Overview of the European Commission's Investigation
In a significant development for FDJ, the company has acknowledged the European Commission's decision which concluded that no State aid was provided during its privatization process. This resolution comes with a reevaluation of the equalisation payment, now set at €477 million instead of the previous €380 million.
Details of the Investigation
The investigation was initiated on 26 July 2021, aiming to assess whether the payment made by FDJ for exclusive rights to operate point-of-sale sports betting and lottery for 25 years was justified. The confirmation of no State aid underscores the integrity of FDJ's privatization framework.
Financial Impact and Future Dividends
Following the investigation's conclusion, FDJ appreciates the closure and agrees with the European Commission's stance that the legal structure adopted at the time of privatisation was sound and robust. The company's balance sheets will be adjusted to reflect the new equalisation amount of €477 million, which will be recognized as an intangible asset and amortised over a span of 25 years from the effective date.
Starting from the 2024 financial year, FDJ has decided to base its dividend payments on this adjusted net profit. Such strategic changes are aimed at presenting a more accurate picture of the company's economic performance, providing stakeholders with better insights for comparative purposes in the competitive landscape.
Adjustments in Future Financial Reporting
FDJ's adjusted net profit will factor in several aspects, particularly targeting the amortisation tied to exclusive rights. For instance, an additional amortisation of €17.9 million for the period from 2019 to 2023 will influence the company’s financial results. Furthermore, adjustments for non-cash currency impacts from the acquisition of Kindred Group will also be integrated into the financial reporting.
Recent Developments in Share Capital
Recently, a ruling from the French Court of Cassation allowed FDJ to abolish 3% of its share capital. This adjustment has increased the total number of shares to 185,270,000. Such actions indicate the Group's proactive measures in structuring its capital to enhance financial flexibility.
About FDJ Group
FDJ Group stands out as one of Europe’s premier operators in the betting and gaming sector. Boasting a diverse portfolio complemented by a commitment to technological innovation, FDJ employs close to 6,000 individuals across around 15 regulated European markets. The Group offers a wide variety of gaming options, featuring lottery games in France and Ireland and sports betting both in physical locations and online.
FDJ's strategy incorporates a strong focus on responsible gaming, ensuring that all betting activities promote recreational use while complying with legal frameworks. The Group is publicly listed on Euronext Paris and holds a prominent position in various major indices, demonstrating its significance in the financial market.
Frequently Asked Questions
What was the outcome of the European Commission's investigation?
The European Commission concluded that no State aid was granted to FDJ during its privatisation, and the equalisation payment was adjusted to €477 million.
How will the new equalisation payment affect FDJ's finances?
The additional €97 million will be recorded as an intangible asset and amortised over 25 years, impacting future net profit calculations and dividend payments.
When will FDJ start basing dividends on adjusted net profit?
FDJ will base its future dividend payments on adjusted net profit beginning with the financial results for 2024.
How many shares does FDJ currently have outstanding?
Following recent adjustments, FDJ now has a total of 185,270,000 shares outstanding.
What is FDJ's approach to responsible betting?
FDJ emphasizes responsible gaming in its strategy, ensuring its offerings promote recreational betting while adhering to regulatory requirements.
