![]() # Transforming # gameour #### Annual Report 2023 ![]() Refreshed corporate strategy, focusing on three strategic objectives (Drive Organic Growth; Expand online margins; Empower growth in US) to deliver value for our shareholders as the next phase of our transformation Further expansion into regulated markets with leading market positions; expansion into Poland with acquisition of STS Holdings and partnership with TAB NZ providing unique access to New Zealand sports betting market Enhancement of in-house content and capabilities with acquisition of 365Scores and Angstrom Sports Strong performance of BetMGM boosted by product and tech enhancements including Single Account Single Wallet in 27 markets Only global operator with 100% revenue from regulated or regulating markets Launch of new sustainability strategy including an updated regulatory and safer gaming charter #### Strategic and operational highlights Financial highlights Group Revenue £4.8bn +11% 2022: £4.3bn Online Net Gaming Revenue £3.4bn +12% 2022: £3.1bn BetMGM Net Gaming Revenue 1 $2.0bn +36% 2022: $1.4bn Group Underlying EBITDA 2 £1,008m +1% 2022: £993.0m Loss after Tax from Continuing Operations £879m 2022: profit of £33m Adjusted Net Debt £3.3bn 3.3x (3.1x proforma) 2022: £2.8bn (2.8x) Profit after Tax from Continuing Operations before Separately Disclosed Items £339m 2022: £224m Adjusted Diluted EPS 44.2p 2022: 60.5p 01 Introduction 02 We are Entain 06 Investment proposition 08 Chairman’s introduction 12 Chief Executive’s Review 18 The industry in which we operate 20 How we create value 23 Our strategic framework 38 Regulatory update 40 Sustainability 42 ESG Governance 44 Safer betting and gaming 46 Secure and trusted platform 48 Working environment 50 Positively impact our communities 53 ESG KPIs 56 TCFD Statement 64 Engaging with stakeholders 68 Chief Financial Offi cer’s Review 79 ERM and Principal Risks 87 Viability Statement 88 Chairman’s Governance Overview 89 Board of Directors 92 Governance framework 98 Board Activities during 2023 101 People & Governance Committee Report 104 Audit Committee Report 110 Sustainability & Compliance Committee Report 113 Directors’ Remuneration Report 138 Directors’ Report 141 Independent Auditor’s Report 160 Consolidated income statement 161 Consolidated statement of comprehensive income 162 Consolidated balance sheet 163 Consolidated statement of changes in equity 164 Consolidated statement of cash flows 165 Notes to the consolidated financial statements 215 Company income statement 216 Company balance sheet 217 Company statement of changes in equity 218 Notes to the Company financial statements 223 Glossary 224 Shareholder information 225 Corporate information 1. Represents NGR from 100% of BetMGM. 2. Underlying EBITDA is earnings before interest, tax, depreciation and amortisation, share based payments and share of JV income. EBITDA is stated pre-separately disclosed items. Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() At Entain, we’re on a mission to provide our customers around the world with the most entertaining experiences, supported by market leading player protection across betting & gaming. Entain plc Annual Report 2023 01Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### We are Entain Betting and gaming is in our DNA. It’s the purple thread that drives our evolution, our people, and our purpose. We’re the brands our players hold in their hands – and heart. #### Our values This year, we powered up our people with a new set of values and behaviours. These new values form the cornerstones of our culture, unlock the highest performance of our teams and lay the foundations for creating incredible experiences for our customers. Our new values mean we’re all looking towards the same future. At Entain, we: Do What’s Right We put our cus tomers first and play a leading part in protecting our players. We are creating a work environment where everyone can be themselves, and act with integrity all the time. To do what’s right we must keep ourselves honest so our people should never be afraid to speak out if something feels wrong. Keep it Simple We make things easy for our customers by focusing on them and their needs. We’re clear on our goals and who’s accountable for what, so we all know what success looks like. We remove complexity wherever we find it, because we all perform better that way. Go Beyond We stay curious. We need to learn from our successes AND from setbacks to push forward. We surround ourselves with the best people and we put in the effort needed to turn ambitions into reality. We embrace change because that’s when progress happens. Win Together We have a shared vision for Entain. We collaborate, break down barriers and share ideas for the greater good. We never forget that we’re on the same side, so we treat everyone the way we want to be treated. We’re inspired by our teammates. We celebrate their success, because when they win, we all win together. We only operate in regulated or regulating betting and gaming markets, which means we’re focused on delivering asecure and trusted betting and gaming business for ourstakeholders.Now,weoperateinover 30 markets, with leadership positions in the five larges t regulated markets and two fastest growing – US and Brazil. And, through our global scale and household names, we’re focused on leveraging our skills, talent and capabilities to elevate our technology and data insights to create product s and ex periences like noother. #### Entain, today. Global & Diversified portfolio Leadership positions Customer Focused High Quality Revenue & Growth Largest sports betting & gaming platform Leading Responsible Operator 130+ 130 licences across >40 territories 40 Territories worldwide 42 Currencies accepted 33 Languages offered K W c a G W l e f W W W W b g 02 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() 30+ Leading brands Our commitment to sustainability This year, we introduced our new Sustainability strategy. A strategy that makes a real positive impact in the communities in which we work and play, one that builds trust with wider society, and ensures we are a leader in player protection. We’re continuously building on insights and have refreshed our strategy across four pillars that encapsulat the sustainability issues that are most important to Entain, our customers, investors and partners: Be a leader in player protection: Player safety is a fundamental building block of our business and we are proud to play a leading role across our markets. Provide a secure and trusted platform: We lead on integrity in everything that we do. From having the highest ethical standards, to only operating in regulated or regulating markets, to having an aim of gold standard data protection, and cybersecurity. Create the environment for everyone to do their best work: We attract a broad and diverse audience from the inside out. Positively impact our communities: We play our role in limiting global warming to no more than 1.5°C and we create a positive impact on our communities. Read more about our sustainability strategy and commitments in 2023 here. Our commitment to the customer 1. Customers are the focus of everything we do. 2. Our purpose is to provide them with the most entertaining customer experience supported by market- leading player protection. 3. We will offer them exciting and trusted sports betting and gaming products and services. 4. Listen to and respond to customer needs. 5. Using our technology platform, we will continuously innovate to introduce new products and create a personalised and localised experience for each of our customers. Online 71% Retail 29% Other – 2023 NGR Split Online 75% Retail 25% Other – 2023 Underlying EBITDA Split 1 Online sports wagers £13.7bn -3% 2022: £14.1bn Retail sports wagers £4.3bn +12% 2022: £3.9bn #### Our commitmentto the gameOur divisions 1. New opportunities and Corporate are excluded as they are negative. #### Our leading brands 03Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements We are Entain ![]() 2017 2019 2020 #### Our timeline of transformation Corporate activity –February – GVC admitted to LSE Main Market 2016 July 2018 – Created BetMGM, 50/50 Joint Venture with MGM Resort February 2016 – GVC acquisition of bwin.party 2018 Leadership changes – February – Barry Gibson appointed Group’s Non- executive Chairman. – July – Shay Segev appointed as CEO, succeeding Kenneth Alexander. Corporate activity – November – new corporate strategy announced – project Sunrise re 100% regulated markets) December 2020 – GVC Holdings renamed Entain plc Business alignment to 100% regulated marketsGrowth through transformative acquisitions March 2018 – GVC and Ladbrokes Coral Group completed, creating one of the largest listed online gaming businesses in the world 04 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() 2021 2022 202 1 2 0 August 2022 – formation of Entain CEE (venture with EMMA Capital, to create a strategic platform across CEE) December 2023 – secured DPA to conclude HMRC investigation into legacy business November 2023 – new evolved 3-year plan: organic growth, margin expansion and US market share. Leadership changes – January – Jette Nygaard- Andersen appointed as CEO M&A activity – March – acquisition of Enlabs (Baltics) – March – acquisition of Bet. pt (Portugal) – July – acquired remaining 49% of Crystalbet – September – acquisition of unikrn (esports and skill- based wagering) M&A activity – January – acquisition of Klondaika (Latvia) – February – acquisition of Avid Gaming/Sports Interaction (Canada) – March – acquired Totolotek (Poland) – November – acquisition of SuperSport (Croatia) Leadership changes – December – Jette Nygaard-Andersen resigns as CEO. Stella David becomes Interim CEO M&A activity – January – acquisition of BetCity (Netherlands) – March – announced partnership with TAB NZ – June – announced 365 Scores acquisition – August – completed acquisition of STS – October – completed acquisition of Angstrom Sports Corporate activity – January – accelerated exits from unregulated market – June – equity raise Evolved strategy 2023 05Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Investment proposition Entain is a leading consumer-focused business operating in the global betting and gaming industry which enjoys attractive dynamics and structural market growth. Our strong local brands supported by in-house technology and operational capabilities, enable leading positions in regulated markets. Execution of our focused strategic objectives of organic growth, margin expansion and US market share, will deliver sustainable long term value for our stakeholders. #### Operates in large and #### growing markets #### Diversified #### regulated operator Attractive global industry dynamics Structural market drivers High-single-digit % growth across our markets Portfolio optimised for growth and ROI 100% regulated or regulating markets Diversified by geography, product & customer Strong brands underpin leading market positions Read more: pages 18-19 Read more: page 26-37 06 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Focused execution of #### strategic targets Superior #### financial #### returns Execution plan #### Increased localisation driving engagement & #### retention #### Disciplined capital allocation #### A leader in player protection #### Target revenue growth ahead of our markets #### Operational leverage supports #### margin expansion #### Strong operating cash flow & balance sheet #### Progressive dividend policy Read more: pages 23-25 Read more: pages 68-77 Online NGR +12%(CC) Dividend +17.8p 2022: 17p BetMGM NGR +36% Entain is a differentiated customer-focused business operating in a global industry with attractive growth dynamics. We are the most diversified, leader of scale in our sector, with superior growth embedded across our business, delivering profitable and sustainable returns for our stakeholders. 07Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Investment proposition ![]() #### Chairman’s introduction #### J M Barry Gibson #### Chairman Entain plc Annual Report 202308 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() our positive contribution to corporate social responsibility. Financial performance During 2023, we delivered Total Group revenue growth of 14%, with Group Net Gaming Revenue (NGR), excluding our 50% share in BetMGM, growing 11%. However, this was down 2% on a proforma basis reflecting the operational and regulatory challenges the organic business faced. We delivered EBITDA of just over £1bn, despite sacrificing profits as we re-shaped the business to focus on regulated markets. Our balance sheet is robust and while leverage is above levels we would ideally like over the longer term, our balance sheet and available cash is healthy. As a result, we are continuing with our progressive dividend with a payment of approximately £113m for the year. Deferred Prosecution agreement December’s Deferred Prosecution Agreement with the Crown Prosecution Service was important in drawing a much- needed line under legacy GVC issues. Confronting these challenges was never going to be easy, but we can be proud of the positives – particularly the recognition of Entain’s extensive co-operation, the “wholesale changes” within our business and above all, the acknowledgement that “the company in its current form is effectively a different entity”. Those welcome comments on Entain and our transformation reflect our commitment to operate only in markets that are regulated or have a clear pathway to regulation. We are proud We’ve made significant strategic progress; lessons have been learned on operational implementation and we draw to a close a period overshadowed by the behaviours of a different era. Entain can now look forward confidently as a global operator with a clear and sustainable strategy, supported by the hard work and commitment of our 31,000 colleagues. This year the business has: Delivered Total Group revenue growth of 14%, including our 50% share of BetMGM Finalised a £585m Deferred Prosecution Agreement (DPA) to conclude the HMRC investigation into activities by the company’s legacy Turkish-facing business, which was sold in 2017. Accelerated our exit from unregulated markets, delivering our commitment to only operate in regulated markets. Expanded into new regulated markets, in particular Poland and New Zealand, whilst withdrawing from less attractive opportunities. Refined our operational strategy to streamline the business, grow revenues and improve margins, as well as invest behind our US business to drive market share gains. Refocused our leadership under our Interim Chief Executive, Stella David, and added new expertise to our Board. Led by example in our commitment to safer gambling and player protection and won recognition for  as a period of necessary, but ultimately positive, transition for Entain. We strengthened our revenue base, enhanced our Board, and delivered a satisfactory resolution to our previous regulatory issues. 09Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chairman’s introduction ![]() Geographically, we embedded our footprint in Central and Eastern Europe in 2023 with Entain CEE’s acquisition of STS, the leading sports-betting operator in Poland. Following our acquisition of SuperSport in Croatia during 2022, STS further consolidates our position across the region, with a regulated betting market which is expected to continue to grow rapidly in the years ahead. Similarly, our 25-year partnership with TAB NZ, secured Entain’s position as the sole licensed operator with access to the very attractive New Zealand market. We also enhanced our technology and product capabilities in the US market with the acquisition of Angstrom Sports, which will provide an unrivalled experience for our customers in the U.S., the most important and fast-growing new regulated market in the world. Additionally, bringing 365scores, one of the world’s leading scores and sports media companies into our group, supports our ambitions of improving the customer experience and broadening our pathways to growing our customer audiences. Driving operational focus In our rapidly consolidating global industry, acquisitions have been important in cementing the strategy of our business and securing leading positions in attractive regulated markets. As we look forward, in November we revised our strategic targets, outlining our plans to drive organic growth expand our EBITDA margins to 28% by 2028 and deliver on our market share ambitions in the US. We cannot be complacent and must recognise that we have to deliver operational excellence on time, every time and our management are focused on delivering a stronger performance in the coming year. Looking forward we have many opportunities to improve our performance. Most importantly we must better leverage the benefits of our scale whilst being agile to fine tune our offering to customers and to respond to changing markets. In the US we’re more excited than ever about the prospects for BetMGM and are working with our partners in MGM to drive our market share to at least 20%. The recent introduction of a new single wallet capability, new apps and games are just the beginning of improvements we have been working hard to deliver and they are already demonstrating great improvements for our customers. of that commitment to deliver higher quality and more sustainable revenues in the future despite forgoing around £100 million of EBITDA from those 140 + unregulated markets that we have now exited. In our industry we must embrace regulation, it’s the right thing for our customers and it’s the right thing for our stakeholders. Good regulation, properly implemented and well enforced, is good for our business. It improves visibility and stability of earnings, and means that the most credible, respected and responsible operators can engage with customers. We work constructively with industry bodies and regulators around the globe to ensure that wherever we can we influence the development and implementation of better regulation and its application. We are continuing to cooperate fully with AUSTRAC in relation to their investigation into our Australian business, which commenced in September 2022 and remains ongoing. Over time the wider benefits of regulation will far outweigh the short-term financial cost of market exits. I’m confident that because of our strategic decisions, we are now firmly on the right road to deliver the enhanced value our shareholders and other stakeholders deserve and expect. Strategic focus on regulated growth markets Having gone through a period of re-focusing our portfolio, we are now the most diversified operator of scale in our sector working exclusively in regulated or regulating markets. While M&A activity will be much slower going forward as our focus shifts to organic growth, we made some key strategic transactions for the business in 2023. 10 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chairman’s introduction ![]() Our newly formed capital allocation committee has begun reviewing Entain’s markets with the goal of maximizing shareholder value of the portfolio. This will help the company to effectively manage its balance sheet as well as be in a position to make further investments in growth opportunities. Fresh perspectives and leadership I’d like to thank Jette Nygaard-Andersen for her hard work leading the business for nearly three years. Having taken the reins amid the Covid pandemic, she set in place the foundations of our regulated markets strategy, executing our portfolio re-shaping and leading significant acquisitions as well as enhancing our management team. Jette offered leadership at a time of great change and challenge for our business. The conclusion of the HMRC investigation through the DPA and our revised strategy provided a natural transition point. The Board was pleased to be able to call on Stella David to take on the Chief Executive Officer role on an interim basis. Stella knows the business extremely well and as an experienced leader with a strong track record across many fields, she is well placed to drive operational delivery while we seek a permanent Chief Executive Officer – a process that is well advanced. Alongside refreshed leadership, we have also brought fresh experience to the wider board. We welcomed Amanda Brown as a new Non-Executive Director and Remuneration Committee member in November. Amanda brings extensive commercial and Human resource experience to us. In January 2024 Ricky Sandler, the Chief Executive of our shareholder Eminence Capital, was also appointed to our Board and to our new Capital Allocation Committee. Ricky knows our business extremely well and his focus will be on generating value for all shareholders. Nobody has a monopoly on wisdom and as Chairman I believe Entain will benefi t from the fresh perspectives and constructive challenge that both Ricky and Amanda bring. We anticipate further Non-Executive Director appointments over the coming weeks and recognise that we need to re- balance the board’s gender balance following recent changes. Pierre Bouchut has also become our Senior Independent Director and Virginia McDowell has been appointed as Chair of the Remuneration Committee. I am chairing the People and Governance Committee together with our new Capital Allocation Committee, which has a clear mandate to ensure a disciplined return on investment from the markets and products we choose to prioritise. Importantly it underlines our firm commitment to deliver shareholder value. Safer gambling and community engagement Even though Entain has seen much transition as a business this year, player protection remains vital. We continue to ensure we provide an environment that is as safe as possible for our customers. We care about our customers, and we want them to enjoy their experience, which is why we developed our Advanced Responsibility and Care programme to provide an invisible safety net. ARC has already delivered 1m proactive interactions, and protected 400k unique customers from harmful play. Amidst all the change, another thing that will never falter is our commitment to investment in people and making a positive contribution to the communities in which we operate, such as through our Entain Foundation. The Entain Team Suffice to say any business as complex and geographically spread as ours has to rely on a committed team of highly talented individuals. During this last year we have benefited from over 30,000 people working every day to deliver better service and results. On behalf of the Board, I would like to thank each and every one of our colleagues for the hard work, loyalty and enthusiasm they have shown. Note 1. Underlying EBITDA is earnings before interest, tax, depreciation and amortisation, share based payments and share of JV income. EBITDA is stated pre- separately disclosed items. #### We must better #### leverage the benefits of #### our scale whilst being agile to fine tune our #### offering to customers and to respond to #### changing markets.” 11Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chairman’s introduction ![]() #### Chief Executive’s Review #### Stella David #### Interim Chief Executive Officer 12 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements 12 Entain plc Annual Report 2023 ![]() Dear Shareholder Entain is a leading sports betting and gaming business, operating in a global industry with attractive dynamics and structural growth. We are  only operating in regulated or regulating markets. Our strong brands, leading market positions and increasingly localised offering are supported by in-house technology and product capabilities. The Group’s strategy is focused on delivering the most entertaining customer experience supported by market-leading player protection to deliver quality growth and sustainable returns for our shareholders. While 2023 presented many challenges and our performance in some of our markets was behind our expectations, overall we made good strategic progress. We re-shaped our geographic footprint enabling us to focus on leadership positions in regulated or regulating markets, broadened our customer engagement and continued to implement leading player safety measures. We also secured a conclusion to a material overhanging legacy issue. Reflecting the significant progress made in re-focusing our business, in November 2023 we revised our strategic ambitions, focusing on key objectives and priorities for the next three years that will drive shareholder value. One of these changes has been leadership. I have been on Entain’s board as Senior Independent Director since March 2021 and was honoured to accept the role of Interim CEO. Although my appointment is on an interim basis, the business will not be treading water. We have clear targets to deliver. I will focus on driving the execution of our revised strategic priorities until the appointment of a new, permanent, CEO. Performance in 2023 During 2023, we achieved total revenue growth of 14%, including our 50% share in BetMGM, in spite of operational and regulatory challenges. We expanded into the regulated markets of Croatia, Poland and New Zealand as well as adding to our capabilities with the acquisitions of 365Scores and Angstrom. Entain’s operations now span over 30regulated or regulating territories, with established brands supporting leading positions in many of our markets. Regulation remains an over-arching factor in our industry and for the Group’s performance. Clear regulatory frameworks that are appropriate and well enforced, are positive for us and our customers. However, in the short term, they can createheadwinds as significant changesare put in place and uneven implementation can occur ahead of consistent enforcement. During 2023, we managed regulatory change in a number of our larger markets, impacting headline organic performance. The most notable being our implementation of ever-tightening UK affordability measures and the persistent lack of impactful regulatory oversight in Germany. We estimate the aggregate of regulatory impacts was a negative 6ppt headwind to Online NGR performance in 2023. As a result, proforma 3 organic Online NGR 13Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Executive’s Review ![]() was down 3%cc 2 versus the prior year, whilst proforma 3 Retail NGR grew 2%cc 2 . Total Group NGR, including our 50% share of BetMGM was up 14% and up 2%cc 2 on a proforma 3 basis. We also continued to improve the sustainability of our business, ensuring more diversified, sustainable and ultimately higher quality earnings. We achieved another record level of active customers, with proforma 3 actives +10%, demonstrating the underlying strength in our core business as well as our broadening, more recreational customer base. In the UK, Online NGR was down 6%, reflecting the ongoing digestion of regulatory changes. We estimate that we experienced a headwind of approximately c10ppt to our Online NGR growth. Unfortunately, this drag did not ease during H2 as we expected due to the imposition of further affordability measures. The iterative imposition of cumulative safer gambling measures throughout 2023 has resulted in overly complex journeys for our customers. We continue to believe that restrictions should be personal and appropriate for each customer, however, we must ensure the experience for our customers is smooth. In the short term we expect that the measures currently in place will continue to weigh on performance. However, we are encouraged that our industry and regulator are working together to agree a pragmatic framework for customer safer gambling checks. If implemented, as currently anticipated, these will provide a clear and consistent approach to player protection for customers across all operators in the UK. Our focus remains firmly on acquisition and retention of customers to grow market share. In 2023 we grew UK online actives by +18% driven by continued customer engagement with exciting marketing campaigns, new product releases and wider offering enhancements. UK Retail NGR was up +2% on a LFL 4 basis with a good performance in both sports and gaming across both machines and OTC. Our strong performance is underpinned by our market leading retail offering reaching a broader demographic of customers supported by exclusive and in-house content coupled with digital in- shop experiences. Our business in Italy continues to perform well, with online NGR up +3%cc 2 versus 2022. The underlying market growth remains strong and omni-channel operators continue to outperform. Despite increased competitive activity, Eurobet, bwin and GiocoDigitale grew actives +13% by leveraging our omni- channel proposition, brand strength and ongoing investment in our products. Retail NGR was up +16%cc 2 and the retail shop network remains invaluable to our omni-channel offering, with combined Online and Retail NGR +63%cc 2 versus pre-Covid levels. Combined Online NGR in Australia and New Zealand was up 11%cc 2 , although down -5%cc 2 on a proforma 3 basis. In Australia, whilst we experienced a softer market along with increased competition, our Ladbrokes and Neds brands continue to deliver unique content and engaging products. Entain Australia’s partnership with TAB NZ also provides a broader differentiated experience for sports betting customers in New Zealand as well as Australia, and we look forward to customers in New Zealand enjoying an enhanced experience as our offer migrates to Entain Australia’s technology platform in 2024. Our NGR in Brazil was down 14%cc 2 year on year reflecting our disappointing operational execution in early 2023. We installed a new management team, taking swift action to realign customer acquisition channels, payment processing and product engagement, and are pleased to be seeing positive signs from the impact of these actions taken. As the Brazilian sports betting and gaming regulation progresses towards licencing during 2024 the market will remain intensely competitive. However, we remain excited for our Brazilian business and believe we are well positioned in this fast growing regulated market. Sportingbet remains a strong brand and we are focused on rebuilding market share growth, leveraging an improved app experience, product innovation, as well as our 14 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Executive’s Review ![]() 365Scores acquisition supporting growth going forward. Entain’s CEE business continues to perform strongly, maintaining its market leadership with the SuperSport brand in Croatia and expanding our presence across the CEE region with the acquisition of STS Holdings in Poland. Proforma 3 NGR was up 13%cc 2 for Online and 4%cc 2 for Retail on a constant currency basis. SuperSport proforma 3 Online NGR grew 29%cc2 benefitting from its leading omni- channel offering and its first to market cashout offering, whilst STS Online NGR was flat year on year, reflecting its sports only offering impacted by customer friendly sporting results in October offsetting prior growth. Our Crystalbet brand remains the market leader in Georgia and continues to perform well. Online NGR grew +7%cc 2 , refl ecting the strength of our operations and brand, and sees us well positioned as the market digests increases in online gaming taxes and licence costs in 2024. Enlabs continues to perform well, with profoma NGR +3%cc 2 despite some markets in the Baltics and Nordics experiencing more challenging economic environments. Enlabs delivered +13% growth in active customers supported by localised offering of sports and gaming products. In Germany, we continue to see the impact of new regulatory measures alongside limited regulatory enforcement. Despite some unregulated operator exits during 2023, the uneven operating landscape remains a significant challenge to licenced operators adhering to regulation. Our Online NGR for Germany declined year on year. However, our bwin brand continues to be strong and we remain positive on the German market’s long-term prospects, but regulatory enforcement is critical. During 2023, we added further capabilities to evolve our offering and customer engagement further. Our acquisitions of 365Scores and Angstrom Sports enable us to expand our content, data and analytical capabilities, and ultimately enhance our customer’s experience. 365Scores is one of the world’s leading sports apps providing highly engaged sports fans real time action and results. Its access, content and data insights are a key part of how we are reinvigorating our offering in Brazil and addressing this exciting regulating growth opportunity. Arguably the most signifi cant for our business, particularly for the US opportunity and BetMGM’s performance, was our acquisition of Angstrom Sports. Angstrom will provide next generation sports modelling, forecasting and data analytics. BetMGM is already seeing benefi ts from offering customers more betting markets and more accurate pricing. With this addition, Entain will become the only global operator with a full in- house suite of end-to-end analytics, risk and pricing capabilities for US sports betting products. We are excited to build on BetMGM’s momentum and successes during 2023. Its performance inline with targets and achievement of H2 EBITDA profitability validates our business model and sees BetMGM in position to be self funded going forward. BetMGM is established as one of the leaders in the fast-growing, highly competitive US sports betting and iGaming market. In 2023, BetMGM continued delivering good growth, with NGR up 36% to $1.96 billion and achieved profitability over the latter three quarters of the year. Our products are available in 28 markets with a combined market share of 14%5 in sports betting and iGaming across the US. #### Aligned with our #### strategy, 2023 saw delivery of #### growth coupled with #### sustainability, ensuring #### more diversified, sustainable and #### ultimately higher #### quality earnings.” 15Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Executive’s Review ![]() operational leverage we can expand our EBITDA margins over time, creating better returns for our shareholders. US Market Growth – Our focus to drive our US performance remains a key strategic priority. BetMGM is established as one of the leaders in this fast growing highly competitive industry. Much of this success is underpinned by Entain technology and product capabilities, which have been significantly strengthened for our US proposition. Entain’s acquisition of Angstrom further accelerates this, particularly for our parlay and in-play products with Same Game Parlay (“SGP”), SGP+ and new LIVE SGP pricing models. Our strategic roadmap for 2024 sees BetMGM invest behind this strengthening and differentiated offering. BetMGM’s Big Game commercial campaign, as well as partnership with X, demonstrate the drive behind the brand to accelerate player acquisition and retention. BetMGM is the only top three operator with a licenced mobile app live in Nevada. This advantage will be amplified when BetMGM’s single account single wallet functionality receives licence approval in Nevada. Working closely with our co-parent, BetMGM will be able to unlock the power of MGM Resorts unique omni-channel advantages leveraging the Las Vegas visitor footfall as well as tentpole events for a deep and replenishing pool of players. We remain committed to empowering BetMGM as it continues to progress towards delivering c$500m of EBITDA in 2026. Drive Organic Growth – We are rebalancing our portfolio to prioritise growth and returns, exiting smaller markets where the timeframe for suitable returns is too long, such as Chile, Peru, Zambia and Kenya. In addition, we have closed our B2C operations of Unikrn and are focusing on delivering the Unikrn eSports offer through our existing sports betting and gaming brands. We are refocusing our operational execution on customer acquisition and retention, by reinvigorating our acquisition channels and accelerating technology and product delivery. In two of our markets, UK & Brazil we see signifi cant opportunities to drive value through our commercial excellence programme, including, simplified and streamlined customer journeys, more effective marketing, improved app experience and products, especially in sports betting. Player protection remains embedded in our ambition to deliver the best experience for customers, however, our approach must evolve along with our offering, ensuring it is localised and appropriate for each market. Margin Expansion – Having grown rapidly through M&A we now need to focus on simplifying our operations, removing duplication and enabling greater agility. Our efficiency programme, Project Romer, will not only improve ways of working for our teams, but will also unlock efficiencies through operational streamlining, functional integration and restructuring, as well as deliver net cost savings of £70m by 2025. Coupled with maximising our BetMGM also made fantastic progress against key strategic initiatives, solidifying the foundations for 2024 and beyond. As well as delivering substantial enhancements to our app features, design and speed, the seamless execution of SASW functionality across 21 states was the most significant upgrade to BetMGM’s customer experience. BetMGM players can now travel across these states, betting with the same account credentials and wallet. We have already seen improved retention KPIs, a 5x increase in new state bettors who had previously played with BetMGM in a different state, with multi- state customers now representing over 20% NGR. Together with our partner, MGM Resorts International, we look forward to unlocking this powerful differentiator for BetMGM customers in Nevada, with state regulator’s approval of our SASW functionality expected during 2024. Revised strategic priorities The Group has been transformed over the last four years since becoming Entain, delivering an improved sustainable business only operating in regulated or regulating markets. In November 2023 we updated our corporate strategy, focusing on three strategic objectives to deliver value for our shareholders as the next phase of our transformation: Drive organic growth Expand online margins Empower growth in US 16 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Executive’s Review ![]() Positively impact our communities – We were proud to be the fi rst betting and gaming company to formally commit to a Net Zero target for carbon emissions with the Science-based Targets Initiative (SBTi). This reflects our ambition to lead the industry on decarbonisation, along with our commitment to reduce our absolute scope 1 and 2 (market-based) and material Scope 3 emissions by 42% by 2027 and 60% by 2030, from a 2020 base year. In 2023, our Net Zero Action Group developed our first net-zero strategy to help us achieve these ambitions. We also want to make a positive impact on our communities through the charitable work of the Entain Foundation. Our flagship Pitching In programme in the UK pioneers engagement between semi-professional football and local communities. Our funding of the Trident Community Foundation has helped to deliver over 100 initiatives to improve the lives of thousands of people across the country. Last year we also continued to partner with a range of charities, such as bringing access to technology with community-based technology hubs in partnership with ComputerAid as well as delivering support to under privileged communities in the US with the Charles Oakley Foundation. Notes 1. Awarded; EGR North America Socially Responsible Operator 2023, SBC Global and SBC LATAM Socially Responsible Operator of the Year, and Vixio Global Regulatory Award for Outstanding Contribution to Safer Gambling. 2. Growth on a constant currency basis is calculated by translating both current and prior year performance at the 2023 exchange rates. 3. Proforma references include all 2022 and 2023 acquisitions as if they had been part of the Group since 1 January 2022. 4. UK Retail LFL YoY NGR is calculated based on shops that traded for the full year in both 2023 and 2022 5. Market share for last three months ending November 2023 by GGR, including only US markets where BetMGM was active; internal estimates used where operator-specific results are unavailable. At the start of 2024 we updated our regulatory and safer gaming charter based around four principles: Only operate in regulated markets or in markets with a clear path to regulating Committed to a constructive and progressive relationship with regulators Always comply with in-market regulation Take a market leading approach to player protection in each market we operate, developing and using tools to identify & limit customer harm Provide a secure and trusted platform – We operate in a highly regulated sector where the highest ethical standards are critical in maintaining trust with our customers and wider society – from gold standard data protection, keeping crime out of betting and gaming, to eliminating poor working conditions in our supplier base. Through this strategy, our expectations of ourselves is to exceed these standards. We have a comprehensive training programme for all our colleagues across the Group and I am delighted with the completion rates. Governance oversight from the Board is key to ensuring robust execution and accountability across the business. Further details on these processes are set out in our Governance report on page 96. Create an environment for everyone to do their best work – Ensuring we are able to attract a broad and diverse pool of the best talent is vital for our success. We aim to be an employer of choice with an inclusive and supportive culture, where talents from all backgrounds can flourish. Our Diversity, Equity and Inclusion (DE&I) strategy is built on establishing strong networks and having launched the Women@Entain and Pride@Entain groups in 2022, in 2023 we launched Black Professionals@ Entain, a new network designed to create a culture where black colleagues can thrive professionally and personally. As a technology based employer, we also recognise the importance of encouraging women to succeed in the sector. In 2023, Entain partnered with the McLaren F1 team on a returnship programme, providing unique opportunities for skilled women to resume their STEM careers. Over six months, 10 career returners worked at both Entain and McLaren in roles ranging from Data Analysts to Software Developers. The programme received accolades, including the Innovator of the Year at the Women in Gaming Diversity Awards. Sustainability – A key enabler supporting our growth In November 2023, we unveiled a refreshed sustainability charter. This updated charter was informed by a double materiality assessment we conducted throughout H1 2023, which identified how sustainability- related issues impact our business and how we impact the environment in which we operate. Our charter’s four pillar structure encapsulates the sustainability issues that are most important to Entain, our customers and partners: Be a leader in player protection Provide a secure and trusted platform Create an environment for everyone to do their best work Positively impact our communities A leader in player protection – Our objective is to be a leader in player protection. In 2023, our safer gaming programme ARC™ (“Advanced Responsibility and Care”) was rolled out across 22 jurisdictions alongside the continuing optimisation of ARC™ features. This saw a significant increase in the volume of interactions and interventions with customers, with 6.1 million ARC™ interactions in 2023, up 121% versus 2022. In recognition of these efforts, during 2023 Entain won a number of responsible operator awards 1 including EGR, SBC and Vixio. #### Our new sustainability #### charter reiterates the importance of #### sustainability as an #### enabler to our overall #### corporate strategy.” 17Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Executive’s Review ![]() 2012 £23.0bn 2011 £ 20.0bn 2013 £25.0bn 2014 £28.0bn 2015 £31.0bn 2016 £35.0bn 2017 £40.0bn 2018 £46.0bn 2019 £53.0bn #### The industry in which we operate Source: H2GC (25/01/2024) – Global Online GGR (including offshore). Global Online Growth Entain’s Retail operations are in the UK, Italy, Belgium, Republic of Ireland (ROI), New Zealand and Croatia. The UK Retail market was estimated to be worth £7.2bn in 2023, an increase of 6% versus 2022, as operator investment in gaming cabinets and self-service betting terminals has broadened engagement with products such as in-play now being available through SBBI. The UK Retail market is highly consolidated, with four operators accounting for over 85% of all betting shops. Entain is the leading operator in UK Retail, with over 2000 stores across the Ladbrokes and Coral brand covering 96% of all postcodes in the UK. The Italian Retail sports betting market is estimated to be worth £1.2bn in 2023, up from £1.1bn in 2022. Entain operates via the Eurobet brand as the 3rd largest operator in the market for over the counter sports betting in Italy. The Republic of Ireland and Belgium Retail markets are smaller, estimated to have been worth £1.0bn and £0.9bn respectively in 2023. Entain operates in Belgium and ROI via the Ladbrokes brand and is the largest operator in Belgium and third largest in ROI. A new market for Entain, Croatia, is relatively small, valued at £0.4bn in 2023, however the shops serve an important bridge for customers between the offline (retail) and online experience. In 2023 Entain gained a Retail presence in New Zealand, as part of the exclusive 25YR partnership signed with the New Zealand government, through which Entain is responsible for operating TAB NZ, the only operator with an Online and Offline licence in the country. 2023e Landbased Gambling Total Market Size – £bn Betting Casino Machines Bingo Lottery UK 7.2 18% 1 2% 38% 3% 29% Italy 15.1 8% 1% 53% 2% 36% ROI 1.0 38% 5% 27% 4% 27% Belgium 0.9 14% 12% 20% 15% 38% New Zealand 1.2 7% 28% 47% 0% 18% Croatia 0.4 21% 13% 53% 0% 12% H2GC (25/01/2024) – Landbased GGR Entain’s Online Markets Geographically, in 2023 Core markets represented 67% of the total Online betting and gaming Market that Entain operated in. The largest individual countries being the UK (c15%), Italy (c8%) and Australia (c6%). In 2023, the UK market grew 10%, with growth unevenly distributed amongst operators, reflecting the timing of implementation of affordability changes by operators. The Italian online market grew 13%, as it continued to benefit from the Offline to Online transition. The Australian market shrank 3%, due to tightening market conditions combined with the lapping of a very strong 2022, which had benefited from a lagged Covid effect. Growth markets accounted for 33% of the Total Online Market for Entain in 2023, the majority of which was USA (21%) and Brazil (5%). The USA grew 43% versus 2022, driven largely by growth of existing states, as well as the annualization of 2022 state launches. Brazil grew 31%, driven in part by an increasing awareness of Online gambling ahead of legislation aimed at creating a licenced regime which is expected to take effect in 2024 following Government approval at the end of 2023. Global Online Growth Entain only operates in regulated or regulating markets. The total global online gaming market, which also includes unregulated markets, was estimated to be worth c£107bn in 2023. Over the past twelve years the market grew at 13% CAGR and growth from 2022 to 2023 was 15%, in part driven by same state betting and gaming growth in US States. Entain’s markets Entain’s Online portfolio is categorised into Growth & Core markets, Core markets are forecast to grow at 6% CAGR 2023-2026 and Growth markets at 17% on an Entain- weighted basis. The next largest market is the unregulated Asia market which represents 26% of the global total, followed by regions that are part regulated, part unregulated including North America (18%), Oceania (7%), Latin America (3%), and Africa (2%). Excluding Asia, Entain has online operations in countries in these regions. #### Retail Online Entain plc Annual Report 2023Entain plc Annual Report 202318 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() 2021 £84.0bn 2023 £ 107.0bn 2022 £95.0bn 2020 £67.0bn Share of Global online market by region Oceania 6% Latam 8% Core 67% Growth 33% N America 21% N America 7% UK 15% Europe 38% Oceania 1% Europe 2% Africa 1% Entain’s markets Core markets (£bn) Growth markets (£bn) 2021 2022 2023 2024 2025 2026 2028 2027 26 26 29 31 33 36 41 38 8 10 14 16 19 22 31 26 2021 2022 2023 2024 2025 2026 2028 2027 Source: Regulus Partners, Online NGR 11% Online gaming is forecast to grow 11% CAGR between 2021 and 2027, with the US growing at 23%. 