FDJ Reports Strong Results Post-Kindred Merger: A Bright Future Ahead
La Française des Jeux (FDJ), one of Europe’s leading lottery and gaming operators, has released an impressive report for the first nine months of the year, demonstrating the robustness of its financial position following its recent merger with the Kindred Group. This strategic acquisition has not only augmented FDJ’s market presence but has also robustly diversified its offerings, reinforcing its status as a “European champion” in the gaming industry.
Financial Performance Overview
FDJ’s year-to-date revenue reached EUR 2.01 billion ($2.18 billion), marking a significant 12% increase year-on-year. A major chunk of this revenue, approximately EUR 1.9 billion ($2.06 billion), originated from the company’s operations in France, showcasing the strength of its domestic market performance. The lottery segment led the revenue charge, contributing EUR 1.5 billion ($1.6 billion) to the total, which represents an 8% increase year-on-year. This growth can be attributed to favorable trends across various game offerings, appealing to a broad demographic of players.
In addition to lottery sales, FDJ’s sports betting segment saw robust results, generating EUR 407 million ($441.4 million), up 13% from the previous year. This surge reflects a growing interest in sports betting, particularly as major sporting events have captured public attention throughout the year.
Point-of-sale revenue in France increased by 3%, and a noteworthy 9% rise was reported across Ireland. Meanwhile, digital revenue thrived, escalating to EUR 302 million ($327.5 million), indicating an undeniable shift towards online gaming platforms.
ESG Excellence: Moody’s Recognition
As part of its commendable financial performance, FDJ has garnered recognition for its strong commitment to environmental, social, and governance (ESG) practices. Moody’s, a respected ratings agency, reaffirmed FDJ’s position at the top of its Hotel, Leisure, Goods and Services sector ratings with a score of 71/100—a rating that highlights the company’s dedication to sustainability and ethical governance. In a global context, FDJ ranks 31st among 4,500 companies assessed by Moody’s, further solidifying its reputation as a leader in responsible corporate practices.
Stéphane Pallez, FDJ’s Chief Executive Officer and Chair, acknowledged the impressive financial and non-financial outcomes achieved in this period. He expressed optimism for FDJ’s trajectory and the anticipated benefits of the Kindred acquisition for shareholders and stakeholders alike.
Updated Forecast Following the Kindred Acquisition
In light of the recent acquisition, FDJ has revised its revenue outlook for 2024, projecting a 9% increase in full-year revenue and an EBITDA margin estimated at around 25%. With the incorporation of its EUR 2.5 billion acquisition of Kindred, FDJ expects an even more pronounced revenue growth of approximately 16% for 2024, maintaining the EBITDA margin expectation.
This acquisition is monumental for FDJ, as it now holds a 91.77% stake in Kindred—one of Europe’s top five online gaming companies. After successfully navigating the regulatory challenges that accompanied the merger, FDJ is strategically positioned to expand its ownership to 100% and fully capitalize on the synergies between both operational portfolios.
If the acquisition had been finalized on January 1, 2023, FDJ estimates that consolidated revenue for FY 2024 would have reached EUR 3.5 billion. Conversely, had the merger occurred at the start of 2024, the combined first-half revenue would be projected at EUR 1.9 billion, indicating substantial growth potential beginning from the next fiscal year.
Conclusion: A Promising Horizon
The successful merger with Kindred Group not only enhances FDJ’s market standing but also diversifies its gaming offerings, thus setting the stage for continued innovation and growth. As FDJ navigates this transitional period, stakeholders can anticipate a robust fiscal future driven by strategic investments, a solid operational framework, and a steadfast commitment to sustainability.
With commendable financial results, strong ESG ratings, and an optimistic outlook for the upcoming year, FDJ stands poised to solidify its reputation as a leading player in the gaming industry—a true example of resilience and strategic foresight in an ever-evolving market landscape.
