In a trading update, Entain announced that its online revenue experienced a 7% increase. However, when excluding Germany, this increase reached 18% year-on-year, marking the 23rd consecutive quarter of double-digit growth for online operations.
The rise in online revenue was driven by a 12% increase in online sports betting revenue, with sports wagers up 1%. Online gaming revenue saw a slight increase of 1%. Notably, Entain highlighted strong online performance in all major markets during Q3, with particular emphasis on Australia and Brazil.
On the other hand, retail revenue experienced a 1% decrease compared to the previous year. While UK volumes continued their recovery to pre-Covid-19 levels, Europe is still in the process of rebuilding. Retail sports bets also declined by 15% in Q3.
In terms of the US market, Entain reported strong growth through its BetMGM joint venture with MGM Resorts. BetMGM held a 23% market share across the states in which it operates during the three months leading up to August. In fact, BetMGM is now live in 16 markets across the US, including recent launches in Arizona, Wyoming, and South Dakota.
Entain’s CEO, Jette Nygaard-Andersen, expressed satisfaction with the company’s performance, highlighting the ability to deliver sustainable and diversified growth. Nygaard-Andersen also mentioned the company’s player protection initiatives, particularly the innovative ARC program, which has the potential to transform player protection across the industry.
Looking at the year-to-date performance, Entain reported an overall 8% increase in group revenue for the nine months ending in September. Online revenue saw a significant boost of 20%, driven by a 38% increase in online sports betting revenue and a 7% rise in online gaming revenue. However, the retail sector experienced a decline of 23% due to the impact of Covid-19.
Entain confirmed that its group earnings before interest, tax, depreciation, and amortization (EBITDA) for the full year are expected to align with previous guidance of between £850m (€1.0bn/$1.16bn). The growth in Q3 is expected to be offset by the licensing process in the Netherlands, as the Dutch regulated market opened on 1 October, allowing only licensed operators to offer online gambling in the country.
Regarding future prospects, Nygaard-Andersen expressed confidence in Entain’s ability to triple the size of its business by offering customers engaging products while leveraging scale and technology. The CEO mentioned that the company remains very confident in its future prospects.
Last month, Entain received a takeover proposal from US betting giant DraftKings. After rejecting an initial bid, Entain received a new proposal of £28.00 per share from DraftKings, representing a 46.2% premium on Entain’s closing share price on 20 September. This proposal values Entain’s business at £16.40bn, based on the number of shares in issue as of 30 June 2021.
