In a challenging financial year, Sky Bet’s profits were impacted by increased operating expenses.
- Sky Bet owner, Flutter Entertainment, reports a £44m rise in expenses, totalling £310.2m.
- Despite a revenue increase to £495.4m, Sky Bet’s pre-tax profit dropped to £48.9m.
- High inflation and elevated salaries were key factors affecting the company’s financial performance.
- No dividends were issued this year, contrasting with the £107.2m payout in 2022.
Sky Bet, a subsidiary of Flutter Entertainment, has experienced a significant financial impact in its recent fiscal year. The company’s records, filed with Companies House, reveal a drop in pre-tax profits to £48.9 million. This decline is primarily attributed to a substantial £44 million rise in operational expenses, bringing total expenses to £310.2 million. The increased costs were largely due to persistent high inflation and rising salaries within the organisation.
Interestingly, Sky Bet’s overall revenue saw an uptick, improving from £469.7 million to £495.4 million over the period. However, this revenue growth was insufficient to counterbalance the steep increase in expenses and prevent the profit decline. Despite the financial strain, the company opted not to distribute any dividends this year, marking a notable shift from the £107.2 million payout it made in the previous year.
Sky Bet’s journey under Flutter Entertainment began with its acquisition in 2020 after Flutter merged with The Stars Group in a deal valued at £3.4 billion. Before this, the company was significantly controlled by CVC Capital Partners, which acquired an 80% stake for £600 million in 2015. The recent financial results come alongside Flutter Entertainment’s optimistic projections, with expectations of a 20% increase in group revenue and a 34% surge in adjusted EBITDA by the close of 2024, largely driven by robust performance in the US market.
Flutter’s financial updates underscore a sharp increase in group revenue by 20% to $3.6 billion (£2.8 billion) for the quarter ending June 30, 2024, as demand escalates across all markets. Notably, US revenue experienced a 39% rise, reaching $1.5 billion (£1.2 billion), while revenue from the UK and Ireland climbed by 17% to $928 million (£723 million). These figures closely follow record performances posted by Tombola, another Flutter affiliate, which disclosed £201.6 million in revenue and a £50.7 million pre-tax profit in 2023.
The financial trajectory of Sky Bet highlights the significant impact of rising costs on profitability despite revenue growth.