2027 Forecast Entain plc Annual Report 2023 19Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements The industry in which we operate ![]() P l a y e r p r o t e c t i o n #### Industry #### leading #### products #### Market #### leading #### protection O n l i n e #### SPORTS #### BETTING #### GAMING #### We provide sports betting and gaming offerings to #### customers through both #### Online and Retail channels #### We offer our customers #### engaging and entertaining #### experiences supported by #### market-leading player protection #### Engaging #### customer #### experience #### How we #### create value R e t a i l 20 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Customers #### Customer satisfaction 78% Positive experience #### Safer betting & Gaming 8.7m Customer interactions in 2023 #### Our people #### Employee Engagement 77% Actively engaged #### Wellbeing 83% Manager’s care about employee wellbeing #### Communities #### Entain Foundation £100m Committed over 5 years #### Net Zero by 2035 Throughout all operations #### Investors #### 2023 EBITDA £1bn #### Revenue from regulated 100% and regulating markets #### Marketing #### Excellence #### Product #### & Content #### CRM and Data Proprietary #### Technology #### Leading Player #### Protection We create value for all our stakeholders: #### We deliver on our #### strategy and create #### value by leveraging a #### unique set of capabilities… People and #### Talent #### Regulatory #### Expertise #### Global Scaleand Brands 21Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements How we create value ![]() #### How we #### create value #### We deliver on our strategy and create value by #### leveraging a unique set of capabilities. #### Marketing #### Excellence #### We have unparalleled customer #### insight that we use to engage our audiences with new experiences, media content and marketing to attract a broader demographic of #### recreational players. Read more: pages 34 to 37 #### Product & Content #### Our award-winning in-house #### development studios enable #### us to create exclusive content #### and innovate to provide our #### customers with a richer, more #### engaging experience. Read more: pages 26 to 33 #### Proprietary #### Technology #### By owning and operating our own #### technology we can be more flexible #### and adaptable, keeping us ahead #### of the competition and enabling us to expand into new markets, #### provide great products and lead #### on responsibility. Read more: pages 27 to 29 #### CRM and Data Our customer CRM capabilities and #### player analytics enable a powerful #### data-led approach to marketing Read more: pages 14 to 16 #### People and Talent #### Our people are our number one asset and our ability to attract and #### retain the best minds both within and beyond the industry is key to #### our success. Read more: pages 46 to 47 #### Regulatory #### Expertise As the world’s only global operator #### operating exclusively in regulated #### and regulating markets we have #### unparalleled experience of working #### with regulators coupled with an uncompromising approach to #### player safety. Read more: pages 38 to 39 #### Leading Player #### Protection #### We provide best-in-class customer #### protection through innovative features, customer support, #### communications and our culture. Read more: pages 44 to 45 #### Global Scale #### and Brands We offer over 30 leading brands, #### some dating back more than 135 #### years, offering customers a great #### trusted offer Read more: pages 2 to 3 22 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202322 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Our strategic #### framework Before a refresh in November 2023, Entain’s strategy was based on the two pillars of growth and sustainability. Achieved On target Not achieved Key: 2023 priorities KPIs #### Growth #### 1 Leadership in #### North America Established Top 3 operator with 14% share of Sports Betting & iGaming market in US and Ontario NGR $1.95bn, +36% YoY growth 28 live markets with 49% adult population; 4 new launches; Ohio, Massachusetts, Puerto Rico, Kentucky Successful delivery of Single Account Single Wallet functionality across 27 states Significant digital sports offering improvements; app speed, user experience, broader bet offering iGaming strength supported by new games & product enhancements – 33 exclusive new game launches by our in- house studios (Read more on page 27) Acquisition of Angstrom Sports (Read more on page 29) Global Online market 107bn Group NGR £4.8bn Online NGR £3.4bn Underlying EBITDA £1.0bn #### 2 Grow presence #### in core markets Online Actives +10%, FTDs +7% Online NGR growth on a compound annual basis over the last four years of 12% 3 Expanding into #### new markets Entered Netherlands (BetCity completion Jan-23), Poland through acquisition of STS, and New Zealand through 25yr partnership with TAB NZ 4 Extend into #### interactive #### entertainment Pivoted eSports strategy, Unikrn no longer B2C brand, now supporting eSports offering for our other brands. #### Sustainability #### 5 Lead on #### Responsibility Rolled our ARC™ across 27 jurisdictions, including real-time models in 23 jurisdictions. ARC™ for retail now live across UK and ROI 98% completion rate of annual compliance, safer gambling, and AML training Contributed 1% of our GGY in the UK to Research, Education and Treatment (RET), totalling £18.7m £20.8m Contribution to safer betting and gaming initiatives 83% Employee satisfaction with approach to wellbeing 2035 Target set for carbon Net Zero throughout operations £100m Commitment to Entain Foundation over five years #### 6 Diversify our #### regulated #### activities 100% of revenues from regulated or regulating markets since February 2023 #### 7 Broaden our #### customer appeal F2P Coral Racing Club – (Read more on page 30) Ladbrokes Live – (Read more on page 33) F1 – (Read more on page 37) #### 8 Invest in our #### people & #### communities Entain’s Returnship programme with McLaren Racing receiving accolades at the Women in Gaming Diversity Awards and the Personal Today Awards 250+ aspiring champions received SportsAid financial award since 2019, to cover the costs of training, equipment, and travel. 250 non-league football clubs supported via Pitching In since 2020, reaching their communities Launch of Black Professionals@Entain network 2023 progress 23Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]()  corporate strategy. These refocused objectives recognise the progress achieved by the business, whilst acknowledging there is still further transformation needed to maximise the opportunities ahead. We have set clear targets and initiatives to deliver value for our stakeholders. Ensuring focused execution in driving Organic Growth, Margin Expansion and US market share growth. The world leader in betting, gaming and interactive entertainment To deliver the most entertaining customer experience supportive by market leading player protection Priorities Enablers KPIs 2023 progress +7% Online organic NGR growth in-line with market (from 2025, Ex-US) Ongoing optimisation of market portfolio to maximise growth and ROI Implemented Comprehensive commercial and operational excellence program in key markets Build on capabilities and innovate our sports product >28-30% >28% for 2026 30% BY 2028 Online EBITDA margin (Ex-US) Launched Project Romer to create a more agile organisation and drive gross cost efficiencies of c£100M 20-25% 20-25% market share Capitalise on new product and pricing capabilities, and omnichannel Delivery of Single Account, Single Wallet functionality in 27 markets Enhancement of in-house content and capabilities through acquisition of Angstrom #### People and culture #### Technology and product #### Governance #### Organic #### growth Grow presence in existing markets, synergistic adjacencies #### Margin #### expansion Drive margin expansion through scale and operational leverage #### US market #### growth Empower profitable growth and share gains in the US Purpose Vision 24 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202324 1Overview 8 Strategic report 88 Governance 140 Financial statements Strategic framework ![]() Risks Links to Remuneration Principal risks 1 2 3 4 5 6 7 8 9 10 Read more: pages 83 to 86 Executive annual bonuses are linked to Operating Profit, Online NGR growth and safer betting and gaming targets and customer metrics. Safer betting and gaming metric and customer satisfaction metrics implemented for 2023 bonus schemes. Principal risks 1 2 3 4 5 6 7 8 9 10 Read more: pages 83 to 86 Principal risks 1 2 3 4 5 7 8 10 Read more: pages 83 to 86 #### Sports betting #### and gaming #### courses through #### our DNA. It’s the #### purple thread that steers our evolution, #### guides our people #### and shapes our purpose. 25Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements 25Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements Strategic framework ![]() ## our technology ## and product Entain today, is underpinned by incredible talent, in-house technology and leading product capability. We have hundreds of always-on sports data and game supplier integrations, which we bring to life as easy to play games  way. With the largest RMG platform in our industry and a sportsbook powering approximately 1.8K matchers per day, we’re evolving our strong in-house technology,   ## Shaping the game: Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202326 ![]() Our award-winning in-house gaming studios have continued to go from strength to strength in powering our brands globally and providing our customers with exclusive gaming experiences. From branded BetMGM  non-traditional tap games, our in– house team has now delivered over 300 titles to our retail and digital brands. Demonstrating that our customers love our products, one of our original 2023 games, Pig Banker, saw over double the revenue of an average in-house new game within 60 days of launch. Pig Banker was so popular with our customers, that it trotted to the top 3 games worldwide, including number 1 in the UK, Brazilian, and Canadian markets. And to top things off, the follow up release, “Pig Banker: Three Little Piggies” proved to be an immediate player hit by taking the top spot for spins per player to  Our in-house gaming team also had cause for celebration in 2023, launching  game “Pot O’ Fortune: Golden Tap”, which reached the top spot for GGR for game release of its type when compared to third party releases. #### In-house gaming at Entain +26% 2023 In House Studios GGR increased by 26% vs 2022  all live products across all 3 studios) +28% Active players on in-house games across non US  vs 2022 +18% Average spins per active also increased by 18% vs 2022 showing players are engaging more with our in-house products 14 In-house studios saw GGR growth across 14 European   33 new in-house games launched in the US 2023 #### The milestones #### reached and quality #### delivered this year #### are a testament #### to the unrivalled creativity and hard- #### work of our people #### in our in-house #### game studios. We’re proud of the way we develop, #### construct, and bring #### to life the exclusive #### gaming experience #### for our customers #### across our brands.” Ciara Nic Liam Gaming Director Continued on next page Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements 27Entain plc Annual Report 2023 ![]() When it comes to in-house technology at Entain, our trading team are right at the heart of it. Our in-house trading platform is powered by our own propriety technology, which turns millions of real-time data points into odds for our customers. Every kick, goal, overtake and point scored is integrated from multiple data feeds and turned into a betting opportunity for players worldwide. What makes our in-house tech so fundamental to our transformation is the strength of its core. With it, we’re set up to be able to tweak, adapt and localise the peripherals of our platform to suit the needs of our players, all over the world. #### The technology that powers our in-house #### trading platform 28 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Betstation brings a market #### leading digital experience #### to our players which is a cut #### above the rest.” Introducing Angstrom: #### next generation sports #### betting #### Our Retail technology #### -Major milestones hit #### for our digital in-shop #### experience Last October, we completed the acquisition of the newest member of the Entain Group, Angstrom. Angstrom Sports’ unrivalled sports modelling, forecasting and data analytics provision simulates predictive modelling, in order to create highly sophisticated pricing and forecasting capabilities. In short, it will be a game changer for our in-house trading technology. Angstrom will enable BetMGM to provide endless moments of excitement for fans in the US, with the most accurate lines in the industry. The acquisition secures Entain as the only global operator which will have a full in-house suite of end-to-end analytics, risk and pricing capabilities for US Sports betting products. We hit a milestone moment last November, as Group BetStation went live in our 1000th shop in the UK & Ireland Retail Estate.   players that’s a cut above the rest. Our in-house developed software gives customers the freedom to place their bets in  power to place in-play bets on sports around the world. 29Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() With over 30 brands, across 40 markets, we’re able to provide entertaining experiences to customers all over the world. But it’s not just through our core product offering that our customers engage with us. At Entain, we go beyond the game to enhance the sports betting and gaming experience for our players – beyond a bet, scroll or tap.  customers closer to the action than ever before following the launch of the free-to-join Coral Racing Club. The club provides a unique opportunity for racing  a racehorse owner through unmissable content, priceless opportunities, exclusive offers and much more. Now over 160,000 members strong, the  It has created thousands of unforgettable memories with its stable of 10 racehorses, including over 1,000 raceday tickets won by members, 37 unique ‘owner for the day’ experiences created and in excess of £40,000 being shared in prize money. For many years Coral has demonstrated a deep passion for, and commitment to, British Racing,  expanded our sponsorship portfolio to become the leading bookmaker sponsor in the UK. And now, with the Coral Racing Club, Coral is doing more than any betting operator has done before to grow the appeal of racing and promote the sport.” Simon Clare Director of PR Continued on next page #### A year of Coral Racing Club Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202330 ![]() ## Beyond the game: ## customer ## experiences 1Overview 8 Strategic report 88 Governance 140 Financial statements 31Entain plc Annual Report 2023 ![]() ### Elevating the social betting ### experience with STS and Eurobet STS’s new brand campaign, Kocham   the last few months in the form of a new ecosystem designed to inspire customers. It incorporates a new smart  experience and empowers customers.   #### partnership extension #### Eurobet’s ReadyBet Empowered by a seamless digital experience across various devices, Eurobet’s Readybet effortlessly  Readybets, generated weekly through inputs from retail shop managers, the trading room, marketing teams, and even digital and retail customers,  betting experience. Offering a curated selection of “wise” picks from reputable and successful sources, the Readybet platform fosters a sense of community by turning customers and betting shops into interactive “tipsters.” Enhanced with dedicated promotions and challenges, this approach bridges the gap between conventional sports betting and a social experience, creating a vibrant marketplace accumulator bets. Last year, our joint venture BetMGM continued to offer fans unforgettable entertainment built around the game they love, with a multi-year extension of their  League (NHL ® ). #### ‘Players Bet’ is built #### around the trusted #### community of STS #### players who draw #### inspiration from each #### other’s bets, including bets shared by the #### best players with a #### proven track record #### of effectiveness. #### Over 2 million bets #### have been copied in #### 2023 indicating that #### players actively seek #### bets from trusted sources. The fact that #### 51% of copied bets #### are turning into real bets, shows the  of this feature and #### the power dormant #### in the community. Through team-branded casino games,  slot game, Gold Blitz, VIP fan experiences, and sponsored branding in national broadcasts, players will experience the   Collection, Wild Multiplier Free Spins, and  teams and the league’s iconic shield. It’s through these exciting activations that BetMGM will continue to deliver new ways  sport they love.  space on the STS site that allows players to copy bets shared by other players, check out success rates of other betters, duplicate their bets and chat with each other on a forum fostering a sense of community amongst customers. STS is the only operator in Poland offering this free, community-driven feature, reinforcing our commitment to a smart and socially connected betting future. 32 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]()  ### dreams on Europe´s big stage The launch of  Last year we embarked on an exciting new era for Ladbrokes, connecting thousands of fans with free events through the Ladbrokes LIVE platform. In The O2, AEG Presents, and NME, we’re working with three of the biggest and most iconic brands in the entertainment industry and this means we will be able to reward our audiences with the chance to attend some of the most exciting live shows in Britain for free.” Kelly Rose   furthered its ambition to provide customers with excitement beyond   entertainment platform that rewards thousands of fans with free access to the UK’s best live music, comedy and sports events, powered by exciting  partnerships with The O2, AEG  The unique collaboration between Ladbrokes and NME has also seen the return of the iconic Club NME nights with a series of dates across the UK featuring incredible headline talent and unmissable DJ sets. Fans have been able to win free access to Club NME nights through the Ladbrokes LIVE platform. With over 135,000 plays and hundreds of tickets already won in 2023, we are giving reasons for consumers to engage with us again and again in, everyday play. Besides bringing pure entertainment and joy to the football fans and uniting players from across Europe, bwin and other Entain brands were able to generate unrivalled brand presence across the continent during the 22/23 season, with branding visible at 80% of all matches across 56 countries; 20% of this being Responsible Gambling messaging.  we’ll be there for every shot, pass and tackle to make the third season an even better one for our customers.” Gemma Bell,  For the past two seasons (21/22 & 22/23) bwin has delivered the ultimate football experience by giving fans the opportunity to play in ‘the bwin Fans Final’ in the UEFA Europa League Final Stadium.  Arena, the day after the UEFA Europa League Final in Budapest.  UEFA Europa League and UEFA Europa Conference League, bwin laid out the red carpet in Budapest for 40 customers who witnessed the UEFA Europa League epic between Roma and Sevilla unfold, before taking to the turf of the Puskas Arena the next day. Customers were treated to pre- match training sessions, personalised kits and the opportunity to lift a customised trophy just like the Sevilla players did a few hours prior. Joined by legends Esteban Cambiasso and Luis García, the bwin Fans Final saw dreams brought to life for our players. An intimate lunch with the ambassadors and the nomination of the Player of the Match rounded the experience into an unforgettable event with one of the winners stating: “These days I will never forget, the memories will live with me forever. It was the best football trip ever, a dream came true, what a privilege to have been part of it.” 33Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() ## Championing the game: ## Advertising 34 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements1Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202334 ![]() All of our brands have their own unique identity – from the striking blue of Coral to the playful orange of Foxy Bingo. It’s our heritage and brand recognition that has built up such trust with our customers, and it’s through this trust that we’ve been able to push boundaries with iconic advertising, activations and campaigns. Last year saw Foxy Bingo’s ‘Get Your Fox On’ ATL campaign level-up with  Salon and The Celebrity Swap Shop. Continued on next page Opened by Geordie Queen, Vicky Pattison, Dirtie Gertie’s Mullet-only Salon in Newcastle offered consumers free mullet haircuts, foxy nails and games of  of pedicabs and iconic parts of the centre were turned purple and orange with incredible out-of-house advertisement, with over 2 million impacts. In total, the campaign gained a 1.1 billion reach via media coverage, gave 94 dodgy haircuts and engaged whole new community of Foxy fans. #### Get Your Fox On with #### Foxy’s Celebrity Swap #### Shop & Mullet Salon 35Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements1 Overview 8 Strategic report 88 Governance 140 Financial statements 35Entain plc Annual Report 2023 ![]() #### Gala’s Jolly Good #### Fish and Chip hotel #### Eurobet.Live with #### Luca Toni Gala Bingo continued to build community spirit amongst   iconic bingo call 33, Gala’s ‘The Jolly Good Fish & Chip Hotel’ gave British seaside goers the chance to enter Gala Land and  as games of bingo. The activation built on Gala’s ‘Where A Little Joy Goes A Long  last summer With over 800 consumers attending the prototype hotel and 314 million people reached via earned social media coverage, it’s safe to say customers experienced the brand in a whole new way, combining the classic charm of the Great British seaside with the wonder and joy of Gala Land. Eurobet.live elevated the football experience for fans across  Cup winner, Luca Toni, as it’s presenter. The campaign seamlessly integrated the excitement of live scoring with the thrill of the matches themselves, providing viewers with real-time updates, insights and analysis, detailed statistics and engaging multimedia content. Eurobet.live not only celebrated the passion and excitement of football, but also underlined its commitment to providing fans with a comprehensive and immersive platform to stay connected to the game they love. Eurobet.Live has also strengthened it’s connection with fans, through prestigious partnerships with several Serie A teams, including the iconic Juventus as well as a partnership with the entire Serie C league. #### These strategic alliances #### served as a powerful bond #### between the Eurobet.live #### brand and football fans #### on the ground, solidifying #### its position as the premier platform for live scoring, #### results, and multimedia #### content in Italy.” Alexis Grigoriadis Marketing Director, Italy Get Your Fox On with Foxy’s Celebrity Swap Shop & Mullet Salon continued In the wake of Foxy’s new laundrette theme ads, the team brought the screen to life up north with The Celebrity Swap  where locals swapped drab for fab and get their hands on a celebrity item. 17 celebrities donated items to the laundrette, and in total, 23 bags of clothes were donated to charity. Foxy consumers took to the laundrette to experience the brand’s new and engaging identity and with free Bingo sessions on site. The brand saw a 17% increase in betting players from the activation. 36 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]()   and our joint venture, BetMGM, left    From exclusive grandstand hospitality to the excitement of experiencing incredible entertainment within touching distance of the track in their retail shops, BetMGM bolstered the anticipation of placing bets on the race with awesome experiences throughout the GP weekend. The team also pulled off some incredible activations with McLaren Racing; from BetMGM’s logo being centre stage on the car to a series of marquee and On-property digital placements, BetMGM certainly gave F1 superfans an experience to never forget. The spectacle received 3X the number of bets compared to any other F1 event in the company’s history. The Las Vegas GP certainly shattered records for the King of Sportsbooks.      yearling for two separate races, as well as an  Classic. This year, TAB became the naming rights sponsor for the meeting, and with three $1m  TAB wanted to do something different to attract attention of customers. A few days before the meeting, Entain Australia and NZ took over the second tallest freestanding structure in the southern hemisphere, Auckland’s Sky Tower, and projected the barrier draw for the three main races onto it. Watched on by trainers, owners and horse racing fanatics, the incredible display revealing which horse starts where, set the scene for a weekend that ended up smashing records for TAB’s horse racing history. The six-race meeting saw a 26.6% increase in turnover compared to the highest wagered meeting    of the day set a record for the most wagered race in New Zealand, with Year-on year-turnover for the TAB Karaka Millions up 66%.  Known for its massive audiences, thrilling action, much-anticipated commercials,   huge opportunity for BetMGM to be at the centre of the action, having the world’s  To maximize this opportunity, Entain launched its new Nevada app with access to BetMGM’s full sportsbook offering, weeks before the Super Bowl, giving the best BetMGM experience to the NFL fans in Nevada for this landmark event. Then, BetMGM set out to do what so many other brands struggle to do in this domain, carve out a memorable Big Game commercial that perfectly complements and establishes a connection with the brand.  its three-part campaign which featured the never-before-seen pairing of sports legends, Tom Brady and Wayne Gretzky, along with actor Vince Vaughn, marking an iconic moment for BetMGM. The BetMGM team didn’t stop there. In addition to the advertisement, BetMGM executed a multi-faceted approach to “Win Las Vegas” for Super Bowl week. Alongside extraordinary VIP experiences with celebrity ambassadors, BetMGM painted Las Vegas gold and black with a variety of outdoor, indoor, digital and special advertising campaigns that greeted fans from the moment they get off the plane.  