The owners of gambling companies including Paddy Power, Betfair and William Hill have reported a plunge in revenues after implementing safer gambling initiatives – but said that the cost of living crisis is not slowing down punters’ betting habits.
London-listed Flutter, which owns Paddy Power, Sky Bet and Betfair, said that its UK revenues fell by 4% year on year in the first six months.
The online gambling company 888, which acquired William Hill International in a £2.2bn deal last year, said UK revenues fell by a quarter to £121m in the first half.
Both companies said that the impact on UK revenues was because of implementing measures to tackle problem gambling, such as £10 limits on slot machine stakes and introducing mandatory deposit limits for all customers under 25 years of age.
Last month, proposals to reform gambling laws were postponed for a fourth time amid turmoil at top of the Conservative party after the resignation of Boris Johnson.
“We are confident that the safer gambling changes we have already made to date position us well for the future,” said the Flutter chief executive, Peter Jackson.
Shares in Flutter, which reported global revenues up 11% to £3.4bn, surged by more than 12% – the biggest riser among blue-chip FTSE 100 companies – after the company said that consumers are not betting less despite the increasing pressure on household incomes.
“We currently see no discernible signs of a consumer slow down and resultant reduced spending levels across our businesses,” Flutter said. The revenue impact from the measures amounted to £48m in the first half.
“Flutter took the top slot among the FTSE risers, with the shares jumping after the company said there were no signs of consumers betting less – something the market had been fearing given the cost of living crisis,” said Danni Hewson, a financial analyst at AJ Bell. “This reinforces the idea that people will be happy to keep betting in the hope of winning big during more difficult economic times.”
Itai Pazner, the chief executive of 888, said that the move to pro-actively increase player protections have “put the group in an even stronger position for the future”.
In March, the Gambling Commission fined 888 £9.4m, the third highest in the history of British gambling regulation, over multiple failings that led to customers racking up huge losses during the Covid pandemic.