- Better than expected H1
- Full-year outlook increased
- Shares up with events
Global sports betting and gaming group Entain (ENT) reported double-digit increases in both net gaming revenue and profit for the first half of 2025, comfortably beating consensus estimates, and raised its full-year guidance.
However, shares in the Ladbrokes and Coral brands owner have had a strong run leading into the numbers, having gained around 35% so far in 2025, so the relatively muted price reaction, down 2%, is not so surprising.
At the same time, analysts have been busy revising up their 2025 earnings estimates over the last few months so the increased guidance has less of an impact on full-year expectations.
OPERATIONAL IMPROVEMENTS
Online net gaming revenue outside the US for the six months to 30 June was up 8% in constant currencies, driven by the UK & Ireland up 21%, Brazil up 21%, and Central and Eastern Europe up 8% year-on-year.
Although growth slowed from the 10% pace of the first quarter, this reflected a drag from the strong performance related to last year’s Euros football tournament.
Entain’s US joint venture BetMGM reported net gaming revenue up 35%, driven by a 61% increase in online sports betting and iGaming up 28%.
An improved net gaming revenue mix and operational efficiencies contributed to an expanded EBITDA (earnings before interest, tax, depreciation, and amortisation) margin of 26.2% with EBITDA increasing 11% to £583 million.
Group EBITDA including Entain’s 50% share of BetMGM was up 32% year-on-year to £625 million.
This strong first-half growth led management to upgrade full year online net gaming growth to 7% versus mid-single-digit previously and an EBITDA margin to a range of 25% to 26% from the prior 25%.
Management also reaffirmed the company was on track to generate £500 million of adjusted cash flow in the medium term.
CONTINUED MOMENTUM
Analyst Greg Johnson at Shore Capital commented: ‘Ahead of the results, our EBITDA forecast stood at £1.12 billion so we see some modest upside risk to estimates noting that simply annualising the H1 outturn would leave EBITDA slightly above the full-year performance.’
Analysts at Peel Hunt added: ‘Entain continues to deliver on its promise of improving operational performance and has upside opportunities in a number of international markets to offset potential pressure in the UK.’
