Entain has published its interim results for the first six months of 2022, declaring a “robust group performance” that delivered a broader customer appeal and a new actives level record.
Reflecting on the results, CEO Jette Nygaard-Andersen notes the H1 financials were achieved thanks to Entain “putting the customer at the heart of everything” it does, adding that BetMGM has gone “from strength to strength” in the US as well.
Group revenue grows but online suffers
Reporting its H1 results, Entain declared a total group net gaming revenue (NGR) growth of 18% YoY to $2.58bn (2021: $2.19bn). The group achieved a new level of actives record during the period, up 57% vs H1 2019, and higher quality earnings.
Per region across the Americas, 13% of Entain’s H1 NGR came from the US, 6% came from Brazil, and 2% came from Canada.
The group stated that “innovative new products and enriched experiences” helped to drive its greater customer engagement, as well as further geographic expansion into new regulated markets.
However, online NGR is down 7% YoY to $1.79bn (2021: $1.94bn), with gaming NGR seeing the biggest decrease by 9% YoY to $920.4m (2021: $1bn). Sports NGR fell by 6% YoY to $859.5m (2021: $918.5m), while B2B NGR saw a 42% growth YoY to $18.4m (2021: $12.9m).
Entain notes the drop online is due to “strong prior year comparators driven by Covid lockdowns, temporary closure in the Netherlands, affordability measures in the UK, and customers responding to the economic backdrop”.
For retail in H1, NGR stands at $777.7m, a 232% growth YoY (2021: $233.9m) as customers returned to shops following the end of lockdown restrictions. Sports NGR for the period came in at $433.7m (2021: $121.6m) while machine NGR was registered at $344m (2021: $112.2m).
The group adds that retail continues to perform “ahead of expectations with a more interactive digital experience across gaming machines and betting terminals driving greater customer engagement”.
Group EBITDA for H1 is up 17% YoY at $575.9m (2021: $490.5m), and group profit after tax from continuing operations stands at $34.24m, down $77.04m.
As of June 30, Entain has reported a net debt of $2.7bn with net debt to EBITDA ratio of 2.3x, “reflecting continued investment in growth opportunities”.
“We continue to make excellent progress on our strategic priorities, with momentum in our business remaining strong as a result of putting the customer at the heart of everything we do,” commented Nygaard-Andersen on the results.
“I am delighted that more customers are choosing to play with us as we focus on providing them with even better products, engaging content, and exciting experiences. This has resulted in our highest ever level of actives in H1, up 57% versus the same period two years ago.
“Not only is this approach great for our customers, but it also provides us with a broader, more recreational customer base that will support more sustainable long-term revenues.”
Entain’s BetMGM strong North American market share
BetMGM, Entain’s sports betting joint-venture in North America with MGM Resorts International, saw its revenue improve by 65% YoY in H1 to $608m.
Now live in 23 jurisdictions, the operator is also on track to deliver over $1.3bn in FY22 NGR and a positive EBITDA by 2023.
Excluding New York, BetMGM is also the number two sports betting and igaming operator in the markets for which it operates across North America, with a 23% market share. In just igaming markets, BetMGM is the number one operator with a 30% market share.
Elsewhere, Entain continued to expand its “growth opportunities” with five transactions announced so far in 2022. This includes the creation of Entain CEE and the acquisition of SuperSport for Central and Eastern Europe expansion, as well as the completion of the Avid Gaming transaction in Canada.
“We continue to lead our industry on responsibility and sustainability as we deliver further progress on our Sustainability Charter,” noted Nygaard-Andersen.
“ARC continues to be rolled out into international markets and our efforts have been recognized in the UK and internationally with awards from GamCare, S&P, and SBC, as well as our inclusion in the Global Sustainability Yearbook 2022.”
Update to FY22 guidance
Looking ahead, Entain expects FY2022 group EBITDA to be in the range of $1.13bn to $1.19bn, in line with the current consensus. Online NGR is expected to be “flat” YoY, while a “continuation” of H1 retail NGR is anticipated in H2.
The group has also announced a new progressive dividend policy, with a full-year payment of $122.2m split evenly between interim and full year. It has also reported an interim dividend of 10.3 cents per share
Nygaard-Andersen concluded: “As ever, I would like to thank each and every one of our talented colleagues around the world for their hard work and dedication in helping deliver these results. We have established a meaningful runway for sustainable and high-quality growth.
“While we remain vigilant to the consumer backdrop, our geographic and product diversity provides resilience which, together with our proven ability to drive superior returns, gives us confidence that we will continue to deliver benefits for our stakeholders.”