REG - Entain PLC - Final Results
06/03/2025 07:15
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RNS Number : 5502Z Entain PLC 06 March 2025
6 March 2025
Entain plc
("Entain" or the "Group")
FY24 marked the Group's return to organic growth with results at top of
guidance
Continuing momentum sees business well placed for 2025
Entain plc (LSE: ENT), the global sports betting and gaming group, today
reports its results for the year ended
31 December 2024 ("FY24").
· Total Group Net Gaming Revenue ("NGR"), including 50% share of BetMGM,
up +6%, +9%cc(2), +4%cc(2) proforma(3)
o FY24 Online NGR (exc. US) up +9%, +12%cc(2), +6%cc(2) proforma(3) with
improving momentum through the year
o Q4 Online NGR (exc. US) up +13%cc(2), stronger than expected, including
benefit of operator friendly sports margins
· Accelerating growth in "must win" markets:
o UK&I Online NGR returned to growth sooner than expected in Q3, and in
Q4 grew +21%cc(2) in line with market
o Brazil NGR grew +41%cc(2) YoY, rebuilding strongly from +9%cc(2) in Q1 to
+65%cc(2) in Q4
o In the US, BetMGM's accelerating momentum and strategic refinement
underpins our confidence in delivering positive EBITDA(4) in 2025 and the
pathway to $500m EBITDA(4) in the coming years
· Margin expansion: Online EBITDA(4) margin of 25.3%, ahead of
expectations, benefiting from stronger than anticipated growth and operational
efficiencies
· Group EBITDA(4) of £1,089m, in line with upgraded(5) guidance,
+12%cc(2) YoY, +5%cc(2) proforma(3)
· Outlook: Year to date trading and ongoing operational execution
supports our expectation to grow FY25 Online NGR in line with underlying
markets
o Entain remains comfortable with market expectations(6) for FY25
o Pathway to generating over £0.5bn of annual adjusted (7) cash flow in the
medium term
Stella David, Interim CEO of Entain, commented:
"2024 has been a year of transformation for Entain. I am delighted to see that
our strategic and operational improvements are translating into strong
performance; clear evidence that our strategy is delivering. I want to thank
all my colleagues for their tremendous hard work and resilience.
Entain has a high quality portfolio of iconic brands with podium positions in
attractive markets. Our return to organic growth is the beginning of our
rebuild journey; our momentum continues, and we have started the year
strongly. I am incredibly proud of our achievements so far and look forward to
our opportunities ahead."
FY24 Trading performance:
Net Gaming Revenue (NGR)
H1 H2 FY
YoY YoY cc(2) YoY YoY cc(2) YoY YoY cc(2)
Rpt(13)
Proforma(3)
Rpt(13)
Proforma(3)
Rpt(1)
Proforma(3)
UK & Ireland (6%) (6%) 7% 7% 0% 0%
International 7% 3% 5% 9% 6% 6%
CEE(5) 126% 12% 27% 13% 62% 12%
Total Group (exc US) 6% 0% 7% 9% 7% 4%
Total Online 9% 1% 9% 11% 9% 6%
Total Retail 1% (4%) 3% 3% 2% flat
Total Group inc 6% 0% 7% 8% 6% 4%
50% of BetMGM
FY24 performance highlights
· Total Group NGR, including 50% share of BetMGM(1), up +6%,
+9%cc(2), and +4%cc(2) on a proforma(3) basis
o Group NGR (exc. US) up +7%, +9%cc(2), 4%cc(2) proforma(3)
o Online NGR (exc. US) up +9%, +12%cc(2), +6%cc(2) proforma(3), with active
customers up +10% proforma(3)
o Retail NGR (exc. US) up +2%, +3%cc(2), flat YoY proforma(3), with strong
Q4 driving growth in H2
· UK & Ireland NGR flat cc(2), reflects our accelerating
recovery through the year with Q1 -7% to Q4 +13%
o UK&I Online +2%cc(2) with H2 growth of +14%cc(2) evidencing our
customer journey simplification and improving player experiences
§ Actives customers grew +11% YoY
§ Spend per head returned to growth in Q4 across both sports and gaming, for
the first time since Q1-2021
o UK&I Retail -1%cc(2) (+1%cc(2) LFL) with H2 up +2%cc(2) (+4% LFL) with
the benefit from strong sports margins and the completion of our new Kascada
cabinets rollout offsetting some softness in the Retail gaming market
· International NGR up +10%cc(2), +6%cc(2) on a proforma(3) basis
o Brazil delivered excellent revenue growth, with FY24 NGR up +41%cc(2) and
actives +42%
o Australia NGR grew +1%cc(2) YoY, despite softness in the underlying market
o Italy +3%cc(2) (Online +2%cc(2), Retail +4%cc(2))
· Entain CEE(5) continued to perform well with NGR up +12%cc(2)
proforma(3), with SuperSport in Croatia performing particularly strongly at
+16%cc(2) YoY
· BetMGM delivered net revenue of $2.1 billion, up +7% YoY, with
strengthened sports product and increased iGaming marketing investment driving
acceleration in growth and player engagement metrics through the year
o Market share(8) stabilisation at 14%, with iGaming (22%) and Online Sports
(8%)
FY24 financial highlights
· Group EBITDA(4) of £1,089m driven by proforma(3) EBITDA growth of
+5%cc(2) and the annualisation of 2023 acquisitions
o Online EBITDA(4) £941m, +11%, Retail EBITDA(4) £261m, -11%
· Group loss after tax of £461m, reflecting separately disclosed
items charge of £876m which include impairments following known regulatory
changes and heightened competitor activity in certain smaller markets
· Adjusted diluted EPS(9) of 29.9p, (46.9p exc. US)
· Second interim dividend of c£60m (9.3p per share) proposed,
bringing the total dividend for the year to £119m (18.6p per share)
· Robust balance sheet with adjusted(10) net debt of £3,339m and
available cash of over £1bn at 31 December 2024
· Project Romer efficiency programme on track with upgraded annual
net savings target of £100m in 2026
FY24 summary: 1 January to 31 December 2024
Total Group (ex US) Reported(1)
2024 2023 Change CC(2)
Year ended 31 December £m £m % %
Net gaming revenue (NGR) 5,161.9 4,833.1 7% 9%
Revenue 5,089.2 4,769.6 7% 9%
Gross profit 3,118.1 2,907.0 7%
Underlying EBITDA(4) 1,088.8 1,007.9 8%
Underlying operating profit(11) 616.6 641.8 (4%)
Underlying (loss)/profit before tax(11) 518.4 444.9 16%
Profit after tax pre separately disclosed items 379.5 339.1
Loss after tax (461.0) (878.7)
Basic EPS (p) (70.8) (141.4)
Continuing adjusted diluted EPS(9) (p) 29.9 44.2
Continuing adjusted diluted EPS excl US(9) (p) 46.9 51.0
Dividend per share (p) 18.6 17.8
( )
Q4 2024 Trading performance:
Q4 2024: 1 October to 31 December 2024
Total Gaming Sports Sports Sports
NGR NGR NGR Wagers Margin
Reported(13) CC(2) Proforma CC(2,3)
UK & Ireland +13% +13% +6% +24% +2% +3.3pp
Online UK&I +21% +21% +13% +45% +5% +3.5pp
Retail UK&I +5% +6% (4%) +16% (1%) +3.2pp
International +4% +10% +3% +14% +5% +1.2pp
Online Int'l +3% +9% +3% +14% +6% +1.0pp
Retail Int'l +8% +12% +2% +14% (1%) +2.3pp
CEE +12% +14% (3%) +22% +1% +4.6pp
Online CEE +11% +14% (2%) +22% +1% +4.4pp
Retail CEE +13% +16% (11%) +21% +1% +5.4pp
Group (ex US) +8% +11% +4% +18% +4% +2.0pp
Online +9% +13% +6% +20% +5% +1.7pp
Retail +6% +8% (4%) +15% (1%) +3.0pp
BetMGM (5%) +0%
Total Group inc. +6% +9%
50% of BetMGM
Capital Allocation Committee
The Capital Allocation Committee remains committed to delivering shareholder
value, continuing to monitor the Group's strategic progress alongside its
significant capital commitments.
Dividend
In line with the Group's progressive dividend policy, the Board has proposed a
total dividend for 2024 of c£119m, (18.6p per share), paid to shareholders in
equal instalments with H1 and FY results. As such a second interim dividend of
c£60m (9.3p per share), is expected to be paid on 25 April 2025 to
shareholders on register on 14 March 2025.
Current trading
The Group has started the year strongly, with the momentum seen during 2024
continuing into 2025. Trading year to date reflects the benefit from operator
friendly sports margins, and volumes in line with our expectations. In the US,
BetMGM's accelerating performance has also continued into 2025 including
record SuperBowl results.
Guidance
Entain has now passed through the most significant operational impacts of
previous regulatory changes which created performance headwinds. As such, we
expect mid-single-digit percent growth in Online NGR in 2025, in line with our
weighted average for underlying markets.
Entain remains comfortable with market expectations (6) for FY2025. 2025
Online EBITDA margin is expected to be c25%, broadly flat year on year, with
our increasing scale and operational efficiencies offsetting the impact of
Brazil now operating in the newly regulated and locally taxed market from 1
January 2025.
Continued operational and strategic progress underpin our confidence in
Entain's pathway to generating over £0.5bn of annual adjusted (7) cash flow
in the medium term.
As previously announced(12), BetMGM expects FY25 to deliver revenue of
$2.4-$2.5 billion and positive EBITDA.
Notes
(1) 2024 reported numbers are audited and relate to continuing
operations
(2) Growth on a constant currency basis is calculated by
translating both current and prior year performance at the 2024 exchange rates
(3) Proforma references include all 2023 acquisitions as if they
had been part of the Group since 1 January 2023
(4) EBITDA is defined as earnings before interest, tax,
depreciation and amortisation, share based payments and share of JV income.
EBITDA is stated pre-separately disclosed items
(5) As detailed in the 2024 Q3 Trading Update published on 17
October 2024
(6) Consensus EBITDA FY25 £1,109m as confirmed in 11 February
2025 statement
(7) Annual adjusted cash flow excludes working capital,
dividends, acquisitions and associated financing
(8) Consolidated Gross Gaming Revenue (GGR) market share
consists of last three months ending October, November, or December 2024 as
latest reported for U.S. sports betting markets where BetMGM was active
(online and retail), last three months ending December 2024 for U.S. iGaming
markets where BetMGM was active, and last three months ending December 2024
for the Ontario market. Internal estimates used where operator-specific
results are unavailable
(9) Adjusted for the impact of separately disclosed items,
foreign exchange movements on financial indebtedness and losses/gains on
derivative financial instruments (see note 9 in the interim financial
statements)
(10) Adjusted net debt excludes the DPA settlement. Leverage also
excludes any benefit from future BetMGM EBITDA or the payments due to acquire
the minority interests in Entain CEE
(11) Stated pre separately disclosed items
(12) As detailed in the 2024 BetMGM FY Update published on 4 February
2025
(13) These results are unaudited
Enquiries
Investor Relations - Entain plc investors@entaingroup.com (mailto:investors@entaingroup.com)
Media - Entain plc media@entaingroup.com (mailto:media@entaingroup.com)
Sodali & Co Tel: +44 (0) 20 7250 1446
Rob Greening/Russ Lynch/Sam Austrums entain@sodali.com (mailto:entain@sodali.com)
Presentation and webcast
Entain will host our Full Year 2024 Results presentation and Q&A session
today, Thursday 6(th) March at 9:30am GMT, at Bank of America, 2 King Edward
Street, City of London, London, EC1A 1HQ.
Analysts and investors are welcome to attend in person, having pre-registered
via the in-person registration link
(https://entain-2024-full-year-results.open-exchange.net/registration) .
Alternatively please join the webcast approximately 15 minutes ahead of the
event: online webcast link
(https://entain-2024-full-year-results.open-exchange.net/registration) .
The presentation slides as well as a replay and transcript will be available
on our website:
https://entaingroup.com/investor-relations/results-centre/
(https://entaingroup.com/investor-relations/results-centre/)
Upcoming dates:
Annual General Meeting 23 April 2025
Q1-25 Trading Update: 29 April 2025
2025 Interim results: 12 August 2025
Dividend Timetable
Announcement date: 6 March 2025
Ex-Dividend date: 13 March 2025
Record date: 14 March 2025
Payment date: 25 April 2025
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. 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. Other than
in accordance with its legal or regulatory obligations (including under the
Market Abuse Regulation (596/2014) as it forms part of English law by virtue
of the European Union (Withdrawal) Act 2018, the UK Listing Rules, the
Disclosure Guidance and Transparency Rules and the Prospectus Rules), the
Company undertakes no obligation to update or revise any such forward-looking
statements. Nothing in this document should be construed as a profit forecast.
The Company and its Directors accept no liability to third parties in respect
of this document save as would arise under English law.
About Entain plc
Entain plc (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, STS, SuperSport and TAB NZ; 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 and is the only
global operator to exclusively operate in domestically regulated or regulating
markets operating in over 30 territories.
Entain is a leader in ESG, a member of FTSE4Good, the DJSI and is AAA rated by
MSCI. For more information see the Group's website: www.entaingroup.com
(http://www.entaingroup.com/) .
LEI: 213800GNI3K45LQR8L28
CHIEF EXECUTIVE OFFICER'S REVIEW
Entain is a leading player in sports betting and gaming, a global industry
with attractive dynamics and structural growth. We are proud to be the most
diversified leader of scale in our sector, operating over 35 iconic brands
across more than 30 regulated or regulating markets. Our footprint of podium
positions in attractive growth markets underpins the sustainable quality of
our earnings. Entain is focused on providing our customers great player
experiences with engaging products and content, underpinned by leading player
protection.
To deliver value for our shareholders, we have a clear strategy to drive
organic revenue growth, margin expansion and market share gains.
Having stepped in as Entain's Interim CEO in December 2023, I had the
privilege of leading the Group through the first eight months of 2024. We have
been laser focused on executing our strategic objectives and driving
operational momentum to return the Group to structural growth. To achieve
this, we needed to confront challenges head on, improve our ways of working,
deliver on our product and technology roadmap, and prioritise execution in our
must-win markets of the UK, Brazil and the US. We made significant progress on
these fronts in 2024, establishing a solid foundation for sustainable growth,
which continues into 2025.
In September 2024, Gavin Isaacs joined as CEO and the Board and I would like
to thank him for his contribution during his tenure. He stepped down in
February 2025 and I am pleased to return to the CEO role on an interim basis
to continue driving the Group's strategy forward. Our objectives remain clear
and aligned with our mission to create value for all shareholders.
I am very proud of the progress Entain achieved in 2024. Our return to growth
for both organic NGR and EBITDA(1) is clear evidence that our operational
transformation is succeeding. However, there is plenty of hard work still to
do, delivering the brilliant basics that drive customer acquisition and
retention, and enhance player experiences. Our rebuilding momentum continues
and sees Entain well positioned for 2025. I am both confident and excited for
the many opportunities ahead.
2024 performance
2024 was a year of inflection for Entain. The Group's performance improved as
the year progressed and clearly illustrates the turnaround of the underlying
business. We ended 2024 at the top of our guidance range, which we had
upgraded twice during the year, reflecting the business' momentum and trading
performance.
Total Group NGR including our 50% share of BetMGM was up +6% reported(1),
+9%cc(2) and +4%cc(2) on a proforma(3) basis. Excluding BetMGM, Group NGR was
up +9%cc(2) and +4%cc(2) proforma(3). The Group's Online and Retail operations
delivered year on year growth in NGR of +12%cc(2) and +3%cc(2) respectively,
+6%cc(2) and flat cc(2) on a proforma(3) basis.
FY2024 Online Net Gaming Revenue YoY FY2024 Retail Net Gaming Revenue YoY
CC(2) Proforma(3) CC(2) CC(2) Proforma(3) CC(2)
Group Online inc. 50% BetMGM 11% 6% Total Retail 3% flat
Online ex. 50% BetMGM 12% 6% UK&I / LFL (1%)/1% -
UK&I 2% - International 7% 1%
International - 7% Italy 4% -
Australia 1% - Belgium (6%) -
Italy 2% - Entain CEE - 9%
Brazil 41% - Croatia 5% -
New Zealand - 4% Poland - 12%
Georgia 13% -
Netherlands - (13%)
Germany 0% -
Other 8% -
Entain CEE - 13%
Croatia 19% -
Poland - 8%
The Group's improving underlying organic growth as well as the benefit from
stronger than expected sports win margins, particularly in the Euros
tournament and the Premier League in Q4, delivered Group EBITDA(1) of
£1,089m, up +12%cc(2) year on year, including proforma(3) EBITDA growth of
+5%cc(2).
Entain's acceleration in performance, from Group NGR growth of flat cc(2) in
H1(4) and +9%cc(2) in H2(4) on a proforma(3) basis evidences the progress
achieved, giving us increasing confidence in 2025 and further ahead.
Although Entain has passed through the most significant operational impacts of
previous regulatory changes, our global industry and its regulatory
environment continues to evolve. Brazil's newly(5) regulated sports betting
and gaming regime and the Betting and Gaming Council's (BGC) new industry
code(6) were notable positive changes, whilst Belgium and the Netherlands face
further regulatory tightening. The potential liberalisation of iGaming in
Poland, as well as both online casino and the introduction of the legislative
"net" in New Zealand also continues to be positive. However, recognising the
impact from adverse regulatory changes, as well as heightened competitor
activity in certain smaller markets, an impairment charge was recorded in
2024.