with X in a one-of-a-kind collaboration to  platform, starting with the Super Bowl and continuing through 2025. Regardless of who was the Super Bowl champion, BetMGM came out a winner. The new platform was able to handle a 30% uplift in activity over the Super Bowl weekend and a 72% increase in customers from the 2023 Big Game, thanks to the incredible efforts and collaboration between the Entain, BetMGM and MGM teams. #### Smashing #### records under the neon lights of  37Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Regulatory #### update Unlike slots and poker, casino table games are regulated on a state-by-state basis. The states may either create a monopoly or issue as many licences as the state has land-based casinos. By the end of 2023,  North Rhine- Westphalia had opted for a licensing system. To date, only Schleswig-  process, but the group has opted not to apply for a licence for commercial reasons. In North Rhine-Westphalia, details on the tendering process were expected to be published in 2023 but due to various delays, the details are now expected in Q1 2024. Entain looks forward to participating in this process. Germany  now been operational in Germany for over a year. Encouragingly, the GGL has been more proactive in issuing sanctions against unlicensed operators, but we still see room  continuously working with the regulator and state governments to push for more effective enforcement against illegal operators and in 2023 worked jointly with the University of Leipzig and the local online casino association to produce a study investigating the scale of the issue. While the Group was granted three slots and two poker licences in November 2022 and the Group´s sports betting licences were also extended for another 5 years in late 2022, the restrictive environment in Germany continues to prove challenging. The process for managing playing limits for slots, poker and sports betting remains one of the most pertinent regulatory challenges for licensed operators. There is also mounting political pressure for stricter sports betting advertising  Interstate Treaty is set to be published soon. The UK The UK Government published its White Paper of the 2005 Gambling Act Review in April 2023. As expected, this document included consultations on a number of areas, including online slots staking limits;  levy for research, education and treatment; additional requirements on game design and direct marketing as well as the creation of an Ombudsman. We continue to engage government actively in this process, both directly and via our trade body. We have continued to develop and enhance our Advanced Responsibility and Care™   risk, as well as targeted interventions and interactions. Whilst many of the changes within the White Paper can be achieved via secondary legislation, we are collaborating with the other major operators to voluntarily progress initiatives such as a single view of the customer and the creation of an Ombudsman. Gaming is a truly global market and in 2023 the Group held licences in over 30 jurisdictions across the world. The Group is committed to only operating in regulated or regulating markets and as from February 2023, 100% of the Group’s  viable regulation of the betting and gaming sector is in everyone’s interests. It provides stability for operators, important taxation streams for governments and – most importantly – provides the consumer with proper protections and safeguards by ensuring that only responsible providers operate in the market. 38 Entain plc Annual Report 2023 1Overview 8 Strategic report 88 Governance 140 Financial statements ![]() Africa In late 2023, Entain decided to withdraw from the regulated markets of Zambia and Kenya but the Group remains committed to  in South Africa, where it has been present for a number of years. US The sports betting regulatory activity continues at pace in the United States. Kentucky, North Carolina and Vermont are amongst the US states that have regulated in 2023. Rhode Island has been added to the list of US iGaming states. Finally, additional states have adopted, or are in the process of adopting, modernised forms of responsible gambling regulation; a trend Entain welcomes with an eye on the long- term sustainability of the US market. Bearing in mind that over 35 US states have already allowed for sports betting in one form or another, the Group remains of the view that in the coming years some 40 or even 45 US states will have regulated sports-betting, which will provide BetMGM with even broader market access across the country. The number of states that permit online casino is also expected to grow in the years to come – for example the state of New York as already announced its intention to attempt iGaming regulation in 2024. LATAM In Latin America, Brazil adopted a law that allows for domestic licensing of sports betting and online casino in late 2023. The law will be implanted throughout  market expected to launch at some point in Q3 2024.The regulation will extend to all online gambling verticals, including sports betting and gaming, and will allow for an open licensing system subject to payment of betting and other taxes and fees. Furthermore, the Group has launched licensed operations in Mexico under its bwin brand. There was better news in France where we have seen nascent discussions about the possible legalisation of online casino, while in Croatia the Government completed a regulatory review and is now looking to bolster its efforts to tackle the illegal market. At the end of 2023, Entain only operated in two markets in Europe where it is not yet locally regulated. Despite our best efforts in Austria, there have been no changes to the status quo and the Government has no imminent plans to initiate the reforms it announced in March 2021. Nevertheless, we will continue to push for regulatory reforms. Encouragingly, in Finland the  process of dismantling the monopoly in favour of a licensing system that we expect to come into force sometime in 2026. Australia A parliamentary inquiry issued a report in 2023 calling for a ban on gambling advertising as part of a 31-point plan to reform the Australian gambling market. It also proposed various other measures including the establishment of a single national regulator and a formal duty of care. We expect the Government to come forward with its response to the report and  Elsewhere, the National Self-Exclusion Register BetStop launched in August, while a ban on credit card betting was adopted in December 2023 and will come into effect in mid-2024. Canada The Ontario online betting and gaming market became regulated on 4 April 2022,  Province to issue domestic licenses for private operators. Entain operates in Ontario through its bwin and Party brands as well as Sports Interaction, a Canadian brand the Group acquired in February 2022. Going forward, other Canadian Provinces such as Alberta and British Colombia are expected to introduce regulation. Other Europe In 2023, wide-reaching advertising restrictions were introduced in Belgium, while a pending parliamentary bill and a draft Royal Decree could impose further restrictions on local operators in 2024. Fortunately, the sector was successful in blocking a proposal to introduce an additional 5% tax which would have had a detrimental impact on licenced operators and encouraged customers to move to black market operators and therefore reduce player protections. In the Netherlands, Entain completed the acquisition of BetCity in January 2023. National elections took place in November and we await the formation of a new coalition government which could lead to change in direction for gambling policy. We are also expecting the Dutch authorities to come forward with new proposals on playing limits, AML and duty of care requirements which are likely to come into effect in 2024 and impose stricter compliance requirements on operators . The headline gambling tax rate also increased by 1% to 30.5% from 1st January 2024. In Italy, the Government published a new framework law in 2023 laying the foundations for potentially wide-reaching sectoral reforms to be enacted in 2024 and beyond, including an overhaul of the current gambling licence tender procedure which will increase licensing costs and impose stricter regulatory requirements on operators. In Spain, the government has moved oversight of gambling to a newly- formed Ministry, while plans to introduce a system of cross-operator limits remain on the medium-term agenda. In Ireland we are still awaiting the enactment of the pending Gambling Regulation Bill that will introduce a formal regulatory and licensing regime for online gambling. In  a draft law has been published to amend the Gaming Act, including the introduction of a B2B licence regime to take effect from 2025. In 2023, we have seen tax increases announced in several of the markets where we operate. The Prime Minister of Georgia announced plans to increase taxes for online gaming from 10% to 15% GGR, and player winnings withholding taxes from 2% to 5%, effective from 1 January 2024. The Swedish government has announced its intention to increase the rate of gaming tax from 18% to 22% with effect from 1 July 2024, while the Latvian Government plans to increase online gambling tax from 10% to 12% GGR from January 2024. 39Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Regulatory update ![]() #### At Entain, sustainability is a key enabler of our corporate strategy.   2023 was a pivotal year for sustainability at Entain as we unveiled our new Sustainability Strategy, building on our longstanding commitment to sustainability and taking it to the next level. With this new Strategy, we wanted to strengthen our sustainability leadership position as well as listen to our stakeholders and respond to the changing Environmental, Social, and Governance (“ESG”) landscape. We conducted a double materiality assessment to help us understand our unique sustainability-related risks and opportunities, as well as our impacts on society and the environment. We conducted surveys and interviews, analysed industry reports, and held leadership workshops, gathering input from over 250 internal and external stakeholders from around our business, to understand how we can ensure we are supporting value creation to all stakeholders. These insights helped us develop a strategic framework that will focus our sustainability actions in the coming years. Our new approach, which is presented on the next page, is structured across four pillars that encapsulate those ESG issues that are most important to Entain, our customers, investors, and partners: Be a leader in player protection Provide a secure and trusted platform Create the environment for everyone to do their best work Positively impact our communities  report extensive progress across each of these strategic pillars. We invite you to discover our achievements on the following pages, which include: Rolling out our player protection programme ARC TM in our digital offer to cover 27 jurisdictions and launching ARC TM for retail in the UK and the Republic of Ireland. 100% of our revenues coming from regulated or regulating markets since February 2023. Winning Innovator of the Year at the Women in Gaming Diversity Awards for our Returnship programme with McLaren Racing. Partnering with EcoVadis, the world’s largest platform for supplier sustainability ratings, and onboarding 35% of in-scope vendors and supporting them to improve their sustainability performance. Looking at 2024, we will remain sharply focused on delivering our new strategy and  role that underpins our long-term growth. #### Sustainability at Entain 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202340 ![]() #### Entain’s Sustainability Strategy At Entain, we see sustainability as a key enabler of our corporate strategy and growth. We embrace our role within society with the strongly held belief that the most sustainable business in our industry will be the most successful.   assigned Board-level oversight, summarised below. You can read more details about how we developed the strategy using the results of our 2023 double materiality exercise here. What it means Aligned material clusters Focus areas Oversight Be a leader in player protection We provide industry- leading customer protection through innovative features, customer support, communications and our culture. Safer betting and gaming Ethical & compliant behaviour Innovation Industry-leading tailored customer protection tools and processes Empower our people to support and protect our customers Harm prevention through education and responsible communications Promote research and share evidence- based learnings with the industry Sustainability & Compliance Committee Provide a secure and trusted platform We lead on integrity in everything that we do. From having the highest ethical standards, to only operating in regulated markets, with an aim of gold standard data protection, and cybersecurity. Ethical & compliant behaviour Data privacy and cybersecurity Corporate Governance Only operate in regulated markets Ethics and integrity at the core of our organisation and culture Provide industry- leading cybersecurity, data privacy and AI governance Clear and robust governance processes for each of our key ESG areas Sustainability & Compliance Committee Create the environment for everyone to do their best work We are an employer of choice, and we build an inclusive and supportive culture where talents from all backgrounds can thrive. Diversity, equity and inclusion Having the right people Attract, engage and retain the best, most diverse talent Provide the right growth opportunities for all Build a sense of belonging for all Entainers People & Governance Committee Positively impact our communities We play our role in limiting global warming to no more than 1.5°C and we create a positive impact on our communities. Environmental Sustainability Corporate Governance Reduce our environmental impact Creating a sustainable value chain Promote grassroots, women’s and disability sports Support communities where we operate Sustainability & Compliance Committee Entain plc Annual Report 2023 41 1 Overview 8 Strategic report 88 Governance 140 Financial statements Sustainability ![]()  Climate governance Given the urgent need for action to address the climate emergency, we have stepped up our governance in this area. Our CEO is now responsible for our approach to climate change, and climate-related risks and opportunities. In addition, we have developed our Net Zero Action Group. The Net Zero Action Group reports to the ESG Steering Committee, which is a selection of leaders from around the business who are responsible for delivering and developing an organisation- wide approach to achieve our Net Zero ambitions. You can read more about how we manage our climate-related risks and opportunities in our TCFD Statement on pages 56 to 63.  In addition to the ESG Steering Group and the Net Zero Action Group, we have formed groups that report to the ESG Steering Group that focus on delivering our  additional expertise and insights from the business. Steering groups include groups focused on Anti-modern Slavery and Human Rights, Safer Betting and Gaming, Anti-Money Laundering, and Diversity & Inclusion. Board Committee Oversight In May 2023, Entain restructured its Board oversight of ESG issues to better manage the increasing workload of the prior ESG Committee and further embed sustainability across the Group. The newly created Sustainability and Compliance Committee was created to take on the bulk of the responsibilities of the former ESG Committee. The Sustainability and Compliance Committee has oversight for safer betting and gaming, regulatory compliance, anti-money laundering and  & corruption, human rights (including our approach to addressing modern slavery risks), health and safety, environmental impact (including the evolution of our strategy and processes in response to the Taskforce for Climate-related Financial Disclosures), data protection and charitable donations, including the work of the Group’s Entain Foundation. Chaired by Virginia McDowell, one of our Non-Executive Directors, the Committee has three members and guides the business on all aspects of ESG strategy, sets targets and monitors our performance. The second newly created Committee, the People and Governance Committee, took on the responsibilities of the previous Nomination Committee and added responsibility for oversight of the Group’s approach to Diversity, Equity and Inclusion and other people-related functions such as engagement and culture and employee wellbeing. The ESG Steering Group The ESG Steering Group, which meets monthly, consists of functional leaders from across the business, including Sustainability, Investor Relations, Human Resources, Corporate Affairs, Legal, Health, Safety & Security, Operations, People and Communications. Convened by our Group Head of Sustainability and chaired by our  Group oversees the implementation of our sustainability strategy. #### Delivering our #### Sustainability Strategy #### starts with robust governance. As our ambitions grow, and best practice evolves, we continue to expand our processes. ” Entain plc Annual Report 202342 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() Strategy Board Delivery Coordination Oversight ESG Steering Group Operating Units and Central Functions Operational teams People and Governance Committee People and Governance Committee Sustainability and Compliance Committee People and Governance Committee Anti-Money Laundering and Counter-terrorism Financing Anti-Bribery and Corruption Health and Safety Environmental Impact Modern Slavery and Human Rights Privacy and Data Protection Net Zero Action Group Regulatory Compliance Safer Betting and Gaming Talent and capability Diversity, Equality and Inclusion Employee engagement Employee well-being Our performance across ESG Rating Agencies We are proud to be a sector leader amongst many of the leading independent ESG rating providers. The below table summarises our performance and improvement over time. We will continue to work tirelessly to further improve our ESG practices and performance, with the aim of further improving the standards for our industry and in these external assessments. Rating Evaluation Score (31 December 2023) Score (31 December 2022) Industry Rank MSCI ESG Score AA 7.2 6.7 N/A Sustainalytics ESG Risk Rating Low 19.6 (a lower score shows a lower risk) 22.3 13/87 in the Casinos & Gaming industry ISS ESG ESG Score C 49 47 1 st decile S&P Global ESG Score S&P Yearbook and DJSI Europe constituent 60 67 95th percentile FTSE4Good ESG Score Inclusion in FTSE4Good Index 3.8<> 3.8 93 rd percentile CDP Climate Management B B N/A ESG Governance Structure Entain plc Annual Report 2023 43 1 Overview 8 Strategic report 88 Governance 140 Financial statements Sustainability ![]()   Material issues Safer betting and gaming Ethical and compliant behaviour Innovation Oversight Sustainability & Compliance Committee Advanced Responsibility and Care™ (“ARC TM ”): Our leading tailored customer protection tool Our recent materiality assessment found that safer betting and gaming is our most material ESG issue, and ARC™ is our  – providing a technology-led approach to player protection through real-time and individually tailored detection, interaction and interventions with players that are potentially at risk. Given its importance to Entain and our customers, the roll-out and effectiveness of ARC™ is linked to through our Group Bonus Scheme, which includes our executive team. The details of how we incentivise the delivery of player protection is outlined further in the Remuneration Report on p131. This year, ARC™ continued to mature in the UK and expand globally. By the end of 2023, ARC™ is now live across our core international markets (except Brazil). Our safer betting and gaming programmes in our retail estate in the Republic of Ireland and the UK are also supported by ARC™. This provides our customer facing retail colleagues with data-driven insights to help them spot and address risky play in our shops. We continue to monitor the effectiveness of ARC™, the results of which are reviewed by the Executive Committee and Sustainability and Compliance Committee quarterly. Empowering our people We continue to deeply embed safer gaming into the culture of our company. At the end of 2023, 98% of our colleagues were up to date with their mandatory annual safer betting and gaming training. This training provides all colleagues with the essential understanding of our approach to, and compliance requirements on, safer betting and gaming. However, we also understand  key responsibilities for player protection. Focus area 2023 Highlights Best-in-class tailored customer protection tools and processes Rolled our ARC™ to cover 27 jurisdictions (2022: 22), including real-time models in 23 jurisdictions ARC™ for retail now live across UK and ROI 7.5 million ARC™ interactions (+98% YoY) to 742,112 unique customers Empower our people to support and protect our customers 98% completion rate of annual compliance, safer gambling, and AML training Enhanced safer gaming training, delivered by EPIC Risk Management, delivered to all senior leaders Harm prevention through education and responsible communications Expanded our stakeholder education and training in the US, through our partnership with EPIC Risk Management and major leagues as well as players associations such as the Major League Baseball, National Football League, League Soccer Players Associations and the NHL Alumni Association 20% of TV advertising space and football sponsorship dedicated to safer betting and gaming communications or Foundation promotion Promote research and share evidence-based learnings Final year of partnership with Harvard Medical School’s Cambridge Health Alliance  research into Safer Betting and Gaming Contributed 1% of our GGY in the UK to Research, Education and Treatment (RET), totalling £18.7m Awards and accreditations: UK North America International GamCare Advanced Safer Gambling Standard Online: Advanced Level 2 (highest level) Retail: Advanced Level 2 EGR North America Awards 2023: Socially Responsible Operator SBC Global and SBC LATAM Socially Responsible Operator of the Year Vixio Global Regulatory Awards: Award for Outstanding Contribution  Entain plc Annual Report 202344 1 Overview 8 Strategic report 88 Governance 140 Financial statements Be a leader in Player Protection ![]() For these roles, we continue to roll out more  our senior leadership periodically undertakes in-depth training from EPIC Risk Management. Customer-facing roles who are responsible for engaging directly with our customers also receive in-depth training on identifying and interacting with customers who may be at higher risk of harmful play. We are also leveraging our partnership with Harvard Medical School’s Cambridge Health Alliance Division on Addition (“CHADA”) to support our training programmes. Since 2019, 16 of our safer betting and gaming training programmes have been reviewed by the team at CHADA  the latest research. Responsible marketing Responsible marketing is a core part of our commitment to promote responsible attitudes, and protect children, young persons and vulnerable individuals. We have a long history of leading the industry in this area, spearheading the UK whistle-to-whistle advertising ban,  sponsorship in UK football. Our commitment to responsible advertising and marketing is underpinned by our recently refreshed External Marketing Policy. This Policy outlines our responsible marketing principles. All relevant staff receive training on the policy. We also work closely with trade associations to strengthen best practice for our industry’s marketing and advertising. For example, we are a signatory of – and contributor to – the European Betting and Gaming Association’s (“EGBA”) Code of Conduct. Promoting research through our partnership with Harvard Medical School  research partnership with the Cambridge Division on Addiction, which has now produced 14 research papers since 2019. The outcomes of this research have been highly practical, underpinning our 26 markers of protection – the behavioural patterns found to indicate signs of risk that are used by ARC™. As this research is published, or is in the process of publication, this allows not just Entain but the whole industry to access the latest research. You can read more about this research programme in our 2023 Social Impact Report.     Interactions excellence: Interaction Excellence aims to promote insightful and valuable discussions with teams that deal with customers that are potentially the most at risk. The training focuses on strengthening soft skills that colleagues will draw upon during customer interactions. In 2023, this training was reviewed by the Harvard Medical School’s Division on Addiction, Cambridge Health Alliance. Moving forward we will also conduct in-depth training with leaders from around the business (aimed at our senior leadership team and Board Directors), to further integrate a culture of player protection right at the top of the organisation. This training will be run by EPIC Global Solutions and refresh the leadership training delivered in late 2022. Embedding safer betting and #### gaming into our culture As part of the 2023 Group Annual Bonus Plan, a mandatory training module was implemented on compliance, safer gambling and anti-money laundering, achieving a 98% completion rate. Our goal is to train all colleagues on the importance of player protection, preventing money laundering, and responsible marketing – with retail colleagues receiving a more tailored version of the content relevant to their role. We also know that some colleagues have unique responsibilities for their role – whether it be engaging directly with customers, designing new products, or leading teams or divisions. In 2023 we worked with EPIC Global Solutions to deliver in-depth masterclasses and face-to-face-training on safer betting and  roles. For example, our customer service and retail colleagues took part in sessions that equipped them with the skills to 1. Core countries are those that are using our core technology platform. ARC™ is embedded within this core technology, so in these countries we can use the full power of our markers of protection and interactions. 