Entain PLC · LSE:ENT
Entain — Debt Investor Presentation (July 2021)
33 slides from Entain's debt investor presentation, Jul 8, 2021
Slide 1: Entain plc Lenders Presentation
Entain plc Lenders Presentation 8 July 2021
Slide 2: Disclaimer
Disclaimer NOT FOR PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION. These materials and accompanying presentation (the “Materials”) have been prepared by Entain PLC
Slide 3: Today's Presenter
Today’s Presenter Rob Wood Group CFO & Deputy CEO • 9 years with Entain • Group CFO since March 2019, previously UK Retail CFO for 6 years • Appointed Deputy CEO in March 2021 • Prior roles in Private Equity (Cerberus) and Restructuring advisory (Rothschild, KPMG) 3
Slide 4: Table of Contents
Table of Contents Transaction Overview Business Overview Current Trading Update Appendix Opportunities to deliver significant stakeholder value 4
Slide 5: Transaction Overview
Section 1 Transaction Overview
Slide 6: Transaction Overview
Transaction Overview Entain PLC (“Company”) is a global online-led sports-betting and gaming group operating in high growth markets within a high growth sector The company has delivered strong financial and operational performance against the backdrop of a challenging operating environment (H1’2
Slide 7: Indicative Sources and Uses and Pro Forma Capital Structure
Indicative Sources and Uses and Pro Forma Capital Structure Sources & Uses for the refinancing transaction Sources of funds (£m) Uses of funds (£m) EUR term loan B-4 add-on (€300m) 268 Cash on balance sheet 268 USD term loan B-3 ($774m) 566 USD term loan B-3 ($774m) 566 Total sources 834 Total uses
Slide 8: Summary Terms
Summary Terms New EUR Term Loan B New USD Term Loan B Borrower(s) Entain Holdings (Gibraltar) Limited Entain Holdings (Gibraltar) Limited, GVC Finance LLC Security and Ranking Senior Secured, pari passu (as per existing) Existing Corporate Rating Ba2 (Stable) / BB (Stable) / BB (Positive) (M/S/F) Am
Slide 9: Corporate Structure
Corporate Structure Structure Chart Maturity New £590m Senior Secured 2026 Entain PLC RCF New $774m Senior Secured GVC Finance LLC (US co-borrower) 2024 2027 Term Loan B3 New €300m Senior Secured 2028 Term Loan B4 Holding company Entain Holdings €1,125m Senior Secured 2024 (Gibraltar) Limited Term
Slide 10: Transaction Timeline
Transaction Timeline July 2021 Financing key dates M T W T F S S Announcement of the 1 2 3 4 transaction Wednesday 7th July 2021 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Global investor call Thursday 8th July 2021 26 27 28 29 30 31 Key date Pricing and allocation Friday 16th July 20
Slide 11: Business Overview
Section 2 Business Overview =ntain
Slide 12: Entain at a Glance
Entain at a Glance Entain is one of the largest global online-led sports-betting and gaming businesses • Entain is a global online sports betting and gaming business listed on the Online Net Revenue Split2 London Stock Exchange (FTSE 100) and headquartered in London, UK Other, 17% • One of the large
Slide 13: Truly Global Footprint
Truly Global Footprint… Online Americas Europe APAC Retail (Worldwide) • 28 leading global brands • #1 operator in UK retail • Italy #3 • Licensed in 27 countries • Belgium #1 • Ireland #3 • Offices in >20 locations globally • Significant growth potential in JV with MGM new and existing markets • #2
Slide 14: Market-Leading Brand Portfolio
…with a Market-Leading Brand Portfolio Well-established global and regional brands increase marketing efficiency and create barriers to entry UK (1) Germany Australia Italy (1) Belgium (1) Online: Sports Offering Online: Games offering n/a Ireland (1) Georgia Brazil Baltics Portugal Online: Sports O
Slide 15: Proprietary, Integrated Technology Provides a Key Competitive Differentiator
Proprietary, Integrated Technology Provides a Key Competitive Differentiator Our own powerful and flexible technology puts us in control and provides a sustainable competitive advantage OMNI-CHANNEL DEVICES 2M+ 120+ Changes Sports bets per day with per day zero downtime API SERVICES Available on 100
Slide 16: Our Strategy has Underpinned Our Success to Date
Our Strategy has Underpinned Our Success to Date VISION The world leader in sports betting and gaming entertainment Revolutionise betting and gaming to create the most exciting PURPOSE and trusted entertainment for every customer STRATEGY TECHNOLOGY ENABLED Sustainability Growth • Focus on regulated
Slide 17: Strong Track Record of Growth, with More to Come
Strong Track Record of Growth, with More to Come Strong Track Record of Growth Online NGR £m 1,000 +28% 50% 22 41% 32%4 23%5 online NGR growth1 online EBITDA consecutive in 2020 growth in 2020 quarters of double 28% 23% digit online growth 19% 11% 17% 11% 15% 29% 18% 500 25% 26% 15% 13% 17% 18% 12%
