GVC Holdings has defined a new strategy for sustainable growth that will have the business renamed Entain and is committed to generating 100% of revenue from locally regulated markets by the end of 2023.
The operator said the new strategy will be driven by its technology platform and supported by a series of strategic initiatives, some of which will be launched soon.
Among the five ‘pillars’ of sustainability was a proposal to change the group’s brand as Entain plc, which GVC said would reflect fundamental changes in business and the industry in general. The name change is subject to shareholder approval.
“Under our new corporate identity, we will continue to use our unique technology platform to take advantage of the exceptionally strong momentum in the market, reach new audiences, improve the customer experience and provide industry-leading products with levels of player protection,” said the chief executive of GVC, Shay Segev.
The strategy will also contemplate the objective of generating all revenues in regulated markets by 2023. Currently, 96% of revenues come from regulated markets, a figure expected to reach 99% by the end of 2020. If it becomes clear that regulation of markets it is unlikely, the company will attempt to leave the jurisdiction.
The company will seek to further increase its focus on player safety and protection, with the launch of the new Advanced Responsibility & Care (ARC) program. Additional customer checks will also be implemented on all customers, to better track potential damage.
These player protection efforts will become a key metric for the company’s bonuses. As of 2021, a responsible gaming metric will be incorporated into the annual bonus conditions for the entire group.
Expansion plans and focus on eSports
In terms of improving corporate governance, GVC stressed that its nominating board and committee would continue to commit to bringing greater diversity to the group, with more changes to be made to the composition in due course.
This part of the strategy will also include a commitment to communities to launch the new Entain Foundation, a program that will donate £ 100 million over the next five years. This will include the new Pitching In program, which will support grassroots sports and athletes.
“We are absolutely committed to pursuing the highest standards of corporate governance, providing excellent career development opportunities for our colleagues and supporting the communities in which we operate,” said Segev.
Looking at the growth aspects of the strategy, GVC divided this into four goals that would significantly increase the group’s scale in the next three to five years.
This includes the goal of becoming the leading operator in the United States through its joint venture BetMGM with MGM Resorts, which already has an estimated market share of 18% across the state in which the brand operates.
In addition, GVC will seek to expand to new audiences, listing electronic sports as a priority. “Our clear strategy of prioritizing sustainability and growth will allow us to achieve these goals, thereby providing long-term value for all of our shareholders,” said Segev.
Meanwhile, GVC has published a brief commercial update based on how the group’s new sustainability strategy will impact business progress.
Earnings before interest, tax collection and amortization (EBITDA) in 2021 are expected to reach £ 40 million, due to the impact of GVC’s exit from unregulated markets and the group launching new player protection initiatives.
Last week, GVC warned that the temporary closure of bookmakers in England could lead to a £ 27 million drop in EBTIDA in the year. Along with the restrictions in force across Europe, GVC stressed that the overall reduction in EBTIDA could reach £ 37 million.