French gaming and betting giant FDJ United has published its financial results for the first half of the year, highlighting a slight decrease in revenue. The company attributed its sub-optimal revenues to tax-related headwinds, although its EBITDA margin remained in line with its annual target.
Regulatory Changes and Tax Hurdles Proved a Burden
In its report, FDJ highlighted gross gaming revenue (GGR) of EUR 4.3 billion ($5 billion), representing a decrease of 1.3% year-on-year. The company’s revenue, meanwhile, was almost EUR 1.8 billion ($2.1 billion), marking a decrease of 4.5%.
According to FDJ, the decrease in revenue was due to the impact of gaming tax increases in certain regions where it operates.
In the meantime, the GGR from lottery and betting operations in France reached EUR 3.4 billion ($3.9 billion), down 2% year-on-year. Revenue from the same operations in France was EUR 1.2 billion ($1.4 billion), down 3.9%. The French lottery segment’s GGR and revenue were approximately EUR 3 billion ($3.5 billion) and EUR 1 billion ($1.15 billion), respectively, equivalent to decreases of 2.1% and 4%, respectively. FDJ explained that this reflects a significantly lower number and amounts of major Euromillions jackpots in H1, as well as a heatwave-related decrease in traffic. Excluding the Euromillions game, lottery GGR from other products showed improvement of 1% for retail and 6% for online.
Retail betting was slow in Q1 but experienced improvements in Q2. For reference, sports betting GGR and revenue for the first half of the year were EUR 450 million ($518.8 million) (-1.1%) and EUR 218 million ($252.3 million) (-2.9%), respectively. The performance of online betting was in line with expectations, as the vertical posted stable GGR of EUR 702 million ($809.2 million) and revenue of EUR 431 million ($496.8 million) (-7.4%).
FDJ United highlighted the UK and the Netherlands as two regions where its business was impacted by higher taxes and regulatory shifts. Minus these two, the company’s H1 GGR and revenue would have increased by 6.6% and 0.6%, respectively. Still, FDJ reported improvements in the Netherlands, despite the challenging environment.
FDJ, however, benefited from the World Cup when EUR 700 million ($806.9 million) in stakes was placed.
The company also reported recurring EBITDA of EUR 404 million ($465.7 million), equivalent to a 22.7% margin. Adjusted net profit for the period was EUR 180 million ($207.5 million).
The company also reduced its fixed costs by 2.8%. At the end of Q2, it had a “very solid balance sheet,” with net financial debt of roughly EUR 2 billion ($2.3 billion).
FDJ Remains Optimistic, Targets Higher Dividend
In the meantime, FDJ United said that its new management is working on new action plans to gradually restore the company’s performance and optimize its resource allocation. Speaking of which, the company announced that it will be running a review of its market portfolio within the online betting and gaming division, as well as non-core assets within the Payment and Services division, among others.
The review comes less than two years after FDJ wrapped up its acquisition of Kindred.
Stéphane Pallez, FDJ’s chair & CEO, commented on the performance, acknowledging the headwinds in certain regions and the negative impact of the heatwaves and warming. However she remained optimistic about the company’s long-term performance.
Backed by solid fundamentals and a robust financial structure, FDJ UNITED continues to invest in innovation, the attractiveness of its product portfolio and the acceleration of its transformation in order to return to a path of sustainable, profitable and value-creating growth.
Stéphane Pallez, chair & CEO, FDJ United
FDJ United said that its current targets include stable GGR across French betting and sports betting and the company’s online betting and gaming segments, as well as a recurring EBITDA margin of between 23% and 24%.
For FY 2026, FDJ also targets an increase in the dividend.