2. Risk is determined based on our Long-term Excessive Play (LTEP) model, which is one of our three primary ARC™ Markers of Protection models, which scores every user of the Entain Platform from 1 (low risk) to 100 (high risk) daily. LTEP is used for assessing risk due to identify underlying problem gambling behaviour over time. identify signs of harm and effectively interact with customers to advise on our suite of tools that may be used to help them. Key modules focused on: Introducing our retail teams to problem gambling to help them understand how gambling related harm can present itself and ensure that they are aware of how to protect our customers to limit the negative impacts of gambling. Between May and August 2023, 294 colleagues attended the EPIC Safer Gambling Awareness training. Affordability Interactions: This training provided our colleagues with guidance on the key steps they should take to ensure that customers are keeping their betting affordable, and the communication tools they can use to encourage safer gambling and manage  Entain plc Annual Report 2023 45 1 Overview 8 Strategic report 88 Governance 140 Financial statements Lead on player protection ![]() Ethics and integrity at the core  We are committed to conducting our business in line with the highest ethical standards. We heavily invest in governance, resources, and training to combat  of gambling. For Entain, this starts with playing an active role in safeguarding the values and integrity of sport. We want all sports events to be fair and played to the best of participants’ abilities. This is why we work closely with regulators and sports governing bodies to  corrupt betting activity. We are a member of the International Betting Integrity Association (IBIA) and the Sports Betting Integrity Forum (SBIF). In 2023, we continued to reinforce our Ethics & Compliance (“E&C”) function with new team members and stronger governance. We launched a new Ethics  clear accountability across the group and ensures that our E&C team has the required independence and authority to act as an effective second line of defence. We also launched a three-year E&C Strategy, which sets our action plan for achieving a best-in- class E&C programme. Only operate in regulated markets  commercially viable regulation of the betting and gaming sector is in everyone’s interests. It offers stability for operators, important taxation streams for governments and – most importantly – provides the consumer with proper protections and safeguards by ensuring that only responsible providers operate in the market. Since February 2023, 100% of our group’s revenue come from regulated or regulating markets. As of 31 December 2023, we held licences in 34 jurisdictions across the world.  markets where we can see a clear pathway to regulation that will enable us to obtain domestic licences in the next two years. These regulating markets are Brazil, Mexico, Peru, Austria and Finland. For more about this, please refer to our regulatory update on pages 38 to 39. We appointed a Group Money Laundering  Financial Crime (“AFC”), and we expanded our AFC team. After a period of growth and multiple acquisitions, we revised our organisational structure with all colleagues with AFC responsibility reporting to the central AFC Leadership Team. This new governance framework gives us better control and oversight across all our entities, subsidiaries, and joint ventures. We have also initiated an evaluation of our international subsidiaries to assess the maturity of local AFC programmes. This will conclude in 2024 with on-site visits and upskilling programmes tailored to the needs of our colleagues.    Material issues Ethical & compliant behaviour Data privacy and cybersecurity Corporate Governance Oversight Sustainability & Compliance Committee Focus area 2023 Highlights Only operate in regulated markets 100% of revenues from regulated or regulating markets since February 2023 Ethics and integrity at the core of our organisation and culture New Ethics & Compliance Charter and Strategy Average completion rate of 95% across Entain’s Big Four Compliance Training Modules Refreshed set of Entain Values, with “Do what’s right” at its core Provide industry-leading cybersecurity and data privacy Growing headcount in Data Privacy and Cybersecurity teams, by 25% and 35% respectively compared to 2022.     Clear and robust governance processes for each of our key ESG areas New ESG governance structure with two board-level committees (Sustainability & Compliance and People & Governance) Awards and accreditations: ISO 27001 2022 Information Security Management System Entain plc Annual Report 202346 1 Overview 8 Strategic report 88 Governance 140 Financial statements Provide a secure and trusted platform ![]() #### Doing what’s right Every colleague, including contractors and agency staff, must complete four compliance modules covering Entain’s Code of Conduct as well as ethical topics such as safer gambling, data privacy, or bribery and corruption prevention. As part of this, colleagues sign a declaration that they have understood the training and will comply with Entain’s Code of Conduct. Our 2023 Group Bonus was linked to achieving 85% completion for each module – an ambitious but achievable target given the turnover in certain parts of our business. This year, we achieved an average completion rate of 98% – up from 93% in 2022 and 82% in 2021. Big Four Learning Modules Completion Rate Code of Conduct 94% Compliance, Safer Gambling, and Anti-Money Laundering 98% Data Privacy 98% Cybersecurity 98% Provide industry-leading cybersecurity and data privacy Safeguarding our corporate and customer information remains a top priority for  growing headcount of our Data Privacy and Cybersecurity teams, which respectively increased by 25% and 35% in 2023. In 2023, we continued building our data privacy assurance function with dedicated resources to monitor the effectiveness of our privacy activities, keep risks under review, and update policies and procedures. We boosted privacy controls by introducing Effectiveness and Maturity Reviews of our most critical data processes. We also reinforced our risk management process with a new privacy risk register which feeds into Entain’s Enterprise Risk Management  additional 20 privacy risks in 2023. Throughout the year, we further embedded  Data Ethics Charter, which we launched  responsible use of AI and data-driven technologies. We collaborate across the business to embed Privacy by Design, building data privacy considerations directly into the development of our products and processes. We have also been preparing for emerging legislation  Intelligence Act. Working closely with our Data Sciences & AI (“DSAI”) colleagues, the Privacy team created a blueprint for Entain’s AI Governance Framework and developed a new AI policy which will be released in 2024. As cybercrimes continue rising globally, we are continuously improving our cybersecurity programme to protect our players from digital threats. In 2023, we introduce new security features in our products such as customer multi-factor authentication. We also reinforced our cyberattack detection processes by deploying machine-learning and AI- based systems which uncover patterns of malicious activity and block attacks before they can reach our customers. We managed to decrease the average  65% compared to 2022. As part of our commitment to best   standard for information security. As of 31 December 2023, 80% of our operations  ISO 27001. In 2024, we will continue  our 2023 acquisitions. Clear and robust governance processes for each of our key ESG areas In April 2023, Entain restructured its Board oversight of ESG issues to better manage the increasing workload of the prior ESG Committee and further embed sustainability across the Group. This new  importance of ESG topics for the group. You can read about our ESG governance structure on page 43.       Entain plc Annual Report 2023 47 1 Overview 8 Strategic report 88 Governance 140 Financial statements Provide a secure and trusted platform ![]() Focus area 2023 Highlights Attract, engage and retain the best, most diverse talent Launch of Black Professionals@Entain employee network  Entain ranking 5 in the 2023 All-In-Diversity Project Index Entain’s Returnship programme with McLaren Racing receiving accolades at the Women in Gaming Diversity Awards and the Personnel Today Awards Provide the right growth opportunities for all Launch of Your Goals, Entain’s new objective-setting programme Build a sense of belonging for all Entainers Launch of refreshed values and behaviours 94% of Entain Managers received mental health training through the Workplace of Tomorrow programme 400,000 employee interactions with Entain’s Well-Me events, activities, and content 9.1% utilisation rate for our Employee Assistance programme Awards and accreditations:    Material issues Diversity, equity and inclusion Having the right people Oversight People & Governance Committee On International Women’s Day 2023, we  policy. Our ambition was to help colleagues understand menopause-related issues and normalise talking about the symptoms. The policy came with a global awareness campaign and support for managers in having conversations around menopause. We built a virtual Menopause Hub with resources and bite-size training for those going through the menopause journey and for managers and teammates wanting information on how to best support women in the workplace. We are committed to positively impacting diversity not just within Entain, but across our industry. We partner with universities and charities to improve female representation within STEM careers. One example of this is our partnership with Girls Who Code, through which we have reached 10,680 young women since 2021. You can read more about our work to drive diversity in the tech sector in our 2023 Social Impact Report. In 2024, we will focus our efforts on further embedding DE&I within our Resourcing Strategy to increase representation in our hiring process. Our new recruitment and candidate management platform will provide us with better DE&I data on our Attract, engage and retain the best, most diverse talent Diversity, Equity and Inclusion (DE&I) are key to Entain’s future sustainability and success. Attracting and retaining key talent remains one of our Principal Risks as a tech business (see page 85), and workforce diversity plays an essential role in innovating, driving change, and delivering outstanding products and services for our customers. As part of our commitment to DE&I, we understand the importance of global employee networks in providing a safe space for colleagues with a shared identity or experience. Launched in 2022, the Women@ Entain and Pride@Entain groups continue to grow, with over 1200 and 250 members respectively. In 2023, Women@Entain piloted a new mentoring programme for women in our Product & Technology team, matching participants with senior mentors. We also launched Black Professionals@Entain, a new network designed to create a culture where black colleagues can thrive professionally and personally. Led by our network, we signed a UK partnership 10,000 Black Interns Foundation, and have pledged to offer career opportunities to Black students and graduates in the summer of 2024. Gender diversity at Entain Group Board 33% 2023 3 out of 9 (33%) 2022 2021 3 out of 9 (33%) 4 out of 10 (40%) Senior managers 28% 221 out of 794 (28%) 194 out of 752 (27%) 128 out of 364 (26%) 2023 2022 2021 All Employees 46% 13,645 out of 29,576 (46%) 13,479 out of 28,940 (47%) 11,583 out of 25,554 (45%) 2023 2022 2021 Male Female Personnel Today Equity, Diversity & Inclusion award Women in Gaming Diversity Awards Innovator of the Year award Entain plc Annual Report 202348 1Overview 8 Strategic report 88 Governance 140 Financial statements Create the environment for everyone to do their best work ![]() candidates and recruits, allowing us to tailor interventions and set group-wide targets. We will also continue to remove any barriers in the hiring process for candidates and colleagues through the design and launch of our new recruitment platform in 2024. Provide the right growth opportunities for all Our colleagues’ continuous personal and professional growth is essential, and we invest in targeted learning & development (“L&D”) within our business units. Programmes, courses, and self-led learning are tailored to the needs of our teams and individuals. Entainers globally have access to best- in-class learning resources, such as LinkedIn Learning, Get Abstract, and Pluralsight. These platforms enable our colleagues to continuously develop their skills – from marketing to Python coding or public speaking. In 2023, we focused our L&D efforts on customer-facing roles, both in our global Customer Services team and across our Retail Estate. We know that customer satisfaction starts with great leadership and employees who feel supported and valued. In our Customer Services team, we kicked off Let’s Lead, a new leadership programme. The seven-week curriculum includes a mix of self-paced learning, in-person training,  external providers. With over 20 modules, the programme equips our managers with all the technical knowledge and soft skills they need to successfully lead their teams. This includes completing a Mental Health First Aider course, as part of Entain’s commitment to wellbeing. 979 colleagues have already completed the course, with 113 learning sessions delivered and we will roll it out to Hyderabad, India and Montevideo, Uruguay in 2024. In our retail business, we have built a consistent foundation of competency and knowledge among managers and team leaders. The Enhance, Establish and Elevate Your Game programmes support colleagues at different points in their careers,  role to sharpening their leadership skills. In 2023, the programme trained over 2000 colleagues. We are proud that many of our retail management team started as Customer Service Managers before growing into senior roles. Last year, we also worked to harmonise the way our colleagues think about their professional objectives. We launched Your Goals, an objective-setting programme, to ensure all our colleagues have meaningful conversations with their managers about their goals and understand how these align with Entain’s strategy. In 2024, we will develop Entain Leadership Expectations which will be supported by a structured, consistent, and global leadership pathway. Build a sense of belonging for all Entainers Following an intensive period of business growth, we wanted to bring our colleagues together and consolidate our shared culture. 2023 saw us launching a refreshed set of values and behaviours which build on our core beliefs whilst helping us prepare for the next phase of our evolution: Do what’s right, Keep it simple, Go beyond, and Win together. More than words on a wall, these values act as guiding principles for our colleagues across all locations and at all levels. They have been embedded in everything we do, from the way we recognise our colleagues to how we set individual objectives. In line with these values, we remain passionately committed to creating a supportive and encouraging environment where all our colleagues can thrive. The Entain Well-Me strategy is designed to help employees make positive changes to improve their physical, mental, and emotional health. Our 2022 global well- being survey, which was completed by 9,600 colleagues, helped us identify strategic priorities for the coming years. In 2023, we rolled out Workplace of Tomorrow, a mental health programme designed to give people managers the tools to support their teams and create a culture of trust and psychological safety. Developed by experts at Unmind, the training equipped our managers to have supportive conversations, giving them practical knowledge on topics such as self- care, stress and anxiety, or active listening. 94% of the Entain managers completed the course last year. 74% of them taking action with their team as a result. Our 2023 global wellbeing campaigns were tailored to boost the mental and physical  Live-Well Festival consisted of a week- long event with expert-led workshops on  65,000 engagements on our intranet. In November, nearly 600 colleagues joined Breaking Stereotypes Together, a live event to champion men’s mental health and share techniques for combatting stress. Looking at 2024, we are using data from our global wellbeing survey to pilot Entain’s new resilience training, The Energy Edge. The programme aims to help colleagues grow their energy and performance through a mix of text learning, bite-sized videos, and interactive activities. We will open the programme to our retail colleagues in early 2024 before opening to our global workforce. In 2023, we partnered with the McLaren F1 team on a Returnship programme, providing unique opportunities for skilled women to resume their STEM careers. Over six months, 10 career returners worked at both Entain and McLaren in roles ranging from Data Analysts to Software Developers. The placements were tailored to their experience and ambitions, and they received extensive support to ensure a successful transition back into work. We are delighted that, at the end of the returnship, most returners secured a role at Entain or McLaren. The programme received two accolades, including the Innovator of the Year at the Women in Gaming Diversity Awards. #### Driving Diversity Forward with #### McLaren Racing    Entain plc Annual Report 2023 49 1 Overview 8 Strategic report 88 Governance 140 Financial statements Create the environment  best work ![]()   Material issues Environmental sustainability Corporate Governance Oversight Sustainability & Compliance Committee Focus area 2023 Highlights Reduce our environmental impact 70% global electricity from renewable sources, including over 99% in the UK through green tariffs and a 5-year Power Purchase Agreement 9% decrease in market-based Scope 1 & 2 emissions globally from the prior year Near-term and Net Zero submitted to the Science Based Targets Initiative (SBTi),  Create a sustainable value chain 35% of our in-scope third-party spend enrolled on the EcoVadis platform with  Promote grassroots, women’s and disability sports   helping to cover the costs of training, equipment, and travel 100 non-league football clubs supported via Pitching In since 2020, enabled to reach their communities Support communities where we operate Donating £25.4m, to support our communities. Fundraising £0.5m for Prostate Cancer UK and £1m for Chance for the Children via the Ladbrokes Coral Trust, funding life-saving research and treatment Awards and accreditations: ISO 14001: Environmental Management across our operations in GB (shops, stadia and  Entain plc Annual Report 202350 1 Overview 8 Strategic report 88 Governance 140 Financial statements Positively impact our communities ![]() Environmental Impact Doing what’s right is one of Entain’s long- standing values. Whilst our greenhouse gas (GHG) emissions are relatively low compared to companies in other industries, we have an important role to play due to our size and global scale – especially given the critical and urgent importance of climate change.  company to formally commit to a Net Zero target with the Science-based Targets  process commencing in 2023 and due to be concluded in 2024.  the industry on decarbonisation. We have committed to reduce our absolute scope 1 and 2 (market-based) and material Scope 3 emissions by 42% by 2027 from a 2020 base year, and 60% by 2030. We have also committed to be net zero by 2015 – reducing our Scope 1, 2 and 3 emissions by 90% by 2035, and investing in credible carbon removal projects to neutralise the remaining 10%. These targets, which follow the SBTi criteria, will see us reduce our emissions in line with a 1.5 decarbonisation pathway ahead of the UK Government’s 2050 timeline. In 2023, our Net Zero Action Group    next section). We continue to procure over 99% of our electricity in the UK from renewable sources, which equates to 70% renewable electricity globally. We are currently looking at the viability of sourcing renewable electricity in our key markets globally. We recognise that as a digital business, we need to understand our digital emissions. We have been collecting and analysing data from our data centre suppliers to understand the energy consumption and renewable energy purchasing of our major providers. Our most recent analysis in 2022 indicated that over 50% of our data centres are on renewable electricity contracts, and we are engaging with our providers to increase this further. We know that ambitious decarbonisation requires credible and up-to-date data to monitor and address our emissions hotspots. In 2023 we signed up to carbon accounting software that we will launch and operationalise in 2024. To increase the quality of our emissions reporting, we have also commissioned the Carbon Trust to verify our Scope 3 emissions footprint in addition to our annual scope 1 and 2  Creating a sustainable supply chain Our commitment to ethics and sustainability extends to our business partners. We want to work closely with our suppliers to support them on their decarbonisation journey and to protect human rights beyond our operations. In early 2023, we took an important step by partnering with EcoVadis, the world’s largest platform for supplier sustainability ratings. EcoVadis allows us to evaluate our key suppliers and set corrective action plans across four topics – environment, labour and human rights, ethics, and sustainable procurement. The platform also provides our suppliers with e-learning training on a self-service model. Working with EcoVadis  giving us access to primary emission data from our suppliers and helping us identify those who are committed to the Science Based Targets Initiative (“SBTi”).  we focused on onboarding our existing suppliers to the platform, enrolling and assessing over 35% of in-scope vendors. This represents £523m of third-party spend. So far, we found that our suppliers scored on average 59.6 out of 100 on EcoVadis, 13.6% higher than the benchmark. We also embedded EcoVadis in our tender process, making its sustainability assessment a mandatory requirement for all winning suppliers. We are now working with our suppliers to create corrective action plans, supporting them in improving their sustainability performance. We encourage them to set Science-based Targets, increase their use of renewable energy sources, and publish policies around Anti-Bribery and Corruption (“ABC), Modern Slavery, and Diversity, Equity and Inclusion (“DEI”). Our ambition is for 75% of our in-scope third-party spend to be assessed on EcoVadis by the end of 2025. Next year, we will start implementing our 2024-2026 Modern Slavery Strategy by conducting an extensive risk assessment of all our in-scope suppliers, mapping areas where modern slavery could be more prevalent based on factors such as purchasing category or political instability.  suppliers and, when necessary, request the completion of supplier self-assessment questionnaires and plan for external on-site audits to be completed in 2025. Promoting Grassroots, Disability and Women’s Sports Entain is passionate about sports and understands the role it plays in society. We are proud to invest at the grassroots level, supporting amateur and professional athletes of all ages, backgrounds, and abilities to chase their dreams. The Entain Foundation supports projects across the globe that you can discover in our 2022/23 Social Impact Report. In the UK, we are proud of our long-term commitment to SportsAid, helping young British athletes aspiring to become the country’s next Olympic, Paralympic, Commonwealth, and world champions. Since 2019, Entain has helped 251 athletes  help with training, equipment, competition costs, and personal development training. We empower a diverse cohort of sports people nationwide, with a close to even gender split, 48% of our athletes with a disability and 16% coming from ethnic minority backgrounds. By 2024, we will have donated £500,000 to SportsAid. Entain plc Annual Report 2023 51 1 Overview 8 Strategic report 88 Governance 140 Financial statements Positively impact  ![]() In the U.S., we have partnered with Oak Out Hunger Entain since 2022. The project, launched by the Charles Oakley Foundation, provides education in responsible gambling with other forms of support to underprivileged communities. The Entain Foundation U.S. sponsorship provides funding and expertise in preventing and mitigating problem gambling to the Oak Out Hunger community project. In 2023, the Entain Foundation U.S. helped fund 10,000 meals to those communities in need. If you would like to learn more about the difference we make with our partners across the globe, we invite you to review our 2022/23 Social Impact Report. We also launched Pitching In in 2020 to support and develop grassroots sports in the UK, helping non-league clubs improve their facilities. This multi-million-pound, multi-year investment programme works with the Trident Leagues to champion their achievements and tell their stories. Pitching In has been designed from the ground up to deepen links between clubs and their local communities. We are also the founding partner of the Trident Community Fund since 2020, investing £150,000 every year to enable clubs to engage in vital community-based projects and invest in their local areas. In 2022, we unveiled the Pitching In Volunteer Hub, a unique online portal and one-stop shop for every Trident League club to connect football fans with potential volunteers. The Volunteer Hub provides a simple web-based interface where clubs can post volunteering vacancies, while fans can search for available opportunities in their preferred clubs or locations. To date, nearly 300 positions have been processed through the hub, helping to bring a vitally needed new generation of volunteers to the Pitching In clubs. Support communities where  As a global business, we want to positively impact local communities across the markets where we operate. Entain partners with small to large-sized charities across the globe to support the causes that are the most important to our colleagues, our customers, and our communities. In Kenya, we partner with ComputerAid, an international charity aiming to address unequal access to technology in African countries. Our support is helping to create a Solar Learning Lab (“SLL”) in Al Huda Primary School, providing technology access to traditionally marginalised communities in South Kenya. The SLLs are shipping containers converted into  panels to generate electricity, enabling them to be deployed in remote locations. In 2023, we enabled ComputerAid to install two containers in Al Huda Primary School with 20 computer stations, 20 laptops, as well as drinking water and toilet facilities. We expect over 750 students to access this communal space in the coming months. 