Separately in 2024, the Australian Transaction Reports and Analysis Centre
(AUSTRAC) commenced civil penalty proceedings against the Group's subsidiary
in Australia. Entain co-operated fully with AUSTRAC throughout its
investigation, and we are hopeful of making progress towards a resolution with
AUSTRAC through 2025.
Organic revenue growth
Critical to driving organic growth is player acquisition and retention, and
our customers are central to our mindset as we continue to deliver our
brilliant basics, enhance our offering, reinvigorate our acquisition channels,
and improve our customer journeys and experiences end-to-end.
The UK and Brazil were highlighted as two of our "must win" markets, due to
their significance within our Group portfolio and potential future growth
opportunity. I am very proud that our teams' hard work has delivered
successful 2024 results, with both these markets performing ahead of
expectations.
UK & Ireland
Returning to growth in Entain's largest market was a cornerstone of the
Group's overall performance and strategic success. The performance of our
UK&I business in H1, with NGR down -6%cc(2) year on year, reflected the
impact that our previous approach to regulatory implementation had on our
customers' experience and engagement, particularly in Online.
The turnaround of our UK&I Online growth was critical to the Group's
performance during 2024 and demonstrates the success of our decisive actions.
UK&I Online NGR was up +2%cc(2) versus the prior year, and importantly
returned to year on year growth sooner than anticipated. Q4 delivered NGR
growth of +21%, recovering from down -8% in H1, and growing back in line with
the market.
Addressing the complexity and friction of our customer journey's without
compromising our player protection was an important component of our
performance recovery. As evidenced during H1, the stabilisation in spend per
head has now moved into growth on a year on year basis, across both sports and
gaming in Q4.
Alongside our smoother customer journeys, we also delivered numerous
initiatives to improve our UK offering and player experience across both
sports and gaming. Our brands have continued to engage players with leading
gaming content including an unrivalled library of in-house and exclusive
games. As well as Foxy's engaging marketing campaigns, we are delighted with
how our players are enjoying LadBucks and Coral Coins, our new coin economy
loyalty programme and a differentiator to peers. Our Sportsbook enhancements
prioritised key elements of players' experiences: UX, design and app speed.
Our new in-house Bet Builder sports product launched in H2, aligned with the
start of the Premier League football season, and further enhancements are
expected during the year ahead.
The UK&I is an omni-channel market which brings many opportunities,
particularly following our organisational restructuring which combined the
management of UK&I Online and Retail. We are pleased with the performance
of our UK&I retail estate as it digests some gaming market softness, as
well as ongoing inflationary and cost challenges. UK&I Retail delivered
+1%cc(2) LFL NGR growth versus 2023, underpinned by our digital in-shop
experiences, strong sports win margins and next-generation Kascada cabinets
which rolled out fully in H2.
International
Brazil is the fastest growing market outside of the US and it introduced a
regulated sports betting and gaming regime from 1 January 2025. Having seen
our business lose direction during 2022, 2024's excellent performance is
testament to the decisive actions and hard work undertaken in overhauling our
go-to market approach. Led by local management, initiatives included
refreshing our brand, realigning customer acquisition channels, integrating
smooth payment processing, as well as refining our product to embrace local
favourites across both our gaming portfolio and sports offering.
The green shoots of returning growth emerged in early 2024 and accelerated
strongly through the year. Our Brazil business delivered Online NGR growth of
+41%cc(2) for the year, accelerating from +28%cc(2) in H1(4) to +57% cc(2) in
H2(4).
The newly regulated sports betting and gaming regime brings significant
changes to the Brazilian market for 2025. We believe we are well positioned in
this attractive, albeit highly competitive, market. We are pleased with our
performance so far in 2025, successfully launching on day one of the newly
regulated regime as well as partnering as the main sponsor of Palmeiras
football club, which is already generating excellent player engagement.
Australia, the largest Online market in our International division, performed
well during 2024 despite the underlying market experiencing some expected
softness. Having achieved H1(4) NGR that was flat versus the prior year,
including some benefit from strong sports margins, our Ladbrokes and Neds
brands continue to differentiate themselves in this highly competitive market.
NGR growth improved to +2%cc(2) in H2(4), delivering NGR up +1%cc(2) for the
year. We continue to focus on improving the quality of our player base with
unique product and experiences, as well as expanding our offer to include
additional overseas races, which resonate with our Australian customers.
Leveraging the strength of our Australia platform, our partnership with TAB NZ
in New Zealand is making progress. The business was successfully migrated onto
Entain Australia's technology during Q2 and Entain launched our new
complementary online-only sister brand "betcha" in August. On a proforma
basis, Online NGR was up +4%cc(2) and we are encouraged by accelerating
momentum through the year, with actives growing 10% in 2024. More customers in
New Zealand are enjoying an enhanced and engaging sports betting experience,
and we look forward to this growing opportunity following the introduction of
the legislative "net" for racing and sports betting expected in 2025, as well
as the improving outlook for online casino regulation in the future.
Our business in Italy continues to operate in a competitive and consolidating
market. Our 2024 performance of +3%cc(2) NGR growth, Online (+2%cc(2)) and
Retail (+4%cc(2)), reflects both customer-friendly sports margins as well as
the challenging competitive environment as peer operators maximise their
consolidation-led growth strategies. The growth in the underlying Italian
market remains strong and omni-channel operators continue to outperform as
brand recognition and point-of-sale touchpoints remain particularly critical
to driving online customer acquisition and engagement. Our Eurobet brand
continues to leverage its omnichannel position, offering customers new sports
markets and exclusive gaming products. Entain's multi-brand approach secures
our top-tier position in this highly attractive market and we are well placed
to benefit from the implementation of the revised online licensing expected
during 2025.
Entain CEE
We continue to be pleased with our Entain CEE performance with NGR up
+12%cc(2) YoY on a proforma basis, delivering +13%cc(2) and +9%cc(2) NGR
growth for Online and Retail respectively.
In Croatia, SuperSport remains a market leader across both Online and Retail
and continues to be a standout performer. Online NGR grew +19%cc(2) YoY whilst
Retail NGR was up +5%cc(2), as players enjoy our strong brand and engaging
product offering. In Poland, STS delivered proforma NGR growth of +8%cc(2)
during 2024, with wagering up +12%cc, first time depositors (FTDs) +28% and
actives +10% versus the prior year, and maintained our market leadership
despite facing heightened competitive intensity ahead of the potential
liberalisation of iGaming in the medium-term horizon.
Margin expansion
Supporting the Group's strategic growth transformation is our focus on
aligning structures and simplifying our operating model, particularly across
our product and technology footprint. Ensuring our business has strong
foundations enables us to be more agile and execute more effectively to
capitalise on growth opportunities. Our efficiency programme, Project Romer,
is unlocking operational efficiencies as well as savings. Having completed the
initial phase of initiatives, we saw potential for even greater efficiencies
and increased our target of delivering net cost savings from £70m to at least
£100m in 2026. As well as delivering efficiency savings, these initiatives
also free up capital to reinvest back into product and player experience,
supporting further growth, building scale and operational leverage to expand
our EBITDA margin.
In 2024 we expanded our Online EBITDA margin to 25.3%, ahead of expectation of
24-25% due to scale benefits from stronger than anticipated revenue
performance, particularly in our UK business. In 2025, Online EBITDA margins
is expected to remain broadly flat year on year reflecting our increasing
scale and operating efficiencies offsetting the impact of Brazil's new
regulatory tax structure, and we remain confident of driving margin expansion
in future years.
Empowering US growth
Expanding our market share is one of the Group's strategic goals, with
stabilisation of BetMGM's share in the US an important part of our growth
transformation.
BetMGM continues to be a leading operator in the world's largest gaming
market, operating in 29 markets including 2024 launches in North Carolina and
district wide in Washington D.C.
2024 was a year of investment and rebuilding of momentum for BetMGM. We
strengthened the business by improving our product offering, enhancing player
engagement, refining our customer acquisition and retention strategies, and
unlocking unique omnichannel opportunities. Our improved offering and
strategic refinement saw BetMGM stabilise market share, and exit the year with
encouraging key metrics including Q4 EBITDA(1) trending towards breakeven on a
normalised basis(7).
Our leading iGaming business continues to grow strongly and deliver attractive
returns. We increased our investment behind our brand and unique offering with
the widest range of market leading games content, which drove an acceleration
in 2024 NGR growth from +13% in Q1 to +25%(7) in Q4. BetMGM's omnichannel
advantage is a key differentiator with proprietary titles and record-breaking
jackpots driving strong engagement. The strong momentum in our iGaming
business and increasing potential for legalisation in new states, gives us
ever-increasing confidence in BetMGM's profitable growth trajectory.
BetMGM made meaningful progress in Online Sports during 2024, seeing a
stabilisation in our market share. In addition to numerous upgrades across our
product offering, providing customers a smoother, faster, richer experience,
the integration of Angstrom, Entain's US-sports focused pricing and data
analytics capability, was critical to improving our parlay betting offering to
include the broadest number of markets and unique pricing combinations. These
improvements were notable during the NFL season, driving a year on year handle
increase of +26% in Q3 and +38% in Q4.
Coupled with our increased investment in customer acquisition, during 2024 we
progressively refined our strategy to amplify our premium brand, iGaming
heritage and unique omnichannel advantages with tailored promotions and
enhanced real-life experiences resonating well with customers and enhancing
efficiency.
Further amplifying our unique omni-channel strengths, expanding our
nationwide, single, digital wallet into Nevada, becoming the first sports
betting app in the state to offer bettors a seamless experience when
travelling to other regulated states. This remains a key differentiator given
MGM Resorts' Las Vegas presence and the fact that BetMGM is the only podium
operator with a mobile license in the state. The 2024/25 NFL season saw 61%
growth in Nevada-acquired first-time depositors and doubled the percentage of
those who continued to play with us after returning to their home state.
With BetMGM's renewed acceleration across both iGaming and Online Sports, we
expect to achieve positive EBITDA in 2025, and our scaled podium position in
the world's largest gaming market underpins our confidence in our pathway to
$500 million EBITDA in the coming years.
Group strategy and priorities
Since becoming Entain in 2020, the Group has been transforming to become a
stronger, leaner, and more sustainable business, only operating in regulated
or regulating markets.
To deliver value to all our shareholders, Entain has clear strategic goals:
· Organic revenue growth - acquiring and retaining customers by ensuring
a smooth, relevant and engaging experience for players
· Margin expansion - simplifying our operating model to be more agile
and effective, driving greater returns through efficient use of capital
· Market share gains - outperforming our markets over the long term
We have made strong progress in the operational phase of our transformation,
and the evidence of what we have achieved so far demonstrates that our
strategy is working - rebuilding our growth momentum and returning our
business to its winning ways. Following the successes in our "must win"
markets, UK, Brazil and US, our execution focus has evolved, broadening across
our footprint of podium positions in attractive markets to deliver further
high quality growth and share gains.
The Group has made an excellent start, but there is still a lot of hard work
to do to return Entain to its winning ways and deliver value for all our
shareholders.
2024 sustainability highlights:
At Entain, sustainability is integral to our growth strategy and long-term
success. Our Sustainability Charter is built on four core pillars that address
the priorities of our customers, employees and stakeholders:
· Lead on player protection - Ensuring player safety remains at the
heart of our commitment to delivering the best customer experience. We
continuously enhance our approach to align with market developments and
customer needs.
· Provide a secure and trusted platform - It is critical that we
uphold the highest ethical standards to maintain the trust of our customers
and wider society. 100% of our revenue is derived from regulated or regulating
markets. In 2024, we introduced an AI and Data Ethics Charter and launched
'Leading with integrity', new ethics training for managerial roles
· Create an environment for everyone to do their best work - In
order to attract a broad and diverse pool of talent, we strive to be an
employer of choice with a dynamic and supportive culture. In 2024, we revamped
our objective programme, Your Goals, and developed our first global Employer
Value Proposition. Our efforts to promote wellbeing and inclusion were
recognised by the 2024 All-In-Diversity Project Index
· Positively impact our communities - In 2024 we voluntarily
contributed £21.9m to safer gambling initiatives and other good causes. To
support our reset GHG emissions reduction targets, we have partnered with
Normative, a science-based carbon accounting platform, to drive emissions
reduction through data-driven insights. Through initiatives such as our
Pitching In investment programme, we continue to support grassroots sport,
funding non-league football and promoting engagement between local clubs and
their communities via the Trident Community Fund
Sustainability Recognitions in 2024 include:
· Tier 1 in the CCLA Corporate Mental Health Benchmark UK 100
· Ranked Second in the 2024 All-In-Diversity Project Index
· Awarded highest safer gambling certification in the UK by
independent charity focussed on preventing gambling harm
· Recognised among the Top 20 UK Best Companies to Work For -
LinkedIn 2024
· Achieved AAA rating from MSCI, and retained inclusion in
FTSE4Good and Dow Jones Sustainability Indices
· SBC Global Socially Responsible Operator of the Year awarded to
the Entain US Foundation
Our ongoing sustainability efforts reflect our commitment to responsible
growth, ethical leadership, and positive societal impact.
Notes
(1) EBITDA is defined as earnings before interest, tax, depreciation and
amortisation, share based payments and share of JV income. EBITDA is stated
pre-separately disclosed items
(2) Growth on a constant currency basis is calculated by translating
both current and prior year performance at the 2024 exchange rates
(3) Proforma references include all 2023 acquisitions as if they had
been part of the Group since 1 January 2023
(4) These results are unaudited
(5) Brazil's regulated sports betting and gaming regime launched on
1 January 2025
(6) BGC announced new voluntary industry code on customer checks on
1 May 2024
(7) Adjusted figures normalise for Q4 2023 BetMGM rewards points
adjustments across both Online Sports and iGaming, and December 2024
theoretical margin in Sports
Financial Results and the use of non-GAAP measures
The Group's statutory financial information is prepared in accordance with
International Financial Reporting Standards ("IFRS") and IFRS Interpretations
Committee (IFRS IC) pronouncements as adopted for use in the European Union.
In addition to the statutory information provided, management have also
provided additional information in the form of Contribution and EBITDA as
these metrics are industry standard KPIs which help facilitate the
understanding of the Group's performance in comparison to its peers. A full
reconciliation of these non-GAAP measures is provided within the Income
Statement and supporting memo.
During the current year, the Group has amended its operating segments in line
with the revisions to the Group's reporting to the executive management team
("CODM"). The Group's operating segments are aggregated into four reportable
segments; UK&I, International, CEE and Corporate, with a New Opportunities
segment also present in 2023.
CHIEF FINANCIAL OFFICER'S REVIEW
FINANCIAL PERFORMANCE REVIEW
Group
Reported results(1)
Year ended 31 December 2024 2023 Change CC(2)
£m £m % %
NGR 5,161.9 4,833.1 7% 9%
VAT/GST (72.7) (63.5) (14%) (18%)
Revenue 5,089.2 4,769.6 7% 9%
Gross profit 3,118.1 2,907.0 7%
Contribution(4) 2,480.5 2,279.4 9%
Operating costs (1,391.7) (1,271.5) (9%)
Underlying EBITDA(5) 1,088.8 1,007.9 8%
Share based payments (13.3) (21.7) 39%
Underlying depreciation and amortisation (344.7) (301.5) (14%)
Share of JV loss (114.2) (42.9) (166%)
Underlying operating profit(7) 616.6 641.8 (4%)
Reported Results(1):
NGR and Revenue increased by +7% (both +9%cc(2)) versus the prior year, with
the benefit of annualisation of 2023 acquisitions, strong underlying
performance in several of our key markets and the return to growth in the UK.
Proforma(3) NGR was +4%cc(2) year on year with Online +6%cc(2) and Retail in
line.
Contribution(4) in the year of £2,480.5m was +9% higher than 2023.
Contribution(4) margin was +0.9pp higher than 2023, reflecting the benefit of
geographic mix on the blended margin and a focus on marketing efficiencies.
Operating costs were 9% higher due to annualisation of the 2023 acquisitions
and increased colleague bonus costs. Resulting underlying EBITDA(5) of
£1,088.8m was +8% higher than 2023.
Share based payment charges were £8.4m lower than 2023, while underlying
depreciation and amortisation was 14% higher, reflecting the impact of prior
year acquisitions and continued investment in product. Share of JV losses of
£114.2m includes an operating loss of £109.4m relating to BetMGM (2023:
£42.0m).
Group underlying operating profit(7) of £616.6m was -4% lower than 2023.
After separately disclosed items of £866.7m (2023: £1,286.5m), the Group
made an operating loss of £250.1m (2023: loss of £644.7m).
