Q4 Trading Update

Jay DossetterNews

20 January 2022

Entain plc
(“Entain” or the “Group”)

Strong 2021 performance evidences Entain’s high growth dynamics
FY21 EBITDA expected to be in the range of £875m – £885m, ahead of previous expectations

Entain plc (LSE: ENT), the global sports-betting and gaming entertainment group, today reports trading for the period from 1 October to 31 December 2021 (“Q4”), as well as for the financial year to 31 December 2021 (“FY21”).

Financial Highlights

  • Strong FY21 performance with Group net gaming revenue (“NGR”) up 7% (+8% cc1) year on year
    • FY21 Online NGR up 12% (+13% cc1), demonstrating consistent ability of our operating model to deliver diversified and sustainable growth
    • Strong growth in all major markets with FY21 Online NGR up 18% (+20% cc1) excluding Germany, where the new regulatory regime is impacting the market
    • Online growth continues to be actives driven, with actives up 25% year on year
    • Retail NGR down 3%4 (-3% cc1, 4), reflecting more Covid-19 restrictions than the prior year
    • Including 50% share of BetMGM joint venture, Group FY21 NGR2 was up 14% (15% cc1)
  • Robust performance in Q4 with group Q4 NGR up 4% (+6% cc1)
    • Q4 Online NGR down 9% (-6% cc1), ahead of expectations albeit down versus the prior year due to particularly strong comparatives
    • With most shops open for the full period, Q4 NGR in Retail was up 60%4 (+62% cc1,4) year on year with volumes returning to within 10%4 of pre-Covid levels
  • FY21 Group EBITDA5 expected to be in the range of £875m – £885m, ahead of previous expectations
  • BetMGM (the Group’s joint venture in the US with MGM Resorts) continues to perform strongly, with FY21 NGR of approximately $850m2, 6, up nearly 5 times versus the prior year, as announced yesterday
    • 24%3 share in sports-betting and iGaming in the markets in which BetMGM operates for the three months to November
    • iGaming market leadership position maintained with 30%3 market share
    • BetMGM expects net revenue from operations of over $1.3bn in 2022 and anticipates reaching positive EBITDA in 2023

Operational highlights

  • Additional investment of £25m7 in New Opportunities business segment in 2022 to support the launch of first esports skill-based wagering products during 2022
  • Continued progress on ESG initiatives under our Sustainability Charter
    • Entain Foundation launched EnTrain, a new multi-million-pound global initiative to increase access to technology and improve diversity
    • ARC (“Advanced Responsibility & Care”) programme continues to progress well, with real-time customer interaction trials underway, along with initial stages of international rollout
    • Entain was named Socially Responsible Operator of the Year at the SBC Awards North America, as well as EGR Operator of the Year
    • Entain continues to be the only online-led gaming company included in the Dow Jones Sustainability Indices, in addition to its continued inclusion in the FTSE4Good index

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

“2021 has been a successful and eventful period for Entain, and our market-leading platform has driven another year of strong, sustainable and diversified growth. All of our major markets have performed well.  BetMGM, our hugely exciting business in the US, has been a particular highlight with FY21 net gaming revenue ahead of expectations and an upgraded outlook for 2022.

We have also made significant operational progress and have continued to provide our customers with even better content, experiences and excitement as the worlds of media, entertainment, technology and gaming converge.

As ever, our sustainability efforts have been at the core of everything that we do. We have continued to lead the way in the critically important area of player protection, and our technology-based Advanced Responsibility and Care programme is progressing well.

We continue to see significant growth opportunities ahead of us, with a total addressable market of around $160bn across our new and existing markets, as well as in emerging areas of interactive entertainment.  We believe these opportunities will enable us to at least treble the size of our business. As a result, we remain confident in our prospects for the year ahead and beyond.”

 

Q4: 1 October to 31 December 2021

Total NGR

Total NGR cc1

2yr CAGR
Total NGR  

Sports Wagers

 

Sport Wagers cc1

Sports Margin

 

Online

Sports

(14%)

(12%)

17%

(1%)

2%

(1.7pp)

Gaming

(4%)

(2%)

11%

Total Online

(9%)

(6%)

14%

 

 

 

Retail4

60%

62%

(4%)

75%

77%

(4.4pp)

 

 

 

 

 

 

Total Group

4%

6%

6%

 

 

 

 

Full Year: 1 January to 31 December 2021

Total NGR

Total NGR cc1

2yr CAGR
Total NGR 

Sports Wagers

 

Sport Wagers cc1

Sports Margin

 

Online

Sports

21%

22%

22%

20%

21%

+0.0pp

Gaming

4%

6%

16%

Total Online

12%

13%

19%

 

 

 

Retail4

(3%)

(3%)

(21%)

(10%)

(9%)

(1.3pp)

 

 

 

 

 

 

Total Group

7%

8%

3%

 

 

 

 

 

 

 

 

 

 

Total Group inc BetMGM2,8 share

14%

15%

7%

 

 

 

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 and are not yet finalised for 2021
  • BetMGM market shares for the three month period to November 2021
  • Retail operates in UK, Italy, Belgium and Republic of Ireland. Retail numbers are quoted on a LFL basis. During Q4, there were an average of 4,425 shops/outlets in the estate, compared to an average of 4,679 for the same period last year. In the full year, there were an average of 4,540 shops in the estate, compared to an average of 4,727 in the same period last year.
  • Guidance on EBITDA is on a post IFRS 16 basis
  • 2021 net revenue for BetMGM on a GAAP basis is expected to be approximately $813 million, which includes approximately $52 million related to Nevada MGM operations for which BetMGM records on a net basis as BetMGM is considered to be the agent in the Nevada transactions for GAAP purposes
  • Combined total EBITDA investment in New Opportunities including innovation of £50m for FY2022
  • Total Group including BetMGM includes 50% share of BetMGM revenues

Enquiries:

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

investors@entaingroup.com
david.lloyd-seed@entaingroup.com
davina.hobbs@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

 Q4 Conference Call & Webcast
An analyst call will be held today, Thursday 20th January 2022 at 9:00am UK (10:00am BST).

Participants may join via webcast or by conference call dial in, approximately 10 minutes before the start of the call.

Live audio webcast link: https://brrmedia.news/ENT_Q4

To participate in the Q&A, please also connect via the conference call dial in details.

UK:                      +44 (0)33 0336 9601
US:                      +1 646 828 8073
Access Code:     4458668

A replay and call transcript will be available on our website:  https://entaingroup.com/investor-relations/results-centre/

Upcoming dates:

FY21 Results:                    3 March 2022
Q1 Trading Update:         7 April 2022
BetMGM CMD:                  May 2022

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 a joint-venture with MGM Resorts International creating a leader, BetMGM, in sports-betting and iGaming in the US. 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 and is AA rated by MSCI. The Group has set a science-based target, 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