GMVHY - Entain Plc (GMVHF) Q4 2023 Earnings Call Transcript

2024-03-07 14:46:17 ET

Entain Plc (GMVHF)

Q4 2023 Results Conference Call

March 07, 2024 04:30 AM ET

Company Participants

Stella David - Interim CEO

Rob Wood - CFO and Deputy CEO

Sameer Deen - Chief Commercial Officer

Satty Bhens - Chief Product & Technology Officer

Davina Hobbs - Director of IR

Conference Call Participants

James Rowland Clark - Barclays

Estelle Weingrod - JPMorgan

Kiranjot Grewal - Bank of America

Joe Thomas - HSBC

Roberta Ciaccia - Investec

Simon Davies - Deutsche Bank

Presentation

Stella David

I'm joined here by Rob Wood, who is the CFO and the Deputy CEO. We've got Sameer Deen, who is the Chief Commercial Officer. And at the end, we've got Satty Bhens, who is the Chief Product and Technical Officer. We've also got quite a few of the management in the audience today. And hopefully, at the end of the session, you'll have a chance to talk to some of those informally before you go.

Let me get down to business. I'm going to kick off with the reflections and thoughts, having been the interim CEO for nearly three months now. Then I'm going to give you a brief overview of the performance in 2023, but also looking forward to the priorities that we have in 2024. Rob will then take you through the financials, and then Sameer and Satty are going to provide detail on what we've been doing and what concrete actions we have taken with specific examples and what more we're going to be doing as we go forward. And then I'll wrap up, and then we'll have an opportunity to do Q&As.

So let me start with my reflections. Yes, I am an interim CEO, but i am definitely not a caretaker CEO. I am not here to tread water in any way, shape or form. We need momentum as a business. And I'm very much focused on execution.

We are moving at pace. And my job, as I see it, is to hand this business on to the permanent CEO with great positive operational momentum. And I'm very pleased to say that the recruitment process for the permanent CEO is going very well.

I'm also pleased to say that we've added strength to our bench on the Board. In the last two or three months, we've added Amanda Brown, and we've added Ricky Sandler. And hopefully, in the next week or two, we'll be able to announce the addition of yet one more Board member.

So the strengthening of the bench, along with the initiation of the Capital Allocation Committee, means that the Board is going to be look in depth at what other things we need to do to maximize and improve shareholder returns. Now the Capital Allocation Committee was only set up very recently. So as I'm sure you hopefully will appreciate, it's not the timing for me to update any more on that because it hasn't reached any conclusions.

If I now look into the business itself, I'm also really encouraged by the enthusiasm dynamism of the management team that I've been working very closely with. And fundamentally, Entain is a strong business. It's working in an industry with strong growth dynamics. And our absolute focus under my watch is that what we're going to focus in on being who we are, and that is a betting and gaming company.

Now I understand the prior aspiration to move into broader interactive entertainment. But quite frankly, that was a distraction. We are laser-focused on being 100% a betting and gaming company. And my style within the organization, which I think is important, is one of making it safe, although I am demanding, but making it safe to share the brutal truth, or what I like to call them the elephants in the room.

Because actually, if we face the elephants in the room, we can really, really get into proper debate, proper real change at real pace. So what are these elephants? Well, firstly, complexity. Complexity has gradually accumulated over time in this business, and that has been exacerbated by the fact we've done numerous acquisitions. And the problem with the complexity is hampering our agility and therefore, our ability to get things done.

So we have a great opportunity, I believe, to unlock the ways of working and drive more effective and more efficient outputs. In the U.S., we're very proud of the successes that we've had with BetMGM, and its performance quite rightly is a key focus for us. And where I like to think of MGM and ourselves, Entain, that we are the co-parents of BetMGM. But being fully transparent, it took us, and that is Entain, some time to realize just how quickly we needed to feed BetMGM with better product, better customer experiences and better, more focused U.S. tailored products.

Now the good news, as Satty is going to tell you later on, is that the work that he and his team have done over 2023 have really helped BetMGM be much more competitive, and there is a lot more positive news to come in 2024. However, this all leads to another elephant in the room....

For further details see: