Entain – Return Of In Person Betting Fuels A Revamped Dividend Policy
Entain PLC (LON:ENT)’s revenue rose 19% to £2.1bn at the half year mark, with an 18% increase in net gaming revenue. That was driven by a strong rebound in retail performance following lockdowns the previous year, which more than offset a decline in Online.
Operating costs jumped 31% higher as Retail reopened and new acquisitions fed into the cost base. Nonetheless, underlying cash profit (EBITDA) rose 17% to £471.0m.
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A new dividend policy is being introduced, starting with a total dividend of £100m to be paid this financial year. That’ll be split evening across the halves, so an 8.5p interim dividend has been announced today.
The group remains on track to deliver £925-£975m of cash profit this year.
The shares were up 3.9% following the announcement.
Entain's Earnings
Matt Britzman, Equity Analyst at Hargreaves Lansdown
“The resurgence of in person betting continued over the first half as a cost-of-living crisis and broader economic uncertainty don’t seem to be deterring players from heading out for a rush of in person gaming. The flip side of that trend is a drop in online gaming, though importantly activity’s stabilising well ahead of pre-pandemic levels.
Positive performance and the rebound of retail has paved the way for a fresh and revitalised dividend policy. Starting at £100m over the current year, split between the first and second half, that’s expected to grow from here. Good news for investors, though that will put added strain of cash that’s already being snapped up in BetMGM and the acquisition led growth strategy.
Speaking of BetMGM, the group’s joint venture over the pond, performance remains strong. Profits should start to flow at some point next year and BetMGM management have recently upped their forecast addressable market to around $37bn, there’s a big slice of pie up for grabs.”
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