Entain published its 2023 financial report, and according to it, the company experienced a net loss of ￡936,5m (€1,09bn/$1,19bn). The main reason for this is an increase in its expenses, mostly due to the UK settlement with His Majesty’s Revenue and Customs (HMRC) and the Crown Prosecution Service (CPS). However, the gaming revenue increased by 11,1%.
Increased expenses:?
In 2023, net gaming revenue was ￡4,83bn. Other segments of business also recorded an increased revenue, including group revenue which was ￡4,77bn, 11% more than in 2022.
However, because of the settlement, the company had to pay ￡585m in December. On top of that, Entain had to make a charitable donation that cost them ￡20m and pay ￡10m for CPS and HMRC costs.?
But that’s not all when it comes to Entain’s expenses. The impairment costs were increased, and there was a cost of acquired intangible assets and restructuring spending.
In 2023, a significant amount of money was invested in operations and marketing. The total cost was ￡1,27bn, which is 12% more than in 2022.
Barry Gibson, the company’s chairman, isn’t disappointed by this loss. He is positive that it was a time for transition and that it will positively affect future growth. He said: “We have significantly strengthened the quality of our revenue base, enhanced our board, and delivered a resolution to a critical, historic, regulatory issue. As our transformation continues the newly formed capital allocation committee has commenced a review of Entain’s markets, brands, and verticals. The objectives of the review are to help focus the organization, improve competitive positions, and maximize shareholder value.”
Stella David, a CEO, agrees: “2023 presented a number of challenges for the group, both industry-wide and Entain-specific. I am extremely proud of how our people around the world came together to navigate the business through an eventful and at times difficult year. We have started the new financial year with a clear plan to accelerate our operational strategy and are making pleasing progress across a range of initiatives to re-focus our market portfolio, prioritize organic growth, drive our share in the US, and expand our margins.”
New markets and new opportunities to grow:
The most profitable market for Entain is the UK, where the revenue was ￡1,95bn. The Italian market generated ￡517,4m, while New Zealand earned ￡515,1m. Other European markets generated ￡1,44bn, while all other markets where Entain is present at the moment earned a total of ￡339,9m.
Significant success was achieved when it came to expansion to new markets. The company partnered with CrystalBet in Georgia, followed by acquisitions of STS in Poland and SuperSport in Croatia.
As it was stated in a press release, the record has been set when it comes to the number of new customers, with a 23% year-on-year increase.
The retail market was greatly affected by the COVID-19 pandemic, but things finally started to look better. Net gaming revenue was ￡1,39bn, which represents an increase of 8,5%.
Retail sports betting generated ￡813m, 15,3% more than in 2022. Machines earned 0,2% more, and the revenue was ￡573,7m.
The report included the performance of BetMGM, which is a joint venture of Entain and MGM Resorts International. In 2023, a decrease in revenue was noticed, and the revenue decreased by $2.00bn. However, in the second quarter of 2023, positive EBITDA was recorded for the first time ever.
According to the source, David commented: “We are entirely focused on operational excellence and outstanding execution and, as a result, are confident that we are on a pathway to delivering future growth. We remain confident that our continued focused execution will drive organic growth into 2025 and beyond.”