Entain, an international sports lottery company, announced in an update of its transactions released in the morning on Wednesday, that its third quarter group ‘ s total net lottery income (NGR) had increased by 6 per cent over the same period (by 7 per cent at the fixed exchange rate). This data includes its 50 per cent share of BetMGM, a joint venture in the United States, but this time the operator separately published a 4 per cent growth in the non-United States market NGR (5 per cent fixed-exchange-rate increase), of which a 10 per cent growth in the Central and Eastern Europe region was the main catalyst.
The 8 per cent growth in the United Kingdom market, the NGR, was in line with expectations and largely benefited from the strong performance of online operations (15 per cent growth). Entain states that this stems from “the strong investment and further market share growth brought about by higher player values”. It is noteworthy that the Brazilian market, NGR, declined by 10 per cent in comparison to the same year, and despite a 14 per cent increase in the number of investments, was not translated into income growth as a result of adverse sporting events. The Group’s chief finance officer, Robert Wood, emphasized in a teleconference on the financials that, despite the decline in revenues, companies were “confident” in the potential of the Brazilian market. He attributed this to “pure bad luck in sports”, noting that football operations in the market were relatively high and were influenced by the European crown and local leagues. Wood maintains that the market “still meets expectations” on the basis of the billing.
When asked how to deal with the impact of a possible increase in the United Kingdom’s distance-bending tax, CEO Entain Tesla David warned that a number of business areas would be hit. She said to the analyst: “We can take a number of measures, including reducing the level of preferences, adjusting the rate of compensation and cutting the marketing budget. These are the means to deal with undesirable tax increases.” Robert Wood added that the sports block would be severely damaged and that operators (including Entain) were likely to reduce sponsorship contracts and associated advertising. “Whatever the market tax rate changes, because of the long-cycle of the return on sponsorship and the focus on brand exposure, it is bound to be the first reduction target for the operator,” he noted, “the only winner in this case is the black market operator, whose competitive disadvantage is reduced. The real losers are the sports industry, of course.” At the same time, Tesla David stated: “We will not stand by and are actively developing a response.” The increase in the long-distance lottery tax has become the focus of the industry and was also mentioned by Rank in the first quarter of 2025, which was published on Wednesday. The British Government announced in April that it was considering the development of a new long-distance lottery tax and has initiated a process of consultation, with progress expected to be announced in the autumn budget on 26 November.
In response to an analyst’s question as to whether tax increases could benefit Entain by accelerating industrial integration and eliminating small competitors, Robert Wood confirmed that small operators were bound to be under pressure and that about 25 per cent of the UK online lottery market was currently occupied by three-tier or smaller operators. With regard to the progress of litigation with Australian AUSTRAC regulators, Tesla David expressed satisfaction with the company’s current compliance system, arguing that “the current system may have reached industry lead”. She noted that the schedule of proceedings was not yet clear and that it might eventually be resolved through the courts and that conciliation proceedings were currently under way with the regulatory bodies, which would “continue as needed”. The operator had appointed a new permanent CEO for Australian operations in August, and Andrew Wallis had been formally appointed to the two-month interim CEO.