Ladbrokes owner Entain has said it will do “whatever it takes” to expand in the US despite rejecting an £8bn takeover approach from the Las Vegas-based casino giant MGM this month.
Its US betting joint venture, which it runs with MGM, lifted online revenues 130 per cent over the year as it entered new states where gambling had been recently legalised, Entain said on Thursday. It increased its 2020 revenue forecast for the business to a range of $175m to $180m, up from $150m to $160m.
MGM this week dropped its attempt to buy the FTSE-listed gambling company after disagreements over the value and structure of the deal and the shock departure of Shay Segev as Entain chief executive during the talks.
Despite friction between the joint venture partners over the merger, Mr Segev told analysts on a call that Entain considered the US its “largest opportunity and we are fully committed to do whatever it takes to maintain our growth”. Both MGM and Entain were in a “good position . . . to inject further funds” into the business, he added.
The companies have so far put a total of $450m into the venture, which Entain expects to report losses of just over £60m for 2020.
In a trading update on Thursday, Entain reported its 20th quarter of double-digit online revenue growth despite the widespread disruption to sports during the pandemic — an increase that countered a sharp drop in retail betting while its shops across Europe remained largely closed under lockdown regulations.
The company also confirmed that Jette Nygaard-Andersen, a non-executive director who joined the group in 2019, would replace Mr Segev. She was formerly chair of the Danish competitive gaming company Astralis and will be the first female boss of a UK-listed betting group.
Chief financial officer Rob Wood has been promoted to deputy chief alongside his existing role.
Entain said net revenue online increased 27 per cent in the year to the end of December compared with 2019, while retail sales fell more than a third in the UK and Europe.
The growth in online sales came in large part due to beneficial sports margins and customers shifting from retail to online betting during lockdowns — a trend that has boosted companies across the sector.
Mr Wood said the impact of retail closures was about £43m a month. The company has benefited from roughly £13m in monthly furlough funds for staff.
Entain is also grappling with its £250m offer for the Swedish online gaming company Enlabs. The deal requires the approval of 90 per cent of Enlabs shareholders but some hedge funds, accounting for more than 10 per cent of the Swedish company’s investor base, have signalled opposition to the deal.
The company said it was “not concerned at this stage”, however.
Ms Nygaard-Andersen, whose background is predominantly in media and technology, said she wanted to maintain the group’s long-term strategy as well as pursue opportunities in esports, recreational interactive gaming and skills-based games.