UK & Ireland
UK & Ireland Total UK & Ireland Online UK & Ireland Retail
Year ended 31 December FY FY Change FY FY Change FY FY Change
2024 2023 % 2024 2023 % 2024 2023 %
£m £m £m £m £m £m
Sports wagers 4,920.4 5,176.2 (5%) 2,276.2 2,480.0 (8%) 2,644.2 2,696.2 (2%)
Sports margin 17.0% 15.7% 1.3pp 13.5% 12.0% 1.5pp 20.0% 19.2% 0.8pp
Sports NGR 796.5 775.2 3% 262.3 248.4 6% 534.2 526.8 1%
Gaming NGR 1,256.9 1,272.5 (1%) 722.3 715.9 1% 534.6 556.6 (4%)
B2B NGR - - - - - - - - -
Total NGR 2,053.4 2,047.7 0% 984.6 964.3 2% 1,068.8 1,083.4 (1%)
EU VAT/GST (4.3) (4.0) (8%) (4.3) (4.0) (8%) - - -
Revenue 2,049.1 2,043.7 0% 980.3 960.3 2% 1,068.8 1,083.4 (1%)
Gross profit 1,395.8 1,385.7 1% 625.8 601.5 4% 770.0 784.2 (2%)
Contribution(4) 1,169.4 1,176.4 (1%) 401.5 394.6 2% 767.9 781.8 (2%)
Contribution(4) margin 56.9% 57.4% (0.5pp) 40.8% 40.9% (0.1pp) 71.8% 72.2% (0.4pp)
Operating costs (732.1) (706.1) (4%) (175.4) (158.2) (11%) (556.7) (547.9) (2%)
Underlying EBITDA(5) 437.3 470.3 (7%) 226.1 236.4 (4%) 211.2 233.9 (10%)
Share based payments (5.9) (7.8) 24% (4.1) (5.4) 24% (1.8) (2.4) 25%
Underlying depreciation and amortisation (145.8) (138.0) (6%) (54.4) (44.6) (22%) (91.4) (93.4) 2%
Share of JV (loss)/income - - - - - - - - -
Underlying operating profit(7) 285.6 324.5 (12%) 167.6 186.4 (10%) 118.0 138.1 (15%)
Reported Results(1):
NGR in the first half was down -6%, reflecting the impact that our previous
approach to regulatory implementations had on our customers' experience and
engagement. Following our focused effort to simplify customer journeys, NGR in
H2(6) grew +7%.
In Online, NGR was +2% year on year with both sports +6% and gaming +1% ahead.
Following a decline of -8% in the first half, NGR in H2(6) was +14%cc(2)
higher than in 2023. Actives were ahead year on year by +11% and spend per
head showed growth in both sports and gaming during Q4(6).
In Retail, NGR was -1%cc(2) YoY (LFL +1%), with sports +2%cc(2) and gaming
-4%cc(2). Whilst NGR was behind year on year, H2(6) NGR was +2%cc(2) YoY (+4%
LFL) following the full roll out of new Kascada cabinets in Q3.
Gross profit of £1,395.8m was £10.1m ahead of 2023 with margin of 68%,
marginally ahead of 2023. Marketing spend was £17.1m higher than 2023,
resulting in contribution(4) of £1,169.4m, down £7.0m versus 2023.
Operating costs were -4% higher than 2023, reflecting higher colleague bonus
costs, offset by cost control savings and the impact of shop closures in
Retail. Resulting EBITDA(5) of £437.3m was £33.0m lower than 2023 (H1(6)
down £43m, H2(6) up £10m). After charging depreciation and share based
payments, operating profit(7) was £285.6m. Increased depreciation charges
reflected investment in our product offerings across both channels.
As a result of continuing soft footfall across our Retail estate in Republic
of Ireland, an impairment charge of £8.7m has been recognised.
After separately disclosed items of £3.8m (2023: £14.3m), the operating
profit was £281.8m (2023: £310.2m).
International
International Total International Online International Retail
Year ended 31 December FY FY Change FY FY Change FY FY Change
2024 2023 % 2024 2023 % 2024 2023 %
£m £m £m £m £m £m
Sports wagers 12,382.3 12,004.7 3% 10,791.0 10,503.5 3% 1,591.3 1,501.2 6%
Sports margin 14.5% 14.3% 0.2pp 14.1% 13.8% 0.3pp 17.6% 18.0% (0.4pp)
Sports NGR 1,519.2 1,407.7 8% 1,237.0 1,137.3 9% 282.2 270.4 4%
Gaming NGR 1,040.6 1,025.5 1% 1,013.2 999.5 1% 27.4 26.0 5%
B2B NGR 80.6 57.9 39% 80.6 57.9 39% - - -
Total NGR 2,640.4 2,491.1 6% 2,330.8 2,194.7 6% 309.6 296.4 4%
EU VAT/GST (68.4) (59.5) (15%) (63.0) (55.9) (13%) (5.4) (3.6) (50%)
Revenue 2,572.0 2,431.6 6% 2,267.8 2,138.8 6% 304.2 292.8 4%
Gross profit 1,443.4 1,340.7 8% 1,321.5 1,218.2 8% 121.9 122.5 0%
Contribution(4) 1,062.0 942.9 13% 950.9 827.8 15% 111.1 115.1 (3%)
Contribution(4) margin 40.2% 37.9% 2.3pp 40.8% 37.7% 3.1pp 35.9% 38.8% (2.9pp)
Operating costs (468.0) (395.9) (18%) (397.2) (331.3) (20%) (70.8) (64.6) (10%)
Underlying EBITDA(5) 594.0 547.0 9% 553.7 496.5 12% 40.3 50.5 (20%)
Share based payments (3.9) (6.0) 35% (3.9) (6.0) 35% - - -
Underlying depreciation and amortisation (180.0) (152.2) (18%) (143.4) (116.4) (23%) (36.6) (35.8) (2%)
Share of JV (loss)/income (3.1) (1.5) (107%) (3.1) (1.5) (107%) - - -
Underlying operating profit(7) 407.0 387.3 5% 403.3 372.6 8% 3.7 14.7 (75%)
Reported Results(1):
International NGR for 2024 was +6%, +10%cc(2), or +6%cc(2) proforma(3) higher
than 2023 with strong underlying performance in all of our key markets and
growth in both sports NGR, +6%cc(2) proforma(3), and gaming NGR, +5%cc(2)
proforma(3). International Online NGR grew +6%, +10%cc(2) (proforma(3)
+7%cc(2)) and Retail grew +4%, +7%cc(2) (+1%cc(2) proforma(3)).
In Brazil, NGR was up +41%cc(2) year on year, with actives growing in line
with NGR, reflecting our end-to-end reinvigorated go-to-market approach. We
successfully transitioned into a regulated regime from 1 January 2025 and
remain confident that SportingBet is well placed for growth in this highly
competitive market.
Online NGR in Australia was +1%cc(2) ahead of 2023, returning to growth in
H2(6), +2%cc(2), despite the softer market conditions and last year's
introduction of BetStop, the National Self-Exclusion Register. Our year on
year performance demonstrates that our differentiated brands and engaging
products continue to resonate with customers.
Italy NGR was +3%cc(2) ahead of 2023, Online +2%cc(2) and Retail +4%cc(2).
Online market share lowered over 2024, although H2(6) showed signs of
stabilisation. Retail market share remained flat and continues to rank well on
profitability per shop with approximately 15% share of revenue from 11% of
retail units.
Despite the tougher macro-economic environment in New Zealand, NGR was
+1%cc(2) ahead of 2023 on a proforma(3) basis. Online was up +4%cc(2), with
H2(6) +7%cc(2) following the successful migration to the Australian platform
and the launch of new sister brand, betcha. Retail down -9%cc(2).
Baltics and Nordics Online NGR was +9%cc(2) year on year with inflationary
pressures in the region starting to ease and our content leadership strategy
landing well.
In Germany, our business has stabilised with NGR in line year on year and
+2%cc(2) in H2(6).
Proforma(3) NGR in the Netherlands was down -13%cc(2) versus 2023 following
further regulatory tightening in the year.
Georgia NGR was +13%cc(2) ahead of 2023 mainly driven by gaming products, with
Crystalbet maintaining its market leading position.
Gross profit for our International segment was +8% ahead of 2023 given the NGR
growth and favourable geographic mix. Marketing spend was slightly lower
versus prior year despite increased NGR, seeing contribution(4) margin
increase by +2.3pp and delivering contribution(4) of £1,062.0m.
Operating costs were 18% higher year on year as a result of inflation, higher
colleague bonus costs and the annualisation of 2023 acquisitions. Resulting
EBITDA(5) of £594.0m was £47.0m ahead of 2023, and after deducting
depreciation and share based payments, operating profit(7) was £407.0m,
£19.7m ahead. The increase in depreciation has largely been driven by the
annualisation of 2023 acquisitions and the New Zealand partnership.
As a result of the tougher macro-economic environment in New Zealand and the
delay in the introduction of the legislative net, an impairment of £142.5m
has been recognised against TAB New Zealand. Additionally, regulation changes
have impacted the Netherlands and Belgium, resulting in impairments being
recorded on BetCity (£113.1m) and Belgium (£76.3m) assets. In relation to
these, there has also been a release of BetCity and TAB New Zealand contingent
consideration totalling c£80m.
After separately disclosed items of £524.0m (2023: £435.5m), the operating
loss was £117.0m (2023: £48.2m).
CEE (Croatia and Poland)
CEE Total CEE Online CEE Retail
Year ended 31 December FY FY Change FY FY Change FY FY Change
2024 2023 % 2024 2023 % 2024 2023 %
£m £m £m £m £m £m
Sports wagers 1,582.7 896.8 76% 1,325.4 737.8 80% 257.3 159.0 62%
Sports margin 22.8% 18.7% 4.1pp 22.1% 17.7% 4.4pp 26.4% 23.5% 2.9pp
Sports NGR 361.5 187.8 92% 288.9 145.1 99% 72.6 42.7 70%
Gaming NGR 126.5 113.3 12% 116.0 102.6 13% 10.5 10.7 (2%)
B2B NGR - - - - - - - - -
Total NGR 488.0 301.1 62% 404.9 247.7 63% 83.1 53.4 56%
EU VAT/GST - - - - - - - - -
Revenue 488.0 301.1 62% 404.9 247.7 63% 83.1 53.4 56%
Gross profit 278.9 180.6 54% 226.7 146.9 54% 52.2 33.7 55%
Contribution(4) 249.1 167.2 49% 199.5 134.5 48% 49.6 32.7 52%
Contribution(4) margin 51.0% 55.5% (4.5pp) 49.3% 54.3% (5.0pp) 59.7% 61.2% (1.5pp)
Operating costs (78.2) (45.6) (71%) (38.3) (21.0) (82%) (39.9) (24.6) (62%)
Underlying EBITDA(5) 170.9 121.6 41% 161.2 113.5 42% 9.7 8.1 20%
Share based payments - - - - - - - - -
Underlying depreciation and amortisation (18.0) (7.8) (131%) (10.3) (1.9) (442%) (7.7) (5.9) (31%)
Share of JV (loss)/income - - - - - - - - -
Underlying operating profit(7) 152.9 113.8 34% 150.9 111.6 35% 2.0 2.2 (9%)
Reported Results(1):
CEE NGR for 2024 was +62% (+65%cc(2)) ahead of the prior year, reflecting the
acquisition of STS in Poland during H2(6) 2023. On a proforma(3) basis, CEE
NGR was +12%cc(2) ahead of the prior year.
NGR in Croatia was +16%cc(2) ahead of 2023 with our SuperSport brand
continuing to perform well and maintaining the leading position in the market.
Online NGR was +19%cc(2) ahead with Retail +5%cc(2).
Proforma(3) NGR in Poland was +8%cc(2) ahead of 2023 with Online +8%cc(2) and
Retail +12%cc(2). Despite the increasingly competitive landscape in Poland, we
have maintained market leadership and growth in the year.
Gross profit of £278.9m was +54% ahead of 2023. Whilst gross profit margin of
57.2% was -2.8pp behind 2023, this reflects the impact of the acquired Polish
business on the blended CEE segment rather than an underlying reduction in
margin. Marketing spend of £29.8m was £16.4m higher than 2023 reflecting
both the impact of the acquisition of STS in Poland and additional spend in
both markets to support the underlying growth in NGR. Resulting
contribution(4) of £249.1m was +49% ahead of 2023, at a margin of 51.0%.
Operating costs were £32.6m higher than 2023 as a result of costs associated
with the acquired STS business and inflation. Resulting EBITDA(5) of £170.9m
was £49.3m ahead of the prior year, up +41% or up +8% on a proforma(3) basis.
After charging depreciation of £18.0m, operating profit(7) was £152.9m,
£39.1m ahead of 2023. The increase in depreciation is due to the impact of
the acquired Polish business.
The current competitor landscape in Poland has led to an impairment of £75.9m
being recognised in relation to STS.
After separately disclosed items of £243.9m (2023: £111.2m), the operating
loss was £91.0m (2023: profit of £2.6m).
New Opportunities
Reported results(1)
Year ended 31 December 2024 2023 Change
£m £m %
Underlying EBITDA(5) - (18.2) 100%
Share based payments - - -
Underlying depreciation and amortisation - (2.7) 100%
Share of JV loss - - -
Underlying operating loss(7) - (20.9) 100%
Reported Results(1):
Costs in 2023 reflect those incurred in the Group's former Unikrn business
which has now been closed as a customer facing operation. After separately
disclosed items of £36.3m, the operating loss for 2023 was £57.2m.
Corporate
Reported results(1)
Year ended 31 December 2024 2023 Change
£m £m %
Underlying EBITDA(5) (113.4) (112.8) (1%)
Share based payments (3.5) (7.9) 56%
Underlying depreciation and amortisation (0.9) (0.8) (13%)
Share of JV loss (111.1) (41.4) (168%)
Underlying operating loss(7) (228.9) (162.9) (41%)
Reported Results(1):
Corporate underlying costs(5) of £113.4m were broadly in line with last year.
After share based payments, depreciation and amortisation and share of JV
losses, Corporate underlying operating loss(7) was £228.9m, an increase of
£66.0m versus the prior year. This was driven by a £67.4m increase in the
share of loss in the US JV, BetMGM. After separately disclosed items of
£95.0m (2023: £689.2m), the operating loss of £323.9m (2023: £852.1m) was
£528.2m lower than in 2023.
Notes
(1) 2024 reported results are audited and relate to continuing
operations
(2) Growth on a constant currency basis is calculated by translating
both current and prior year performance at the 2024 exchange rates
(3) Proforma references include all 2023 acquisitions as if they had
been part of the Group since 1 January 2023
(4) Contribution represents gross profit less marketing costs and is
a key performance metric used by the Group
(5) EBITDA is defined as earnings before interest, tax, depreciation
and amortisation, share based payments and share of JV income. EBITDA is
stated pre separately disclosed items
(6) These results are unaudited
(7) Stated pre separately disclosed items
STATUTORY PERFORMANCE REVIEW
Results(1)
2024 2023 Change CC(2)
Year ended 31 December £m £m % %
NGR 5,161.9 4,833.1 7% 9%
Revenue 5,089.2 4,769.6 7% 9%
Gross profit 3,118.1 2,907.0 7%
Contribution(3) 2,480.5 2,279.4 9%
Underlying EBITDA(4) 1,088.8 1,007.9 8%
Share based payments (13.3) (21.7) 39%
Underlying depreciation and amortisation (344.7) (301.5) (14%)
Share of JV and associates loss (114.2) (42.9) (166%)
Underlying operating profit(5) 616.6 641.8 (4%)
Net underlying finance costs(5) (264.2) (229.4)
Net foreign exchange/financial instruments 166.0 32.5
Profit before tax pre separately disclosed items 518.4 444.9
Separately disclosed items:
Amortisation of acquired intangibles (286.8) (254.6)
Recognition of HMRC settlement liability (3.9) (585.0)
Other (585.1) (447.9)
Loss before tax (357.4) (842.6)
Tax (103.6) (36.1)
Loss after tax from continuing activities (461.0) (878.7)
Discontinued operations - (57.8)
Loss after tax (461.0) (936.5)
NGR and Revenue
Group NGR and revenue were +7% ahead of last year and +9% ahead on a constant
currency basis(2), with Online NGR +9% and Retail NGR +2% year on year.
Further details are provided in the Financial Performance Review section.
Operating profit/(loss)
Group operating loss for the year was £250.1m, £394.6m lower than in 2023.
The Group reported underlying operating profit(5) of £616.6m, -4% lower than
2023 (2023: 641.8m) largely due to increased joint venture losses. Underlying
EBITDA(5) was +8% ahead, largely in line with the revenue increase.
Depreciation and amortisation was 14% higher than 2023 driven by continued
investment in product and technology. The Group's share of BetMGM losses in
the year were £109.4m, £67.4m higher than 2023 as the business invested in
product and marketing to rebuild momentum and strengthen the business for the
future. Analysis of the Group's performance for the year is detailed in the
Financial Performance Review section.
Financing costs
Finance costs recorded by the group for 2024 were £273.3m (2023: £230.4m).
Underlying finance costs of £264.2m excluding separately disclosed items of
£9.1m (2023: £1.0m) were £34.8m higher than 2023 primarily driven by
interest on the increase in Group debt.
Net gains on financial instruments, driven primarily by a foreign exchange
gain on re-translation of debt related items and the settlement of a number of
currency swaps, were £166.0m in the year (2023: £32.5m). This gain is offset
by a foreign exchange loss on the translation of assets in overseas
subsidiaries which is recognised in reserves and forms part of the Group's
commercial hedging strategy.
Separately disclosed items
Items separately disclosed before tax for the year amount to £875.8m (2023:
£1,287.5m) and relate to £286.8m of amortisation on acquired intangibles
(2023: £254.6m), restructuring program costs, including Project Romer, of
£49.6m (2023: £49.7m) and legal and onerous contract costs of £6.7m (2023:
£17.6m) primarily relating to the costs associated with our commitments to
the DPA and associated shareholder litigation.
The Group has also recorded an impairment charge of £476.4m during the
current year (2023: £289.0m) with impairment recognised against the Group's
Tab New Zealand business of £142.5m, the BetCity business of £113.1m, STS of
£75.9m, Belgium of £76.3m and an impairment of the Group's Republic of
Ireland retail portfolio of £8.7m. Further details are provided in Note 11.
There has also been a write down of £18.5m of certain New Zealand assets
following the platform migration and a number of smaller impairments against
other assets that the Group no longer intends to use including shop closures.
