Entain’s results for 2020 show strong performance across the year with online net gaming revenue up 27%.
Online Growth Offsets Retail Losses
Entain Plc has published its full-year results for the period January – December 2020. The company posted revenues of £3.56 billion, a ‘flat’ change from the £3.57 billion recorded in 2019.
Underlying EBITDA was up 11% from £761.4 million to £843.1 million. The increase is due to the positive results of the operator group’s online division. Underlying operating profit increased by 2% from £520.6 million to £529.5 million.
Group profit after tax experienced a substantial increase from the £131.2 million loss declared in 2019 to £113.8 million in 2020. Despite the challenging 2020, the Group reported strong performance, which continued its momentum in 2021 as well.
Sports NGR leapt 24% from £966.5 million in 2019 to £1.2 billion in 2020. There was a 5% growth in the volume of sports wagers placed. The figures were due to ‘favorable results, product and geographic mix and increases in retail style betting’, according to Entain.
Online net gaming revenue increased by 27% for the full year and 41% in the last quarter of the year, thus marking a 20th consecutive quarter of double-digit online NGR growth. Underlying EBITDA was up 50% to £803.5 million.
Jette Nygaard-Andersen, Entain’s newly appointed CEO highlighted the company’s strategic focus on growth and sustainability and said he was excited about the digital operator’s future prospects.
Retail Business is Down 36% with 300 Closures
Retail operations in the UK, Italy, Belgium, and the Republic of Ireland suffered a negative impact from the mandatory Covid-19 closures. The UK retail estate was down 36% with Entain closing over 300 stores in the UK in 2020. According to Harry Barnick, Senior Analyst for leisure sector companies at Third Bridge, the operator needs to make progress in 2021 to continue to restructure the estate.
Barnick pointed out that the decline was offset by the 27% growth in the company’s online channel. However, he stressed the fact that the review of the 2005 Gambling Act in the UK is a significant threat to online revenues and profits.
Recently, Entain increased its acquisition offer for Enlabs to SEK 3.7B ($440M). This is an attempt by the company to dictate its future course independent of a large US casino operator, Barnick said.
MGM Resorts decided not to proceed with its acquisition attempts after Entain rejected its $11 billion all-stock deal. Entain said the offer significantly undervalued its business.