Slide 18: Significant Opportunities in New Markets in Our Core Business
Significant Opportunities in New Markets in Our Core Business AFRICA LATIN AMERICA POPULATION: c.850m POPULATION: c.300m GDP: c.$2.3trn GDP: c.$2.7trn POTENTIAL GGR: >$10bn POTENTIAL GGR: >$25bn EUROPE APAC POPULATION: c.160m POPULATION: c.1,400m GDP: c.$2.5trn GDP: c.$14.3trn POTENTIAL GGR: >$12bn
Slide 19: Proven Track Record of M&A Driving Value
Proven Track Record of M&A Driving Value 2012/13 2016 2018 2020 2021 Acquisition of Acquisition of Acquisition of Acquisition of 50/50 JV with Acquisition of Acquisition of bet.pt Acquisition of Enlabs Sportingbet bwin.party Ladbrokes Coral Crystalbet MGM Neds Our attributes of scalable technology a
Slide 20: Unequivocal Commitment to Sustainability
Unequivocal Commitment to Sustainability Sustainability Charter Corporate People & Regulation Responsibility Governance Communities Only operate in regulated Scientific approach Best in class corporate Best place to work with markets by end of 2023 to safer betting and gaming governance diversity an
Slide 21: Key Takeaways
Key Takeaways 1 A Leading Global Digital Sports Betting, Gaming and Entertainment Company 2 Market-Leading Brand Portfolio 3 Competitive Advantage from Proprietary and Integrated Technology Platform 4 Strong Track Record of Growth with Further Opportunities for Expansion 5 Proven Track Record of M&A
Slide 22: Current Trading Update
Section 3 Current Trading Update
Slide 23: Key Financial Highlights FY2020
Key Financial Highlights FY2020 Strong delivery in a challenging year Online Net Group Underlying BetMGM Operating Gaming Revenue EBITDA Net Gaming Profit Revenue £2.7bn £843m2,5 £530m2,5 +28%cc1 +11% $178m +59% +2% Online +140% Adj. diluted EPS Underlying Free Leverage (excl. US) Cashflow 73.1p3 £5
Slide 24: Group Financial Overview
Group Financial Overview Underlying free cashflow provides balance sheet flexibility to support our growth strategy Key metrics For the year ended 31 December Post IFRS 16 Post IFRS 16 Post IFRS 16 LTM June 2021 2020 2019 Unaudited Reported Reported Net gaming revenue1 - £3,629m £3,633m EBITDA1 £884
Slide 25: Current Trading Update
Current Trading Update Strong first half performance across the Group driving EBITDA upgrade H1 trading highlights Q2: 1 April to 30 June 2021 H1: 1 January to 30 June 2021 • Total Group NGR growth of 11% (+11% cc(1)) • Strong online performance across the first half with NGR up 28% (+27% cc(1)) Tot
Slide 26: Appendix
Appendix =ntain
Slide 27: Deep Regulatory Knowledge and Experience
Deep Regulatory Knowledge and Experience UNITED KINGDOM ALDERNEY NORTHERN IRELAND • Entain Group is currently licensed in 27 UNITED STATES AUSTRALIA JERSEY countries around the globe, including 12 US states, and holds more than 100 licenses. GERMANY SOUTH AFRICA PORTUGAL • Currently 99% of Entain’s
Slide 28: We are Leading the Industry on Player Safety
We are Leading the Industry on Player Safety How ARC works What is ARC? ARC is an intelligent technology system that uses behavioural insight, data science and analytics to assess risks in gaming Its main purpose is to protect the player. They are not aware that ARC exists, but it is learning all th
Slide 29: BetMGM Has Proved to be a Winning Combination
BetMGM Has Proved to be a Winning Combination… $163m $1bn+ 25% 28% Estimated Q1 2021 Forecasted 2022 April market share across all Of all customer acquisition from net revenue net revenue active jurisdictions partnerships and affiliates $32bn 20-25% 30-35% $250 Long-term total addressable Expected l
Slide 30: Positioned to Take Leadership in the US Market
…And is Now Positioned to Take Leadership in the US Market Estimated US market share (all live states) Estimated US market share (BetMGM states only) 35% 50% 31% 30% 40% 25% 22% 30% 30% 20% 18% 24% 15% 20% 18% 10% 10% 5% 0% 0% Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr
Slide 31: Leading Management Team
Leading Management Team Jette Nygaard-Andersen Rob Wood Robert Hoskin Group CEO Group CFO and Deputy CEO Chief Governance Officer 20 years industry experience 9 years industry experience 16 years industry experience Sandeep Tiku Simon O’Halloran Adam Lewis Group COO Chief People Officer Managing Dir
Slide 32: Competitive Edge Through Retail
Competitive Edge Through Retail Technology Driving Digital growth Brand advantage Efficient Model Significant investment in: • Maximise digital app • Significant advertising value • c.£100m per annum cash downloads • Ladbrokes spontaneous brand generation1 • Integrated EPOS system • 200,000 online F
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