In addition, £43.3m has been recorded on movements in fair value of
contingent consideration (2023: £71.8m), relating to discount unwind and
reassessment of contingent consideration and put option values primarily
relating to Tab NZ and SuperSport acquisitions and the release of the BetCity
contingent consideration.
In the year the Group also recorded £3.9m of discount unwind relating to the
DPA liability (2023: £585.0m charge for the initial recognition of the
liability) and a £9.1m non-cash financing cost following the H1 refinancing
(2023: £1.0m).
In the prior year the Group incurred corporate transaction costs of £17.8m.
Separately disclosed items
2024 2023
£m £m
Legal settlement (3.9) (585.0)
Amortisation of acquired intangibles (286.8) (254.6)
Impairment (476.4) (289.0)
Corporate transaction costs - (17.8)
Restructuring costs (49.6) (49.7)
Legal and onerous contract costs (6.7) (17.6)
Movement in fair value of contingent consideration (43.3) (71.8)
Other including financing (9.1) (2.0)
Total (875.8) (1,287.5)
Profit/(loss) before tax
The Group's loss before tax of £357.4m is £485.2m lower than 2023 primarily
as a result of the reduction of one-off costs included in separately disclosed
items.
Group profit before tax(5) and separately disclosed items was £518.4m (2023:
£444.9m), an increase compared to the prior year of £73.5m with growth in
underlying EBITDA(4) more than offset by an increase in BetMGM losses and
depreciation and amortisation and interest. After charging separately
disclosed items, the Group recorded a pre-tax loss from continuing operations
of £357.4m (2023: £842.6m), with the separately disclosed costs discussed
above having a significant impact on the reported results.
Taxation
The tax charge on continuing operations for the year was £103.6m (2023:
£36.1m), reflecting an underlying effective tax rate pre-BetMGM losses and
foreign exchange gains on external debt of 25.1% (2023: 23.0%), after a tax
credit on separately disclosed items of £35.3m (2023: £69.7m). The increase
year on year of £67.5m is the result of growth in underlying profit before
tax pre-BetMGM losses, increases in domestic tax rates, the introduction of
minimum tax regimes, and the one-off separately disclosed Gibraltar marketing
deduction
Discontinued operations
During the prior year, the Group recorded a £57.8m loss in discontinued
operations relating to its former Intertrader business which was disposed of
in November 2021. The loss recorded primarily reflects legal costs associated
with historic matters.
Cashflow
Year ended 31 December 2024 2023
£m £m
Cash generated by operations 976.2 810.0
Corporation tax (142.0) (137.3)
Interest (254.9) (224.6)
Net cash generated from operating activities 579.3 448.1
Cash flows from investing activities:
Acquisitions & disposals - (1,315.4)
Cash acquired/disposed - 87.9
Dividends received from associates 1.4 9.6
Net capital expenditure (298.1) (259.9)
Investment in Joint ventures (19.8) (40.7)
Purchase of Investments - (3.1)
Net cash used in investing activities (316.5) (1,521.6)
Cash flows from financing activities:
Equity issue - 589.8
Net proceeds from borrowings 591.7 1,780.3
Repayment of borrowings (315.9) (1,428.6)
Subscription of funds from non-controlling interest - 350.5
Settlement of financial instruments and other financial liabilities (138.8) (279.9)
Repayment of finance leases (68.0) (68.5)
Equity dividends paid (116.3) (106.9)
Minority dividends paid (12.5) (7.4)
Disposal of investment 5.2 -
Payments to non-controlling interests (4.1) -
Net cash used in financing activities (58.7) 829.3
Foreign exchange (15.8) (13.7)
Net increase in cash 188.3 (257.9)
During the year, the Group had a net cash inflow of £188.3m (2023: outflow of
£257.9m).
Net cash generated by operations was £976.2m (2023: £810.0m) including
£1,088.8m of underlying EBITDA(4) (2023: £1,007.9m) and a working capital
outflow of £9.1m (2023: £601.8m inflow) offset by separately disclosed items
that are reported in operating activities of £103.5m (2023: £742.9m)
excluding items charged to depreciation, amortisation and impairment. In the
prior year a £57.8m loss on discontinued operations was also included.
Included within working capital is a £67.0m inflow for balances held with
payment service providers as well as customer funds, which are net debt
neutral (2023: £29.7m outflow).
During the year, £142.0m was paid out in relation to corporate taxes (2023:
£137.3m) with a further £254.9m paid out in interest (2023: £224.6m).
Net cash used in investing activities for the year was £316.5m (2023:
£1,521.6m) and includes net investment in capital expenditure of £298.1m
(2023: £259.9m) and an additional £19.8m invested in BetMGM (2023: £40.7m).
In the prior year net cash outflows on acquisitions of £1,315.4m were also
incurred. These outflows were partially offset by dividends received from
associates of £1.4m (2023: £9.6m).
Net cash used in financing activities for the year was £58.7m (2023: £829.3m
received). £591.7m was raised through new financing facilities (2023:
£1,780.3m) which were used, in part, to repay £315.9m of debt (2023:
£1,428.6m). In the prior year, £589.8m was also raised through an equity
issuance and £350.5m received from minority holdings to meet their
obligations under the SuperSport earn-out and STS acquisition which were
recorded in non-controlling interests. £138.8m was paid on settlement of
other financial instruments and liabilities, primarily relating to swap
settlements and contingent consideration on previous acquisitions including
New Zealand (2023: £279.9m). Lease payments of £68.0m (2023: £68.5m)
including those on non-operational shops, were made in the year.
During the year, the Group paid £116.3m in equity dividends (2023: £106.9m)
and £12.5m in dividends to the minority interest in Entain CEE (2023:
£7.4m). There was also £5.2m received on disposal of an investment.
Net debt and liquidity
As at 31 December 2024, adjusted net debt(6) was £3,339.1m and represented an
adjusted net debt(6) to underlying EBITDA(4) ratio of 3.1x (3.5x including the
DPA liability). The closing net debt has benefitted from a working capital
inflow in the year which is expected to partially unwind in 2025. The Group
has not drawn down on the revolving credit facility at 31 December 2024 (2023:
£295m).
Par value Issue costs/ Premium Total
£m £m £m
Term loans (3,681.9) 50.6 (3,631.3)
Interest accrual 0.1 - 0.1
(3,681.8) 50.6 (3,631.2)
Cash 588.9
Net debt (3,042.3)
Cash held on behalf of customers (196.6)
Fair value of swaps held against debt instruments 66.8
Other debt related items* 157.5
Lease liabilities (324.5)
Adjusted net debt (3,339.1)
*Other debt related items include balances held with payment service
providers, deposits and other similar items
Refinancing
On 1 March 2024, the Group raised an additional £300m of borrowings under a
bank loan facility which was used to repay all amounts drawn on the Group's
revolving credit facility. On 1 March 2024, the commitments available under
the Group's revolving credit facility were increased by £45m to £635m.
On 29 April 2024, the Group announced the successful re-pricing of the
existing $1,740m loan with a margin reduction of 75bps and removal of the
10bps credit adjustment spread. Additionally, $500m was added on to increase
the loan to $2,240m. There was no change in the maturity date of October 2029.
It was also announced that the €1,030m loan was re-priced with a margin
reduction of 50bps to 325bps and this loan was also increased by €235m to
€1,265m. There was no change in the maturity date of June 2028.
The proceeds of the extended term loans were used to immediately repay the
£300m bank loan borrowed earlier in Q1 2024 with the remaining funds used to
improve the Group's liquidity.
Going Concern
In adopting the going concern basis of preparation in the financial
statements, the Directors have considered the current trading performance of
the Group, the financial forecasts and the principal risks and uncertainties.
In addition, the Directors have considered all matters discussed in connection
with the long-term viability statement including the modelling of 'severe but
plausible' downside scenarios such as legislation changes impacting the
Group's Online business and severe data privacy and cybersecurity breaches.
Given the level of the Group's available cash and the forecast covenant
headroom even under the sensitised downside scenarios, the Directors believe
that the Group and the Company are well placed to manage the risks and
uncertainties that it faces. As such, the Directors have a reasonable
expectation that the Group and the Company will have adequate financial
resources to continue in operational existence, for at least 12 months (being
the going concern assessment period) from date of approval of the financial
statements, and have, therefore, considered it appropriate to adopt the going
concern basis of preparation in the financial statements.
Notes
(1) 2024 and 2023 statutory results are audited, with the tables presented
relating to continuing operations and including both statutory and
non-statutory measures
(2) Growth on a constant currency basis is calculated by translating both
current and prior year performance at the 2024 exchange rates
(3) Contribution represents gross profit less marketing costs and is a key
performance metric used by the Group
(4) EBITDA is earnings before interest, tax, depreciation and
amortisation, share based payments and share of JV income. EBITDA is stated
pre separately disclosed items
(5) Stated pre separately disclosed items
(6) Adjusted net debt excludes the DPA settlement. Leverage also excludes
any benefit from future BetMGM EBITDA or the payments due to acquire the
minority interests in Entain CEE
CONSOLIDATED INCOME STATEMENT
2024 2023
Notes Underlying Separately disclosed Total Underlying Separately disclosed Total
items items items items
(Note 6) (Note 6)
£m £m £m £m £m £m
Net Gaming Revenue 5,161.9 - 5,161.9 4,833.1 - 4,833.1
VAT/GST (72.7) - (72.7) (63.5) - (63.5)
Revenue 5 5,089.2 - 5,089.2 4,769.6 - 4,769.6
Cost of sales (1,971.1) - (1,971.1) (1,862.6) - (1,862.6)
Gross profit 3,118.1 - 3,118.1 2,907.0 - 2,907.0
Administrative costs (2,387.3) (866.7) (3,254.0) (2,222.3) (1,286.5) (3,508.8)
Contribution(1) 2,480.5 - 2,480.5 2,279.4 - 2,279.4
Administrative costs excluding marketing (1,749.7) (866.7) (2,616.4) (1,594.7) (1,286.5) (2,881.2)
Group operating profit/(loss) before share of results from joint ventures and 730.8 (866.7) (135.9) 684.7 (1,286.5) (601.8)
associates
Share of results from joint ventures and associates (114.2) - (114.2) (42.9) - (42.9)
Group operating profit/(loss) 616.6 (866.7) (250.1) 641.8 (1,286.5) (644.7)
Finance expense 7 (280.3) (9.1) (289.4) (241.8) (1.0) (242.8)
Finance income 7 16.1 - 16.1 12.4 - 12.4
Gains/(losses) arising from change in fair value of financial instruments 7 145.0 - 145.0 (90.6) - (90.6)
Gains arising from foreign exchange on debt instruments 7 21.0 - 21.0 123.1 - 123.1
Profit/(loss) before tax 518.4 (875.8) (357.4) 444.9 (1,287.5) (842.6)
Income tax (138.9) 35.3 (103.6) (105.8) 69.7 (36.1)
Profit/(loss) from continuing operations 379.5 (840.5) (461.0) 339.1 (1,217.8) (878.7)
Loss for the year from discontinued operations after tax - - - - (57.8) (57.8)
Profit/(loss) for the year 379.5 (840.5) (461.0) 339.1 (1,275.6) (936.5)
Attributable to:
Equity holders of the parent 335.6 (788.3) (452.7) 304.1 (1,232.7) (928.6)
Non-controlling interests 43.9 (52.2) (8.3) 35.0 (42.9) (7.9)
379.5 (840.5) (461.0) 339.1 (1,275.6) (936.5)
Earnings per share on profit/(loss) for the year
from continuing operations 30.2p(2) (70.8p) 44.3p(2) (141.4p)
From profit/(loss) for the year 9 30.2p(2) (70.8p) 44.3p(2) (150.7p)
Diluted earnings per share on profit/(loss) for the year
from continuing operations 29.9p(2) (70.8p) 44.2p(2) (141.4p)
From profit/(loss) for the year 9 29.9p(2) (70.8p) 44.2p(2) (150.7p)
Memo
EBITDA(3) 1,088.8 (103.5) 985.3 1,007.9 (742.9) 265.0
Share-based payments (13.3) - (13.3) (21.7) - (21.7)
Depreciation, amortisation and impairment (344.7) (763.2) (1,107.9) (301.5) (543.6) (845.1)
Share of results from joint ventures and associates (114.2) - (114.2) (42.9) - (42.9)
Group operating profit/(loss) 616.6 (866.7) (250.1) 641.8 (1,286.5) (644.7)
1. Contribution represents gross profit less marketing costs and is a
key performance metric used by the Group.
2. The calculation of underlying earnings per share has been adjusted
for separately disclosed items, and for the removal of foreign exchange
volatility arising on financial instruments as it provides a better
understanding of the underlying performance of the Group. See Note 9 for
further details.
3. EBITDA is earnings before interest, tax, depreciation and
amortisation, share based payments and share of JV income.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Notes 2024 2023
£m £m
Loss for the year (461.0) (936.5)
Other comprehensive (expense)/income:
Items that may be reclassified to profit or loss:
Currency differences on translation of foreign operations (189.4) (83.5)
Total items that may be reclassified to profit or loss (189.4) (83.5)
Items that will not be reclassified to profit or loss:
Re-measurement of defined benefit pension scheme (8.1) (3.7)
Tax on re-measurement of defined benefit pension scheme 4.8 1.3
Surplus on revaluation of other investment - 1.1
Share of associate other comprehensive expense - (1.1)
Total items that will not be reclassified to profit or loss (3.3) (2.4)
Other comprehensive expense for the year, net of tax (192.7) (85.9)
Total comprehensive expense for the year (653.7) (1,022.4)
Attributable to:
Equity holders of the parent (621.4) (1,020.8)
Non-controlling interests (32.3) (1.6)
CONSOLIDATED BALANCE SHEET
Notes 2024 2023
£m £m
Assets
Non-current assets
Goodwill 10 4,138.9 4,716.0
Intangible assets 10 3,519.4 3,960.1
Property, plant and equipment 12 573.8 533.4
Interest in joint venture - -
Interest in associates and other investments 32.6 47.1
Trade and other receivables 27.1 31.8
Derivative financial instruments 19.1 -
Deferred tax assets 476.1 493.2
Retirement benefit asset 55.1 61.8
8,842.1 9,843.4
Current assets
Trade and other receivables 563.8 503.2
Income and other taxes recoverable 78.9 71.5
Derivative financial instruments 67.3 31.9
Cash and cash equivalents 588.9 400.6
1,298.9 1,007.2
Total assets 10,141.0 10,850.6
Liabilities
Current liabilities
Trade and other payables (1,120.6) (878.6)
Balances with customers 13 (196.6) (196.8)
Lease liabilities (77.2) (65.7)
Interest-bearing loans and borrowings (25.3) (319.2)
Corporate tax liabilities (76.6) (48.6)
Provisions (34.8) (20.9)
Derivative financial instruments (8.5) (117.5)
Deferred and contingent consideration and other financial liabilities (215.1) (157.0)
(1,754.7) (1,804.3)
Non-current liabilities
Trade and other payables (286.4) (433.8)
Interest-bearing loans and borrowings (3,605.9) (3,038.8)
Lease liabilities (247.3) (210.2)
Deferred tax liabilities (738.7) (825.1)
Provisions (2.9) (4.2)
Derivative financial instruments (11.1) -
Deferred and contingent consideration and other financial liabilities (1,474.6) (1,741.5)
(6,366.9) (6,253.6)
Total liabilities (8,121.6) (8,057.9)
Net assets 2,019.4 2,792.7
Equity
Issued share capital 5.2 5.2
Share premium 1,796.7 1,796.7
Merger reserve 2,527.4 2,527.4
Translation reserve (15.0) 150.4
Retained earnings (2,768.6) (2,211.7)
Equity shareholders' funds 1,545.7 2,268.0
Non-controlling interests 473.7 524.7
Total shareholders' equity 2,019.4 2,792.7
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued share Share Merger Translation reserve1 Retained earnings Equity shareholders' funds Non- controlling Total
reserve
capital premium
interests shareholders' equity
£m £m £m
£m
£m £m
£m
£m
At 1 January 2023 4.8 1,207.3 2,527.4 240.2 (846.9) 3,132.8 183.8 3,316.6
Loss for the year - - - - (928.6) (928.6) (7.9) (936.5)
Other comprehensive (expense)/income - - - (89.8) (2.4) (92.2) 6.3 (85.9)
Total comprehensive income - - - (89.8) (931.0) (1,020.8) (1.6) (1,022.4)
Issue of shares 0.4 589.4 - - - 589.8 - 589.8
Share-based payments charge - - - - 23.6 23.6 - 23.6
Business combinations - - - - - - 354.0 354.0
Recognition of put option liability - - - - (350.5) (350.5) - (350.5)
Purchase of non-controlling interests - - - - - - (4.1) (4.1)
Equity dividends (Note 8) - - - - (106.9) (106.9) (7.4) (114.3)
At 31 December 2023 5.2 1,796.7 2,527.4 150.4 (2,211.7) 2,268.0 524.7 2,792.7
At 1 January 2024 5.2 1,796.7 2,527.4 150.4 (2,211.7) 2,268.0 524.7 2,792.7
Loss for the year - - - - (452.7) (452.7) (8.3) (461.0)
Other comprehensive expense)/income - - - (165.4) (3.3) (168.7) (24.0) (192.7)
Total comprehensive income - - - (165.4) (456.0) (621.4) (32.3) (653.7)
Share-based payments charge - - - - 11.9 11.9 - 11.9
Non-controlling interests created - - - - - - 1.4 1.4
Purchase of non-controlling interests - - - - 3.5 3.5 (7.6) (4.1)
Equity dividends (Note 8) - - - - (116.3) (116.3) (12.5) (128.8)
At 31 December 2024 5.2 1,796.7 2,527.4 (15.0) (2,768.6) 1,545.7 473.7 2,019.4
1. The translation reserve is used to record exchange differences arising from
the translation of the financial statements of subsidiaries with non-sterling
functional currencies.
