Entain maintains confidence in 2022 outlook but Euro headwinds blur vision

Entain Plc’s 2022 performance began in line with corporate expectations, as its business units and brand portfolio are matched against tough 2021 like-for-like comparatives. 

Publishing its Q1 2022 trading update, Entain reported that group NGR was up 31%. This, it said, was supported by the return of its retail unit performance which achieved a 1,000% NGR uptake against 2021 lockdown comparatives.  

The FTSE100 gambling group maintained its headline momentum, despite the trading period accounting for an 8% decline in online NGR.

Breaking down its online performance, Entain’s sportsbook recorded a 7% decline in NGR, combined with a further 10% drop in NGR for its online gambling segment.

Across the group, online wagers declined by 7%. As of yet, Entain has not provided any guidance with regards to trading impacts on its sports unit such as unfavorable results, regulatory headwinds or customer spend declines.

Trading across its online gambling segment during the quarter had to exclude the performance of Germany and the Netherlands where the markets are undergoing regulatory change.

Looking forward, Entain stated that its European portfolio will be refreshed by the M&A additions of Klondaika Latvia and Totolotek Poland which it believes will “deliver strategic growth expansion into new markets” 

Jette Nygaard-Andersen, Entain’s CEO, commented: “We have started the year with a good performance across all areas of our business, driven as ever by the strength of our industry-leading platform.”

“We have delivered strong performances in all of our major markets, and I am pleased to report that Retail is performing well with customers returning for our in store experience.”

In North America, Entain underlined strong progress for its BetMGM joint venture that has established itself as the “number two operator with 24% market share where BetMGM brand operates”.

Following a further four new market launches during Q1, BetMGM is now live across 23 US states. 

Elsewhere, Entain made its Canadian debut on 4 April after launching BetMGM in Ontario’s newly regulated online gambling marketplace. The FTSE firm will secure an instant Canadian podium place following its CAD $300 million, acquisition of AVID Gaming operator of Mohawk licensed bookmaker Sports Interaction.

Entain remains confident that BetMGM will achieve its ‘EBITDA positive target’ by 2023 trading. Further details will be provided at the BetMGM Business Update on 12 May 2022

“In the US, BetMGM is firmly established as the number two operator, and our market launches during Q1 mean that we now have access to over 41% of the US adult population,” Nygaard-Andersen added.

“Elsewhere, our strategy of expanding into new markets is continuing at pace, having acquired businesses in Canada, Latvia and Poland during Q1.“Given the strength and continuing momentum of our underlying business, coupled with our proven ability to grow both organically and through M&A, we remain confident in our financial performance for FY22 and beyond”

 

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