Entain reiterates full-year 2024 guidance for BetMGM as NFL results bite
FTSE 100 firm says that despite customer-friendly results in the US, BetMGM’s adjusted EBITDA losses are still expected to land at $250m on back of “investment year”
Entain’s shares spiked in early morning trading on Monday after the FTSE 100 firm reiterated its full-year 2024 guidance despite a sustained period of customer-friendly US sports results in Q4.
The London-listed firm said its US-facing JV, BetMGM, is still expected to report an EBITDA loss of around $250m (£206.2m), which was in line with the company’s plans given 2024 was an “investment year”.
BetMGM reported a H1 EBITDA loss of $123m, with H2 expected to be similar.
Entain said that despite the “customer-friendly US sports results seen during Q4, particularly in October and December”, its original guidance still stands.
The group’s shares were up by more than 5% in early trading but, at the time of writing, were up 1.9% to 631p. However, Entain’s stock is down 32% compared with 12 months ago.
At a wider group level, Entain also stood firm by its EBITDA guidance it reaffirmed as part of its Q3 results, published in October.
At the time, Entain said it expected EBITDA to be towards the top end of the £1.04bn to £1.09bn range it had issued following its H1 results.
In the note issued today, Entain said: “Following operator-friendly sports results during Q4, we now expect group EBITDA to be at the top of the £1.04bn to £1.09bn guidance range.”
The reiteration comes after Flutter issued a profit warning last week, with the NFL results during Q4 potentially resulting in quarterly adjusted EBITDA taking a $360m hit.
At a full-year 2024 level, the FanDuel parent company issued a reduction in its US revenue midpoint by $370m, while US adjusted EBITDA could fall by $205m.
Flutter said the NFL had thrown up the “most customer-friendly [results] since the launch of online sports betting”, with favourites winning 72% of the first 256 games of the season.
Flutter suffered a $74m blow on December 30 after the Detroit Lions beat the San Francisco 49ers 40-34 and many customers had winning bet builders, or same game parlays.
The business added that Q4 sportsbook net revenue margin should come in at 6.6%, with a structural revenue margin of 14.5%.
Despite the blows in the US, Flutter said “good momentum” in the UK and Ireland in the shape of favourable Premier League results had helped the ex-US arm.
In turn, ex-US revenue and adjusted EBITDA for full-year 2024 are now expected to be around 1% and 2% higher than previous guidance, respectively.
Entain is due to release its full-year 2024 results on March 6, while BetMGM will report its performance on 4 February.