CONSOLIDATED STATEMENT OF CASHFLOWS
Notes 2024 2023
£m £m
Cash generated by operations 14 976.2 810.0
Income taxes paid (142.0) (137.3)
Net finance expense paid (254.9) (224.6)
Net cash generated from operating activities 579.3 448.1
Cash flows from investing activities:
Acquisitions(1) - (1,315.4)
Cash acquired on business combinations - 87.9
Dividends received from associates 1.4 9.6
Purchase of intangible assets (203.9) (191.5)
Purchase of property, plant and equipment (94.4) (69.1)
Proceeds from the sale of property, plant and equipment including disposal of 0.2 0.7
shops
Purchase of investments in associates and other investments - (3.1)
Investment in joint ventures (19.8) (40.7)
Net cash used in investing activities (316.5) (1,521.6)
Cash flows from financing activities:
Proceeds from issue of ordinary shares - 589.8
Net proceeds from borrowings 591.7 1,780.3
Repayment of borrowings (315.9) (1,419.2)
Repayment of borrowings on acquisition - (9.4)
Subscription of funds from non-controlling interests - 350.5
Disposal of investment 5.2 -
Settlement of derivative financial instruments (37.5) (13.2)
Settlement of other financial liabilities (101.3) (266.7)
Payment of lease liabilities (68.0) (68.5)
Dividends paid to shareholders (116.3) (106.9)
Dividends paid to non-controlling interests (12.5) (7.4)
Payments to non-controlling interests (4.1) -
Net cash used in financing activities (58.7) 829.3
Net increase/(decrease) in cash and cash equivalents 204.1 (244.2)
Effect of changes in foreign exchange rates (15.8) (13.7)
Cash and cash equivalents at beginning of the year 400.6 658.5
Cash and cash equivalents at end of the year 588.9 400.6
(1)Included within the prior year cash flows from acquisitions is £5.4m
relating to the purchase of minority holdings in STS.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1 Corporate information
Entain plc ("the Company") is a company incorporated and domiciled in the Isle
of Man on 5 January 2010 whose shares are traded publicly on the London Stock
Exchange. The principal activities of the Company and its subsidiaries ("the
Group") are described in the strategic report. The consolidated financial
statements of the Group for the year ended 31 December 2024 were authorised
for issue in accordance with a resolution of the Directors on 6 March 2025.
The nature of the Group's operations and its principal activities are set out
in Note 5.
2 Basis of preparation
The financial information set out above does not constitute the company's
statutory accounts for the years ended 31 December 2024 or 2023 but is derived
from those accounts. Statutory accounts for 2023 have been delivered to the
registrar of companies, and those for 2024 will be delivered in due course.
The auditor has reported on those accounts; their reports were (i) unqualified
and (ii) did not include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report.
The consolidated financial statements of the Group have been prepared in
accordance with UK-adopted International Financial Reporting Standards and in
accordance with the requirements of the Isle of Man Companies Act 2006
applicable to companies reporting under IFRSs. The accounting policies set out
in this section as detailed have been applied consistently year on year other
than for the changes in accounting policies set out in Note 3.
The consolidated financial statements are presented in Pounds Sterling (£).
All values are in millions (£m) rounded to one decimal place except where
otherwise indicated. The separately disclosed items have been included within
the appropriate classifications in the consolidated income statement. Further
details are given in Note 6.
Going concern
In adopting the going concern basis of preparation in the financial
statements, the Directors have considered the current trading performance of
the Group, the financial forecasts and the principal risks and uncertainties.
In addition, the Directors have considered all matters discussed in connection
with the long-term viability statement including the modelling of "severe but
plausible" downside scenarios such as legislation changes or breaches
impacting the Group's business and severe data privacy and cybersecurity
breaches.
Given the level of the Group's available cash and the forecast covenant
headroom even under the sensitised downside scenarios, the Directors believe
that the Group and the Company are well placed to manage the risks and
uncertainties that it faces. As such, the Directors have a reasonable
expectation that the Group and the Company will have adequate financial
resources to continue in operational existence, for at least 12 months (being
the going concern assessment period) from date of approval of the financial
statements, and have, therefore, considered it appropriate to adopt the going
concern basis of preparation in the financial statements.
3 Changes in accounting policies
From 1 January 2024 the Group has applied, for the first time, certain
standards, interpretations and amendments. The adoption of the following
standards and amendments to standards did not have a material impact on the
current period or any prior period upon transition:
- IAS 1 Presentation of Financial Statements, Classification of
liabilities as current or non-current;
- IAS 1 Presentation of Financial Statements, Amendments
regarding the classification of debt with covenants;
- IAS 7 Statement of Cash Flows, Supplier finance arrangements;
- IFRS 7 Financial Instruments: Disclosures, Supplier finance
arrangements
- IFRS 16 Leases, Amendments regarding seller-lessee subsequent
measurement in a sale and leaseback transaction.
4 Summary of significant accounting policies
4.1 Basis of consolidation
The consolidated financial statements comprise the financial statements of the
Group at 31 December each year. The consolidation has been performed using the
results to 31 December for all subsidiaries, using consistent accounting
policies. With the exception of a small number of immaterial subsidiaries, the
financial statements of those subsidiaries are prepared to 31 December.
Control is achieved where the Company is exposed, or has rights, to variable
returns from its involvement with the investee and has the ability to affect
these returns through its power over the investee.
All intragroup transactions, balances, income and expenses are eliminated on
consolidation.
Subsidiaries are consolidated, using the acquisition method of accounting,
from the date on which control is transferred to the Group and cease to be
consolidated from the date on which control is transferred from the Group. On
acquisition, the assets and liabilities and contingent liabilities of a
subsidiary are measured at fair value at the date of acquisition. Any excess
of the cost of acquisition over the fair values of the separately identifiable
net assets acquired is recognised as goodwill. Where necessary, adjustments
are made to the financial statements of subsidiaries to bring the accounting
policies used in line with those used by the Group.
4.2 Critical accounting estimates and judgements
The preparation of financial information requires the use of assumptions,
estimates and judgements about future conditions. Use of available information
and application of judgement are inherent in the formation of estimates.
Actual results in the future may differ from those reported.
Judgements
Management believes that the areas most notable where judgement has been
applied are:
- separately disclosed items (Note 6)
- contingent liabilities.
Separately disclosed items
To assist in understanding the underlying performance of the Group, management
applies judgement to identify those items that are deemed to warrant separate
disclosure due to either their nature or size. Whilst not limited to, the
following items of pre-tax income and expense are generally disclosed
separately:
- amortisation of acquired intangibles resulting from IFRS 3
"Business Combinations" fair value exercises;
- profits or losses on disposal, closure, or impairment of
non-current assets or businesses;
- corporate transaction and restructuring costs;
- certain legal, regulatory and tax litigation;
- changes in the fair value of contingent consideration; and
- the related tax effect of these items.
Any other non-recurring items are considered individually for classification
as separately disclosed by virtue of their nature or size. During 2024 the
Group separately disclosed a net charge on continuing operations before tax of
£875.8m including £286.8m of amortisation of acquired intangibles resulting
from IFRS 3.
The separate disclosure of these items allows a clearer understanding of the
trading performance on a consistent and comparable basis, together with an
understanding of the effect of non-recurring or large individual transactions
upon the overall profitability of the Group.
The separately disclosed items have been included within the appropriate
classifications in the consolidated income statement. Further details are
given in Note 6.
Contingent liabilities
In the assessment of contingent liabilities, certain judgements are required
to assess whether disclosure or provision is needed. If the criteria for
recognising a provision are not met, but the outflow of resources with
economic benefits is not remote, such obligations are disclosed in the notes
to the consolidated financial statements as contingent liabilities. Contingent
liabilities are only recognised as a provision if the obligations are more
certain, i.e. the outflow of resources with economic benefits has become
probable and their amount can be reliably estimated.
Estimates
Included within the financial statements are a number of areas where
estimation is required.
Management believes that the areas most notable where estimates have been
applied are:
- contingent consideration
- impairment (Note 11).
Contingent consideration
In the recognition of fair value of contingent consideration in business
combinations and reassessment at each reporting date, management uses
estimates in the inputs and assumptions based on the latest financial
forecasts and other relevant information for the businesses acquired.
Specifically, for the TAB NZ acquisition, the key estimates the Group has used
are the post-tax discount rate and projected cashflows for the forecast
period.
Impairment
On acquisition, any goodwill acquired is allocated to cash-generating units
for the purpose of impairment testing. Where goodwill forms part of a
cash-generating unit and part of the operation within that unit is disposed
of, the goodwill associated with the disposal is included in the carrying
amount of the assets when determining the gain or loss on disposal.
An impairment review is performed for goodwill and other indefinite life
assets on at least an annual basis. For all other non-current assets an
impairment review is performed where there are indicators of impairment. This
requires an estimation of the recoverable amount which is the higher of an
asset's fair value less costs to sell and its value in use. Estimating a value
in use amount requires management to make an estimate of the expected future
cash flows from each cash-generating unit and to discount cash flows by a
suitable discount rate in order to calculate the present value of those cash
flows. Estimating an asset's fair value less costs to sell is determined
using future cashflow and profit projections as well as industry observed
multiples and publicly observed share prices for similar betting and gaming
companies. See Note 11 for details on sensitivity analysis performed around
these estimates.
Impairment losses are recognised in the consolidated income statement and
during the current year, the Group has recognised an impairment charge of
£476.4m primarily against the Group's New Zealand, BetCity, STS and Belgium
businesses. See Note 11 for further details.
4.3 Other accounting policies
Business combinations
For business combinations, the Group estimates the fair value of the
consideration transferred, which can include assumptions about the future
business performance of the business acquired and an appropriate discount rate
to determine the fair value of any contingent consideration. Certain
judgements are also required to assess whether transfers of assets reflect
payments for future service or elements of acquisition consideration.
The Group then estimates the fair value of assets acquired and liabilities
assumed in the business combination. The area of most notable estimation
within the fair value exercise relates to separately identifiable intangible
assets including brands, customer lists and licences. These estimates also
require inputs and assumptions to be applied within the relief from royalty
calculation of fair values with the more significant assumptions relating to
future earnings, customer attrition rates and discount rates. The Group
engages external experts to support the valuation process, where appropriate.
IFRS 3 'Business Combinations' allows the Group to recognise provisional fair
values if the initial accounting for the business combination is incomplete.
The fair value of contingent consideration recognised in business combinations
is reassessed at each reporting date, using updated inputs and assumptions
based on the latest financial forecasts and other relevant information for the
businesses acquired. Fair value movements and the unwinding of the discounting
is recognised within the income statement as a separately disclosed item. See
Note 6 for further details.
Goodwill on acquisition is initially measured at cost, being the excess of the
cost of the business combination over the Group's interest in the net fair
value of the separately identifiable assets, liabilities and contingent
liabilities at the date of acquisition in accordance with IFRS 3 Business
Combinations. Goodwill is not amortised but reviewed for impairment at the
first reporting period after acquisition and then annually thereafter. As such
it is stated at cost less any provision for impairment of value. Any
impairment is recognised immediately in the consolidated income statement and
is not subsequently reversed.
On acquisition, any goodwill acquired is allocated to cash-generating units
for the purpose of impairment testing. Where goodwill forms part of a
cash-generating unit and part of the operation within that unit is disposed
of, the goodwill associated with the disposal is included in the carrying
amount of the assets when determining the gain or loss on disposal. On the
current year acquisitions, any non-controlling interests where put options are
in place are recognised using the present access method where the Group
assesses that the non-controlling shareholder has present access to the
returns associated with their equity interests.
'Put' options over the equity of subsidiary companies
The potential cash payments related to put options issued by the Group over
the equity of subsidiary companies are accounted for as financial liabilities.
The amounts that may become payable under the option on exercise are initially
recognised at the present value of the expected gross obligation with the
corresponding entry being recognised in retained earnings. Such options are
subsequently measured at amortised cost, using the effective interest method,
in order to accrete the liability up to the amount payable under the option at
the date at which it first becomes exercisable. The present value of the
expected gross obligation is reassessed at the end of each reporting period
and any changes are recorded in the income statement. In the event that an
option expires unexercised, the liability is derecognised with a corresponding
adjustment to retained earnings.
Intangible assets
Intangible assets acquired separately are capitalised at cost and those
acquired as part of a business combination are capitalised separately from
goodwill. The costs relating to internally generated intangible assets,
principally software costs, are capitalised if the criteria for recognition as
assets are met. Other expenditure is charged in the year in which the
expenditure is incurred. Following initial recognition, intangible assets are
carried at cost less any accumulated amortisation and any accumulated
impairment losses.
The useful lives of these intangible assets are assessed to be either finite
or indefinite. Indefinite lived assets are not amortised and are subject to
an annual impairment review from the year of acquisition. Where amortisation
is charged on assets with finite lives, this expense is taken to the
consolidated income statement through the 'operating expenses, depreciation
and amortisation' line item.
The useful lives applied to the Group's intangible assets are as follows:
Exclusive New Zealand licence 25-year duration of licence
Other licences Lower of 15 years, or duration of licence
Software - purchased & internally capitalised costs 2-15 years
Trademarks & brand names 10-25 years, or indefinite life
Customer relationships 3-15 years
The useful lives of all intangible assets are reviewed at each financial
period end. Impairment testing is performed annually for intangible assets
which are not subject to systematic amortisation and where an indicator of
impairment exists for all other intangible assets.
An intangible asset is derecognised on disposal, with any gain or loss arising
(calculated as the difference between the net disposal proceeds and the
carrying amount of the item) included in the consolidated income statement in
the year of disposal.
Pensions and other post-employment benefits
The Group's defined benefit pension plan holds assets separately from the
Group. The pension cost relating to the plan is assessed in accordance with
the advice of independent qualified actuaries using the projected unit credit
method.
Actuarial gains or losses are recognised in the consolidated statement of
comprehensive income in the period in which they arise.
Any past service cost is recognised immediately. The retirement benefit asset
recognised in the balance sheet represents the fair value of scheme assets
less the value of the defined benefit obligations.
There is a degree of estimation involved in predicting the ultimate benefits
payable under defined benefit pension arrangements. The pension scheme
liabilities are determined using actuarial valuations. The actuarial valuation
involves making assumptions about discount rates, mortality rates and future
pension increases. Due to the long-term nature of this plan, such estimates
are subject to uncertainty.
In making these estimates and assumptions, management considers advice
provided by external advisers, such as actuaries. Where actual experience
differs to these estimates, actuarial gains and losses are recognised directly
in other comprehensive income. The Gala Coral Pension Plan has a net asset
position when measured on an IAS 19 basis. Judgement is applied, based on
legal, actuarial, and accounting guidance in IFRIC 14, regarding the amounts
of net pension asset that is recognised in the consolidated balance sheet.
Although the Group anticipates that plan surplus will be utilised during the
life of the plan to address member benefits, the Group recognises its pension
surplus in full on the basis that there are no substantive restrictions on the
return of residual plan assets in the event of a winding up of the plan after
all member obligations have been met.
The Group's contributions to defined contribution scheme are charged to the
consolidated income statement in the period to which the contributions relate.
Investments in joint ventures
A joint venture is an entity in which the Group holds an interest on a
long-term basis, and which is jointly controlled by the Group and one or more
other venturers under a contractual agreement.
Joint control exists only when decisions about the relevant activities require
the unanimous consent of the parties that collectively control the
arrangement.
The Group's share of results of joint ventures is included in the Group
consolidated income statement using the equity method of accounting.
Investments in joint ventures are carried in the Group consolidated balance
sheet at cost plus post-acquisition changes in the Group's share of net assets
of the entity less any impairment in value. The carrying value of investments
in joint ventures includes acquired goodwill.
If the Group's share of losses in the joint venture equals or exceeds its
investment in the joint venture, the Group does not recognise further losses,
unless it has obligations to continue to provide financial support to the
joint venture.
Investments in associates
Associates are those businesses in which the Group has a long-term interest
and is able to exercise significant influence over the financial and
operational policies but does not have control or joint control over those
policies.
The Group's share of results of associates is included in the Group's
consolidated income statement using the equity method of accounting.
Investments in associates are carried in the Group's consolidated balance
sheet at cost plus post-acquisition changes in the Group's share of net assets
of the entity less any impairment in value. The carrying value of investments
in associates includes acquired goodwill. If the Group's share of losses in
the associate equals or exceed its investments in the associate, the Group
does not recognise further losses, unless it has obligations to continue to
provide financial support to the associate.
Property, plant and equipment
Land is stated at cost less any impairment in value.
Buildings, plant and equipment are stated at cost less accumulated
depreciation and any impairment in value.
Depreciation is applied using the straight-line method to specific classes of
asset to reduce them to their residual value over their estimated useful
economic lives.
Land and buildings Lower of 50 years, or estimated useful life of the building, or lease.
Indefinite lives are attached to any freehold land held and therefore it is
not depreciated.
Plant and equipment 3-5 years
Fixtures and fittings 3-10 years
ROU assets arising under lease contracts are depreciated over the lease term
(as defined in IFRS 16) being the period to the expiry date of the lease,
unless it is expected that a break clause will be exercised when the lease
term is the period to the date of the break.
