(News Bulletin 247) – The gambling operator reported growth of 8% on a comparable basis in the third quarter and raised its outlook for the 2024 financial year. The company is mainly awaiting the verdict from the European Commission on exclusive rights.

FDJ picks up the pace a little. In the third quarter, the gambling operator’s turnover increased by 8% on a comparable basis to 669 million euros, or 1% more than the Visible Alpha consensus, notes Oddo BHF. The group also accelerated its growth compared to the first half (+4.7%).

The activity was particularly driven by the lottery, where growth stood at 10% on a comparable basis, thanks in particular to the rise in online lottery (which represents 14% of revenue compared to 12% a year ago). earlier) and “the return of Amigo’s growth since June”, notes Oddo BHF.

FDJ had redesigned the formula of this game to make it less addictive at the request of the National Gaming Authority. Furthermore, “Euromillions high jackpot draws were more numerous than in the third quarter of 2023”, underlines FDJ.

At the end of this quarter, FDJ raised its forecasts for 2024, counting on an increase in its revenues of 9% and a current gross operating margin (Ebitda) of around 25%. The company previously expected growth of around 8% and a margin of around 24.5%. These objectives exclude the impact of the acquisition of the Swedish Kindred, owner of Unibet and whose takeover was recently finalized by the company.

Oddo BHF notes, however, that this increase in outlook has already been integrated by the consensus which expects growth of 10.7% and a margin of 24.7%.

On the Paris Stock Exchange, FDJ shares moved little, gaining 0.6% at 4:00 p.m.

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The 2025 budget to watch

The group’s action suffered at the start of the month from fears of an increase in taxation on gambling, which would have been contained in the social security financing bill for 2025.

This measure was not “included in the government’s financing plan but it could be discussed during the next debates in Parliament”, underlines Oddo BHF.

On the other hand, FDJ will certainly be affected by the increase in corporate tax planned for companies generating more than a billion euros in revenue in France. The Finance bill for 2025 provides for a corporate tax surcharge representing 20.6% of the tax due for 2024 then 10.3% for that of 2025. These rates increase respectively to 41.2% and 20.6% for companies generating more than 3 billion euros in turnover in France.

This measure should have a significant impact on FDJ’s profit, of 5.9% for 2024 net profit, then 2.9% for 2025, calculates Oddo BHF.

Wait for Brussels like Godot

Above all, FDJ is awaiting the verdict from the European Commission on the exclusive rights agreed as part of its privatization in 2019.

Brussels opened an investigation in 2021 into the allocation by the French state to FDJ of these exclusive rights to the physical and online lottery as well as to sports betting for a period of 25 years in exchange for a balance of 380 million euros. The European Commission is investigating whether this operation, carried out as part of the privatization of the group, did not provide an undue advantage to the company.

The European Commission’s verdict has been a long time coming. The market fears that it will result in a significant additional price for the group (the Citi bank mentioned more than 1.5 billion euros in 2022). This uncertainty undermines visibility on FDJ shares.

At the beginning of October, the CEO of FDJ, Stéphane Pallez, estimated on BFM Business that this decision could soon arrive.

“We think that we are nearing the end of this process. We understood that the outgoing Commission which is still active would like to resolve this issue before handing over to the new Commission, which will take office in November,” he said. declared the manager in Good Evening Business. “During the month of October, we hope to have good news on this subject,” she continued.

As for a potential price supplement, if Brussels were to pronounce one, Stéphane Pallez judged that this “adjustment” would not exceed an amount “rather in the low hundreds of millions of euros, which we have fully taken into account “.

This supplement “cannot, in our opinion, exceed a range of around 300 million euros”, explained the CEO.

“The risk linked to the Commission’s decision has not completely disappeared, it is true, but it seems that the end is now in sight,” Oddo BHF wrote this Friday.