Betclic has driven growth for FL Entertainment’s online sports betting and gaming arm to offset declines at Bet-at-home.
Media and betting company FL Entertainment has reported a 15.7% year-on-year rise in group revenue to €4bn in 2022.
Adjusted EBITDA rose by 10% to €670.2m, resulting in an EBITDA margin of 16.6%.
FL Entertainment was formed last year as part of a special-purpose acquisition company (SPAC) merger, which included Betclic Everest Group and its subsidiary bet-at-home, along with television production company Banijay.
Banijay remained the primary contributor of overall group revenue. Nevertheless, FL Entertainment’s online sports betting and gaming business experienced substantial growth, recording a 13% increase in revenue to €835m for 2022.
This segment also witnessed remarkable growth in Q4 2022 after generating revenue of €244.1m, a substantial surge of 34.2% when compared to the same quarter of the previous year.
FL Entertainment’s online sports betting and gaming business has delivered impressive growth, especially considering the challenges faced by Bet-at-home during 2022.
Bet-at-home, which exited the UK market last year, already reported an 85% drop in EBITDA for 2022.
Online revenue increased by 19% in 2022 at constant exchange rates and excluding discontinued Bet-at-home operations.
This growth was primarily driven by a 21% revenue increase of the Betclic entity, which offset a 10% decline at Bet-at-home.
The World Cup in Q4 2022 significantly contributed to Betclic’s performance, with the tournament generating 7.5% of Betclic’s annual sportsbook stakes and 31% in annual new sportsbook Unique Active Players.
Moreover, FL CEO François Riahi praised Betclic’s technology infrastructure, which was put to the test during the World Cup.
The platform processed 6 million odds updates per day and settled 1.5 million bets just 13 seconds after the end of each football match.
By division and including Bet-at-home, revenue in the sportsbook division rose by 13.8% to €670.1m in 2022, with a 25% increase in Unique Active Players.
Online casino revenue rose by 2.7% to €104.8m, driven by greater gamification and the launch of new exclusive games, while online poker revenue increased by 13.1% €49.9m, partially due to cross-selling during the World Cup.
Betclic said its commitment to responsible gaming standards and operating in regulated markets had paid off, with 96.5% of 2022 revenue generated in locally regulated markets.
FL Entertainment CEO François Riahi on Betclic’s strong 2022 performance:
“Betclic has been the most downloaded sports betting app in our core markets of France, Poland and Portugal, and the second most downloaded across Europe, thanks to our state-of-the-art technology platform which leads the way in terms of reliability and efficiency.”
During the earnings call, Riahi was questioned about FL Entertainment’s M&A strategy for the upcoming year.
He replied that the company is strongly considering mergers and acquisitions, particularly in the content production and distribution sector.
However, he also mentioned that it’s challenging to plan for the “truly transformative deals”, and the company must seize opportunities as they arise.
“Nonetheless, we will remain very disciplined as we don’t see any point in acquiring companies at a price where it will be difficult to create value,” he added.
Current trading & outlook
For financial year 2023, FL Entertainment expects mid to-single digit organic revenue growth for its content production & distribution division, but double-digit organic growth for online sports betting and gaming.
The company plans to leverage its increased player numbers generated during the FIFA World Cup and upcoming events like the UEFA Champions League to drive increased betting volumes.
The group has set an adjusted EBITDA target of around €710m for 2023.
Betclic and bet-at-home owner FL Entertainment reported a 29.3% uptick in online sports betting and gambling revenue for Q3 2022 to €194.4m.
FL Entertainment is the publicly listed parent company of Betclic Everest Group (which also owns the bet-at-home brand) and Banijay Group, a television production and distribution company said to be the world’s largest international content producer and distributor.
While content production and distribution accounted for the majority (€717.6m) of FL Entertainment’s total Q3 revenue (€912.1m), the betting and gaming segment played a significant role in the business and has shown encouraging growth.
The majority of online gambling revenue was derived from sportsbook products at €154.8m, while casino and poker accounted for €25.3m and €11.7m in revenue, respectively. Other online gambling products made up the remaining €2.6m of the €194.4m Q3 total.
Those figures brought gambling revenue for the first nine months of 2022 to €591m for FL Entertainment, an increase of 5.7% year-on-year. Over that period, revenue growth was driven by a 15% uptick for the Betclic brand, while bet-at-home reported an 11% year-on-year reduction in revenue.
Adjusted EBITDA from the online gambling segment was €150.8m for the first nine months of the year, an increase of 8.4%.
The firm said revenue was boosted by a positive effect from the 2022 FIFA World Cup, with the bet-at-home brand in particular set to benefit from the tournament.
The brand was able to successfully implement reorganisation measures which resulted in reductions in costs across the business. Those savings were then channelled into additional investments in marketing around the World Cup, according to the operator.
FL Entertainment CEO François Riahi: “With an 11% growth in unique active players year-on-year, Betclic is well placed to capitalise on opportunities from the football World Cup, underpinned by its robust commitment to the highest standards of responsible gaming.”
Following the release of the results, bet-at-home has revised previously issued earnings guidance for the full-year 2022 from a range of €45m-€50m to €52m-€54m.
FL Entertainment held current assets of €2.1bn including cash and cash equivalents of €332.4m as of 30 September 2022. The business has net debt of €2.27bn.
“FL Entertainment delivered strong group revenue growth for the first nine months of 2022, demonstrating continued high profitability and cash generation,” said François Riahi, CEO of FL Entertainment.
“Our online sports betting and gaming business performed very well also, with an outstanding earnings growth, driven by its appealing digital platform and lean cost structure.
“With an 11% growth in unique active players year on year, Betclic is well placed to capitalise on opportunities from the football World Cup, underpinned by its robust commitment to the highest standards of responsible gaming.
“The positive momentum seen in the year to date, combined with our leading positions in attractive and growing segments of the entertainment industry, puts us in a strong position to maintain continued sustainable growth in line with our 2022 guidance and mid-term outlook,” Riahi concluded.