Operator News
France – FDJ confirms nine months of stability for the year so far
By Phil - 23 October 2023
La Française des Jeux (FDJ), France’s leading gaming operator, has confirmed that its revenue for the nine months to end September 2023 stood at €4,808m, stable compared with 2022.
After €3,044 million in public levies, net gaming revenue totaled €1,771m, up 0.8 per cent based on a two per cent increase in stakes.
Stéphane Pallez, Chairwoman and CEO of FDJ Group, said: “Our growth remains solid, with strong players’ demand, even though it has been affected by the low number of Euromillions high jackpot draws. At the same time, the completion of the acquisition of ZEturf at the end of September and the forthcoming closing of Premier Lotteries Ireland acquisition in November illustrate our strategy of internationalisation and diversification. We are delighted that the teams of these two operators are joining FDJ and that these operations will contribute to the Group’s sustainable and profitable growth.”
On a like-for-like basis, sales rose by 1.3 per cent. It rose 4.6 per cent, in line with the first half, excluding Euromillions, which was particularly affected by the low number of high jackpot draws, especially in the 3rd quarter, and excluding Amigo, which was relaunched at the beginning of June with a revised formula in accordance with the regulator’s decision.
In the 3rd quarter, revenue totaled €586m, down one per cent and three per cent on a like-for-like basis. Stakes in points of sale increased 0.8 per cent to €13,278m supported by sports betting and instant games, and despite Amigo and Euromillions impact.
Digital stakes are continuing to grow, driven by all businesses. They were up 10.6 per cent to €2,011m, a performance attributable in large part to the increase in the number of players. Excluding Euromillions, online lottery stakes rose by more than 12 per cent. Online stakes account for more than 13 per cent of total stakes
Lottery revenue totaled €1,407m down 1.2 per cent, based on a slight increase in stakes, but up three per cent excluding Amigo and Euromillions. Driven in particular by the success of launches and relaunches, such as Carré Or in January and Numéro Fétiche in May, instant games stakes rose by more than 4%.
The almost six per cent drop in the stakes for draw games is attributable to the lower number of high jackpot Euromillions draws (19 at 2023 September-end compared to 32 at 2022 September-end), particularly noticeable in the third quarter, and the full impact of the new Amigo draw launched at the beginning of June and in line with the decision of the French National Gaming Authority.
Excluding Euromillions and Amigo, draw stakes are up one per cent and lottery stakes more than three per cent compared with 2022, an “exceptional” year for draw games, especially Euromillions with stakes up by almost +20 per cent to the end of September 2022. Overall, the appeal of this game remains strong, with stakes up by almost +10 per cent compared with 2019, following its relaunch in the first quarter of 2020.
The discrepancy between growth in stakes and growth in revenue is mainly due to Euromillions, which has a high rate of conversion of stakes into revenue.
Revenue of sports betting and online gaming open to competition totaled €360m, an increase of 9.3% in line with growth in stakes. The player payout ratio in the third quarter is very close to that at the end of June and that recorded at the end of September 2022.
Business growth, strong both at the point of sale and online, benefited from the continuing momentum of the FIFA World Cup at the end of 2022, despite a slightly less favourable football calendar in the 3rd quarter of 2023.
The acquisitions of ZEturf and Premier Lotteries Ireland (PLI) will strengthen FDJ’s model. ZEturf is the 2nd largest online horse betting operator in France, with a market share of around 20 per cent. This acquisition enables the FDJ Group to become the 4th largest competitive online gaming operator in France (sports betting, horse betting and poker), with a market share of over 10 per cent. Finalised at the end of September, this acquisition has been consolidated in FDJ’s accounts since 1 October.
In order to benefit fully from the potential of the merger with ZEturf and the synergies within its online business open to competition, and in accordance with the commitments made to the French Competition Authority, FDJ will adopt a new organisation for this business.
With 2022 revenue exceeding €50m, ZEturf doubles the revenue of FDJ’s online gaming business open to competition and will have an accretive effect on the sports betting and online gaming open to competition BU’s contribution margin from 2025.
The acquisition of Premier Lotteries Ireland, the Irish national lottery operator, is a major step in the deployment of the FDJ Group’s international strategy. On 3 October, the Irish lottery regulator gave the go-ahead for the deal, which is due to be finalised in early November, when PLI will be consolidated by FDJ.
In 2022, Premier Lotteries Ireland recorded gross gaming revenue (GGR) of €399m and revenue of €140m, with an EBITDA margin comparable to that of FDJ.