1. The Scope 3 categories included in our target are: Category 1: Purchase Goods & Services, Category 3: Fuel and Energy-related Activities, Category 4: Upstream Transportation and Distribution, Category 5: Waste Generated in Operations, Category 6: Business Travel, and Category 7: Employee Commuting. We completed a similar risk assessment exercise in 2022 and we intend to repeat it every other year. Entain plc Annual Report 202352 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]()  Pillar Data point 2023 2022 2021 Lead on player protection Number of jurisdictions outside the UK covered by the ARC TM player protection programme 27 22 - % contributions of GGY to RET 1% 0.75% 0.5% Cash and in-kind contributions towards responsible betting and gaming initiatives £20.8m £18.3M £12.9m Customer interactions regarding problem gambling 8.7m 1.8m 2.3m ARC TM Interactions 2,3 7.5m 3.7m n/a Customer complaints 1 3,927 4,215 4,045   715 629 655 Self-exclusions made 1,4 53,745 60,261 61,644 Secure & trusted platform % of revenues from domestically regulated or regulating markets 100% 100% Nearly 100% Number of markets exited with no clear path to a sustainable and safe regulated betting and gaming industry 5 93  5 80% n/a n/a % of Technology budget dedicated to Cybersecurity 3.2 n/a n.a Number of markets exited with no clear path to a sustainable and safe regulated betting and gaming industry £0.7m £3.6m n/a Entain plc Annual Report 2023 53 1 Overview 8 Strategic report 88 Governance 140 Financial statements Our ESG Key Performance Indicators ![]() Pillar Data point 2023 2022 2021 Foster an inclusive culture Employees worldwide (headcount) 6 29,582 28,940 25,554 Employees worldwide (FTE) 6 ,7 23,650 24,195 19,314 Female employees 6 13,645 13,479 11,583 % female employees 6 46% 47% 45% Part-time employees 6 9,968 9,754 4,328 % part-time employees 6 34% 34% 17% Median hourly pay difference between male and female colleagues (Gender Pay Gap) 8 4% 3% 5% Mean hourly pay difference between male and female colleagues (Gender Pay Gap) 8 16% 17% 16% Median bonus pay difference between male and female colleagues 8 44% 39% 60% Mean bonus pay difference between male and female colleagues 8 65% 66% 63% Females in all management positions (as % of total  37% 37% 38% Females in junior management positions (as a % of total  39% 40% 40% Females in technical roles 9 28% 31% 30% Female managers in revenue generating functions 10 40% 42% 38%  minority background, as a percentage of UK employees that have reported their ethnicity 11 15% 14% 18%  ethnic minority background 7% 7% 10% Employee age groups: 7 <30 30-50 50+ Unknown 35% 47% 15% 3% 37% 46% 14% 3% 38% 48% 14% 0% Employee contract types: 7 Permanent 12 Fixed-termed 12 Contractors 13 99% 0.1% 1% 99% 0.1% 1.5% 98% 1.21% 1.78% Customer Satisfaction 14 78% 60% 60% Average hours per employee of training and development 13 8.1 10.5 Employee turnover – all 28% 36% 32% Employee turnover – voluntary 20% 27% 25% Whistleblowing incidents reported and investigated 65 51 29 Whistleblowing incidents reported and investigated, broken down  Fraud and theft Code of conduct Procedural non-compliance HSSE HR Grievance Not provided 12 32 15 1 4 1 5 23 12 3 7 1 N/A Accidents 603 624 456 Employee work-related injuries 72 112 117 Employee reportable incidents 5 55 Public work-related incidents 5 11 9 Public reportable incidents 0 22 Robberies 50 73 36 Incidents of anti-social behaviour 6,137 5,979 4,216 Incidents of assault 452 240 132 Absenteeism rate 15 4% 5% N/A % of internal hires 23.8 19% N/A Employee engagement score 16 77% 74% 78% Entain plc Annual Report 202354 1 Overview 8 Strategic report 88 Governance 140 Financial statements Our ESG Key Performance Indicators ![]() Pillar Data point 2023 2022 2021 Positive impact on communities (including Streamlined Energy & Carbon Reporting Data) Total energy consumption (kWh) 17,18 UK Rest of the world (RoW) 124,771,815 77,957,313 46,814,502 125,026,096 82,641,345 42,384,750 110,509,736 85,336,239 25,173,497 Absolute direct emissions (scope 1) – (tCO 2 e) 5,899 4,414 3,663 Absolute indirect emissions (scope 2, location-based) – (tCO 2 e) 27,202 26,846 24,767 % of purchased electricity from renewable sources 19 70.3% 66.4% 67.4% Total GHG emissions – direct & indirect: location based (tCO 2 e) 20 UK RoW 33,101 14,885 18,216 31,259 15,569 15,690 28,430 18,286 10,144 Absolute GHG emissions intensity per employee (tCO 2 e/headcount) 1.12 1.08 1.13 Absolute indirect emissions (scope 2, market-based) – (tCO 2 e) 9,171 12,151 12,677 Total GHG emissions – direct and indirect: market based (tCO 2 e) UK RoW 15,071 625 14,445 16,565 1,980 14,585 16,340 4,932 11,408 Waste generated 21 (tonnes) 3,738 4,384 3,858 Total Scope 3 GHG emissions (tCO 2 e) 22 Category 1: Purchased Goods & Services (EEIO methodology)  Category 4: Upstream Transportation & Distribution Category 5: Waste Category 6: Business Travel Category 7: Employee Commuting 346,051 312,603 15,726 7, 873 101 5,292 4,456 315,550 288,524 12,100 6,399 83 4,398 4,046 Supplier spend £2.8bn £2.7bn £2.1bn Number of suppliers 12,613 12,006 10,380 1. Data covers all Great Britain licenses. 2. Data covers all UK licenses.   TM real-time packages and risk-based interceptors, as well as ARC TM emails. It is a count of the number of customer interactions, not at a distinct  4. Data only includes self-exclusions made via Entain’s own processes (e.g., via customer services) and does not include third-party self-exclusion schemes such as, for example, GAMSTOP (National Online Self-Exclusion Scheme) and the Multi-operator Self Exclusion Scheme. This information has been obtained from Entain’s Regulatory Returns.         SuperSport, Puni Broj, and Minus 5 who have left the business between 1/01/2023 and 31/04/2023. 8. Data covers UK colleagues only. Data is based on a snapshot date of 5 April for the year stated, as per the requirements of the UK’s Gender Pay Gap Reporting.       11. This 2023 data is based on a sample of 47% of UK-based Entain employees who have provided us with their ethnicity information. To prevent us from over or understating the   12. As a percentage of the total number of employees excluding contractors. 13. As a percentage of the total number of employees. 14. Our methodology to measure customer satisfaction changed in 2023, as we stopped using email surveys and replaced them with digital pop-up surveys shared with customers whilst online. 15. Data covers UK retail colleagues only. 16. We measure employee engagement based on the results of the annual Your Voice survey. The 2023 survey was postponed to January 2024, which is the basis for the 2023 data. 17. Coverage of energy consumption and emissions data is 100% for the UK, and 87% globally, by employee headcount. Global and ROW energy and emissions data are scaled up based on this coverage to estimate totals across global operations. This data includes energy consumption related to both scope 1 (company vehicles, gas, and fuel) and scope  ESG Report and CDP submission.   and restate previous years according to our rebaselining policy. 19. Energy from renewable sources only includes electricity purchased that was actively sourced from renewables. All remaining electricity used by Entain is sourced from the local grids where we operate. 20. Emissions are calculated using the GHG Protocol Corporate Accounting and Reporting Standard. Consumption data has been converted to GHG emissions using 2023 BEIS emissions factors and 2023 IEA emissions factors for non-UK grid electricity. Emissions reported above are calculated using both the location-based and market-based methods, using an operational control boundary. 2021 and 2022 GHG emissions (Scope 1 & 2) data has been assured to limited assurance by the Carbon Trust based on ISO  assurance process.     disclosed later in 2024. Entain plc Annual Report 2023 55 1 Overview 8 Strategic report 88 Governance 140 Financial statements Our ESG Key Performance Indicators ![]() and opportunities (Metrics and targets – disclosure C), in particular the physical risks outlined in Table 2. These updates will be included in the 2024 Annual Report. This statement was developed by following the guidance in Section C of the TCFD Guidance Document: Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures. Table 1 is structured against the four pillars of the TCFD framework: Governance, Strategy, Risk Management and Metrics and Targets. Table 2 summarises our most material climate-related risks and opportunities and their estimated impact on the Group. Table 3 outlines the climate change scenarios used in our 2022 analysis and subsequent 2023 review. 2022 scenario analysis, we reviewed our climate-related threats and opportunities to  to the group. This process helped us  our list of climate-related threats and opportunities accordingly.   related risks on the Group and across our different markets. We want to further embed climate-related considerations  relevant business strategies, such as our Key Locations Strategy which determines where we will operate in the future. We will consider additional metrics and targets to monitor our climate-related threats Over the past year, we have made progress in integrating climate-related risks into our group enterprise risk management (“ERM”) framework. In line with the ‘comply or explain’ obligation under the UK’s Financial Conduct Authority Listing Rules, the Group  of the eleven TCFD recommendations and partially compliant with disclosure C of the Metrics and Targets pillar. Where we are partially compliant, we continue to develop and mature our processes as outlined below. Our priority for 2023 was to start evaluating the impact of our relevant climate-related risks on the group in line with our ERM methodology as described on pages 79 to 82. Using the outcomes of our #### TCFD Entain is a staunch supporter of the recommendations of the Task Force for Climate-related Financial Disclosures (“TCFD”), having made voluntary disclosures ahead of the FCA’s mandatory requirements for UK Premium Listed Companies. In this section, we disclose the threats and opportunities of different climate scenarios on our Group – whether these are the impacts of transitioning to a lower-carbon economy, or the adaptational impacts arising from a rapidly warming planet #### Governance (a) Describe the board’s oversight of climate-related risks and opportunities. FC The Entain Board is ultimately responsible for climate-related threats and opportunities, with overall ownership of this agenda sitting with our CEO. Responsibility for identifying and managing threats is delegated to the Sustainability and Compliance Committee, which is accountable for monitoring our progress against targets, and ensuring climate-related risks are adequately addressed, respectively. The Sustainability and Compliance Committee is also responsible for approving, and overseeing the implementation of, our environmental strategy. The Committee receives quarterly updates on our progress against our climate-related performance – including progress against our goals and targets – from the ESG Steering Committee (see below). In 2023, the Sustainability and Compliance Committee was briefed on climate-related issues and opportunities at four of their meetings. The Group Risk Committee, which reports to the Board, has operational responsibility for managing   allocated for monitoring. (b) Describe management’s role in assessing and managing climate- related risks and opportunities. FC Our ESG Steering Group is responsible for assessing and managing climate-related threats and opportunities, as well as overseeing our approach to climate change as part of our wider  and reports to the Board Sustainability and Compliance Committee every quarter (see pages 42 to 43). In addition to our ESG Steering Group, we set up a Net Zero Action Group to deliver Entain’s Net Zero strategy. The Action Group convenes senior colleagues across departments to identify practical measures which can be implemented throughout our global operations to reduce greenhouse gas emissions. It reports to the ESG Steering Group every quarter.  56 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Strategy (a) Describe the climate-related risks and opportunities the organisation  the short, medium, and long term. FC Please see Table 2 on pages 60 to 61 for a full description of climate-related threats (both physical and transition) and opportunities potentially arising over the short, medium, and long term that  As described below, our climate-related threats and opportunities have been assessed against Entain’s ‘Impact versus Action’ matrix (see page 82). In line with our matrix, the materiality of climate-related risks on Entain was assessed by evaluating their potential impact on the Group’s  climate scenarios (see Table 3) and time horizons (see below). All climate-related threats and   the Group. We understand that climate-related threats and opportunities can have longer-term time horizons that span beyond typical enterprise risk management and business planning processes. We considered climate-related risks based on the following time horizons: Short (0-3 years) Medium (3-5 years) Long (5+ years) (b) Describe the impact of climate- related risks and opportunities on the organisation’s businesses, strategy, and  FC In Table 2, we describe the potential impact of climate-related threats and opportunities on the   Addressing climate change is a key part of our strategy, and our Net Zero by 2035 commitment is an important aspect of the Sustainability enabler in our strategic framework. Delivering on this requires  already been made with the climate in mind. For example: Continuing to invest in our green electricity tariff for the UK Retail estate, despite increasing energy costs. Investing in a renewable Power Purchasing Agreement (PPA) to secure renewable energy at a  Increasing our price banding for our company car selection, giving a wider choice for relevant colleagues opting for hybrid and electric vehicles.  strategic planning processes as we further enhance our assessment and response to climate- related issues and further integrate climate-related risks into our day-to-day processes. Currently,   (c) Describe the resilience of the organisation’s strategy, taking into consideration different climate- related scenarios, including a 2°C or  FC In Table 2, we describe the Group’s strategic response and resilience regarding our climate- related risks and opportunities. The risks outlined in Table 2 were developed through a series of workshops held throughout 2022 and reviewed again in 2023 against our ERM methodology. Our analysis raised risks that have not yet been deemed to be Principal Risks in and of themselves, but climate change may become a factor in affecting the impact of our current Principal Risks, and the subsequent actions required to manage those risks, both threats and opportunities.   integrated into functional and divisional risk registers and they are continuously reviewed by their  57Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]() #### Risk Management (a) Describe the organisation’s processes for identifying and assessing climate- related risks. FC   Advisors. The purpose of these workshops was to gather insights from leaders around the business on the climate-related threats and opportunities that were relevant to Entain, identifying those that required further in-depth analysis to determine their impact on our business. In these workshops, we explored three climate change scenarios outlined in Table 3, enabling the workshop participants to draw out how each would affect Entain’s ability to deliver on our strategy. The climate-related   In 2023, we wanted to further integrate these threats and opportunities into our group enterprise risk management framework and start evaluating their impact on the Group in absolute terms as well as in relation to other business risks. We convened leaders and experts from across the business to review the risks and assess them against our ‘Impact versus Action’ matrix, as described on page 82. All risks were assessed for their impact on the business and the actions required to bring those risks within Entain’s risk appetite. The impact of each risk was measured by  and services), the effect on the reputation of our brands and whether it affects our commitment to  very low impact to very high impact. Any climate-related risks potentially having a medium or above impact on the Group is deemed as material and disclosed in Table 2. These material risks have been integrated into our functional and divisional risk registers (see disclosure C below). (b) Describe the organisation’s processes for managing climate-related risks. FC  as described on pages 83 to 86. The feedback from our 2022 and 2023 TCFD workshops found that our climate-related threats and opportunities do not qualify as Principal Risks but rather   functional and divisional risk registers and they are continuously reviewed by their divisional heads.  processes for identifying, assessing, and managing climate- related risks are integrated into the organisation’s overall risk management. FC In 2023, we further embedded the process for identifying, assessing, and managing climate-related risks into our overall risk management and governance framework, which is outlined on pages 79 to 82. As described above, all climate-related threats and opportunities have been assessed  opportunities have been integrated into functional and divisional risk registers and they are continuously reviewed by their divisional heads along with other business risks on an annual basis. 58 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]() #### Metrics and Targets (a) Disclose the metrics used by the organisation to assess climate- related risks and opportunities  strategy and risk management process. FC In 2023, the Group started evaluating our climate-related threats and opportunities against Entain’s ‘Impact versus Action’ matrix, described on pages 60 to 61. The impact of each risk was measured different scenarios and timeframes by evaluating its potential:   operational impact effect on the reputation of our brands affect to health, safety, security, and well-being of our employees This allowed us to evaluate the business impact of climate-related risks – from very low to very high – across three different climate scenarios. Entain also uses the following metrics to monitor its performance in managing transition risks and progress against its Net Zero target: Scope 1 and 2 greenhouse gas emissions Scope 3 greenhouse gas emissions Global energy consumption Percentage of electricity purchased on renewable energy contracts Water consumption (where data is available) Waste (where data is available)   In line with prior years, the Group will report 2023 scope 3 data within its forthcoming 2023-24 ESG Report, expected to be published in Q2 2024. At the time of reporting, climate-related metrics are not linked to remuneration. Entain does not currently have an internal carbon price. (b) Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 greenhouse gas (GHG) emissions, and the related risks. FC  2023, and 2021, showing historical trends. We use the GHG Protocol Corporate Standard and GHG Protocol Corporate Value Chain (Scope 3) Standard as our methodology, using the ‘operational control’ boundary to disclose this information. Given the reputational risk of inaccurate reporting and the need for high-quality ESG data, we commissioned the Carbon Trust to assure our Scope 1, 2, and 3 data. Assurance of our Scope 1 and 2 information has taken place since 2019, and our Scope 3 data for 2021 and 2022 has now been completed. These assurance statements available on the Entain website. (c) Describe the targets used by the organisation to manage climate- related risks and opportunities and performance against targets. C  Committee Report on page 131, linked with customer satisfaction and safer betting and gaming. Currently, Entain does not have a climate-related target that is linked with remuneration. As described on pages 50 to 51, we have set a Net Zero by 2035 target, which is underpinned by a near-term reduction target of 29.4% in our scope 1, 2 and 3 emissions by 2027 from a 2020 baseline year. In 2023, we started quantifying the impact of climate-related threats and opportunities. As   climate threats and opportunities. We will continue this in 2024 with further disclosures against   59Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]()  Link to Strategic Priorities (see pages 23 to 25) Principal Risks Potential Impact Physical Risk Acute Medium-term 5 – Drive Market Share 08 – execution of the Group Strategy Threat: Disruption of live events on trading markets due to increased  We see the risk of this in climate scenarios where extreme weather events continue to affect society, sporting events and other events that are critical to our markets. This may manifest itself in last-minute cancellations or postponement of live events, which has the potential to negatively impact revenues. Physical Risk Acute Medium to Long-term 3 – Tech & product 5 – Drive market share 08 – execution of the Group Strategy  Entain operates globally, and our climate-related physical risks will vary across our markets and global operations. There are several key sites which are critical to the day-to-day operations of the Group and where disruptions would impact our ability to provide customers with our products and generate revenues. Physical Risk Acute Long-term 3 – Tech & product 5 – Drive market share 02 – Data Privacy and Cyber resilience 07 – Maintain Technology platform resilience 08 – execution of the Group Strategy  Our operations are highly dependent on technology and advanced information systems. A disruption or interruption due to weather events in our critical digital value chain could affect trading and customer experience. Physical Risk Chronic Short-term 4 – 08 – execution of the Group Strategy Threat: Increased operational costs. In scenarios where global warming is most prevalent, we may see an increase in costs for cooling our infrastructure. This may have implications in terms of operating expenditure due to increased energy usage, as well as capital expenditure where new systems may need to be installed. Alternately, in a 1.5 o scenario, we may   Physical Risk Chronic Medium-term 4 – 09 – ensure Health, safety, security and well-being of employees, customers, and communities  In the 2 o and 3 o scenarios, our colleagues may be impacted by the effects of climate change in the medium to long term. The increase in vector-borne diseases in new locations in the long term may also impact absentee rates. Similarly, travel disruptions and increased costs of living may affect our colleagues’ ability to travel to work. Transition Risk Policy & Legal Short-term 2 – Key Markets 4 – 01 – Laws, Regulations, Licensing and Regulatory Compliance Threat: Increased regulatory requirements to disclose our climate impacts and demonstrate progress against our targets. This risk is particularly relevant to our strategy to grow in key markets, notably our BetMGM and US strategic priority, where operations in these markets may require further compliance with climate-related reporting regulations. This may lead to increases in costs of compliance, such as external assurance costs, and penalties for non-compliance. #### Table 2- Summary of our most material climate-related risks and opportunities and their #### estimated impact 60 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]() Business Impact Strategic Response & Resilience1.5 o C2 o C3 o C As a global entertainment business, Entain facilitates betting and gaming across more than 30 sports and offers betting opportunities on more than 40,000 different events in any given week. The  In response to this threat, we have incorporated physical climate-related risks into the management  Business continuity plans and arrangements for off-site data storage, alternative system availability and remote working for key operational colleagues and senior management have been tested to certain extents throughout the Covid-19 pandemic and continue to be subject to ongoing review. We are managing this threat by incorporating climate-related physical risks into the management of our current Principal Risk – Maintain Technology Platform Excellence. Our technology resilience is supported by robust operational procedures and business continuity plans. All critical revenue- generating systems are built to mission-critical and high availability standards with all operational data across the ecosystem protected, replicated, and safeguarded. As part of the Group’s technology strategy and objectives we are continuously enhancing our processes and making further improvements and, where necessary, to automate the Group’s full geographical disaster recovery capability. We are already addressing this threat through the decarbonisation of our operations (please  improvements. Supporting our colleagues is an essential part of our ESG strategy and we will continue to monitor the needs of our colleagues to make Entain the best place to work. As stated above, we already have arrangements in place for remote working across our different business functions and operations. We have worked with our IT teams to ensure that all colleagues (excluding colleagues working in shops) have the equipment they need to work remotely. We have an established process in place to report robust organisational emissions – which are assured annually by the Carbon Trust – to comply with our requirements as a UK-listed company. At the beginning of 2024, we started implementing Normative’s carbon accounting tool to continue improving our data collection and quality. We continue to monitor changing regulation in the markets and jurisdictions where we operate and improve the robustness of our emissions reporting. Key: Low Medium High Very High 61Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]()  Link to Strategic Priorities (see pages 23 to 25) Principal Risks Potential Impact Transition Risk Market Long-term 1 – Portfolio Review 5 – Drive market share Threat: Changing Customer Behaviour. In the 2 o and 3 o scenarios, reducing crop yields and supply chain shocks may increase the cost of living in the short to medium term. This may reduce the income available to our customers to spend on entertainment. In addition, more extreme weather events may lead to changes in how customers engage with our products. For example, we may experience a decrease in the footfall of customers travelling in person to our shops. We could also notice an increase in customers receiving entertainment within the home, with a positive impact on our digital business and ability to attract new audiences. Transition Risk Technology Reputation Short to Medium-term 4 –  decarbonisation process. It remains uncertain how the wider economy will respond to climate change, and therefore the availability and pricing of low- carbon solutions. In the 2 o and 3 o scenarios, the availability of low-carbon alternatives would be lower. This has the potential for lower availability of these products and services, in turn leading to increased costs for reaching our net zero target. Our suppliers may face similar challenges and fail to support our Net Zero commitment, impacting our ability to decarbonise our business within the timeline we set. This would have follow-on reputational risks to the Group. In the longer term, we also see a risk due to price uncertainty in credible carbon removals that will be required to mitigate any of our residual emissions to achieve our Net Zero target in 2035, in line with the Science Based Targets Initiative (SBTi)’s Net Zero Standard. Opportunity Products  Short-term  06 – Attracting and retaining key talent Opportunity: Sustainability Leadership. In a 1.5 o scenario, where there is immediate and rapid decarbonisation, we anticipate ambitious decarbonisation commitments from our suppliers and greater availability of lower-emissions products and services at scale, reducing the costs required to deliver our net-zero strategy. This presents Entain with an opportunity  2035 ambition. #### Table 2- Summary of our most material climate-related risks and opportunities and their #### estimated impact #### continued 62 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]() Business Impact Strategic Response & Resilience1.5 o C2 o C3 o C We don’t anticipate this threat to materialise in the short to medium-term. Furthermore, our access to both the online and retail markets mitigates the threat of a reduced footfall in our shops as we can offer our products to customers directly in their homes. We will continue to monitor changes in  expenditure decisions when considering the location of our shops.   