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Bookmaker Entain lifts profit view as bets on Euros break records

Entain upbeat on annual profit as gaming revenues rises
Entain upbeat on annual profit as gaming revenues rises   -   Copyright  Thomson Reuters 2021
By Reuters

By Muvija M

-Ladbrokes owner Entain boosted its 2021 profit view and reported a jump in first-half net gaming revenue on Thursday, with record bets placed on the Euro 2020 following the resumption of sporting events.

Entain expects core earnings of 850 million-900 million pounds ($1.17 billion-$1.24 billion), ahead of current market consensus, and better than the 843.1 million pounds reported in 2020 and 761.4 million pounds in 2019.

After a year marred by cancelled sporting events and closed retail betting shops, an increase in online gambling during the pandemic-induced lockdowns have helped bookmakers.

Entain reported its 22nd straight quarter of double-digit growth in online net gaming revenue, up 22% in the three months to June, when the Euro 2020 kickstarted after being called off last year due to the health crisis.

The company said the tournament was its biggest ever sports betting event, saying it took more bets than it did for the World Cup in 2018. It did not give figures.

Shares in the firm, which owns bwin and Coral brands, rose 2% by 0835 GMT, outshining the blue-chip index.

“We expect trading to improve further once the retail businesses are free of COVID-19 restrictions,” Peel Hunt analysts said, raising their target price to 21 pounds.

Hargreaves analyst Sophie Lund-Yates said England’s semi-final victory on Wednesday, setting up a finals match against Italy on Sunday, could contribute “to the news that underlying cash profits are expected to beat consensus at the full year.”

The firm said it was doubling investment in its game development studios as it steps up its focus on online betting.

It recently bought European groups Bet.pt and Enlabs AB and fended off a takeover attempt from MGM.

Entain said volumes at its retail shops since reopening were only a tenth lower than before the coronavirus crisis.

But the easing of lockdowns in Britain has hit some online earnings, with 888 flagging a 20% drop in average daily revenue since May.

($1 = 0.7255 pounds)