Ladbrokes owner Entain swings back into profit with strong international growth

Entain, the owner of Coral and Ladbrokes, returned to profit in 2020 as the company reported strong growth across its international operations, especially the United States.

Group profit after tax last year was £113.8 million compared with a loss of £131.2m in 2019.

Underlying group earnings were at the top end of expectations at £843.1m, an increase of 11 per cent, while net gaming revenue was flat at £3.6 billion.

Online Ebitda (earnings before interest, taxation, depreciation and amortisation) rose by 50 per cent to £803.5m, reflecting the shift to online during the pandemic as well as good sports margins.

BetMGM, Entain's joint venture in the US with MGM Resorts International, now has an 18 per cent market share across the 12 states where it is live and Entain said it was the number one digital operator for iGaming in January this year. Full-year revenues of $178m were ahead of expectations, Entain added.

Entain chief executive Jette Nygaard-Andersen

Chief executive Jette Nygaard-Andersen said: "The strong underlying momentum within our business, the rapid growth of our US joint-venture, and our continuing international expansion mean we are as confident as ever in the long-term prospects for Entain."

In January Entain rejected a takeover bid from MGM but the company's chief financial officer and deputy chief executive Rob Wood said it remained "business as usual" between the two sides.

He added: "BetMGM is really important to Entain and our share price but it is equally important to MGM Resorts and their share price. Both sides are completely aligned in needing and wanting to do the very best job we possibly can with this business.

"The fact that there were some boardroom discussions around the turn of the year was not a distraction for the business at all."

In turn, Entain has made an approach to buy the wagering arm of Australian gambling giant Tabcorp.

Wood said: "We are clearly a very credible buyer, we're best-placed to do it, we like the Australian market but it is in their hands at the moment so we will just wait and see."

Entain's retail division was "significantly impacted" by Covid-19, with Ebitda for the year at £98.3m. However, Wood said he believed betting shops would "recover pretty well".

He added: "Last summer we did fear that revenue would suffer and ultimately we would lose people from shops but actually we got back to over 90 per cent of where we ordinarily would be in the UK.

"What that told us is that even if customers are using an app for the first time they still crave that social side."

Entain's share price was down 9p at 1,452p on Thursday afternoon.

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