9th Sep 2024 12:39
(Alliance News) - Entain PLC's return to growth in its UK and Ireland online offering helped the Ladbrokes owner achieve a decent start to the second half of the year.
It decided against raising its annual outlook again, however.
Entain said the improving momentum delivered during the second quarter has continued, with online net gaming revenue growth during the second half of 2024 to date "ahead of our expectations".
Providing an update on its "strategic progress and trading performance" ahead of investor meetings this week, the firm said it has performed well so far in its second half, returning to growth in its UK and Ireland online betting offering "earlier than expected".
In the UK&I, Entain disclosed an accelerated recovery across gaming and sports, with sports NGR benefiting from both stronger volumes and margins.
International and Central and Eastern Europe regions continue to perform well while the retail performance across regions remains in line with expectations, Entain added.
In August, Entain increased annual guidance.
It expects 2024 online net gaming revenue growth on a proforma basis to be a low single-digit percentage positive, improved from previous guidance that this would be negative by a low single-digit percentage.
The company expects to deliver earnings before interest, tax, depreciation and amortisation in the range of GBP1.04 billion to GBP1.09 billion, at least 3.2% higher than GBP1.01 billion in 2023. Underlying Ebitda in the first half of 2024 was GBP523.8 million, up 4.9% from GBP499.4 million in 2023.
Shore Capital Markets analyst Greg Johnson commented: "That the UK has turned positive suggests upside risk to full year revenue guidance, although we suspect any material outperformance in revenues will be likely be reinvested back into the business. A return to growth in the UK would also go along way to the medium-term assumptions for annual revenue growth of 6-8% (from 2025).
"That the UK has turned positive ahead of schedule is positive for both the remainder of the year and the growth profile into next year."
A busy summer on the sporting calendar gave Entain a boost, Hargreaves Lansdown analyst Susannah Streeter said.
"The summer of sport clearly enthused punters to make bets, caught up in a wave of excitement amid the Euros and the Olympics. It's meant year-on-year growth has returned to its online business in the UK and Ireland so far in the third quarter. That's not given management enough confidence to raise guidance yet though. However, it may indicate that marketing and product development efforts are bearing fruit which have helped drive more players to Entain's online betting and gaming websites," the analyst added.
Shares in Entain were up 8.4% at 692.80 pence each in London on Monday afternoon.
By Eric Cunha, Alliance News news editor
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