2021 Interim Results

Jay DossetterNews

Click here to download a PDF of the full 2021 Interim Results statement

12 August 202

Entain plc
(“Entain” or the “Group”)

Strong first half performance with continuing momentum across the Group

Entain plc (LSE: ENT), the global sports-betting, gaming and interactive entertainment group, today reports its Interim Results for the six-month period ending 30 June 2021 (“H1”).

Financial highlights

  • Strong performance across H1, reflecting the Group’s robust and diversified business model
  • Total Group net gaming revenue (“NGR”) growth of 11% (+11%cc1)
  • Online NGR up 28% (+27%cc1), driven by strong underlying performances in all key markets, a full sporting calendar and longer lockdown restrictions in retail
    • 22nd consecutive quarter of double-digit Online growth
    • Online NGR was up 38%cc1 excluding Germany where the new regulatory regime is impacting the market
    • Retail NGR down 46% (-46% cc1) reflecting estate closures through much of the period offset by encouraging early trends as shops re-open
  • BetMGM (the Group’s joint venture in the US with MGM Resorts) continues to perform strongly and is well positioned for further success in H2
    • H1 NGR of $357m
    • Number two operator for sports-betting and iGaming across the US with 22%2,3 market share
    • Number one operator in iGaming, extending leadership with 30%,3 market share
    • As announced on 21 April, total combined investment in BetMGM by joint venture partners expected to be $660m by the end of 2021
  • Group EBITDA6,7 up 12% at £401m
  • Group profit after tax for continuing operations £91m, up £69m
  • Full year Group EBITDA6,7,9, upgraded on 8 July 2021, expected to be in the range of £850m to £900m
  • Net Debt of £1,951m at 30 June 2021, with net debt to EBITDA ratio of 2.2x following an active M&A programme and increased investment in BetMGM
  • Successful renewal of a five year £590m Revolving Credit Facility (“RCF”) and a new $1,125m First Lien Term Loan B refinancing
    • Reinforces balance sheet strength at favourable terms and a more balanced maturity profile
    • Increased liquidity for corporate activity and investment

Operational highlights

  • New efficiency programme launched to reduce costs and support investment in innovation and growth:
    • Investment in innovation of c.£100m over three years
    • Cost-savings totalling £100m expected in FY23
    • Net cash benefit of £75m per annum from FY23 onwards
  • Acquisitions of Enlabs in the Baltics and Bet.pt in Portugal completed
  • Ongoing commitment to ESG with further advances made across our Sustainability Charter
    • Encouraging live trials of Entain’s industry leading Advanced Responsibility and Care player protection programme, ARC
    • Commitment to be carbon net zero by 2035 based on Science Based Targets
    • ESG rating upgraded to AA by MSCI rating agency
    • Entain Foundation supported grass roots sports and young athletes through Pitching-In and SportsAid

Investor event – 2.00pm (BST) today

  • Entain is holding an investor event later today where we will outline the exciting opportunities ahead for the Group, including:
    • Growth opportunities in global sports betting and gaming
    • Leveraging Entain platform into the convergence of media, entertainment and gaming to provide new revenue streams in interactive entertainment
    • Deeper insight into the Group’s industry leading technology
    • A business update on the UK Online operations

Jette Nygaard-Andersen, Entain’s CEO, commented:

“Entain’s platform continues to deliver. The quality and diversification of our businesses has enabled us to deliver our 22nd consecutive quarter of double-digit online growth, while also making excellent progress on our strategic priorities.  This performance is not only a result of our industry leading technology, but also the hard work and dedication of our talented teams of people around the world, and I would like to take this opportunity to thank them.

In the US, BetMGM goes from strength to strength with our position as number 2 operator firmly established in the fast-growing sports-betting and iGaming market. We expect to be operational in around 20 states, representing 33% of the US adult population, over the next 12 months.

Entain has a long runway for sustainable growth built into our core business.  In addition, our unique powerful platform puts us at the heart of the convergence of media, entertainment and gaming, providing us with exciting opportunities in interactive entertainment that we believe will further power our growth for many years to come.”

Group

Reported4,5

Six months to 30 June

2021

 2020

Change

CC1

£m

£m

%

%

Net gaming revenue (NGR)

1,792.6

1,609.3

11%

11%

Revenue

1,767.0

1,575.1

12%

12%

Gross profit

1,136.3

1,028.3

11%

Underlying EBITDAR6,7

410.5

369.1

11%

Underlying EBITDA6,7

401.1

358.9

12%

Underlying operating profit7

205.6

234.4

Underlying profit before tax7

246.7

65.9

Profit after tax

90.9

22.4

Basic EPS (p)

13.8

2.5

Continuing adjusted diluted EPS8 (p)

18.5

30.5

Continuing adjusted diluted EPS excl US8 (p)

31.7

31.9

Dividend per share (p)

Dividend
The Board has not proposed an interim dividend, however it appreciates the importance of dividends to our shareholders.  Assuming Covid-19 related restrictions continue to ease around the world, the Board expects that with full year results in March 2022 it will be in a position to recommence a dividend.

