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Entain reported largely in-line Q3 23 trading numbers, accompanied by an implied FY23 EBITDA downgrade. The latter was a result of unfavourable sports results as well as persistent regulatory headwinds. However, the bigger news was the update provided on the firm’s strategy and longer-term targets. While this means the near-term growth and margin trajectory will be slower than previously anticipated, the longer-term targets offer strong upside potential considering the currently-beaten-down valu
Companies: Entain PLC
AlphaValue
Entain exceeded estimates in 1H23 (revenue +2.8%, EBITDA +0.4%), driven by BetMGM’s US performance. Pro-forma revenue reached £2.38bn, up 8% including the US share, with retail compensating for soft online growth. BetMGM’s positive H1 showing with revenue up 55% to $944m, underlines its strong position in the US market. FY23 Group EBITDA is expected to come in at £1bn-£1.05bn. Regulatory challenges impacted ex-US markets, while a £585mn provision for the HMRC investigation settlement surprised t
Entain’s Q1 23 revenue was up 15% YoY, with double-digit reported growth in both the online and retail channels. US JV BetMGM registered 76% growth, putting it on course comfortably to achieve its FY23 guidance. The previously-flagged headwinds in the UK (affordability) and Germany (regulatory challenges) weighed on online growth (+1% pro-forma vs +6% ex-UK and Germany). We do not expect any significant changes to our estimates, given our above-guidance BetMGM estimates as well as the mostly in
Entain reported estimate-beating FY22 earnings. Net gaming revenue (NGR) increased by 12% in the year, driven by a 66% rise in retail. BetMGM performed strongly and is expected to be EBITDA positive in H2 2023. Entain completed five transactions during the year, further diversifying its revenue base. Underlying EBITDA was up 13%, and adjusted diluted EPS up 15%. However, the guidance was softer than expected and should result in a low single-digit cut to our FY23 estimates.
Entain reported Q4/FY22 growth in line with estimates. Importantly, the online segment returned to growth, after four consecutive quarters of decline. The firm now expects FY22 EBITDA to come in at £985–995m (5%/3% ahead of consensus/AV, respectively). BetMGM continued to outperform expectations and is on track for EBITDA break-even in H2 23. We will be upgrading our estimates by low-to-mid single-digits to factor in the FY22 EBITDA upgrade as well as the stronger trajectory of BetMGM.
Entain reported soft Q3 2022 trading numbers as retail growth (+10%) offset the 2% decline in online with the former maintaining its growth momentum vs the pre-Covid level (+8% vs +6% in Q2). In the all-important US market, BetMGM continued to perform well, with revenue up 18% QoQ to over $400m. Although the management maintained the FY22 EBITDA guidance at £925-975m, we will trim our estimates by mid-single digits to reflect the slower-than-expected momentum online.
Entain reported softer than expected H1 22 profit numbers even as BetMGM, on course for EBITDA break-even in 2023, continued to perform strongly. In other positive developments, Entain re-initiated dividends and also announced the setting up of Entain CEE, the firm’s acquisition vehicle focused on Central and Eastern European markets. FY22 EBITDA outlook of £925-975m is in line with consensus but ~3% below our estimates. Hence, we expect to trim our estimates marginally, largely on account of
Entain reported soft Q2/H1 22 trading as revenue was up 6/18%, respectively, in cc terms. The expected retail recovery (79/244% in Q2/H1) more than offset the decline in online (-8/-7% in Q2/H1), which faced multiple headwinds. BetMGM maintained its number two position in the US with a 24% market share and same-state growth of >30%. We will trim our FY22 estimates by high single digits to reflect both the soft Q2 as well as the downgraded online growth guidance.
Entain reported a strong start to FY22 with Q1 revenue up 34%, benefitting from a 10x increase in retail revenues as volumes reached within 5-10% of their pre-Covid levels. As expected, online growth (-6%cc) was hurt by the previously-flagged regulatory headwinds. BetMGM continued to gain momentum with market share at 24%. The JV re-iterated its target of reaching positive EBITDA in 2023. We will upgrade our FY22 estimates marginally, to reflect the stronger than expected retail recovery.
Entain reported a 5% rise in FY21 EBITDA, resulting in a 1.4% surprise. Importantly, retail operations in various regions were within 5% of pre-COVID-19 levels. BetMGM continued to gain share and expects revenue of $1.3bn in FY 22 (+53% yoy) with EBITDA breaking-even in 2023. The board decided against a dividend, which was the only sore spot of the FY 21 performance. We do not expect any significant changes to our estimates, following the largely in line showing (vs AV estimates).
Entain reported a largely in line Q4/FY 21 trading update, registering cc growth of 6/8% for Q4/FY21, respectively. As expected, online revenue was down 6% in Q4, while retail was up 62%. BetMGM performance was well ahead of consensus as well as our expectations. Entain now expects FY21 EBITDA to come in between £875m and £885m (vs £850-900m previously). We will raise our BetMGM estimates as well as the valuation to factor in the strong US momentum.
Entain registered Q3 21 top-line growth of 6%, driven largely by online (10%). In the all-important US market, BetMGM surged ahead with a further expansion in market share of (23% in three months to August vs 22% in Q2 21). FY21 EBITDA guidance of £850-900m was re-iterated, a positive given the recently announced headwinds from Dutch regulations. We do not expect any significant change to our estimates, given that the performance was largely in line with our estimates.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Entain PLC. We currently have 0 research reports from 12 professional analysts.
