Entain’s Q3 performance ahead of expectations

Entain plc (LSE: ENT), the global sports betting and gaming group, today reports trading for the period from 1 July to 30 September 2024 (“Q3”), as well as providing an update on strategic progress and expectations for FY24.

Total Group Net Gaming Revenue (“NGR”): including 50% share of BetMGM1, up +8%, +10%cc2, and +7%cc2 on a proforma3 basisImproving Online NGR growth continues: Q3 Online NGR (excluding US) ahead of expectations, up +10%, +12%cc2, and +9%cc2 on proforma3 basisUK&I returned to YoY growth sooner than expectedAll key markets delivered growth in Q3Encouraging start to H2 for BetMGM: Q3 NGR c.+18%cc2 YoY and seeing market share stabilisationFY24 guidance upgraded: stronger than expected Q3 performance and increased confidence for the balance of the yearExpect mid single-digit proforma3 constant currency growth in Online NGR (from low single digit4)Group EBITDA5 now expected to be towards the top of the £1,040m-£1,090m guidance range

Gavin Isaacs, CEO of Entain, commented:

My first few weeks as CEO of Entain have reaffirmed my view that this is a very good business operating in a highly attractive global industry. Entain has great brands, an enviably diverse global portfolio and is bursting with talent, ambition and opportunities. Entain is already on a path of strategic and operational improvement, with the strong Q3 performance demonstrating the progress achieved so far. We are at the beginning of the journey and I’m looking forward to accelerating our progress, leading the business in our next growth chapter and capturing the many exciting opportunities ahead.

Q3 trading highlights:

Group Q3 performance ahead of expectations, as operational execution continues to deliver improving organic revenue growth.

Total Group NGR excluding 50% share of BetMGM1 up +8%cc2, and +6%cc2 on a proforma3 basisOn a proforma3 basis, Online NGR (exc. US) was up +9%cc2 driven by volume growth and a YoY sports margin tailwind, whilst Retail NGR was down -1%cc2UK & Ireland NGR up +2%cc2 (Online +6%cc2, Retail -2%cc2)UK&I Online positive YoY growth reflects the lapping of prior year regulatory implementation as well as product, offering and customer journey enhancementsInternational6 NGR up +9%cc2 on a proforma3 basis (Online +10%cc2, Retail flat cc2)Brazil (+48%cc2) continued to outperform expectationsEntain CEE7 NGR up +11%cc2 (Online +13%cc2, Retail +2%cc2) on a proforma3 basis, with SuperSport in Croatia continuing to perform particularly stronglyBetMGM1 Q3 NGR demonstrates continuing acceleration, up c.+18%cc2 versus prior year, reflecting our improved product and increased investment in player acquisitionMarket share stabilisation (15%8,9) with iGaming (22%) and Online Sports Betting (8%)BetMGM’s enhanced sports betting experience including Entain’s Angstrom capabilities across MLB, NBA, NFL & NCAAF driving increased parlay bet mix & Gross Gaming Revenue (GGR) holdRecord iGaming revenues in Q3 with FTD’s up +70% and strong online sports to gaming cross-sell in NFL season to dateEncouraging trends from single account single wallet integration in Nevada with strong FTD growth and player engagement continuing upon return to home state10Strategic progress highlights:

Continued delivery against our strategic priorities of organic revenue growth, margin expansion and winning in the U.S, with operational focus on must-win markets, product enhancements and organisational efficiency.

Gavin Isaacs joined Entain as Chief Executive Officer on 2 September 2024, and Stella David succeeded Barry Gibson as Chair on 30 September 2024The Board’s Capital Allocation Committee completed its review of strategic alternatives for Crystalbet, concluding not to pursue a sale. Crystalbet is Georgia’s leading sports betting and gaming brand with strong growth and cash generation. Third party interest did not exceed its value to Entain as an attractive part of our global portfolioProgress continues on our core product and technology roadmap: improving brilliant basics across our platforms, scaling our localisation capabilities and accelerating product delivery velocity in key markets to provide what matters most to our customersBetMGM’s sports betting experience now includes enhanced parlay and player prop offerings, powered by Angstrom’s differentiated market pricing capabilities, as well as new streamlined live betting and bet slip featuresBetMGM became the first sports betting app to offer Nevada bettors seamless, nationwide connectivity through a single, digital wallet, unlocking BetMGM’s unique omnichannel opportunityOutlook:

As a result of a stronger than expected Q3 performance and increased confidence for the balance of the year, FY24 Online proforma3 NGR growth is now expected to be mid single-digit positive4, on a constant currency2 basis. As such, FY24 Group EBITDA is expected to be towards the top end of our £1,040m – £1,090m guidance range.

Q3 2024 Trading performance:

 Q3 2024: 1 July to 30 September 2024TotalNGR

GamingNGR

SportsNGR

SportsWagers

SportsMargin

Reported11CC2Proforma CC2,3Proforma CC2,3 UK & Ireland+2%+2%+2% +3%(1%)0%+0.1ppOnline UK&I+6%+6%+6%+8%0%0%+0.4ppRetail UK&I(2%)(2%)(2%)(2%)(2%)0%(0.1pp) International6+6%+9%+9% +9%+8%+3%+0.1ppOnline Int’l+7%+10%+10%+9%+10%+3%+0.3ppRetail Int’l(1%)0%0%+7%(1%)+6%(1.2pp) CEE7+53%+54%+11% +19%+8%+10%+0.2ppOnline CEE+55%+56%+13%+21%+9%+10%+0.4ppRetail CEE+43%+43%+2%+0%+2%+8%(1.0pp) Group (ex US)+7%+8%+6% +6%+5%+3%+0.2ppOnline+10%+12%+9%+9%+8%+3%+0.4ppRetail(0%)0%(1%)(2%)(1%)+2%(0.5pp)BetMGM1+17%+18%+18%     Total Group inc.50% of BetMGM1

+8%+10%+7%     

Q3 YTD 2024 Trading performance:

 Q3 YTD 2024: 1 January to 30 September 2024TotalNGR

 GamingNGR

SportsNGR

SportsWagers

SportsMargin

Reported11CC2Proforma CC2,3 Proforma CC2,3 UK & Ireland(4%)(4%)(4%) (3%)(4%)(7%)+0.6ppOnline UK&I(4%)(4%)(4%)(3%)(5%)(12%)+0.7ppRetail UK&I(4%)(4%)(4%)(4%)(3%)(2%)0.0pp International6+7%+10%+4% +6%+3%+1%(0.2pp)Online Int’l+7%+10%+6%+5%+4%+1%(0.1pp)Retail Int’l+3%+6%(3%)+10%(4%)+3%(1.3pp) CEE7+96%+100%+12% +23%+8%+11%(0.2pp)Online CEE+99%+103%+13%+25%+9%+12%+0.1ppRetail CEE+82%+86%+6%+7%+6%+7%(0.4pp) Group (ex US)+6%+8%+1% +1%+1%0%+0.1ppOnline+9%+12%+4%+3%+4%0%+0.2ppRetail0%+1%(3%)(3%)(3%)0%(0.4pp)BetMGM1+7%+10%+10%     Total Group inc.50% of BetMGM1

+7%+8%+2%