Entain Releases Q1 Trading Update: How Much Is That Doggie In The Window?

Almost on cue, as it’s circled by would-be investors and corporate raiders, under-fire UK Omnichannel Entain has released a Q1 Trading Update that simultaneously offers some respite from the fiscal storm a blowin’ and begs the question: “How much is that doggie in the window?”

Total Group Net Gaming Revenue (NGR) for the UK gambling giant–owner of leading brands bwin, Ladbrokes Coral, PartyPoker, Sportingbet and half of US sportsbook BetMGM, et al–saw a nominal and highly respectable year-on-year six percent increase.

However, on a so-called pro forma basis, an accountancy device often used to fudge “inconvenient” stats, Online NGR–excluding high-performing BetMGM, which is co-owned with MGM Resorts International–declined by some two percent; despite an impressive 11 percent growth in active customers.

Currently, as the FTSE100 heavy-hitter seeks to stabilise or sell following a slew of corporate missteps and giant fines for AML breaches, it’s all about percentages for Entain.

Tasty Pickings

No hard figures were released in the Trading Update but percentages abounded, as the company’s share price rebounded, if not surged, on the London market, fuelled by the prospect and promise of tasty pickings in any impending corporate dismemberment.

In the UK & Ireland, NGR declined by seven percent; with Online NGR down by nine percent and Retail by six percent.

Internationally, NGR increased by eight percent, reported Entain; although, somewhat incongruously, the company said Online NGR declined one percent and Retail dropped by eight percent.

Make of that what you will.

Brazil, driven by operational improvements, saw a return to growth.

But NGR in Italy was impacted by customer-friendly sports margins. The CEE market, where Entain has recently made a significant number of major acquisitions, thankfully, performed well, with NGR up by 11 percent.

Looking more specifically at BetMGM, which is now scheduled to go US$500 million EBITDA positive by 2025, NGR increased by some two percent, year-on-year.

And NGR, claimed Entain, would have been even greater if not for increased customer-friendly win margins.

“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,” said Stella David, who’s currently sitting in the Entain hot seat–or to be more accurate between two Chairs–as both interim CEO and holding Chair of the Board; following the recent defenestration of CEO Jette Nygaard-Andersen and resignation of Chair Barry Gibson.

Stick or Sell

Continuing the gloss, she added: “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.

“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 U.S.

“We remain confident that our continued focused execution will drive organic growth into 2025 and beyond.”

Indeed–stick or sell–by next year Entain will be a very different gaming animal indeed.