DUBLIN - Flutter (LON:FLTRF) Entertainment (NYSE:FLUT)(LSE:FLTR), a global leader in online sports betting and iGaming, has announced the initiation of a share repurchase program, with the first tranche involving the buyback of up to $350 million worth of its ordinary shares. The buyback is set to start on November 14, 2024, on the New York Stock Exchange and will conclude by March 31, 2025.
The repurchase initiative, which is the first segment of a larger $5 billion program authorized by the Board on September 25, 2024, aims to reduce the company's share capital. Goldman Sachs (NYSE:GS) & Co LLC has been appointed to manage the buyback process on behalf of Flutter. The firm will make independent trading decisions within pre-established parameters, in compliance with both U.S. and U.K. regulatory guidelines.
The maximum number of shares that may be acquired through this buyback has been capped at 17,739,905. All repurchased shares are expected to be cancelled as part of the capital reduction strategy. The timing and volume of future buyback tranches will be contingent upon Flutter's capital requirements and prevailing market conditions.
Flutter Entertainment, which boasts a diverse portfolio of brands such as FanDuel, Sky Betting & Gaming, and PokerStars, has reported a 25% year-over-year revenue increase, totalling $11.79 billion for fiscal year 2023. The company's revenue for the quarter ending September 30, 2024, stood at $3.25 billion.
The announcement also contained forward-looking statements, cautioning that actual results could differ materially from current expectations due to various risks and uncertainties. These statements and risks are detailed in the company's filings with the Securities and Exchange Commission (SEC), which are publicly available.
This news is based on a press release statement and has been issued without any promotional language, ensuring an unbiased report of Flutter Entertainment's strategic financial maneuver.
In other recent news, Flutter Entertainment reported a surge in its Q3 revenue, exceeding analyst expectations and leading to an upward revision of its full-year guidance. The company posted adjusted earnings per share of $0.43, surpassing the projected loss of $0.35. Revenue rose by 27% year-over-year to $3.25 billion, beating expectations of $3.05 billion. A significant contributor to this robust performance was the 51% revenue growth in its U.S. operations.
In light of these recent developments, Flutter Entertainment revised its full-year 2024 guidance. The company now expects group revenue of $14.25-$14.55 billion and adjusted EBITDA projected to be between $2.44-$2.62 billion.
Additionally, Flutter Entertainment disclosed its share repurchase program. The details of the repurchase program, including the number of shares to be bought back and the financial terms, were not specified. The company plans to commence a share repurchase program of up to $5 billion over the next 3-4 years, with the first tranche of $350 million set to begin soon.
InvestingPro Insights
Flutter Entertainment's share repurchase program aligns with its strong financial performance and market position. According to InvestingPro data, the company's revenue growth has been robust, with a 16.28% increase over the last twelve months as of Q2 2024, reaching $12.88 billion. This growth trend is further emphasized by the quarterly revenue growth of 20.33% in Q2 2024.
InvestingPro Tips highlight that Flutter's net income is expected to grow this year, and analysts predict the company will be profitable in 2024. This positive outlook may have influenced the decision to initiate the share buyback program. Additionally, the company's strong return over the last year, with a 67.34% price total return, suggests investor confidence in Flutter's strategy and market performance.
It's worth noting that Flutter operates with a moderate level of debt, which could provide flexibility for capital allocation decisions such as the share repurchase program. However, investors should be aware that the company is trading near its 52-week high, with the current price at 98.15% of its 52-week high.
For those interested in a deeper analysis, InvestingPro offers 14 additional tips for Flutter Entertainment, providing a comprehensive view of the company's financial health and market position.
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