The carrying values of property, plant and equipment are reviewed for
impairment where an indicator of impairment exists, being events or changes in
circumstances indicating that the carrying values may not be recoverable. If
any such indication exists and where the carrying values exceed the estimated
recoverable amount, the assets or cash-generating units are written down to
their recoverable amount.
The recoverable amount of property, plant and equipment is the greater of fair
value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset. For an asset that does not
generate largely independent cash inflows, the recoverable amount is
determined for the cash-generating unit to which the asset belongs.
An item of property, plant and equipment is derecognised upon disposal, with
any gain or loss arising (calculated as the difference between the net
disposal proceeds and the carrying amount of the item) included in the
consolidated income statement in the year of disposal.
Leases
The Group has applied IFRS 16 only to those contracts that were previously
identified as a lease under IAS 17 Leases; any contracts not previously
identified as leases have not been reassessed for the purposes of adopting
IFRS 16. Accordingly, the definition of a lease under IFRS 16 has only been
applied to contracts entered into on or after 1 January 2019.
Leases, other than those with a lease period of less than one year at
inception, or where the original cost of the asset acquired would be a
negligible amount, are capitalised at inception at the present value of the
minimum lease payments. Lease payments are apportioned between the finance
charges and reduction of the lease liability so as to achieve a constant rate
of interest on the remaining balance of the liability. Finance charges are
charged directly against income.
ROU assets are included within property, plant and equipment at cost and
depreciated over their estimated useful lives, which normally equates to the
lives of the leases, after considering anticipated residual values.
ROU assets which are sub-leased to customers are classified as finance leases
if the lease agreements transfer substantially all the risks and rewards of
usage to the lessee. All other sub-leases are classified as operating leases.
When assets are subject to finance leases, the present value of the sub-lease
is recognised as a receivable, net of allowances for expected credit losses
and the related ROU asset is derecognised. The difference between the gross
receivable and the present value of the receivable is recognised as unearned
finance lease income.
Finance lease interest income is recognised over the term of the lease using
the net investment method (before tax) so as to give a constant rate of return
on the net investment in sub-leases. Operating lease rental income is
recognised on a straight-line basis over the life of the lease.
Cash and cash equivalents
Cash and cash equivalents consist of cash at bank and in hand, short-term
deposits (including customer balances).
Financial assets
Financial assets are recognised when the Group becomes party to the contracts
that give rise to them. The Group classifies financial assets at inception as
financial assets at amortised cost, financial assets at fair value through
profit or loss or financial assets at fair value through other comprehensive
income.
Financial assets at amortised cost are recognised when the related business
model's objective is to collect contractual cash flows which are solely
principal and interest. On initial recognition, financial assets at amortised
cost are measured at fair value net of transaction costs.
Trade receivables are generally accounted for at amortised cost. Expected
credit losses are recognised for financial assets recorded at amortised cost,
including trade receivables. Expected credit losses are calculated by using an
appropriate probability of default, taking accounts of a range of possible
future scenarios and applying this to the estimated exposure of the Group at
the point of default.
Financial assets at fair value through profit or loss include derivative
financial instruments. Financial assets through profit or loss are measured
initially at fair value with transaction costs taken directly to the
consolidated income statement. Subsequently, the fair values are remeasured,
and gains and losses are recognised in the consolidated income statement.
Financial assets at fair value through other comprehensive income comprise
equity investments that are designated as such on acquisition. These
investments are measured initially at fair value. Subsequently, the fair
values are remeasured, and gains and losses are recognised in the consolidated
statement of comprehensive income.
Financial liabilities
Financial liabilities comprise trade and other payables, interest-bearing
loans and borrowings, contingent consideration, ante-post bets (open betting
positions) and derivative financial instruments. On initial recognition,
financial liabilities are measured at fair value net of transaction costs
where they are not categorised as financial liabilities at fair value.
Financial liabilities measured at fair value include contingent consideration,
derivative financial instruments, ante-post bets.
Financial liabilities at fair value are measured initially at fair value, with
transaction costs taken directly to the consolidated income statement.
Subsequently, the fair values are remeasured and gains and losses from changes
therein are recognised in the consolidated income statement.
Trade and other payables are held at amortised cost and include amounts due to
clients representing customer deposits and winnings, which are matched by an
equal and opposite amount within cash and cash equivalents.
All interest-bearing loans and borrowings are initially recognised at fair
value net of issue costs associated with the borrowing. After initial
recognition, interest-bearing loans and borrowings are subsequently measured
at amortised cost using the effective interest rate method.
All financial liabilities are recorded as cash flows from financing
activities.
Derecognition of financial assets and liabilities
Financial assets are derecognised when the right to receive cash flows from
the assets has expired or when the Group has transferred its contractual right
to receive the cash flows from the financial assets or has assumed an
obligation to pay the received cash flows in full without material delay to a
third party, and either:
- substantially all the risks and rewards of ownership have been
transferred; or
- substantially all the risks and rewards have neither been retained
nor transferred but control is not retained.
Financial liabilities are derecognised when the obligation is discharged,
cancelled or expires.
Derivative financial instruments
The Group uses derivative financial instruments such as cross currency swaps,
foreign exchange swaps and interest rate swaps, to hedge its risks associated
with interest rate and foreign currency fluctuations. Derivative financial
instruments are recognised initially and subsequently at fair value. The gains
or losses on re-measurement are taken to the consolidated income statement.
Derivative financial instruments are classified as assets where their fair
value is positive, or as liabilities where their fair value is negative.
Derivative assets and liabilities arising from different transactions are only
offset if the transactions are with the same counterparty, a legal right of
offset exists, and the parties intend to settle the cash flows on a net basis.
Provisions
Provisions are recognised when the Group has a present obligation (legal or
constructive) as a result of a past event, it is probable that an outflow of
resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the
obligation.
Provisions are measured at the Directors' best estimate of the expenditure
required to settle the obligation at the balance sheet date and are discounted
to present value where the effect is material using a pre-tax rate that
reflects current market assessments of the time value of money and the risks
specific to the liability. The unwinding of the discount is recognised as a
finance expense.
Foreign currency translation
The presentational currency of Entain plc and the functional currencies of its
UK subsidiaries is Pounds Sterling (£).
Other than Sterling the main functional currencies of subsidiaries are the
Euro (€), the US Dollar ($), the Australian Dollar (AU$) and the New Zealand
Dollar (NZD). At the reporting date, the assets and liabilities of
non-sterling subsidiaries are translated into Pounds Sterling (£) at the rate
of exchange ruling at the balance sheet date and their cash flows are
translated at the weighted average exchange rates for the year. The post-tax
exchange differences arising on the retranslation are taken directly to other
comprehensive income.
Transactions in foreign currencies are initially recorded in the subsidiary's
functional currency and translated at the foreign currency rate ruling at the
date of the transaction. Monetary assets and liabilities denominated in
foreign currencies are retranslated at the foreign currency rate of exchange
ruling at the balance sheet date.
All foreign currency translation differences are taken to the consolidated
income statement. Non-monetary items that are measured at historical cost in a
foreign currency are translated using the exchange rate at the date of the
initial transaction. Non-monetary items measured at fair value in a foreign
currency are translated using the exchange rate at the date when the fair
value was determined.
On disposal of a foreign entity, the deferred cumulative retranslation
differences previously recognised in equity relating to that particular
foreign entity are recognised in the consolidated income statement as part of
the profit or loss on disposal.
The following exchange rates were used in 2024 and 2023:
2024 2023
Currency Average Year end Average Year end
Euro (€) 1.179 1.206 1.149 1.151
US Dollar ($) 1.281 1.259 1.242 1.274
Australian Dollar (AU$) 1.931 2.014 1.873 1.866
NZ Dollars (NZD) 2.103 2.221 2.024 2.010
Income tax
Deferred tax is provided on all temporary differences at the balance sheet
date, between the tax bases of assets and liabilities and their carrying
amounts for financial reporting purposes except:
- on the initial recognition of goodwill;
- where the deferred tax liability arises from the initial
recognition of an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither the
accounting profit nor the tax profit;
- associated with investments in subsidiaries, joint ventures and
associates, where the timing of the reversal of the temporary differences can
be controlled and it is probable that the temporary differences will not
reverse in the foreseeable future; and
- where deferred tax assets or liabilities arise related to the
global minimum level of taxation for multinational groups ("Pillar Two"), in
accordance with the mandatory temporary recognition exception.
Deferred tax assets are recognised for all deductible temporary differences
and carry forward of unused tax assets and unused tax losses, to the extent
that it is probable that taxable profit will be available against which the
deductible temporary differences and carry forward of unused tax assets and
unused tax losses can be utilised. The carrying amount of deferred tax assets
is reviewed at each balance sheet date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available to allow all
or part of the deferred tax asset to be utilised. Deferred tax assets and
liabilities are measured at the tax rates that are expected to apply to the
year when the asset is realised or the liability is settled, based on tax
rates (and tax laws) that have been enacted or substantively enacted at the
balance sheet date. Deferred tax balances are not discounted.
Income tax expenses are recognised within profit or loss except to the extent
that they relate to items recognised in other comprehensive income or directly
in equity, in which case they are recognised in other comprehensive income or
directly in equity.
Revenues, expenses and assets are recognised net of the amount of sales tax
except:
- where the sales tax incurred on a purchase of goods and services
is not recoverable from the taxation authority, in which case the sales tax is
recognised as part of the cost of acquisition of the asset or as part of the
expense item as applicable; and
- receivables and payables are stated with the amount of sales tax
included.
The net amount of sales tax recoverable from, or payable to, the taxation
authority is included as part of receivables or payables in the consolidated
balance sheet.
Accounting for uncertain tax positions
The Group is subject to various forms of tax in a number of jurisdictions.
Given the nature of the industry within which the Group operates, the tax and
regulatory regimes are continuously changing and, as such, the Group is
exposed to a small number of uncertain tax positions. Judgement is applied to
adequately provide for uncertain tax positions where it is believed that it is
more likely than not that an economic outflow will arise. In particular,
judgement has been applied in the Group's accounting for Greek tax.
Equity instruments and dividends
Equity instruments issued by the Company are recorded at the fair value of
proceeds received net of direct issue costs.
Final dividends proposed by the Board of Directors and unpaid at the year end
are not recognised in the financial statements until they have been approved
by shareholders at the Annual General Meeting. Interim dividends are
recognised when paid.
Revenue
The Group reports the gains and losses on all betting and gaming activities as
revenue, which is measured at the fair value of the consideration received or
receivable from customers less free bets, promotions, bonuses and other fair
value adjustments. Revenue is net of VAT/GST. The Group considers betting and
gaming revenue to be out of the scope of IFRS 15 Revenue, and accounts for
those revenues within the scope of IFRS 9 Financial Instruments.
For LBOs, on course betting, Core Telephone Betting, mobile betting and
Digital businesses (including sportsbook, betting exchange, casino, games,
other number bets), revenue represents gains and losses, being the amounts
staked and fees received, less total payouts recognised on the settlement of
the sporting event or casino gaming machine roulette or slots spin. Open
betting positions ("ante-post") are carried at fair value and gains and losses
arising on these positions are recognised in revenue.
The following forms of revenue, which are not significant in the context of
Group revenue, are accounted for within the scope of IFRS 15 Revenue. Revenue
from the online poker business reflects the net income (rake) earned from
poker hands completed by the year end. In the case of the greyhound stadia,
revenue represents income arising from the operation of the greyhound stadia
in the year, including broadcasting rights, admission fees and sales of
refreshments, net of VAT. Given the nature of these revenue streams they are
not considered to be subject to judgement over the performance obligations,
amount received or timing of recognition.
Finance expense and income
Finance expense and income arising on interest-bearing financial instruments
carried at amortised cost are recognised in the consolidated income statement
using the effective interest rate method. Finance expense includes the
amortisation of fees that are an integral part of the effective finance cost
of a financial instrument, including issue costs, and the amortisation of any
other differences between the amount initially recognised and the redemption
price. All finance expenses are recognised over the availability period.
Share-based payment transactions
Certain employees (including Directors) of the Group receive remuneration in
the form of equity settled share-based payment transactions, whereby employees
render services in exchange for shares or rights over shares (equity settled
transactions).
The cost of equity settled transactions is measured by reference to the fair
value at the date on which they are granted. In valuing equity settled
transactions, no account is taken of any performance conditions, other than
conditions linked to the price of the shares of Entain plc (market
conditions).
The cost of equity settled transactions is recognised in the consolidated
income statement, with a corresponding credit in equity, over the period in
which the performance conditions are fulfilled, ending on the date on which
the relevant employees become fully entitled to the award (vesting date). The
cumulative expense recognised for equity settled transactions at each
reporting date until the vesting date reflects the extent to which the vesting
period has expired and the number of awards that, in the opinion of the
Directors of the Group at that date, based on the best available estimate of
the number of equity instruments, will ultimately vest.
No expense is recognised for awards that do not ultimately vest, except for
awards where vesting is conditional upon a market condition, which are treated
as vesting irrespective of whether or not the market condition is satisfied,
provided that all other performance conditions are satisfied.
The dilutive effect of outstanding options is reflected as additional share
dilution in the computation of earnings per share as shown in Note 9.
4.4 Future accounting developments
The International Accounting Standards Board (IASB) has issued the following
new or revised standards with an effective date for financial periods
beginning on or after the dates disclosed below. These standards have not yet
been adopted by the Group. The IASB has also issued a number of minor
amendments to standards as part of their Annual Improvements to IFRS.
The Group is currently assessing the impact of the revised presentation and
disclosure requirements for financial statements from IFRS 18. It is not
anticipated that any of the other above unadopted new standards will have a
material impact on the Group's results or financial position.
IAS 21 The Effects of Changes in Foreign Exchange Rates Lack of Exchangeability 1 January 2025
FRS 7 Financial Instruments: Disclosures and IFRS 9 Financial Instruments Amendments to the classification and measurement of financial instruments 1 January 2026
IFRS 18 Presentation and Disclosure in Financial Statements New accounting standard 1 January 2027
IFRS 19 Subsidiaries without Public Accountability New accounting standard 1 January 2027
IFRS 10 Consolidated Financial Statements Amendments regarding the sale or contribution of assets between an investor Date deferred
and its associate or joint venture
IAS 28 Investments in Associates and Joint Ventures
IFRS S1 and IFRS S2 General Requirements for Disclosure of Sustainability related Financial Awaiting UK endorsement
Information and Climate-related Disclosures
5 Segment information
The Group's operating segments are based on the reports reviewed by the
Executive management team (which is collectively considered to be the Chief
Operating Decision Maker ("CODM") to make strategic decisions and allocate
resources.
IFRS 8 requires segment information to be presented on the same basis as that
used by the CODM for assessing performance and allocating resources, and the
Group's operating segments.
Following an internal review the focus of the business and the reports
reviewed by the CODM have been amended. The disclosure of segment
information has been amended to match the revised reporting structure.
Comparative information has been amended to reflect this change.
The group results are now aggregated into the five reportable segments.
- UK&I: comprises betting, gaming and retail activities from
online and mobile operations, and activities in the shop estates within Great
Britain, Northern Ireland, Jersey, and Republic of Ireland.
- International: comprises betting, gaming and retail activities
in the shop estates in the rest of the world apart from UK&I and CEE.
- CEE: comprises betting, gaming and retail activities in Croatia
and Poland for brands SuperSport and STS.
- Corporate: includes costs associated with Group functions
including Group executive, legal, Group finance, US joint venture, tax and
treasury.
- New Opportunities: Reflects the now closed B2C offering under
the unikrn brand.
The Executive management team of the Group have chosen to assess the
performance of operating segments based on a measure of net revenue, EBITDA
and operating profit with finance costs and taxation considered for the Group
as a whole. Transfer prices between operating segments are on an arm's-length
basis in a manner similar to transactions with third parties.
The segment results for the year ended 31 December were as follows:
2024 UK&I International CEE Corporate Elimination Total Group
£m £m £m £m of internal £m
revenue
£m
NGR(1) 2,053.4 2,640.4 488.0 - (19.9) 5,161.9
VAT/GST (4.3) (68.4) - - - (72.7)
Revenue 2,049.1 2,572.0 488.0 - (19.9) 5,089.2
Gross Profit 1,395.8 1,443.4 278.9 - - 3,118.1
Contribution(2) 1,169.4 1,062.0 249.1 - - 2,480.5
Operating costs excluding marketing costs (732.1) (468.0) (78.2) (113.4) - (1,391.7)
Underlying EBITDA before separately disclosed items 437.3 594.0 170.9 (113.4) - 1,088.8
Share based payments (5.9) (3.9) - (3.5) - (13.3)
Depreciation and Amortisation (145.8) (180.0) (18.0) (0.9) - (344.7)
Share of joint ventures and associates - (3.1) - (111.1) - (114.2)
Operating profit/(loss) before separately disclosed items 285.6 407.0 152.9 (228.9) - 616.6
Separately disclosed items (3.8) (524.0) (243.9) (95.0) - (866.7)
Group operating profit/(loss) 281.8 (117.0) (91.0) (323.9) - (250.1)
Net finance expense (107.3)
Loss before tax (357.4)
Income tax (103.6)
Loss for the year from continuing operations after tax (461.0)
Loss for the year from discontinued operations after tax -
Loss for the year after discontinued operations (461.0)
1. Included within NGR are amounts of £53.7m (2023: £68.1m) in relation to
online poker services and £21.9m (2023: £26.7m) arising from the operation
of greyhound stadia recognised under IFRS 15 Revenue.