Topps Group is the UK’s largest specialist supplier and distributor of tiles and associated products to the UK’s domestic and commercial markets. Each of the last three years the Group has successfully achieved record revenue in a market that’s seen recent volume declines and regional peers enter administration. Following the right sizing of its business, Topps Group is now well positioned to capitalise on the economic recovery and continue taking share from competitors, supported by its global
Companies: Topps Tiles Plc
Zeus Capital
HeiQ reported its interim results for the 12-months to December 2023, a period characterised by challenging conditions in the markets in which the company currently operates. In-line with the recent trading update, the company reported revenues of $41.7m for FY23 and closed the period with a cash balance of c$10m and a net debt position of $2.2m. We have updated our forecasts to reflect the FY23 results and HeiQ’s outlook in 2024, leaving our revenue forecast unchanged but adjusting gross margin
Companies: HeiQ PLC
Cavendish
Companies: 88E CNC FTC TRCS HEIQ CREO ZAM
Companies: Tortilla Mexican Grill Ltd.
Liberum
24th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi
Companies: FTC AGL SRT SOU G4M AOM SUP
Hybridan
At its FY23 results in June 2023, G4M announced its intention to focus on product margins, overhead cost reduction, and efficiency ahead of revenue growth, along with further net debt reduction, in FY24. The FY24 year-end trading update confirms G4M has delivered on these rebalanced priorities, with gross margin rising and net debt almost halving compared with FY23. Cost savings achieved in FY24 and the continued development of higher-margin categories should deliver further upside in FY25E.
Companies: Gear4music (Holdings) PLC
Progressive Equity Research
Companies: JDW MAB MARS WTB FSTA BOWL CPG SSPG LGRS SSTY OTB HSW TMO GYM MEX
Pinewood’s transition to a pure-play automotive SaaS business is now largely complete. Today we introduce summary forecasts out to FY26 and reiterate the investment case. We see significant opportunity for Pinewood to grow its user base in the UK and internationally whilst generating high EBITDA margins and cash conversion. With a 24.5p special dividend embedded in the current price (payable Q1/Q2), the effective price today is 12.3p. Based on the Group’s FY27 target of £27m EBITDA, we estimate
Companies: Pinewood Technologies Group PLC
Vertu is the fourth largest automotive retailer in the UK, with 188 sales outlets and a track record of cross-cycle growth, principally through businesses it has acquired, funded by equity, debt and most importantly cash generation. Vertu operates across the entire vehicle lifecycle, including new and used vehicle sales, and vehicle servicing, repair and parts. Service and repair is a 40+% gross margin repeating business. With economic headwinds, the transition to electric vehicles, recent overs
Companies: Vertu Motors PLC
On 9 January last year, we set out our ten top stock picks for 2023, for what turned out to be another relatively poor twelve months for UK equities due to two wars, stubbornly high inflation and further tightening of monetary policy. This was even as other major markets, such as the US, largely recovered in the year. In the 2023 calendar year, the AIM All-Share index fell 8.2% and is still 42% off its 2021 high. From the release of our 2023 top picks note, the average total return (assuming div
Companies: PTAL GHH IGP MSLH PINE NXQ EQLS NXR AXL
We are initiating coverage of a.k.a. Brands Holding Corp. ("a.k.a. Brands" or the "company"), a leading owner of primarily online apparel-based brands focused on Generation Z and Millennial consumers, with a Buy rating and $14.00 price target, or 10.9X our 2025 EBITDA projection of $20.2 million. The company's brands include: 1) Princess Polly, focusing on 15 to 25 year-old women; 2) Petal & Pup, which offers feminine styles for 25 to 34 year-old women; 3) Culture Kings, a street wear destinatio
Companies: GPS URBN ITX AEO AEO GES GES ITX GPS ANF 0R32 URBN
Small Cap Consumer Research LLC
Domino’s Pizza Group’s (DOM’s) new CEO has set an ambitious long-term growth target, including an acceleration in its net store opening programme. With better alignment between the company and its franchisees, management believes DOM should be capable of generating improved profit growth, versus that achieved in recent years, and potential higher returns.
Companies: Domino's Pizza Group plc
Edison
Borussia Dortmund’s progress to the semi-final of the Champions League brings a further upgrade to profit guidance for FY24. In addition to helping the financial results of the current year, the relative success of German teams against those of other nations in European competitions this season may ensure the club qualifies for the Champions League next season despite currently being outside the top four of the Bundesliga.
Companies: Borussia Dortmund GmbH & Co. KGaA
17th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi
Companies: ARS TIDE SCE SNX ECK CNS TST SPEC SSTY
HeiQ has announced the acquisition of a site in Portugal where the company intends to build a HeiQ AeoniQ production facility with a 3,000 tonne per year capacity. To support the acquisition, the company intends to raise c£2.44m via an equity placing, supported by the issue of a c£1.7m (€1.97m) convertible loan note (largely to management) that will convert upon completion of the raise. We see this as an important step in the development programme for HeiQ AeoniQ. Additionally, HeiQ has provided
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