certainty. We are also actively engaging with our suppliers on decarbonisation, with an initial focus on these 19 suppliers who represent over a third of our scope 3 emissions. Our new partnership with  from our suppliers. Whilst the price of offset is not a threat for the Group in the short to mid-term, we will continue to monitor carbon markets and carbon removal standards developments. Entain has the necessary strategy and governance in place to seize this opportunity. Decarbonisation is a central part of our ESG Strategy. We are committed to achieve Net Zero emissions by 2035 and are now focused on achieving our near-term science-based target. We have committed to a reduction of 29.4% in our scope 1, 2 and 3 emissions by 2027 from a 2020 baseline year. This has been submitted to the Science-based Targets initiative to ensure our journey to decarbonisation is in line with limiting global warming to 1.5 o , as per the Paris Agreement. Our Net Zero Action Group, which  to board-level Sustainable & Compliance Committee. Please refer to page 43 for more details. #### Table 3 – Entain’s Climate Change Scenarios The three scenarios used in identifying Entain’s climate-related threats and opportunities have been tailored for the group, based on a combination of evidence and sources, primarily provided by the Intergovernmental Panel on Climate Change (IPCC), the International Energy Agency (“IEA”), and the Principles for Responsible Investment (PRI). Scenario Basis Description 1.5OC   PRI IPR: 1.5C Required Policy Scenario Action taken has achieved the aims set out in the 2015 Paris Agreement to limit climate change rise to below 1.5°C of pre-industrial levels, but with  2.0oC   PRI IPR: Forecast Policy Scenario Not much has changed from today. Some action has been taken, but it’s very much business as usual. Uncertainty increases and impacts of a changing climate manifest themselves in vulnerable parts of the world. 3.0oC  Economies around the world have continued to be powered by fossil fuels. As a result, the planet reaches a point where it is in crisis and well past the point of no return by 2030. Global warming has accelerated and changes in climate are all around, tangible and, in some cases, catastrophic. Key: Low Medium High Very High 63Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements TCFD ![]() #### Engaging with #### stakeholders In addition, the Remuneration Committee assesses the overall performance of the Group, including progress against its responsible betting and gaming ambitions as well as delivery against its Environmental, Social and Governance (“ESG”) strategy to support decision making on remuneration outcomes. To ensure that the Group continues to operate in line with good corporate practice, Directors as part of their induction receive training on the scope and application of Section 172 to ensure that they are aware of how a Board, in its decision making, must consider its stakeholders. Our approach The Board believes in the importance of engaging in effective communication with all of its stakeholders. Depending on the nature of the issue in question, the relevance of each stakeholder group may vary and not every decision the Board makes will necessarily result in a positive outcome for every stakeholder. At each meeting the Board ensures that the process of considering its stakeholders is embedded in papers it receives to enable it to discharge its duties. The Board monitors the progress and delivery of strategic initiatives through metrics reported in meetings. Section 172 of the Companies Act 2006 imposes a general duty on Directors to act in a way that they consider, in good faith, to most likely promote the success of the  as a whole. The Directors in setting policies and strategies continue to have regard to the interests of the Group’s employees, shareholders, investors, suppliers, customers and regulators, including the impact of its activities on the community and on the Group’s reputation. These factors underpin the way in which the Directors discharge their duties and the Board is cognisant of the need to engender strong relationships with all stakeholders to help the Group deliver its strategy and support its long-term values including sustainability. The Board recognises the importance of effective governance and operates in line with the UK reporting regulations. The information below should be read in conjunction with the rest of the Strategic Report. #### Colleagues In order to gather feedback from colleagues around the Group, Board members participated in a number of virtual and face-to-face employee events in 2023.  major employment locations. These Forums are a vital component of our employee listening and engagement strategy, enabling our people to discuss how their teams connect with the company purpose, strategy and values, as well as discussing topics that impact them and their colleagues. Virginia McDowell, Chair of both the Sustainability & Compliance and the Remuneration Committees, is our appointed Designated Workforce Director, a position she has held since 2019. Virginia is a regular attendee at Employee Forums, enabling her to provide the Board and its Committees with informed feedback and insight into the realities of everyday working life at Entain. Virgina McDowell and Rahul Welde (Independent Non-Executive Director) attended both the National Forum AGM and the Global Engagement Conference in 2023. In addition, we regularly hold hybrid virtual and physical ‘townhall’ meetings through which our CEO, Board Directors and senior management provide updates and dialogue with our colleagues. Twelve such hybrid townhall meetings  locations In 2023. We believe that by encouraging and supporting a diverse workforce where individuals can thrive and success no matter their background, is the best way maximise our talent pool and better represent our global customer-base. We do not discriminate on the basis of age, disability, gender or gender reassignment, pregnancy or maternity, race, religion or belief, sexual orientation  Read more: pages 53 to 57 1 64 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Shareholders    and sustainability objectives. The Group undertakes regular conference calls and  and group calls, publication of the Annual Report, dedicated ESG Report, press releases and Stock Exchange announcements. In 2023, the Group conducted a     In addition to these meetings and conferences, as well as the usual trading  calendar, the Group also held four shareholder events throughout the year. These included a detailed business and strategy update held In November 2023; two updates on the performance of the Group’s BetMGM joint venture and; Entain Sustain, a virtual showcase and presentation of the Group’s refreshed sustainability strategy in December. The Board receives feedback on shareholder views through a variety of channels, including regular meetings throughout the year between shareholders, our Chairman and executive management. In addition to providing the Board with updates on shareholder discussion topics as part of its regular Board reports, over the past year the investor relations team conducted three feedback and audit exercises to enable us to better address investors views based on a number of satisfaction and  including perception of the Group’s strategy, management and opportunities as well as delivery versus expectations and transparency. The quantitative analysis and qualitative feedback were presented to the Board during the year. The audits showed positive progress in investor engagement through the year with Entain performing more positively than the benchmark in all measures. In addition, Board members listen in to results and trading updates held by the Group for analysts and institutional investors and can hear directly the questions and comments on Company performance and are  commentary on the Company throughout the year. #### Customers Our customers’ interests range from product availability, ethical behaviour, service, pricing and promoting responsible attitudes to betting and gaming. The Group, as part of its commitment to safer betting and gaming, engages through initiatives   Our industry-leading ARC TM safer betting and gaming programme was developed in recognition of the importance of tailoring our approach to the individual customer and providing them with the protection and assurance which they should expect from us. Read more: pages 43 to 52 Read more: pages 8 to 11 23 65Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Engaging with stakeholders ![]() #### Suppliers  customer and creditor payment policies. As part of the three-year modern slavery   necessary, request the completion of supplier self-assessment questionnaires. As part of approach to ensuring a responsible supply chain, last year engaged EcoVadis, the world’s largest platform for supplier sustainability ratings. The EcoVadis platform enables us to evaluate our key suppliers and set corrective action plans across four topics – environment, labour and human rights, ethics, and sustainable procurement. Our supplier interests range from fair trading, payment terms, success of the business and long-term partnerships. The Group engages with suppliers by direct engagement, supplier conferences and corporate responsibility and ethics reporting. The Board in its duties receives regular reporting on retail performance and modern slave. Read more: page 55 #### Our Communities  and good causes including safer betting and gaming measures, investment in grassroots sport, reducing environmental impact, diversity in technology and  Entain has committed to investing £100m  range of initiatives and good causes In areas including safer betting and gaming measures, investment in grassroots sport, reducing environmental impact, diversity in technology and projects with a clear link to our local communities.  the Group’s Pitching In grassroots sport investment programme, through which the Entain Foundation supports The Trident Leagues in the UK, made up of 248 clubs at the heart of England’s non- league football pyramid. The Foundation also supports a range projects to promote diversity in and through technology and partnered with ComputerAid and the Turing Trust in 2023 to deliver community hubs in sub-Saharan Africa. The Company provides a comprehensive update to stakeholders through the publication of both annual ESG report and annual Social Impact Report. The Board has overall oversight of corporate responsibility planning and reporting as well as involvement in corporate affairs strategy which is delegated to the Sustainability and Compliance Committee. The Sustainability and Compliance Committee is advised by the executive ESG Steering Group and also works with external consultants which assist the operational units and review the environmental and social performance data. 45 Read more: pages 57 to 60 66 Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Engaging with stakeholders ![]() Read more: pages 36 to 37 #### Regulators   stakeholders. These include regulators, investors, trade associations, safer betting and gaming charities and customers. This engagement is core to our ability to    regulators on an open and regular basis helps us to ensure that each of them  policymakers shape our industry environment to best serve our stakeholder group  Governments and regulators UK Government departments. UK Gambling Commission. Governments and regulators in territories where we hold gaming licences. US state licensing bodies. National information commissioners. Domestic and International trade Associations. What are their expectations? Providing an enjoyable and safe leisure experience. Making sure we operate legally and in a fair manner. Minimising harm and maximising player protection. Ensuring that we protect the young and the vulnerable. Reducing crime and unlawful behaviour.  Ongoing dialogue with regulators, domestic and international trade associations and local authorities. Responding to the UK Government’s Review of the 2005 Gambling Act. Numerous face-to-face meetings bilaterally or as part of industry meetings. Quarterly meetings, at a minimum, between the UK Gambling Commission and senior members of Entain’s leadership team. Detailing governance, risk management and safer betting and gaming strategies through submission to the UK Gambling Commission Annual Assurance Statement process. Partnerships with the GB Health & Safety Executive. Engagement with the Nevada Gaming Commission’s Compliance Committee Formal meetings with our regulators in Gibraltar, Malta, the US and our other global regulated jurisdictions. Engage with the Department of Justice in Ireland as it implements new Anti-Money Laundering  Respond to formal regulatory consultations including most recently the call for evidence on affordability by the UK Gambling Commission and RG consultations in Spain and Sweden. e-betting and gaming international workshops in Spain, annual industry meeting in Denmark and the ‘Licensing information session’ in Germany. Suspicious activity disclosed to relevant national bodies and membership of  Engagement with regulatory authorities in regulating markets via local associations and advisors in the run up to licensing (eg Finland, Brazil). 6 67Entain plc Annual Report 2023 1 Overview 8 Strategic report 88 Governance 140 Financial statements Engaging with stakeholders ![]() #### Rob Wood #### Chief Financial Officer  1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 202368 ![]() Financial Highlights: Group NGR (excluding US) up +11% (+11%cc 2 ), -2% on a proforma basis – Online NGR up +12% (+12%cc 2 ) in 2023, -3% on a proforma basis • Excluding regulatory impacts, underlying proforma Online NGR growth of +3%cc 2 • Record level of Online active customers, +23% YoY, +10% proforma 5 – Retail NGR up +9% (+8%cc 2 ), proforma +2%cc 2 , reflecting the acquired shops in New Zealand and Poland, and the continued strength of the retail estate BetMGM delivered a strong performance through the year – 2023 NGR of $1.96bn, +36% year on year at the top end of expectations – 14% market share in sports betting and iGaming in the markets where BetMGM operates – Positive EBITDA for H2 2023 Group profit after tax before separately disclosed items was £339.1m (2022: £223.9m) Group loss after tax was £878.7m (profit of £32.9m), reflecting the DPA settlement and impairment charges related to Australia point of consumption tax increases and portfolio optimisation Net debt of £3,290.9m (2022: £2,749.8m) and leverage of 3.3x (3.1x proforma 5 ) Adjusted diluted EPS of 44.2p (2022: 60.5p) Second Interim Dividend of 8.9p per share announced, bringing the total dividend for the year to 17.8p per share Financial Results and the use of non-GAAP measures The Group’s statutory financial information is prepared in accordance with International Financial Reporting Standards (“IFRS”) and IFRS Interpretations Committee (IFRS IC) pronouncements as adopted for use in the European Union. In addition to the statutory information provided, management have also provided additional information in the formof constant currency 2 , proforma 3 , Contribution 4 and EBITDA 5 as these metrics are industry standard KPIs which help facilitate the understanding of the Group’s performance in comparison to its peers. A full reconciliation of these non-GAAP measures is provided within the Income Statement and supporting memo.      3     Annual Report 2023 69 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Financial Performance Review Group Year Ended 31 December Results 1 2023 £m 2022 £m Change % CC 2 % NGR 4,833.1 4,348.9 11% 11% VAT/GST (63.5) (52.0) (22%) (29%) Revenue 4,769.6 4,296.9 11% 11% Gross profit 2,907.0 2,714.7 7% Contribution 4 2,279.4 2,128.9 7% Operating costs excluding marketing costs (1,271.5) (1,135.7) (12%) Underlying EBITDA 5 1,007.9 993.2 1% Share based payments (21.7) (19.2) (13%) Underlying depreciation and amortisation (301.5) (238.1) (27%) Share of JV (loss)/income (42.9) (194.1) 78% Underlying operating profit 6 641.8 541.8 18% Results 1 : NGR and Revenue increased by +11% versus 2022 (+11%cc 2 ), with proforma 3 growth in Retail and the benefit of acquisitions more than offsetting a -3%cc 2 proforma 3 decline in Online NGR, as we continue to face regulatory headwinds in both the UK and Germany and experienced soft trading in Australia and Brazil. Total Online NGR was +12% ahead of 2022 whilst Retail NGR was +9% ahead. Contribution 4 in the year of £2,279.4m was +7% higher than 2022 reflecting the increase in NGR, offset by a reduction in contribution margin of -1.8pp, due to territory mix, increased taxation in Australia and the reclassification of certain content costs in Retail to cost of sales rather than operating costs, following the move to a revenue share arrangement. Operating costs were 12% higher due to the impact of acquisitions (8pp), FX (1pp) and underlying inflation, including wage rate and energy price inflation, partially offset by the reclassification of costs to cost of sales. Resulting in underlying EBITDA5 of £1,007.9m, +1% higher than 2022. Share based payment charges were £2.5m higher than last year, while underlying depreciation and amortisation was 27% higher, reflecting the impact of businesses acquired in the year (14pp), the annualisation of prior year acquisitions and continued investment in the business. Share of JV losses of £42.9m includes an operating loss of £42.0m relating to BetMGM (2022: £193.9m), which was in line with expectations. Group underlying operating profit 6 was +18% ahead of 2022. After charging separately disclosed items of £1,286.5m (2022: £213.2m), Group operating loss was £644.7m (2022: profit of 328.6m). Online Year Ended 31 December Results 1 2023 £m 2022 £m Change % CC 2 % Sports wagers 13,724.5 14,090.5 (3%) (2%) Sports margin 13.7% 12.9% 0.8pp Sports NGR 1,531.0 1,443.7 6% 7% Gaming NGR 1,837.6 1,576.9 17% 15% B2B NGR 57.9 29.9 94% 90% Total NGR 3,426.5 3,050.5 12% 12% VAT/GST (59.9) (52.0) (15%) (21%) Revenue 3,366.6 2,998.5 12% 12% Gross profit 1,980.1 1,829.6 8% Contribution 4 1,369.8 1,254.2 9% Contribution 4 margin 40.0% 41.1% (1.1pp) Operating costs excluding marketing costs (512.4) (426.0) (20%) Underlying EBITDA 5 857.4 828.2 4% Share based payments (7.3) (7.8) 6% Underlying depreciation and amortisation (160.2) (118.3) (35%) Share of JV (loss)/income (1.4) (0.2) (600%) Underlying operating profit 6 688.5 701.9 (2%)  Annual Report 202370 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Results 1 : Whilst there is underlying momentum in a number of our key markets, regulatory headwinds in the UK and Germany, as well as weaker trading in Australia and Brazil, impacted NGR performance in 2023. Resulting proforma3 Online NGR was down -3%cc 2 in the year but, with the benefit of acquisitions total Online NGR was +12%cc 2 ahead of 2022. Whilst proforma 3 NGR was down year on year, actives grew +10% year on year on a proforma 3 basis, emphasising the ongoing attraction of our brands to our customers. In the UK, we continue to absorb the impact of regulatory changes and as a result NGR was down -6%. Excluding the impact of these regulatory headwinds, we estimate that underlying NGR was +4% ahead of 2022, while actives were +18% higher than the same period last year. In Italy, constant currency 2 NGR was +3% ahead of 2022. Whilst our brands, along with the rest of the market, lost online market share to one of the leading operators during 2023, our omni-channel offering continues to resonate with customers with combined Online and Retail NGR +63%cc 2 ahead of pre-Covid levels. Local market conditions in Australia have been challenging during 2023 leaving year on year NGR -6% down on a constant currency 2 basis. Whilst we expect trading to remain challenging in 2024, we remain confident in our strategy focusing on brand differentiation, newand innovative products and the customer experience. In Germany, whilst we have seen some non-compliant operators exit the market, the continued lack of robust regulatory enforcement as well as new regulation last Summer continues to impact the business. Resulting NGR in 2023 was -26% behind 2022 on a constant currency 2 basis, primarily driven by lower spend per head. Whilst we received our gaming licences in November 2022, it is disappointing that we are still yet to see the level of enforcement action that is needed in this market to combat unlicensed operators and ensure customers are protected. In Brazil, we continue to see a fiercely competitive market ahead of regulation with a significant increase in the amount spent on marketing by various operators. Whilst we were initially slow to react to changes in the market, we are confident that following a change in our regional leadership we now have the team and localised expertise needed to regain share in this exciting growth market, an opportunity that our 365Scores acquisition will help us further leverage. NGR in Brazil was -14%cc 2 behind the prior year. Georgia NGR was +7%cc 2 ahead of 2022 on a constant currency2 basis, with our Crystalbet brand performing strongly following the implementation of new regulation in the prior year. Following a strong 2023, our Crystalbet brand continues to be the market leader in Georgia. In the Baltics , proforma 3 NGR was +3%cc 2 ahead of 2022 despite high inflation rates in the region. Our brands remain resilient despite the economic pressures in the Baltic states and we continue to attract more customers each year with proforma3 actives +13% ahead of 2022. Our Entain CEE business continues to perform well with proforma 3 NGR +13%cc 2 ahead year on year. NGR in our SuperSport business in Croatia was +29%cc 2 ahead of 2022 (proforma 3 ) maintaining its position as the market leader. NGR in our recent acquisition in Poland, STS, was flat year on year with c4%cc 2 growth to the end of Q3 offset by poor margins in October. NGR in our newly acquired New Zealand business was £84.7m in 2023, slightly ahead year on year on a proforma 3 basis. Contribution 4 margin of 40.0% was in line with guidance but 1.1pp behind 2022 due to territory mix and the impact of additional taxation in Australia which was implemented in H2 of 2022. Operating costs were 20% higher than 2022 with recent acquisitions driving 16pp of the increase and FX 1pp with the remaining 3pp due to underlying inflation offset by the initial benefits from Project Romer. Underlying EBITDA 5 of £857.4m was +4% ahead of 2022, albeit fl at year on year excluding the benefit of TAB NZ accounting treatment to 2023, reflecting the contribution 4 from acquired businesses offset by the decline in proforma 3 NGR and 1.1pp reduction in contribution margin. Resulting underlying operating profit 6 of £688.5m was £13.4m behind 2022 with depreciation and amortisation of £160.2m, £41.9m higher than 2022, half of which is a result of the impact of new acquisitions, including annualisation of those in the prior year, with the remainder of the increase due to recent investment in our technology and product. After charging separately disclosed items of £481.1m (2022: £114.0m), operating profit was £207.4m (2022: £701.9m).  