REG - Entain PLC - BETMGM FY23 UPDATE

EntainAnnouncement

08/02/2024 14:00

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RNS Number : 4965C  Entain PLC  08 February 2024

8 February
2024

 

BETMGM FY23 UPDATE

FY23 NET REVENUE FROM OPERATIONS OF $1.96 BILLION AT TOP END OF GUIDANCE

Positive EBITDA in the Second Half of 2023

 

BetMGM LLC ("BetMGM"), one of the leading sports betting and iGaming operators
across North America, jointly owned by Entain plc (LSE: ENT) ("Entain") and
MGM Resorts International (NYSE: MGM) ("MGM Resorts") is today providing an
update on performance for FY 2023.

 

·      BetMGM delivered a strong FY 2023 financial performance (based on
unaudited results)

o  Net revenue from operations grew 36% year over year to $1.96 billion(1),
at the upper-end of $1.8-$2.0 billion guidance range(2)

§ Same-state growth in net revenue from digital operations of 14%

§ Key metrics across both iGaming and Online Sports Betting improved year
over year, including average monthly actives, FTDs, hold percentages, bonus
levels, NGR per active, and CPAs(3)

o  EBITDA positive in the second half of 2023 with expected FY 2023 EBITDA
loss of approximately $67 million(4)

 

·      Established as a leading operator across North America, live in
28 markets with access to 49% of adult population(5)

o  Four new markets launched during the year: Ohio (online and retail),
Massachusetts (online and retail), Puerto Rico (online) and Kentucky (online
and retail)

o  14% market share in Sports Betting and iGaming in the U.S. and 22% in
Ontario(6)

o  Secured market access with Charlotte Motor Speedway ahead of expected
March 2024 launch of newly legalised sports betting market in North Carolina,
pending regulatory approval

 

·      Further operational progress supported by technology, product and
capability enhancements, positions BetMGM to drive growth going forward

o  Seamless execution of single account single wallet across 21 markets ahead
of the 2023 NFL season

o  Enhanced sports betting experience with improved speed(7), broader market
coverage and new differentiated bet types

o  New in-house and exclusive games, including Dual Play Roulette, as well as
largest progressive jackpots underpinning market leading iGaming offering

 

·      December 4th BetMGM business update set out strategic roadmap to
drive growth in 2024

o  Expanding the depth and breadth of our sports offering by leveraging
Angstrom's sophisticated modelling to support innovative and original
products, including player-popular Same Game Parlay ("SGP"), SGP+ and new LIVE
SGP products

o  Continue to deliver market-leading and engaging gaming experiences that
are more personalized and differentiated, including exclusive and MGM-branded
content

o  Increasingly investing in marketing and player acquisition as sports
product and player retention continue to improve

o  Unlocking BetMGM's unique omnichannel advantages, particularly in Las
Vegas, Nevada

§ Launched new improved app in January with single wallet functionality
expected later in 2024

§ Leveraging Las Vegas sports teams and tentpole events, for example BetMGM's
first Big Game commercial featuring Tom Brady, Wayne Gretzky and Vince
Vaughn

 

·      Reiterating guidance from December 2023 business update of
targeting approximately $500 million of EBITDA in 2026

 

·      Recognized as Digital Operator of the Year by Global Gaming
Awards, Online Casino of the Year by American Gambling Awards, and Casino
Operator of the Year by EGR North America and SBC Awards North America.

 

·      Ongoing commitment to industry leadership in player safety and
responsible gaming

o  Secured five-year extension with GameSense program, providing player tools
and capabilities to play responsibly

o  Partnered with nine NFL teams to promote responsible gambling in stadiums
during games

o  Piloted the first of its kind program with Kindbridge Health to evaluate
efficacy of offering self-excluded individuals' referrals for problem gambling
treatments

 

Adam Greenblatt, CEO of BetMGM, commented:

"Our performance in 2023 demonstrates our commitment to delivering on our
promises. We were able to achieve strong organic growth, while executing
against key strategic initiatives that lay the foundation for 2024 and beyond.
The attainment of EBITDA profitability over the last three quarters of 2023
validates the effectiveness of our business model and provides the basis from
which to invest further in expanding our sports offering through the
integration of Angstrom and leveraging our largely untapped Las Vegas
omni-channel advantages. With this comprehensive roadmap in place, we can
focus on driving accelerated player acquisition and retention and
strengthening our current market position. This clear strategic direction
underpins our confidence in achieving our targets and building long-term,
sustainable value for shareholders."

