Entain in 2020: +28% Online Net Gaming Revenue
In 2020 the world dynamics were deeply affected by the pandemic. Almost all industries struggled to stay alive, but, as many anticipated, online companies managed to keep growing thanks to a new public that was forced to stay home. Although Entain, one of the world's largest gaming companies, also run brick and mortar casinos and bet shops, it showed strong results driven by their online division:
- Online Net Gaming Revenue +28% at £2.7bn
- Operating Profit +2% at £530m
- Online EBITDA +50% (+£270m) at £804m
- Group EBITDA +11% at £843m
- Group Profit after tax +187% at £113.8m compared with a loss of £131.2m in 2019
Entain's online division grew 50% in 2020, almost 95% of the earnings before interest, taxes, depreciation, and amortization. However, due to the COVID-19 impact, the board did not consider it prudent to pay a dividend.
How about partypoker?
We all know that partypoker is just a small branch in the giant Entain is. In the online report, only the Sports NGR, Gaming NGR, and B2B NGR are disclosed; the poker room must be included in the Gaming segment.
- Sports NGR: £1,196.8m
- Gaming NGR: £1,534.8m
In the 2019 report, poker represented 4% of the online market; hence we can suppose that with a 50% growth, it's now 8% of the total, about £123m, 3% of the company.
In 2020 partypoker focused on attracting casual players, and according to Entain, this was a key success criterion for the +47% results in the NGR. The first-time depositors almost doubled, and on average, there were 47% more active customers than in 2019, even considering the new regulatory restrictions placed in Germany.
2021 Guidance and prospects
2021 will be a challenging year for Entain. The prospect includes a low single-digit growth, mainly affected by the negative impact of German regulation. However, the expansion to Portugal (purchase of bet.pt), Colombia (bwin launched on December 9), and the Enlabs purchase will represent a boost in the profits; also, the company announced a capital expenditure (CAPEX) of £150-160m plus an additional £10m license costs.
The company estimates a $50bn potential in regulated markets where they still don't operate and over $1bn in the E-sports betting market.
BetMGM has excellent results on the US-market, and its strategy to become a leader in the US market is backed by this brand, which has already secured access to 23 markets across 12 states. About online poker in the US, Entain expects to start operating in Michigan and Pennsylvania in early 2021.
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