Outlook
Following Entain’s strong first half performance, the Group is confident in its prospects for the second half of 2021 and, as previously guided, expects full year EBITDA6,7,9 to be in the range of £850m to £900m.

Notes

  • Growth on a constant currency basis is calculated by translating both 2021 and 2020 performance at the 2021 exchange rates
  • BetMGM revenues comprise of sports (Online and Retail) and iGaming revenues
  • BetMGM market shares for the three month period to end of June 2021
  • 2021 reported numbers are unaudited
  • Reported results are provided on a post IFRS 16 implementation basis
  • EBITDAR is defined as earnings before interest, tax, depreciation and amortisation, rent and associated costs, share based payments and share of JV income. EBITDA is defined as EBITDAR after charging rent and associated costs.
  • Stated pre separately disclosed items
  • Adjusted for the impact of separately disclosed items, foreign exchange movements on financial indebtedness and losses/gains on derivative financial instruments (see note 8 in the interim financial statements)
  • References to profit expectations are made on a reported basis post IFRS16 implementation

Enquiries:

Investor Relations – Entain plc
David Lloyd-Seed, Group Director of IR & Corporate Communications
Davina Hobbs, Head of Investor Relations
Jennifer Spencer, Senior Investor Relations Manager
Callum Sims, Investor Relations Manager

investors@entaingroup.com
david.lloyd-seed@entaingroup.com
davina.hobbs@entaingroup.com
jennifer.spencer@entaingroup.com
callum.sims@entaingroup.com

Media – Entain plc
Tessa Curtis, Head of Group PR & Media Relations
Jay Dossetter, Head of ESG and Press Office

media@entaingroup.com
tessa.curtis@entaingroup.com
jay.dossetter@entaingroup.com

Media – Powerscourt
Rob Greening / Elly Williamson / Nick Hayns

Tel: +44 (0) 20 7250 1446
entain@powerscourt-group.com

H1 Conference Call & WebcastThursday 12 August 2021 at 8:30am (BST).

Live audio webcast link: https://brrmedia.news/ENT_H121
To participate in Q&A, please also connect via the dial in:           
UK  +44 (0)330 336 9434
US +1 929 477 0402
Room Code: 5173124

Investor Event Conference Call & WebcastThursday 12 August 2021 at 2:00pm (BST).

Live audio webcast link: https://brrmedia.news/InvEvnt_21
To participate in Q&A, please also connect via the dial in:           
UK  +44 (0)330 336 9126
US +1 929 477 0402
Room Code: 1720890

Participants should join via webcast or conference call dial in, approximately 15 minutes ahead of the event start.

A replay and call transcript for the Interim Results and Investor Event will be available on our website:
https://entaingroup.com/investor-relations/results-centre/

Upcoming dates:
Third quarter trading update: 7 October 2021

Forward-looking statements
This document contains certain statements that are forward-looking statements. They appear in a number of places throughout this document and include statements regarding our intentions, beliefs or current expectations and those of our officers, directors and employees concerning, amongst other things, results of our operations, financial condition, liquidity, prospects, growth, strategies and the business we operate. These forward-looking statements include all matters that are not historical facts. By their nature, these statements involve risks and uncertainties since future events and circumstances can cause results and developments to differ materially from those anticipated. Any such forward-looking statements reflect knowledge and information available at the date of preparation of this document. Other than in accordance with its legal or regulatory obligations (including under the Market Abuse Regulation (596/2014), the Listing Rules, the Disclosure Guidance and Transparency Rules and the Prospectus Rules), the Company undertakes no obligation to update or revise any such forward-looking statements. Nothing in this document should be construed as a profit forecast. The Company and its directors accept no liability to third parties in respect of this document save as would arise under English law.

About Entain plc
Entain plc (LSE: ENT) is a FTSE100 company and is one of the world’s largest sports-betting and gaming groups, operating both online and in the retail sector. The Group owns a comprehensive portfolio of established brands; Sports Brands include bwin, Bet.pt, Coral, Crystalbet, Eurobet, Ladbrokes, Neds and Sportingbet; Gaming Brands include CasinoClub, Foxy Bingo, Gala, Gioco Digitale, Ninja Casino, Optibet, partypoker and PartyCasino. The Group owns proprietary technology across all its core product verticals and in addition to its B2C operations provides services to a number of third-party customers on a B2B basis. The Group has also entered into a joint-venture with MGM Resorts to capitalise on the sports betting and gaming opportunity in the US, through BetMGM. Entain provides the technology which powers BetMGM and exclusive games and products, specially developed at its in-house gaming studios. The Group is tax resident in the UK with licenses in a total of 27 regulated markets. Entain is a leader in ESG, a member of FTSE4Good, the DJSI,  is AA rated by MSCI and is included in Bloomberg’s 50 global leaders in sustainability. The Group has set Science Based Targets, committing to be carbon net zero by 2035 and through the Entain Foundation supports a variety of initiatives, focusing on safer gambling, grassroots sport, diversity in technology and community projects.

For more information see the Group’s website: www.entaingroup.com

LEI: 213800GNI3K45LQR8L28

Click here to download a PDF of the full 2021 Interim Results statement