Entain PLC (LSE:ENT) boosted revenue last year as it continued to expand, but poor betting figures meant operating profits fell against 2020.
The sports betting, gaming and interactive entertainment group’s revenues for 2021 rose 8% to £3.8bn, with net gaming revenue up 7%, with gaming retail volumes reaching 90% of pre-covid levels.
But underlying operating profits fell 9% to £484.1mln, as its US betting joint venture BetMGM lost £101.3mln, despite a near-fivefold increase in revenues, as the group expands into the nascent North American market.
Underlying EBITDA for the Ladbrokes and PartyPoker owner of £881.7mln was in line with updated forecasts, as the group was forced to tighten its profit guidance in January on a slowdown in online gambling.
"Our full year results demonstrate yet again that Entain is a business with growth built into its business model. Our strong performance is underpinned by the Entain platform which encompasses the compelling combination of our proprietary technology, our outstanding people around the world, and our industry-leading operational capabilities,” said chief executive Jette Nygaard-Andersen.
“In particular, BetMGM in the US has delivered a five times increase in net gaming revenue versus the previous year, and is ready to challenge for the number one position across the markets in which it operates.”
Entain runs a number of physical locations to support its gaming and betting branch, meaning revenues were more heavily impacted during Covid. Nygaard-Andersen welcomed the gradual return to pre-covid levels in these shops.
The group recorded diluted earnings per share of 44.7p for 2021, against 15.6p in 2020, and it did not propose resuming its dividend, having halted payouts at the height of the pandemic.
Cash burn was £262.7mln as the company put £164.4mln into BetMGM, compared with cash generation of £346.7mln in 2020.
It also announced it would voluntarily repay £44mln received under the furlough scheme.
Entain expects net revenue in BetMGM to reach US$1.3bn in 2022, and is targeting positive EBITDA for the betting arm, which held a 29% share of the iGaming market last quarter, in 2023.