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MarketScreener Homepage  >  Equities  >  Toronto Stock Exchange  >  The Stars Group Inc.    TSGI   CA85570W1005

THE STARS GROUP INC.

(TSGI)
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Flutter suspends 2020 dividend amid coronavirus betting slump

03/27/2020 | 04:01am EST
FILE PHOTO: Paddy Power logo is seen behind a keyboard and gambling dice in this illustration taken in Sarajevo

Paddy Power Betfair parent Flutter Entertainment will pay its 2019 dividend in ordinary shares, shelve a pro-rated dividend in relation to its merger with Stars Group Inc (TSG) and suspend the 2020 dividend for the combined group.

The Irish betting group announced the changes in response to the coronavirus outbreak that it estimated earlier this month would have at least a 90 to 110 million pound impact on full-year earnings if curbs on sports fixtures remained in place until the end of August.

Disruption to global online betting and gaming is expected to impact the financial profile of the combined group in the current financial year, Flutter said on Friday, likely pushing its net debt at the end of the first reporting period following completion above 3.5 times core earnings.

While Flutter said the group has flexibility to maintain leverage at higher ratios, it was committed to a ratio of 1.0x to 2.0x over the medium-term, making it prudent to suspend the dividend while its board "monitors the sporting calendar, associated performance of sports betting as well as the combined group's anticipated deleveraging and balance sheet position".

Poker Stars operator TSG has never declared or paid dividends and is not expected to do so prior to completion, it added.

Flutter agreed last October to buy the Canadian group in a $6 billion (4.92 billion pounds) share deal set to create the world's largest online betting and gambling company by revenue.

Flutter also said on Friday it had entered into new debt arrangements, contingent only on completion of the deal, comprising a term loan and revolving credit facility totalling 1.3 billion pounds to refinance existing Flutter and TSG debt as well as providing ongoing financial flexibility.

"In these challenging times, I am more convinced than ever of the strategic fit of these two complementary businesses," Flutter CEO Peter Jackson, who will retain his role in the combined group, said in a statement.

He said the pair would continue to work with various competition and anti-trust authorities globally to secure the few remaining approvals required and that both companies would ask shareholders to approve the deal in late April.

By Padraic Halpin


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
AT HOME GROUP INC. -7.05% 17.28 Delayed Quote.238.00%
FLUTTER ENTERTAINMENT PLC 5.95% 156.65 Delayed Quote.38.74%
JUST GROUP PLC 2.93% 57.9 Delayed Quote.-28.80%
THE GLOBAL LTD. -6.38% 308 End-of-day quote.-34.61%
THE NEW HOME COMPANY INC. 1.07% 5.67 Delayed Quote.20.39%
THE STARS GROUP INC. 0.00%End-of-day quote.10.62%
WILL GROUP, INC. 0.40% 994 End-of-day quote.-20.61%
WORLD CO., LTD. 2.93% 1370 End-of-day quote.-49.09%
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Financials (USD)
Sales 2020 - - -
Net income 2020 - - -
Net Debt 2020 - - -
P/E ratio 2020 -
Yield 2020 -
Capitalization 10 855 M 7 963 M -
Capi. / Sales 2020 -
EV / Sales 2021 5,09x
Nbr of Employees 4 591
Free-Float -
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Income Statement Evolution
Managers
NameTitle
Rafael Ashkenazi Chief Executive Officer
Divyesh Gadhia Executive Chairman
Guy Nigel Templer Chief Operating Officer
Brian S. Kyle Chief Financial Officer
David A. Lazzarato Independent Director