direct result of cost-saving synergies following the TSG merger. Flutter saved $91.08 million over the year and reduced operating costs as a percentage of revenue by 15 percentage points to 17.1%.

However, it was not sunshine and rainbows because Sportbet fell foul of a couple of rules. Breaking the rules and stepping over the lines regulators set saw Sportbet receive two large fines.

The New South Wales Liquor & Gaming Authority fined Sportsbet $135,000 last November. The regulator found Sportsbet overstepped the mark regarding some advertisements.

That fine pales into insignificance compared to the huge $2.5 million issues last month. The Australian Communications and Media Authority issued the colossal fine over unwanted spam. Sending emails to customers and making them aware of your brand is one way to increase market share. However, spamming those customers with dozens or hundreds of unwanted emails is a recipe for huge fines.

Sportsbet Parent Company Posts $524.15 Million Loss

Sportsbet provided plenty of positives for Flutter but the group lost $524.15 million last year. Flutter gained market share in Australia and plenty in the United States but posted a large loss overall.

Flutter revealed it spent $988.29 million on “non-cash amortisation from acquired intangibles.” Intangible assets are things such as goodwill, brand recognition, and similar. The company wrote these down on its freshly acquired companies, therefore, it is a one-off cost.

Investors in Flutter reacted extremely negatively to the yearly loss. Shares traded at 10,795 pence per share at the close of trading on February 28. Those shares are today available at 8,640 pence per share. That equates to a 19.96% loss of the company’s value. This is a major overreaction from the market although some state a correction is long overdue.

Flutter Launches Safer Gambling Initiative

While Flutter is focused on increasing its global betting and online casino market share, it is doing so with its customers’ well-being in mind. Flutter launched a new initiative this week focusing on social equity and safer gaming. Positive Impact Plan is the catchy name of the new three-pronged scheme.

First, the company aims to have at least 50% of its customers to use the company’s safe gambling tools by 2026. It wants this to read 75% by the year 2030. The company is that determined to reach this total that its employees’ bonuses are directly linked.

In addition, Flutter is increasing the diversity of its staff, especially in locations it operates in. The company has plans to employee more female executives and more staff from ethnic minority backgrounds.

Last, Flutter is changing the lives of 10 million people using the power of sport and play. Flutter spent $81.97 million last year promoting safer and responsible gambling. Other gambling companies could do worse than following in Flutter’s footsteps.