 

Notes

(1)      FY2023 net revenue for BetMGM on a GAAP basis is expected to be
approximately $1,920 million, which includes approximately $64 million related
to Nevada MGM operations for which BetMGM records on a net basis as BetMGM is
considered to be the agent in the Nevada transactions for GAAP purposes

(2)      FY2023 non-GAAP net revenue guidance established in January 2023

(3)      Key metrics include average monthly actives, first time
depositors ("FTDs"), hold percentages, bonus levels, net gaming revenue per
active ("NGR per active"), and cost per acquisition ("CPAs")

(4)      BetMGM has not completed its financial closing procedures for
the three months and year ended December 31, 2023 and actual results can
differ materially from these estimates.  In addition, BetMGM's independent
registered public accounting firm has not audited, reviewed or performed any
procedures with respect to these preliminary estimates. During the course of
the preparation of BetMGM's audited financial statements, BetMGM and its
auditors may identify items that would require material adjustments to these
estimates. As a result, these estimates constitute forward-looking statements
and, therefore, investors are cautioned that they are subject to risks and
uncertainties, including possible adjustments.

(5)      BetMGM operates iGaming and Online Sports Betting in five
markets and Sports Betting only (combined online and retail) in 23 markets.

(6)      Market share for last three months ending November 2023 by GGR
including only U.S. markets where BetMGM was active; internal estimates used
where operator-specific results are unavailable. Ontario market share reflects
the three-month period through December 2023.

(7)      Google Core Web Vitals
(https://web.dev/explore/learn-core-web-vitals) validate that BetMGM in now
one of the fastest apps in the U.S.

 

 Contacts:

 BetMGM
 Witek Wacinski - VP Strategy & Development

                     witek.wacinski (witek.wacinski@betmgm.com)
 @betmgm.com (witek.wacinski@betmgm.com)

 Entain plc
 Investor Relations

        investors@entaingroup.com (mailto:investors@entaingroup.com)

 David Lloyd-Seed - Chief Investor Relations & Communications Officer

 Davina Hobbs- Head of Investor Relations

 Aimee Remey - VP US Investor Relations

 Callum Sims - IR Manager

 News Media

                            media@entaingroup.com

 Lisa Attenborough - Head of Media Relations

 Jodie Hitch - PR Manager

 MGM Resorts International
 Investment Community                                achapman@mgmresorts.com (mailto:achapman@mgmresorts.com)

 Andrew Chapman - Director, Investor Relations

 News Media                                          media@mgmresorts.com (mailto:media@mgmresorts.com)

 Brian Ahern - Executive Director, Media Relations

 

LEI: 213800GNI3K45LQR8L28

 

 

Forward-looking statements

This document contains certain statements that are forward-looking statements.
They appear in a number of places throughout this document and include
statements regarding our intentions, beliefs or current expectations and those
of our officers, directors and employees concerning, amongst other things,
results of our operations, financial condition, liquidity, prospects, growth,
strategies and the business we operate. Examples of these statements include,
but are not limited to, BetMGM's expectations regarding its financial outlook
(including EBITDA guidance). These forward-looking statements include all
matters that are not historical facts. By their nature, these statements
involve risks and uncertainties since future events and circumstances can
cause results and developments to differ materially from those anticipated.
Any such forward-looking statements reflect knowledge and information
available at the date of preparation of this document. Among the important
factors that could cause actual results to differ materially from those
indicated in such forward-looking statements include the significant
competition within the gaming and entertainment industry; BetMGM's ability to
execute on its business plan; changes in applicable laws or regulations,
particularly with respect to iGaming and online sports betting; BetMGM's
ability to manage growth and access the capital needed to support its growth
plans; and BetMGM's ability to obtain the required licenses, permits and other
approvals necessary to grow in existing and new jurisdictions. In providing
forward-looking statements, Entain is not undertaking any duty or obligation
to update these statements publicly as a result of new information, future
events or otherwise, except as required by law. Other than in accordance with
its legal or regulatory obligations (including under the Market Abuse
Regulation (596/2014), the Listing Rules, the Disclosure Guidance and
Transparency Rules and the Prospectus Rules), Entain undertakes no obligation
to update or revise any such forward-looking statements. Nothing in this
document should be construed as a profit forecast. Entain and its directors
accept no liability to third parties in respect of this document save as would
arise under English law.

