Ladbrokes-owner Entain has today lowered its online profit margin forecast for the year after it posted a drop in third-quarter gaming revenue, sending its shares down to a three-year low in early trade.
Entain, which also owns Coral betting shops and online brands bwin and partypoker, said it expected online core profit margin to be about 25% in 2023, down from 27.1% last year.
Gambling firms, which gained from a rise in online betting during the pandemic, are dealing with stiffer regulations and a cost-of-living crisis.
The company, however, anticipated limited impact from regulatory headwinds by the second half of next year, Entain's chief financial officer Rob Wood told Reuters, as it expects most of its revenue to be regulated by then.
Entain expects online net gaming revenue to return to growth on a pro-forma basis in 2024, with online gaming revenue growth forecast in the low single-digits and online core profit margin expected at about 24% and 25%.
Over the last two weeks the company lost money on the main five European soccer leagues, Wood said, which is expected to hit its core profit for the year by about £45m.
Analysts at Peel Hunt said these bad sporting bets could be recovered by the end of the year, "when there is plenty of sport".
Entain said its online net gaming revenue on a pro forma basis was down 6% for the three months ended on September 30.
