Entain shares dip on lower third-quarter profit margins
Entain on Thursday lowered its profit margin forecast for the year after it posted a drop in gaming revenue in the third quarter, hurt by adverse sporting results and regulatory pressures, sending shares of the company down 5%. Total Group (including US) Net Gaming Revenue (“NGR”) up +7%.
The owner of Ladbrokes and Coral betting shops as well as bwin and partypoker online brands said its expected online core profit margin to be about 25% in 2023, down from the 27.1% last year.
Gambling firms, which gained from a rise in online betting during the pandemic, are dealing with stiffer regulations and a cost-of-living crisis.
Sporting results on which there were higher numbers of winning bets have hit core profit by about 45 million pounds ($54.80 million) in 2023, the company said, but added that it expects online net gaming revenue to return to growth on a pro-forma basis in 2024.
Jette Nygaard-Andersen, Entain’s CEO, commented: “Entain has undergone a profound transformation over the last few years, and now has strong foundations from which to move into its next phase of growth. We have made significant investments in responsible gambling initiatives. While these steps have impacted EBITDA, they are unquestionably the right thing to do to improve our long-term prospects.
From here, we have a clear plan to focus our portfolio for organic growth, drive our market share in the US, improve our operational leverage, and increase our EBITDA margins. The wide range of initiatives that are underway will cement our position as a customer-focused industry