Entain: ‘Good’ operational progress being made despite UK & Ireland declines

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Entain has stated that it is making “good progress” in improving operational performance despite declines in the UK & Ireland.

Within its first quarter trading update, the FTSE 100 company noted that its performance was in line with expectations with “organic revenue growth”. 

Total group bet gaming revenue, which includes its 50 per cent share of BetMGM, improved by six per cent year-over-year, but down three per cent on a proforma basis.

Excluding US operations, group NGR rose by four per cent YoY, but declined by three per cent on a proforma basis. Gaming NGR fell by two per cent, sports NGR dropped by five per cent, while sports wagers decreased by five per cent.

Online operations improved by six per cent following an 11 per cent uptick in active customers, but on a proforma basis, these figures dropped by two per cent. Retail operations decreased by one per cent and five per cent on a proforma basis respectively.

“Our Q1 performance was in line with our expectations, with growth reflecting both strong performances in many of our markets as well as known challenges in others,” stated Stella David, Interim CEO of Entain.

“We are particularly encouraged by the level of customer engagement in the US following a successful Super Bowl and March Madness, as well as our return to growth in Brazil following the changes we implemented.”

Entain noted that its UK & Ireland segment saw a seven per cent decline YoY in NGR due to the effects of “regulatory implementation”. Online operations fell by nine per cent, while retail dropped by six per cent. Proforma percentages were the same.

Gaming NGR for the segment fell by seven per cent YoY, while sports NGR dropped by eight per cent. Sports wagers declined as well by 12 per cent.

The operator believes that its actions are “driving operational improvements” and that together with the levelling of the UK regulatory landscape, its brands are positioned for growth into 2025.

Internationally – which includes operations in Australia, Italy, Brazil, Netherlands, New Zealand, Georgia and Germany – NGR improved by four per cent YoY, but fell by two per cent on a proforma basis. Online and retail operations grew by four per cent but dropped by one per cent and eight per cent respectively on a proforma basis.

For the segment, gaming NGR increased by one per cent YoY, while sports NGR declined by five per cent. Sports wagers fell as well by three per cent.

Regarding international operations, Entain stated that “positive” performances across many markets were “partly offset by expected softness in Australia, Netherlands and Germany”, while growth in Brazil is benefiting from “ongoing operational improvements initiated in 2023”.

Despite “strong volume growth, NGR in Italy was impacted by customer-friendly sports margins”.

For its Central and Eastern Europe segment, NGR improved by 11 per cent YoY on a proforma basis following a strong performance from SuperSport in Croatia. Online operations rose by 11 per cent proforma, while retail increased by nine per cent proforma.

Gaming NGR for the segment rose by 30 per cent YoY, while sports NGR increased by six per cent. Sports wagers improved as well by seven per cent.

Holding a 14 per cent market share in sports betting and igaming markets where it operates, BetMGM NGR dropped by two per cent YoY but improved by two per cent proforma.

Entain noted that its strength in igaming is being “offset by customer-friendly win margins across online and retail sportsbooks” and that adjusting for the “impact of sports margin estimated Q1 NGR would have been high single-digit positive”.

The company also highlighted strong customer acquisition growth thanks to Super Bowl and March Madness engagement alongside improvements to its app and product capabilities.

In addition, Entain stated that an “enhanced player experience and exciting pipeline ahead, including more Angstrom-powered offerings” means BetMGM is “well positioned to invest for future growth”. 

David concluded: “Overall, we are pleased with the progress being made against our plan to accelerate Entain’s operational performance. There is still more to do, but the team is fully engaged in delivering operational improvements, product enhancements, as well as greater organisational agility and efficiency.

“We look forward to building on this momentum as we focus on our strategic priorities of organic revenue growth, margin expansion and winning in the US. We remain confident that our continued focused execution will drive organic growth into 2025 and beyond.”