Betting shops boost for Entain but affordability checks have 'material impact'

Strong trading in betting shops has boosted the performance of the owner of Ladbrokes and Coral, but the lift has come from betting terminals and gaming machines rather than traditional over-the-counter business such as horseracing.

Entain said its retail estate, along with US joint venture BetMGM, had performed strongly in the third quarter of the year, while its online arm had moved into growth after a warning during the summer that performance was slowing due to the uncertain economic background.

Chief executive Jette Nygaard-Andersen told analysts there was also still uncertainty over the publication of the government's gambling review white paper, while the company said affordability checks it had introduced at the request of the Gambling Commission were having a "material impact".

In a trading update released on Thursday, Entain said retail net gaming revenue (NGR) was up ten per cent during the third quarter, as well as being eight per cent higher than pre-Covid levels.

Chief financial officer Rob Wood said the company continued to see "encouraging performance across our shops," adding: "In the UK this has been led by the strength of our digital offering with both the gaming machines and bet station cabinets doing very well."

Group net gaming revenue was up two per cent during the period, with online NGR up by one per cent. Entain said it had achieved a record number of active customers during the quarter, up six per cent year on year.

Wood told analysts that in the UK year-on-year trends had improved significantly in comparison with the first half of the year, "despite the ongoing affordability measures being implemented by leading operators".

He added: "There's no doubt that the measures that we are all taking at the direction of the Gambling Commission are having a material impact."

The measures being demanded by the industry regulator have come before the government has published its long delayed gambling white paper, which is expected to contain affordability check proposals.

Entain chief executive Jette Nygaard-Andersen

Nygaard-Andersen said the Liz Truss-led government was facing a number of pressing issues but added: "We do expect to hear more in the coming weeks as they lay out the legislative agenda.

"That said, we are cognisant that it might be slipping down the list of priorities, but of course we would want to get the white paper out and get it into publication, so we do expect to hear something soon."

Nygaard-Andersen noted the new government's comments around freedom of choice and moving away from "nanny state regulation".

She added: "So from our perspective that's all sensible sounding so far and hopefully that will lead to a balanced and proportionate type of regulation when it comes out in the white paper."

The start of the NFL season had boosted Entain's US joint venture BetMGM, which it said now had a 25 per cent market share where it operated, excluding the state of New York. Third quarter NGR was more than $400 million (approx £361m/€412m), up around 90 per cent year on year.

Nygaard-Andersen said the company was looking forward to a strong finish to the year, which included the World Cup, but that it remained remained "vigilant" given the economic backdrop.

She added: "Our diversified revenue base and robust business model enable us to remain confident in our ability to deliver on our growth and sustainability strategy."

Entain's share price closed on Thursday up 4.1 per cent at 1,133p.

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