2. Contribution represents gross profit less marketing costs and is a key
performance metric used by the Group.
2023 UK&I International CEE Corporate Elimination Total Group
£m £m £m £m New Opportunities of internal £m
£m revenue
£m
NGR 2,047.7 2,491.1 301.1 - - (6.8) 4,833.1
VAT/GST (4.0) (59.5) - - - - (63.5)
Revenue 2,043.7 2,431.6 301.1 - - (6.8) 4,769.6
Gross Profit 1,385.7 1,340.7 180.6 - - - 2,907.0
Contribution 1,176.4 942.9 167.2 - (7.1) - 2,279.4
Operating costs excluding marketing costs (706.1) (395.9) (45.6) (112.8) (11.1) - (1,271.5)
Underlying EBITDA before separately disclosed items 470.3 547.0 121.6 (112.8) (18.2) - 1,007.9
Share based payments (7.8) (6.0) - (7.9) - - (21.7)
Depreciation and Amortisation (138.0) (152.2) (7.8) (0.8) (2.7) - (301.5)
Share of joint ventures and associates - (1.5) - (41.4) - - (42.9)
Operating profit/(loss) before separately disclosed items 324.5 387.3 113.8 (162.9) (20.9) - 641.8
Separately disclosed items (14.3) (435.5) (111.2) (689.2) (36.3) - (1,286.5)
Group operating profit/(loss) 310.2 (48.2) 2.6 (852.1) (57.2) (644.7)
Net finance expense (197.9)
Loss before tax (842.6)
Income tax (36.1)
Loss for the year from continuing operations after tax (878.7)
Loss for the year from discontinued operations after tax (57.8)
Loss for the year after discontinued operations (936.5)
Assets and liabilities information is reported internally in total and not by
reportable segment and, accordingly, no information is provided in this note
on assets and liabilities split by reportable segment.
Geographical information
Revenue by destination and non-current assets on a geographical basis for the
Group, are as follows:
2024 2023
Revenue Non-current Revenue Non-current
assets3 assets3
£m £m
£m £m
United Kingdom and Ireland 2,048.5 2,855.6 2,035.3 3,111.9
Australia and New Zealand 573.9 1,160.7 515.1 1,475.4
Italy 518.1 505.8 517.4 512.2
Rest of Europe(1) 1,382.0 3,506.7 1,361.9 3,895.1
Rest of the world(2) 566.7 263.0 339.9 293.8
Total 5,089.2 8,291.8 4,769.6 9,288.4
1. Rest of Europe is predominantly driven by markets in Croatia, Poland,
Belgium, Netherlands and Georgia.
2. Rest of the world is predominantly driven by the markets in Brazil and
Canada.
3. Non-current assets excluding derivative financial instruments, deferred
tax assets and retirement benefit assets.
6 Separately disclosed items
2024 2023
Tax impact Tax impact
£m £m £m £m
Impairment loss(1) 476.4 - 289.0 -
Amortisation of acquired intangibles(2) 286.8 (23.6) 254.6 (41.6)
Restructuring costs(3) 49.6 (10.8) 49.7 (9.6)
Movement in fair value of contingent consideration and put option(4) 43.3 (24.1) 71.8 (15.5)
Financing(5) 9.1 - 1.0 -
Legal and onerous contract provisions(6) 6.7 (2.5) 17.6 (3.0)
Legal settlement(7) 3.9 - 585.0 -
Tax/one-off legislative impacts(8) - 25.7 - -
Corporate transaction costs(9) - - 17.8 -
Loss on disposal of property, plant and equipment(10) - - 1.0 -
Separately disclosed items for the year from continuing operations 875.8 (35.3) 1,287.5 (69.7)
Separately disclosed items for the year from discontinued operations - - 57.8 -
Total 875.8 (35.3) 1,345.3 (69.7)
Separately disclosed items for the year after tax 840.5 1,275.6
(1) Relates to non-cash impairments with the current year charge
recorded against the Group's Tab New Zealand business of £142.5m, the BetCity
business of £113.1m, STS of £75.9m, Belgium of £76.3m and an impairment of
the Group's ROI retail portfolio of £8.7m. Further details are provided in
Note 11. There has also been a write down of £18.5m of certain New Zealand
assets following the platform migration and a number of smaller impairments
against other assets that the Group no longer intends to use including shop
closures.
(2) Amortisation charges in relation to acquired intangible assets
arising from acquisitions. The majority of the charge is from recent
acquisitions, including Enlabs, Bet.pt, Avid, SuperSport, BetCity, STS, and
Tab NZ.
(3) Costs associated with the Group's restructuring programs,
including Project Romer.
(4) Reflects the movement in the fair value of contingent
consideration and put option arrangements on recent acquisitions as well as
the associated discount unwind.
(5) Non-cash loss on Group debt modification. Prior year balance
relates to fees incurred in financing activities. The category has reduced in
value since the half year as a result of the issue costs relating to the 2024
refinance now being capitalised.
(6) Costs relating primarily to our commitments to the DPA and
associated shareholder litigation, as well as other legal costs associated
with disposed businesses.
(7) During the prior year, Entain plc entered into a Deferred
Prosecution Agreement ("DPA") with the Crown Prosecution Service ("CPS") in
relation to historical conduct of the Group, thereby resolving the HM Revenue
& Customs ("HMRC") investigation into the Group. As a result of the
agreement reached, the Group recognised a £585.0m discounted liability
relating to amounts it has agreed to pay in relation to the disgorgement of
profits, charitable donations and contributions to CPS costs. The current year
charge reflects discount unwind on the original discounted liability. The
liability is being paid over four years.
(8) During December 2024 tax legislation was enacted in Gibraltar to
amend a previous enhanced tax deduction for qualifying business marketing and
promotion costs, which had applied for the two years ended 31 December 2021
and 31 December 2022. The amendment has retrospective effect to cut short by
a year the period to which the incentive applied.
(9) Transaction costs associated with the prior year M&A activity,
including the acquisition of 365Scores, NZ Tab, STS and Angstrom.
(10) Relates to the loss on disposal of certain assets within the Group's
retail estates.
The items above reflect incomes and expenditures which are either exceptional
in nature or size or are associated with the amortisation of acquired
intangibles. The Directors believe that each of these items warrants separate
disclosure as they do not form part of the day-to-day underlying trade of the
Group.
7 Finance expense and income
2024 2023
£m £m
Interest on term loans, bonds and bank facilities (264.6) (229.2)
Interest on lease liabilities(1) (15.7) (12.6)
Financing costs (Note 6) (9.1) (1.0)
Total finance expense (289.4) (242.8)
Interest receivable 16.1 12.4
Gains/(losses) arising on financial derivatives 145.0 (90.6)
Gains arising on foreign exchange on debt instruments 21.0 123.1
Net finance expense (107.3) (197.9)
1. Interest on lease liabilities of £15.7m (2023: £12.6m) is net
of £0.2m of sub-let interest receivable (2023: £0.2m).
8 Dividends
Pence per share 2024 2023 2024 2023
pence pence Shares in issue number Shares in issue number
2022 second interim dividend paid - 8.5 - 588.8
2023 interim dividend paid - 8.9 - 638.8
2023 second interim dividend paid 8.9 n/a 639.0 n/a
2024 interim dividend paid 9.3 n/a 639.3 n/a
A second interim dividend of 9.3p (2023: 8.9p) per share, amounting to £59.5m
(2023: £56.9m) in respect of the year ended 31 December 2024, was proposed by
the Directors on 6 March 2025. The estimated total amount payable in respect
of the final dividend is based on the expected number of shares in issue on 6
March 2025. There are no income tax implications for the Group and Company
arising from the proposed second interim dividend.
A dividend reinvestment plan (DRIP) is available to shareholders who would
prefer to invest their dividends in the Company's shares. The last date for
receipt of DRIP elections is 31 March 2025.
The 2023 second interim dividend of 8.9p per share (£56.9m) was paid on 26
April 2024. The 2024 interim dividend of 9.3p per share (£59.4m) was paid on
20 September 2024.
In the year, the Group paid a dividend totalling £12.5m to non-controlling
interests (2023: £7.4m).
9 Earnings per share
Basic earnings per share has been calculated by dividing the loss for the year
attributable to shareholders of the Company of £452.7m (2023: £928.6m loss)
by the weighted average number of shares in issue during the year of 639.1m
(2023: 616.0m).
The dilutive effects of share options and contingently issuable shares are not
considered when calculating the diluted loss per share.
At 31 December 2024, there were 639.3m €0.01 ordinary shares in issue.
The calculation of adjusted earnings per share which removes separately
disclosed items and foreign exchange gains and losses arising on financial
instruments has also been disclosed as it provides a better understanding of
the underlying performance of the Group. Separately disclosed items are
defined in Note 4 and disclosed in Note 6.
Total earnings per share
Weighted average number of shares (millions) 2024 2023
Shares for basic earnings per share 639.1 616.0
Potentially dilutive share options and contingently issuable shares 5.2 1.5
Shares for diluted earnings per share 644.3 617.5
Total profit 2024 2023
£m £m
Loss attributable to shareholders (452.7) (928.6)
- from continuing operations (452.7) (870.8)
- from discontinued operations - (57.8)
(Gains)/losses arising from financial instruments (145.0) 90.6
Gains arising from foreign exchange debt instruments (21.0) (123.1)
Associated tax charge on gains arising from financial instruments and foreign 23.1 1.1
exchange debt instruments
Separately disclosed items net of tax (Note 6) 788.3 1,232.7
Adjusted profit attributable to shareholders 192.7 272.7
- from continuing operations 192.7 272.7
- from discontinued operations - -
Standard earnings per share Adjusted earnings per share
Earnings per share (pence) 2024 2023 2024 2023
Basic earnings per share
- from continuing operations (70.8) (141.4) 30.2 44.3
- from discontinued operations - (9.3) - -
From (loss)/profit for the year (70.8) (150.7) 30.2 44.3
Diluted earnings per share
- from continuing operations (70.8) (141.4) 29.9 44.2
- from discontinued operations - (9.3) - -
From (loss)/profit for the year (70.8) (150.7) 29.9 44.2
The earnings per share presented above is inclusive of the performance from
the US joint venture BetMGM. Adjusting for the removal of the BetMGM
performance would result in a basic adjusted earnings per share of 47.3p
(2023: 51.1p) and a diluted adjusted earnings per share of 46.9p (2023: 51.0p)
from continuing operations.
10 Goodwill and intangible assets
Trade-marks & brand names
Goodwill Licences Software Customer Total
relationships
£m £m £m £m £m £m
Cost
At 1 January 2023 4,270.1 205.4 772.7 1,241.0 2,269.4 8,758.6
Exchange adjustment (68.2) 11.8 (12.7) (12.3) (17.4) (98.8)
Additions - - 191.5 - - 191.5
Additions from business combinations 1,067.5 747.8 49.8 275.5 439.5 2,580.1
Disposals - - (2.9) - - (2.9)
At 31 December 2023 5,269.4 965.0 998.4 1,504.2 2,691.5 11,428.5
Exchange adjustment (194.9) (80.7) (28.6) (43.2) (66.1) (413.5)
Additions - 18.3 185.6 - - 203.9
Disposals - - (2.7) - - (2.7)
Reclassifications - - 2.0 - - 2.0
At 31 December 2024 5,074.5 902.6 1,154.7 1,461.0 2,625.4 11,218.2
Accumulated amortisation and impairment
At 1 January 2023 289.2 26.3 520.8 1,018.0 247.2 2,101.5
Exchange adjustment (13.3) (0.1) (9.1) (13.8) (7.3) (43.6)
Amortisation charge - 45.3 138.0 141.4 90.4 415.1
Impairment charge 277.5 - 2.2 0.5 2.1 282.3
Disposals - - (2.9) - - (2.9)
At 31 December 2023 553.4 71.5 649.0 1,146.1 332.4 2,752.4
Exchange adjustment (34.3) (5.5) (18.3) (33.1) (19.7) (110.9)
Amortisation charge - 48.9 167.4 165.6 103.5 485.4
Impairment charge 416.5 - 19.2 - - 435.7
Disposals - - (2.7) - - (2.7)
At 31 December 2024 935.6 114.9 814.6 1,278.6 416.2 3,559.9
Net book value
At 31 December 2023 4,716.0 893.5 349.4 358.1 2,359.1 8,676.1
At 31 December 2024 4,138.9 787.7 340.1 182.4 2,209.2 7,658.3
At 31 December 2024 the Group had not entered into contractual commitments for
the acquisition of any intangible assets (2023: £nil).
Included within trade-marks and brand names are £1,398.4m (2023: £1,398.4m)
of intangible assets considered to have indefinite lives. These assets relate
to the UK Ladbrokes and Coral brands which are considered to have indefinite
durability that can be demonstrated, and their value can be readily measured.
The brands operate in longstanding and profitable market sectors. The Group
has a strong position in the market and there are barriers to entry due to the
requirement to demonstrate that the applicant is a fit and proper person with
the 'know-how' required to run such operations.
Goodwill reflects the value by which consideration exceeds the fair value of
net assets acquired as part of a business combination including the deferred
tax liability arising on acquisitions.
Licences comprise the cost of acquired betting shop and online licences, as
well as licences acquired as part of acquisitions.
Software relates to the cost of acquired software, through purchase or
business combination, and the capitalisation of internally developed software.
Customer relationships, trade-marks and brand names relate to the fair value
of customer lists, trade-marks and brand names acquired as part of business
combinations, primarily relating to the bwin, Ladbrokes Coral Group, Enlabs,
Sport Interaction, SuperSport, BetCity, 365Scores, STS and Tab NZ businesses.
11 Impairment testing of goodwill and indefinite life intangible assets
An impairment loss is recognised for any amount by which an asset's carrying
amount exceeds its recoverable amount. The recoverable amount is the higher of
an asset's fair value less costs to sell and its value in use. For the
purposes of assessing impairment, assets are grouped at the lowest levels for
which there are separately identifiable cash flows (cash-generating units).
Within UK, Eurobet Retail, Belgium Retail and Tab NZ Retail, the
cash-generating units ("CGUs") are generally an individual Licensed Betting
Office ("LBO") and, therefore, impairment is first assessed at this level for
licences (intangibles) and property, plant and equipment, with any impairment
arising booked to licences and property, plant and equipment on a pro-rata
basis. Since goodwill and brand names have not been historically allocated to
individual LBOs, a secondary assessment is then made to compare the carrying
value of the segment against the recoverable amount with any additional
impairment then taken against goodwill first.
For International the CGU is defined as websites hosted by proprietary
platforms based in non-UK countries and for all other segments the CGU is the
relevant geographical location or business unit. Any impairments are made
firstly to goodwill, next to any capitalised intangible asset and then finally
to property, plant and equipment. The expected cash flows generated by the
assets are discounted using appropriate discount rates that reflect the time
value of money and risks associated with the group of assets.
For both tangible and intangible assets, the future cash flows are based on
the forecasts and budgets of the CGU or business discounted to reflect time
value of money. The key assumptions within the UK and European Retail
budgets are OTC wagers (customer visits and spend per visit), the average
number of machines per shop, gross win per shop per week, salary increases,
the potential impact of the shop closures and the fixed costs of the LBOs. The
key assumptions within the budgets for online businesses are the number of
active customers, net revenue per head, win percentage, marketing spend,
revenue shares and operating costs. All forecasts take into account the impact
of the Group's commitment to be Net Zero by 2035 as well as the impact of
climate change.
The value in use calculations use cash flows based on detailed,
Board-approved, financial budgets prepared by management covering a three-year
period which have been risk adjusted for factors specific to each cash
generating unit. These forecasts have been extrapolated over years 4 to 8
representing a declining growth curve from year 3 until the long-term forecast
growth rate is reached. The growth rates used from years 4 to 8 range from 0%
to 10%. From year 9 onwards long-term growth rates used are between 0% and 2%
(2023: between 0% and 2%) and are based on the long-term GDP growth rate of
the countries in which the relevant CGUs operate or the relevant outlook for
the business. An eight-year horizon is considered appropriate based on the
Group's history of underlying profit as well as ensuring there is an
appropriate decline to long-term growth rates from those growth rates
currently observed in our key markets. A 0% growth rate has been used for the
UK Retail operating segment. All key assumptions used in the value in use
calculations reflect the Group's past experience unless a relevant external
source of information is available. Whilst the same approach is adopted for
Tab NZ impairment reviews, the value-in-use is assessed over the 25-year life
of the licence rather than into perpetuity.
The discount rate calculation is based on the specific circumstances with
reference to the WACC and risk factors expected in the industry in which the
Group operates.
The pre-tax discount rates used and the associated carrying value of goodwill
by CGU is as follows:
Goodwill 2024 2023 2024 2023
% % £m £m
UK Retail 12.8 12.6 76.4 76.4
UK Digital 11.3 11.1 933.6 952.6
International 11.6 11.1 1,315.4 1,345.7
Australia 13.7 13.5 134.5 145.1
Belgium Retail 12.8 12.6 - 53.0
Belgium Digital 12.8 12.6 11.5 39.0
Eurobet Retail 13.5 13.3 74.9 78.5
Eurobet Digital 13.5 13.3 294.2 308.2
Enlabs 12.0 11.8 196.0 205.3
BetCity 13.0 12.7 77.8 200.1
SuperSport 11.7 11.5 503.6 527.8
STS 13.6 11.7 301.8 389.2
365Scores 11.3 12.3 88.0 87.0
Tab NZ Retail 14.2 11.1 - 20.2
Tab NZ Digital 14.2 11.1 89.0 235.3
ROI 11.3 11.1 6.2 15.7
Crystalbet 11.3 11.1 36.0 36.9
4,138.9 4,716.0
It is not practical or material to disclose the carrying value of individual
licences by LBO.