 

Non-GAAP Financial Information

This press release includes net revenue from operations and estimated EBITDA,
which have not been prepared in accordance with GAAP. BetMGM believes this
presentation, which it uses for its own analysis of operations, is useful in
that it reflects the true economic performance of the business. If BetMGM
presented net revenue from operations in accordance with GAAP, then BetMGM
would present the revenues associated with its Nevada digital and retail
sports betting operations different, until such time as BetMGM is licensed as
a Nevada gaming operator. Currently under GAAP, its calculation of Net Revenue
would be on a basis net of operating costs, such that the GAAP reported Net
Revenue would be lower than the Net Revenue reported herein, with Net Income
remaining the same.

 

About BetMGM

BetMGM is a market leading sports betting and gaming entertainment company,
pioneering the online gaming industry. Born out of a partnership between MGM
Resorts International (NYSE: MGM) and Entain Plc (LSE: ENT), BetMGM has
exclusive access to all of MGM Resorts' U.S. land-based and online sports
betting, major tournament poker, and online gaming businesses. Utilizing
Entain's U.S.-licensed, state of the art technology, BetMGM offers sports
betting and online gaming via market leading brands including BetMGM, Borgata
Casino, Party Casino and Party Poker. Founded in 2018, BetMGM is headquartered
in New Jersey.  For more information, visit http://www.betmgminc.com/
(http://www.betmgminc.com/)

 

About Entain plc

Entain (LSE: ENT) is a FTSE100 company and is one of the world's largest
sports-betting and gaming groups, operating both online and in the retail
sector. The Group owns a comprehensive portfolio of established brands; Sports
brands include BetCity, bwin, Coral, Crystalbet, Eurobet, Ladbrokes, Neds,
Sportingbet, Sports Interaction and SuperSport; Gaming brands include Foxy
Bingo, Gala, GiocoDigitale, Ninja Casino, Optibet, Partypoker and PartyCasino.
The Group owns proprietary technology across all its core product verticals
and in addition to its B2C operations provides services to a number of
third-party customers on a B2B basis.

The Group has a 50/50 joint venture, BetMGM, a leader in sports betting and
iGaming in the US. Entain provides the technology and capabilities which power
BetMGM as well as exclusive games and products, specially developed at its
in-house gaming studios.

The Group is tax resident in the UK with operations in over 40 regulated or
regulating territories. Entain is a leader in ESG, a member of FTSE4Good, the
DJSI and is AA rated by MSCI. The Group has set a science-based target,
committing to be carbon net zero by 2035 and through the Entain Foundation
supports a variety of initiatives, focusing on safer gambling, grassroots
sport, diversity in technology and community projects. For more information
see the Group's website: www.entaingroup.com (http://www.entaingroup.com)

 

About MGM Resorts International

MGM Resorts International (NYSE: MGM) is an S&P 500® global entertainment
company with national and international locations featuring best-in-class
hotels and casinos, state-of-the-art meetings and conference spaces,
incredible live and theatrical entertainment experiences, and an extensive
array of restaurant, nightlife and retail offerings. MGM Resorts creates
immersive, iconic experiences through its suite of Las Vegas-inspired brands.
The MGM Resorts portfolio encompasses 31 unique hotel and gaming destinations
globally, including some of the most recognizable resort brands in the
industry. The Company's 50/50 venture, BetMGM, LLC, offers U.S. sports betting
and online gaming through market-leading brands, including BetMGM and
partypoker. The Company is currently pursuing targeted expansion in Asia
through the integrated resort opportunity in Japan. Through its "Focused on
What Matters: Embracing Humanity and Protecting the Planet" philosophy
(https://www.mgmresorts.com/en/company/csr.html) , MGM Resorts commits to
creating a more sustainable future, while striving to make a bigger difference
in the lives of its employees, guests, and in the communities where it
operates. The global employees of MGM Resorts are proud of their company for
being recognized as one of FORTUNE® Magazine's World's Most Admired
Companies®. For more information, please visit us at www.mgmresorts.com
(https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.mgmresorts.com%2F&data=02%7C01%7C%7Cc0dc1390d0904f667a7108d859a99f07%7Cc64a4fa65c9344ee83651e8c8c86f41a%7C0%7C0%7C637357932355339142&sdata=pi4SrXbP6AHPM%2F3tbPdGbDiN5gaHaVOcwgRF7e6iYo0%3D&reserved=0)
. Please also connect with us @MGMResortsIntl on Twitter
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