Included within trade-marks and brand names are £1,398.4m (2023: £1,398.4m)
of intangible assets considered to have indefinite lives. These assets relate
to the UK Ladbrokes and Coral brands and are assessed on a combined CGU basis
between UK Retail and UK Digital.
Following an internal review the focus of the business and the reports
reviewed by the CODM have been amended. The disclosure of segment
information has been amended to match the revised reporting structure of the
Group. As such, the CGU structure has changed to ensure that no CGU is larger
than a segment.
Impairment recognised during the year
Impairments of intangible assets and property, plant and equipment are
recognised as separately disclosed items within operating expenses (see note
6).
Tab New Zealand
During the year, the Group recorded a non-cash impairment charge of £142.5m
against Tab New Zealand (Digital CGU £124.0m, Retail CGU £18.5m) which arose
as a result of the outlook for the New Zealand business deteriorating versus
the position 12 months ago. Whilst this is in part due to the delay in the
introduction of the legislative net (geo-blocking), forecast underlying growth
has also reduced.
STS Poland
Our Polish business continues to face aggressive competitor activity. Whilst
initial views were that the intensity of competition would reduce as the year
progressed and normalise ahead of 2025, we are yet to see any easing. As such,
the outlook for the Polish business for 2025 and beyond has been reduced. This
reduction has led to a non-cash impairment charge of £75.9m against the STS
CGU.
BetCity
With ongoing changes in regulation in the Netherlands and the introduction of
deposit limits, the most recent of which was on 1st October 2024, and a higher
gaming tax rate, the outlook for the BetCity business has weakened over the
last 12 months. This reduction in the outlook has led to a non-cash impairment
charge of £113.1m against the BetCity CGU.
Belgium
During the year, the Group recorded a non-cash impairment charge of £76.3m
against Belgium (Retail CGU £50.5m, Digital CGU £25.8m). This was driven by
ongoing heavy regulation in Retail and the decline in online casino NGR as a
result of the wallet decoupling with bwin.be.
Republic of Ireland
Continued challenges remain against our Retail estate in ROI as a result of a
reduced outlook for this market. During the year, the Group recorded a
non-cash impairment charge of £8.7m against the ROI CGU.
Sensitivity analysis
Sensitivity analysis for all CGUs where an impairment charge has been
recognised in the year is given below, with the exception of ROI as the
remaining assets associated with that CGU are not material. For all other
CGUs, no reasonable change in assumptions would cause an additional material
impairment.
Impairment 5% EBITDA 0.5% discount rate
£ £
££
Tab NZ 45.6 38.6
STS 30.9 28.3
BetCity 8.6 9.7
Belgium 6.8 0.9
91.9 77.5
Impairment recognised during the prior year
Australia
During the prior year, the Group recorded a non-cash impairment charge of
£190.0m against the Group's Australia CGU. The charge was a result of the
impact of ongoing increases in the rate of Point of Consumption tax across
certain states and a forecast decline in Australian revenues in 2024 as a
result of a reduced market outlook.
Whilst our Australian business continued to be profitable and strategically
important, market conditions and tax headwinds reduced the value in use of the
business resulting in the impairment charge. Post the annualisation of the tax
increases and stabilisation of local market conditions, we expect our
Australian business to return to growth.
Unikrn
During the prior year, the Group took the decision to close its B2C eSports
business operating under the Unikrn brand, in favour of developing a leading
eSports proposition on existing labels. As a result of the decision to turn
off its B2C operations, the Group recorded a £43.2m impairment of goodwill
and £1.1m impairment of trade-marks and brands associated with the Unikrn
operation during the prior year within the New Opportunities segment.
Impala
The Group also took the decision during 2023 to close its B2C operations in
Zambia and Kenya, operations that were run out of the previously acquired
African subsidiary. As a result of the decision to close these operations and
focus resources to drive growth in other markets, the Group recorded an
impairment against the value of assets carried against this business. The
resulting impairment was booked against goodwill of £29.9m, and against
software of £4.0m within the International segment.
In addition, an impairment charge of £11.0m was recognised during the prior
year against our Retail estate in ROI as a result of a reduced outlook for
this market, and £5.0m against Totolotek following its closure post the STS
acquisition.
12 Property, plant and equipment
Land and buildings Plant and equipment Fixtures and fittings Leased assets
Total
£m £m £m £m £m
Cost
At 1 January 2023 40.6 141.2 237.6 603.1 1,022.5
Exchange adjustment (0.3) (2.1) (3.5) (1.4) (7.3)
Additions 18.0 27.0 45.9 45.6 136.5
Additions from business combinations 4.9 8.1 2.2 26.9 42.1
Disposals (4.5) (6.7) (5.7) (49.8) (66.7)
Reclassification - 0.9 (0.9) - -
At 31 December 2023 58.7 168.4 275.6 624.4 1,127.1
Exchange adjustment (2.0) (6.7) (11.7) (7.3) (27.7)
Additions 5.5 30.1 49.0 132.4 217.0
Disposals (1.6) (4.2) (16.7) (202.0) (224.5)
Reclassification (0.3) (15.4) 15.9 (2.3) (2.1)
At 31 December 2024 60.3 172.2 312.1 545.2 1,089.8
Accumulated depreciation
At 1 January 2023 12.9 44.6 87.7 370.1 515.3
Exchange adjustment (0.2) (1.5) (2.0) (0.6) (4.3)
Depreciation charge 13.7 29.4 36.6 61.3 141.0
Impairment 0.9 0.7 0.4 4.7 6.7
Disposals (4.5) (6.0) (5.1) (49.4) (65.0)
Reclassification - (0.2) 0.2 - -
At 31 December 2023 22.8 67.0 117.8 386.1 593.7
Exchange adjustment (1.2) (2.2) (11.7) (2.9) (18.0)
Depreciation charge 5.9 33.0 44.0 63.2 146.1
Disposals (1.6) (4.2) (16.7) (202.0) (224.5)
Impairment 1.2 1.3 4.8 11.5 18.8
Reclassification 2.1 (0.6) (1.6) - (0.1)
At 31 December 2024 29.2 94.3 136.6 255.9 516.0
Net book value
At 31 December 2023 35.9 101.4 157.8 238.3 533.4
At 31 December 2024 31.1 77.9 175.5 289.3 573.8
At 31 December 2024, the Group had not entered into contractual commitments
for the acquisition of any property, plant and equipment (2023: £nil).
Included within fixtures, fittings and equipment are assets in the course of
construction which are not being depreciated of £26.4m (2023: £17.1m),
relating predominantly to self-service betting terminals and the new point of
sale system in Retail stores.
An impairment charge of £18.8m (2023: £6.7m) has been made against closed
retail shops and office buildings included within leased assets in the year.
See Notes 6 and 11 for further details.
Analysis of leased assets:
Land and buildings Plant and equipment
Total
£m £m £m
Cost
At 1 January 2023 593.2 9.9 603.1
Exchange adjustment (1.3) (0.1) (1.4)
Additions 32.8 12.8 45.6
Additions from business combinations 26.0 0.9 26.9
Disposals (49.8) - (49.8)
At 31 December 2023 600.9 23.5 624.4
Exchange adjustment (6.9) (0.4) (7.3)
Additions 93.7 38.7 132.4
Disposals (192.5) (9.5) (202.0)
Reclassifications (4.4) 2.1 (2.3)
At 31 December 2024 490.8 54.4 545.2
Accumulated depreciation
At 1 January 2023 361.5 8.6 370.1
Exchange adjustment (0.6) - (0.6)
Depreciation charge 59.0 2.3 61.3
Impairment 4.7 - 4.7
Disposals (49.4) - (49.4)
At 31 December 2023 375.2 10.9 386.1
Exchange adjustment (2.8) (0.1) (2.9)
Depreciation charge 58.9 4.3 63.2
Disposals (192.5) (9.5) (202.0)
Impairment 11.1 0.4 11.5
At 31 December 2024 249.9 6.0 255.9
Net book value
At 31 December 2023 225.7 12.6 238.3
At 31 December 2024 240.9 48.4 289.3
13 Net debt
The components of the Group's adjusted net debt are as follows:
2024 2023
£m £m
Current assets
Cash and short-term deposits 588.9 400.6
Current liabilities
Interest-bearing loans and borrowings (25.3) (319.2)
Non-current liabilities
Interest-bearing loans and borrowings (3,605.9) (3,038.8)
Net debt (3,042.3) (2,957.4)
Cash held on behalf of customers (196.6) (196.8)
Fair value swaps held against debt instruments (derivative financial 66.8 (85.6)
asset/(liability))
Deposits 20.7 48.8
Balances held with payment service providers 136.8 176.0
Sub-total (3,014.6) (3,015.0)
Lease liabilities (324.5) (275.9)
Adjusted net debt including lease liabilities (3,339.1) (3,290.9)
Cash held on behalf of customers represents the outstanding balance due to
customers in respect of their online gaming wallets.
14 Notes to the statement of cash flows
Reconciliation of loss to net cash inflow from operating activities:
2024 2023
£m £m
Loss before tax from continuing operations (357.4) (842.6)
Net finance expense 107.3 197.9
Loss before tax and net finance expense from continuing operations (250.1) (644.7)
Loss before tax and net finance expense from discontinued operations - (57.8)
Loss before tax and net finance expense including discontinued operations (250.1) (702.5)
Adjustments for:
Impairment 457.4 289.0
Loss on disposal - 1.0
Depreciation of property, plant and equipment 146.4 141.0
Amortisation of intangible assets 485.4 415.1
Share-based payments charge 13.3 23.6
(Increase)/decrease in trade and other receivables (78.2) 42.2
Increase in other financial liabilities 50.7 62.7
Increase in trade and other payables 36.9 506.0
Increase/(decrease) in provisions 12.6 (1.9)
Share of results from joint venture and associate 114.2 42.9
Other (12.4) (9.1)
Cash generated by operations 976.2 810.0
15 Commitments and contingencies
AUSTRAC
On 16 December 2024, the Australian Transaction Reports and Analysis Centre
("AUSTRAC") commenced civil penalty proceedings in the Federal Court of
Australia against Entain Group Pty Ltd, the Group's subsidiary in Australia
("Entain Australia").
The proceedings against Entain Australia relate to alleged contraventions of
the Australian Anti-Money Laundering and Counter-Terrorism Financing Act 2006
(the "Act"), identified as part of AUSTRAC's enforcement investigation of
Entain Australia (the "Investigation"). As the Group has previously
disclosed, the Investigation was announced by AUSTRAC in September 2022. The
Investigation has now concluded, with the only outcome being the civil penalty
proceedings.
A Statement of Claim regarding the proceedings has not been issued as at the
date of approval of the annual report and accounts and a provision has not
been recognised as it is not possible to reliably estimate the quantum or
timing of any fine. Previous penalties in AUSTRAC proceedings in the gaming
sector have been material, ranging from AU$45m to AU$450. Therefore, it is
possible that the proceedings may result in a penalty being levied which could
potentially be material. All cases are different and there is inherent risk
in drawing conclusions from previously settled cases. The level of any
penalty is ultimately a matter for the Federal Court of Australia.
It is expected that the Statement of Claim will be issued in mid-March and, in
other cases settled with AUSTRAC, it has taken between 10 and 20 months after
the issuance of the Statement of Claim for the proceedings to conclude.
Another set of proceedings against another entity has been ongoing for 26
months and is still unresolved. It is therefore difficult to predict how
long the proceedings against Entain Australia will last.
Greek Tax
In November 2021, the Athens Administrative Court of Appeal ruled in favour of
the Group's appeal against the tax assessments raised by the Greek tax
authorities in respect of alleged unpaid taxes and penalties for the years
2010 and 2011. In February 2022, the Greek tax authorities appealed against
the judgements to the Greek Supreme Administrative Court. While the Group
expects to be successful in defending the appeals by the Greek tax
authorities, should the Greek Supreme Administrative Court rule in favour of
the Greek tax authorities, then the Group could become liable for the full
2010 and 2011 assessments plus interest, an estimated total of €300m at 31
December 2024.
The appeals were due to be heard before the Greek Supreme Administrative Court
at various dates in 2024 but have been deferred to 30 April 2025 and 14 May
2025.
Shareholder Litigation
On 30 November 2024 and 2 December 2024, Entain plc was served with two claims
brought by two groups of shareholders which arise from the circumstances and
disclosures relating to GVC's legacy Turkish-facing business and the
investigation by HMRC into those operations. The investigation was concluded
upon the entry by Entain plc into a Deferred Prosecution Agreement with the UK
Crown Prosecution Service on 5 December 2023.
Provision has not been made against these claims as they are not considered
probable to result in an economic outflow, nor is it possible to estimate the
likely quantum and timing of any possible outflow given their early stage.
Consistent with any claims of this nature, there is inherent uncertainty in
the final outcome which could be material.
Player Claims
Germany
As with other operators in the industry, companies in the Group face claims
initiated in Germany by German customers for a period relating to before the
Group held a German local gambling licence. In brief, the claimants seek the
return of their gambling losses alleging that the relevant underlying
contracts between the claimant and the applicable Group companies are not
enforceable due to the companies not holding a local gambling licence at the
relevant time. The Group's position is that it held Gibraltarian and Maltese
licences at the relevant time that entitled it to offer its services into
Germany in compliance with EU law. In addition, certain German Courts have
established that the contracts are enforceable.
The claims made against the Group amount to €101.8m (£84.4m) as at 31
December 2024. The Group has not made any provision for these claims as it
does not consider that the law is established in this area. Consequently,
these claims are not considered to result in a probable economic outflow and,
as such, no provision has been made in the Income Statement. Consistent with
any claims of this nature, there can be uncertainty surrounding the final
outcome.
Austria
As with other operators in the industry, companies in the Group face claims
initiated in Austria by Austrian customers. In brief, the claimants seek the
return of their casino and poker losses, alleging that the relevant underlying
contracts between the claimant and the applicable Group companies are not
enforceable because the companies do not hold a local gambling licence. The
Group's position is that it holds a Maltese licence that entitles it to offer
its services into Austria and that it is compliant with EU law. The Group's
approach is to manage the claims against it as efficiently as possible,
including entering into settlements where appropriate. The cost of these
settlements are not material to the Group.
Bet MGM loan guarantee
BetMGM, the Group's joint venture, took out a $150m revolving credit facility
in December 2024. It was secured and undrawn as at the year end. 50% of this
facility is guaranteed by Entain Group. The likelihood of this being called
upon is considered remote.
16 Subsequent events
On 11th February 2025 it was announced by mutual agreement that Gavin Isaacs,
Chief Executive Officer, was stepping down with immediate effect.
Stella David, who was in the role of Entain's non-executive Chair, again
assumed the role of Chief Executive Officer (CEO) on an interim basis until a
permanent replacement has been found. Pierre Bouchut, who was in the role of
Senior Independent Director, became non-executive Chair on an interim basis.
ADDITIONAL INFORMATION
This information has been provided in order to assist year on year
comparability with previously reported results which, prior to the current
year re-segmentation, were analysed as Online and Retail.
Online
Reported results(1)
Year ended 31 December 2024 2023 Change CC(2)
£m £m % %
Sports wagers 14,392.6 13,721.3 5% 8%
Sports margin 14.7% 13.7% 1.0pp 1.0pp
Sports NGR 1,788.2 1,530.8 17% 20%
Gaming NGR 1,851.5 1,818.0 2% 4%
B2B NGR 80.6 57.9 39% 0%
Total NGR 3,720.3 3,406.7 9% 12%
VAT/GST (67.3) (59.9) (12%) (16%)
Revenue 3,653.0 3,346.8 9% 12%
Gross profit 2,174.0 1,966.6 11%
Contribution 1,551.9 1,356.9 14%
Contribution margin 41.7% 39.8% 1.9pp
Operating costs (610.9) (510.5) (20%)
Underlying EBITDA(3) 941.0 846.4 11%
Share based payments (8.0) (11.4) 30%
Underlying depreciation and amortisation (208.1) (162.9) (28%)
Share of JV (loss)/income (3.1) (1.5) (107%)
Underlying operating profit(4) 721.8 670.6 8%
Retail
The Retail business is made up of our Retail estates in the UK, Italy,
Belgium, Croatia, Poland, New Zealand, Australia, Baltics and Republic of
Ireland.
Reported results(1)
Year ended 31 December 2024 2023 Change CC(2)
£m £m % %
Sports wagers 4,492.8 4,356.4 3% 4%
Sports margin 19.5% 18.9% (0.6pp) (0.6pp)
Sports NGR/Revenue 889.0 839.9 6% 7%
Machines NGR/Revenue 572.5 593.3 (4%) (3%)
NGR 1,461.5 1,433.2 2% 3%
VAT/GST (5.4) (3.6) (50%) (54%)
Revenue 1,456.1 1,429.6 2% 3%
Gross profit 944.1 940.4 (5%)
Contribution 928.6 929.6 0%
Contribution margin 63.5% 64.9% (1.4pp)
Operating costs (667.4) (637.1) (5%)
Underlying EBITDA(3) 261.2 292.5 (11%)
Share based payments (1.8) (2.4) 25%
Underlying depreciation and amortisation (135.7) (135.1) 0%
Share of JV income - - -
Underlying operating profit(4) 123.7 155.0 (20%)
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