Annual Report 2023 71 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Retail The Retail business is made up of our Retail estates in the UK, Italy, Belgium, Croatia, New Zealand, Republic of Ireland and Poland. Year Ended 31 December Results 1 2023 £m 2022 £m Change % CC 2 % Sports wagers 4,341.7 3,827.3 12% 11% Sports margin 18.9% 18.3% 0.6pp Sports NGR/Revenue 813.0 705.2 15% 14% Machines NGR/Revenue 573.7 572.6 0% 0% NGR 1,386.7 1,277.8 9% 8% VAT/GST (3.6) ––– Revenue 1,383.1 1,277.8 8% 8% Gross profit 900.2 860.0 5% Contribution 4 890.3 852.1 4% Contribution 4 margin 64.2% 66.7% (2.5pp) Operating costs excluding marketing costs (606.1) (571.9) (6%) Underlying EBITDA 5 284.2 280.2 1% Share based payments (2.4) (2.3) (4%) Underlying depreciation and amortisation (132.1) (112.4) (18%) Share of JV income – –– Underlying operating profit 6 149.7 165.5 (10%) Results 1 : Our Retail businesses continue to show the strength of their offer and customer appeal with 2023 Revenue and NGR both +8%cc 2 ahead of 2022 and proforma 3 NGR +2%cc 2 ahead. In the UK, NGR was +2% ahead of 2022 on a LFL 7 basis, with strong performance across both sports and gaming. Our strong underlying performance continues to be driven by an ongoing focus on market leading content for our gaming machines and betting terminals with both providing a proposition akin to the digital offering but combined with the in-shop experience that cannot be replicated online. NGR in Italy was up +16% on a constant currency 2 basis with a number of enhancements to our offering and the customer experience including cash-out, reduced minimum bet sizes and continuous development of our SSBT proposition driving greater customer engagement. Proforma3 NGR in Croatia grew at +14%cc 2 year on year further enhancing our market leading position and reflecting our program of improvements to the customer offer, including the introduction of a loyalty scheme and enhanced sports content. In Belgium, NGR was up +10%cc 2 with Ireland NGR +1%cc 2 ahead year on year. Our newly acquired Retail businesses in Poland and New Zealand contributed £40.4m of NGR during 2023. Contribution 4 of £890.3m was +4% ahead of 2022 with contribution 4 margin falling by 2.5pp due to territory mix and the impact of certain content costs (1pp) which are now classified as cost of sales rather than operating costs as they move to revenue share arrangements from fixed fees. Operating costs were 6% higher than in 2022 with the impact of acquisitions (5pp) and inflation, including wage rate and energy price inflation, more than offsetting the benefit of costs which are now classified within cost of sales. Resulting underlying EBITDA 5 of £284.2m was £4.0m ahead of 2022. Depreciation of £132.1m was £19.7m higher than 2022, largely due to the impact of acquisitions and the continued investment in our retail estates. Underlying operating profit 6 of £149.7m was £15.8m behind 2022 and, after charging £22.8m of separately disclosed items (2022: £57.4m), operating profit was £126.9m, £18.8m ahead of last year. New Opportunities Year Ended 31 December Results 1 2023 £m 2022 £m Change % Underlying EBITDA 5 (29.3) (29.1) (1%) Share based payments (0.7) (0.3) (133%) Underlying depreciation and amortisation (5.7) (4.5) (27%) Share of JV (loss)/income (1.5) (0.4) (275%) Underlying operating loss 6 (37.2) (34.3) (8%)  Annual Report 202372 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Results 1 : New Opportunities underlying costs 5 of £29.3m were 1% higher than 2022 with increased start-up marketing costs in our Unikrn brand offset by reduced costs associated with our innovation programme. Unikrn has now been closed as a B2C operation and development of our e-Sports wagering offering is now focused on our existing labels. After depreciation and amortisation and share of JV loss, New Opportunities underlying operating loss 6 was £37.2m, an increase in losses of £2.9m on 2022 and, after charging separately disclosed items of £44.3m (2022: £nil), was a loss of £81.5m, £47.2m more than in the prior year. Other Year Ended 31 December Results 1 2023 £m 2022 £m Change % CC 2 % NGR/Revenue 26.7 25.1 6% 6% Gross profit 26.7 25.1 6% Contribution 4 26.3 25.0 5% Operating costs excluding marketing costs (21.0) (20.1) (4%) Underlying EBITDA 5 5.3 4.9 8% Share based payments – –– Underlying depreciation and amortisation (2.7) (2.7) – Share of JV income 2.0 0.4 400% Underlying operating profit 6 4.6 2.6 77% Results 1 : NGR of £26.7m was 6% higher than 2022 driven by additional income in our greyhound stadia with 2022 impacted by adverse weather. Underlying EBITDA 5 of £5.3m was an increase of £0.4m on 2022, with the additional NGR offset by increased overheads associated with the aforementioned increase in number of meets. Underlying operating profit 6 of £4.6m was £2.0m ahead of last year and after charging separately disclosed items of £nil (2022: £0.7m) was £2.7m ahead of 2022. Corporate Year Ended 31 December Results 1 2023 £m 2022 £m Change % Underlying EBITDA 5 (109.7) (91.0) (21%) Share based payments (11.3) (8.8) (28%) Underlying depreciation and amortisation (0.8) (0.2) (300%) Share of JV loss (42.0) (193.9) 78% Underlying operating loss 6 (163.8) (293.9) 44% Results 1 : Corporate underlying costs 5 of £109.7m were £18.7m higher than last year driven by increases in our contributions to Research, Education and Treatment, including GambleAware, increased legal costs and ongoing investment in our governance policies and procedures. After share based payments, depreciation and amortisation and share of JV losses, Corporate underlying operating loss 6 was £163.8m, a decrease of £130.1m. The share of JV loss of £42.0m relates to BetMGM. After charging separately disclosed items of £737.2m (2022: £41.1m), the operating loss was £902.0m versus £335.0m in 2022. Notes 1. 2023 and 2022 statutory results are audited with the tables presented relating to continuing operations and include both statutory and non-statutory measures. 2. Growth on a constant currency basis is calculated by translating both current and prior year performance at the 2023 exchange rates. 3. Proforma references include all 2022 and 2023 acquisitions as if they had been part of the Group since 1 January 2022. 4. Contribution represents gross profit less marketing costs and is a key performance metric used by the Group, particularly in Online. 5. EBITDA is earnings before interest, tax, depreciation and amortisation, share based payments and share of JV income. EBITDA is stated pre separately disclosed items. 6. Stated pre separately disclosed items. 7. UK Retail LFL YoY NGR is calculated based on shops that traded for the full year in both 2023 and 2022.  Annual Report 2023 73 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Statutory Performance Review Year Ended 31 December Results 1 2023 £m 2022 £m Change % CC 2 % NGR 4,833.1 4,348.9 11% 11% Revenue 4,769.6 4,296.9 11% 11% Gross profit 2,907.0 2,714.7 7% Contribution 4 2,279.4 2,128.9 7% Underlying EBITDA 5 1,007.9 993.2 1% Share based payments (21.7) (19.2) (13%) Underlying depreciation and amortisation (301.5) (238.1) (27%) Share of JV loss (42.9) (194.1) 78% Underlying operating profit 6 641.8 541.8 18% Net underlying fi nance costs 6 (229.4) (84.7) Net foreign exchange/financial instruments 32.5 (135.3) Profit before tax pre separately disclosed items 444.9 321.8 Separately disclosed items: Amortisation of acquired intangibles (254.6) (116.9) Recognition of HMRC settlement liability (585.0) – Other (447.9) (102.0) (Loss)/profit before tax (842.6) 102.9 Tax (36.1) (70.0) (Loss)/profit after tax from continuing activities (878.7) 32.9 Discontinued operations (57.8) (13.4) (Loss)/profit after tax (936.5) 19.5 NGR and Revenue Group NGR and revenue were +11% ahead of last year and the same on a constant currency basis 2 , with Online NGR +12% and Retail NGR +9% year on year. Further details are provided in the Financial Performance Review section. Underlying operating profit 6 The Group reported underlying operating profit 5 of £641.8m, +18% ahead of 2022 (2022: £541.8m). Underlying EBITDA 5 was +1% ahead, with the increase in revenue offset by additional taxes, particularly in Australia, and increased operating costs largely associated with acquired businesses and inflation. Depreciation and amortisation was -27% higher than 2022 driven by depreciation on acquired businesses as well as on our recent investment in product and technology. The Group’s share of BetMGM losses in the period were £42.0m, £152.1m lower than 2022 as the business continues on its path to profitability. Analysis of the Group’s performance for the period is detailed in the Financial Performance Review section. Financing costs Underlying finance costs of £229.4m excluding separately disclosed items of £1.0m (2022: £5.7m) were £144.7m higher than 2022 driven by interest on the Group’s new $1bn USD term loan, which was raised in Q4 of 2022, increased drawdowns on the Group’s RCF and the impact of the increase in global interest rates. Net gains on financial instruments, driven primarily by a foreign exchange gain on re-translation of debt related items, were £32.5m in the period (2022: £135.3m loss). This gain is offset by a foreign exchange loss on the translation of assets in overseas subsidiaries which is recognised in reserves and forms part of the Group’s commercial hedging strategy. Separately disclosed items Items separately disclosed before tax for the year amount to £1,287.5m (2022: £218.9m) and relate to the Deferred Prosecution Agreement (“DPA”) with the Crown Prosecution Service of £585.0m (2022: £nil), £254.6m of amortisation on acquired intangibles (2022: £116.9m), corporate transaction costs of £17.8m (2022: £23.9m), restructuring costs, including the initial costs of Project Romer, of £49.7m (2022: £11.8m) and legal and onerous contract costs of £17.6m (2022: £8.1m) primarily relating to the legal costs associated with the HMRC investigation. The Group also recorded a £1.0m loss on disposal of assets (£2022: £1.0m), £71.8m on movements in fair value of contingent consideration (2022: £1.0m income), primarily relating to discount unwind on Tab NZ consideration, and £1.0m in financing costs (2022: £5.7m). In addition, the Group has also recognised an impairment charge of £289.0m during the current year (2022: £7.0m) with impairments recognised against our Australian business of £190.0m, our closed B2C operations in Unikrn and Africa of £78.1m, and smaller impairments against our ROI Retail business, closed shops and offices in the UK and our Totolotek business in Poland of £20.9m. The charge which has arisen in the Group’s Australian CGU is a result of the impact of ongoing increases in the rate of Point of Consumption tax across certain states and a forecast decline in Australian revenues in 2024 as a result of a reduced market outlook.  Annual Report 202374 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Our Australian business continues to be profitable and strategically important. Post the annualisation of the tax increases and stabilisation of local market conditions, we expect our Australian business to return to growth. During the prior year, the Group also recognised a £45.5m charge in respect of the repayment of amounts received under the Governments Covid Furlough scheme. Separately disclosed items 2023 £m 2022 £m Legal settlement (585.0) – Amortisation of acquired intangibles (254.6) (116.9) Impairment (289.0) (7.0) Corporate transaction costs (17.8) (23.9) Restructuring costs (49.7) (11.8) Legal and onerous contract costs (17.6) (8.1) Loss on sale of assets (1.0) (1.0) Movement in fair value of contingent consideration (71.8) 1.0 Other including financing (1.0) (5.7) Furlough repayments – (45.5) Total (1,287.5) (218.9) Profit/(loss) before tax The Group’s profit before tax 5 and separately disclosed items was £444.9m (2022: £321.8m), a year-on-year increase of £123.1m with the growth in underlying EBITDA 5 , a decrease in BetMGM losses and a gain on foreign exchange partially offset by the increase in depreciation and amortisation and interest. After charging separately disclosed items, the Group recorded a pre-tax loss from continuing operations of £842.6m (2022: £102.9m profit), with the separately disclosed costs discussed above having a significant impact on the reported results. Taxation The tax charge on continuing operations for the period was £36.1m (2022: £70.0m), reflecting an underlying effective tax rate pre- BetMGM losses and foreign exchange gains on external debt of 23.0% (2022: 15.4%) and a tax credit on separately disclosed items of £69.7m (2022: charge of £27.9m). Discontinued operations During the current year, the Group recorded a £57.8m (2022: £13.4m) loss in discontinued operations relating to its former Intertrader business which was disposed of in November 2021. The loss recorded primarily refl ects legal costs associated with historic matters as well as a provision for a potential settlement with former owners of part of the business following a long running legal dispute.  Annual Report 2023 75 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Cash flow Year Ended 31 December 2023 £m 2022 £m Cash generated by operations 810.0 846.9 Corporation tax (137.3) (106.1) Interest (224.6) (100.6) Net cash generated from operating activities 448.1 640.2 Cash flows from investing activities: Acquisitions & disposals (1,315.4) (738.6) Cash acquired/(disposed) 87.9 29.9 Dividends received from associates 9.6 3.6 Capital expenditure (259.9) (212.0) Investment in Joint ventures (40.7) (175.1) Purchase of investments (3.1) – Net cash used in investing activities (1,521.6) (1,092.2) Cash flows from financing activities: Equity issue 589.8 – Net proceeds from borrowings 1,780.3 838.4 Repayment of borrowings (1,428.6) (271.8) Subscription of funds from non-controlling interest 350.5 174.3 Settlement of fi nancial instruments and other financial liabilities (279.9) 8.7 Repayment of finance leases (68.5) (83.0) Equity dividends paid (106.9) (50.0 Minority dividends paid (7.4) – Net cash used in financing activities 829.3 616.6 Foreign exchange (13.7) 6.8 Net (decrease)/increase in cash (257.9) 171.4 During the period, the Group had a net cash outflow of £257.9m (2022: inflow of £171.4m). Net cash generated by operations was £810.0m (2022: £846.9m) including £1,007.9m of underlying EBITDA 5 (2022: £993.2m) and a working capital infl ow of £601.8m largely due to payments not having started on the DPA (2022: £45.9m) offset by separately disclosed items that are reported in operating activities of £741.9m (2022: £96.0m) including the DPA but excluding items charged to depreciation, amortisation and impairment as well as a £57.8m loss on discontinued operations (2022: £13.4m). Included within working capital is a £29.7m outflow for balances held with payment service providers as well as customer funds, which are net debt neutral (2022: £47.9m). During the period £137.3m was paid out in relation to corporate taxes (2022: £106.1m) with a further £224.6m paid out in interest (2022: £100.6m). Net cash used in investing activities for the period was £1,521.6m (2022: £1,092.2m) and includes cash outflows for acquisitions of £1,315.4m (2022: £738.6m), net investment in capital expenditure of £259.9m (2022: £212.0m), an additional £40.7m invested in BetMGM (2022: £175.1m) and £3.1m of other investments (2022: £nil). These outflows were partially offset by cash acquired with acquisitions of £87.9m (2022: £29.9m) and dividends received from associates of £9.6m (2022: £3.6m). During the period the Group received a net £829.3m (2022: £616.6m) from financing activities. £589.8m was raised through the equity issuance (2022: £nil) with a further £1,780.3m through new financing facilities (2022: £838.4) which were used, in part, to repay £1,428.6m of debt (2022: £271.8m) including £400m against the Group’s retail bond. During the period, the Group also received £350.5m from minority holdings to meet their obligations under the Supersport earn-out and STS acquisition. These amounts are recorded in non-controlling interests (2022: £174.3m for the acquisition of SuperSport). £279.9m was paid on settlement of other financial instruments and liabilities, primarily relating to contingent consideration on previous acquisitions. In the prior year, the Group received £8.7m on the settlement of other financial instruments and liabilities as a result of the receipt of £41.6m on the partial settlement on a number of swap arrangements, partially offset by contingent consideration payments. Lease payments of £68.5m (2022: £83.0m) including those on non-operational shops, were made in the period. During the period, the Group also paid £106.9m in equity dividends (2022: £50.0) and £7.4m in dividends to the minority interest in Entain CEE (2022: £nil).  Annual Report 202376 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]() Net debt and liquidity As at 31 December 2023, adjusted net debt 7 was £3,290.9m and represented an adjusted net debt 7 to underlying EBITDA 5 ratio of 3.3x (3.1x proforma 3 ). The Group has drawn down £295m on the revolving credit facility at 31 December 2023 (2022:£nil). Par value £m Issue costs/ Premium £m Total £m Term loans (3,420.5) 64.8 (3,356.4) Interest accrual (1.6) – (1.6) (3,422.1) 64.8 (3,358.0) Cash 400.6 Net debt (2,957.4) Cash held on behalf of customers (196.8) Fair value of swaps held against debt instruments (85.6) Other debt related items\* 224.8 Lease liabilities (275.9) Adjusted net debt (3,290.9) \* Other debt related items include balances held with payment service providers, deposits and other similar items Refinancing On 1 March 2024, the Group raised an additional £300m of borrowings under a bank loan facility and used the proceeds to repay all amounts drawn under the Group’s revolving credit facility. Concurrently, the commitments available under the Group’s revolving credit facility (disclosed in Note 36) were increased by £45m further increasing the Group’s available liquidity. As such, the Group’s revolving credit facility now has total commitments of £635m which, as at 1 March 2024, was completely undrawn save £5m carved out for letters of credit and guarantees. Going Concern In adopting the going concern basis of preparation in the financial statements, the Directors have considered the current trading performance of the Group, the fi nancial forecasts and the principal risks and uncertainties. In addition, the Directors have considered all matters discussed in connection with the long-term viability statement including the modelling of ‘severe but plausible’ downside scenarios such as legislation changes impacting the Group’s Online business and severe data privacy and cybersecurity breaches. Given the level of the Group’s available cash post the recent extension of certain financing facilities (see Note 36) and the forecast covenant headroom even under the sensitised downside scenarios, the Directors believe that the Group and the Company are well placed to manage the risks and uncertainties that it faces. As such, the Directors have a reasonable expectation that the Group and the Company will have adequate financial resources to continue in operational existence, for at least 12 months (being the going concern assessment period) from date of approval of the financial statements, and have, therefore, considered it appropriate to adopt the going concern basis of preparation in the financial statements. Notes 1. 2023 and 2022 statutory results are audited, with the tables presented relating to continuing operations and including both statutory and non-statutory measures. 2. Growth on a constant currency basis is calculated by translating both current and prior year performance at the 2023 exchange rates. 3. Proforma references include all 2022 and 2023 acquisitions as is they had been part of the Group since 1 January 2022. 4. Contribution represents gross profit less marketing costs and is a key performance metric used by the Group, particularly in Online. 5. EBITDA is earnings before interest, tax, depreciation and amortisation, share based payments and share of JV income. EBITDA is stated pre separately disclosed items. 6. Stated pre separately disclosed items. 7. Adjusted net debt excludes the DPA settlement of £585.0m. Leverage also excludes any benefit from future BetMGM EBITDA or the payments due to acquire the minority interests in Entain CEE.  Annual Report 2023 77 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chief Financial Officer’sReview ![]()   Responsibility statement of the Directors in respect of the annual financial report We confirm that to the best of our knowledge: the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and the Strategic Report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face. We consider the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group’s position and performance, business model and strategy. Rob Wood Chief Financial Officer & Deputy Chief Executive Officer 07 March 2024 The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the parent Company’s transactions and disclose with reasonable accuracy at any time the financial position of the parent Company and enable them to ensure that its financial statements comply with the Isle of Man Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities. The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the Isle of Man governing the preparation and dissemination of financial statements may differ from legislation inother jurisdictions. In accordance with Disclosure Guidance and Transparency Rule (“DTR”) 4.1.16R, the financial statements will form part of the annual financial report prepared under DTR 4.1.17R and 4.1.18R. The auditor’s report on these financial statements provides no assurance over whether the annual financial report has been prepared in accordance with those requirements. The Directors are responsible for preparing the Annual Report and the Group and parent Company financial statements in accordance with applicable law and regulations. The Directors have elected to prepare the consolidated financial statements in accordance with International Financial Reporting Standards and applicable law and have elected to prepare the parent Company financial statements in accordance with FRS 101 Reduced Disclosure Framework. In preparing each of the Group and parent Company financial statements, the Directors are required to: select suitable accounting policies and then apply them consistently; make judgements and estimates that are reasonable and prudent; for the Group financial statements, state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; for the parent Company financial statements, state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the parent Company financial statements; assess the Group and parent Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; use the going concern basis of accounting unless they either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so; and prepare financial statements which give a true and fair view of the state of affairs of the Group and the parent Company and of the profit or loss of the Group and the parent Company for that period.  Annual Report 202378 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Enterprise Risk Management #### Managing Risks Risk Management Governance The Board has established and reviewed procedures to manage risk, oversee internal control systems and determine the nature  the Company is willing to take in order to achieve its long-term strategic objectives. Our Enterprise Risk Management (ERM) process supports the Board to establish a  emerging Group risks, which are presented to the Committees of the Board and where required, directly to the Board in thematic risk reviews throughout the year by the Risk Owners, using a consistent format Risk Dashboard. The Risk Dashboard highlights whether strategic objectives can be met in the current context and indicates how much action is needed to further manage the risks to an acceptable level. If objectives cannot be met, oversight Committees are asked for additional resources to manage the risks, or, if no additional resources are made available, whether they wish to formally accept the risk exposure or change objectives. This process embeds risk appetite decision-making at the appropriate levels of the Company, with outcomes noted and communicated back to the Risk Owners who can then take action to manage risks accordingly. The Board retains ultimate responsibility for the management and oversight of risk and considers a “top-down” view  risks obtained through the “bottom-up” ERM process, from this, it establishes the Principal Risks to the Group and considers the likelihood of the Principal Risks occurring and whether risks emerging over  deep dives. During 2023, we re-structured the Group Risk Committee, which now meets six times a year in cadence with our other Board Committees and Board meetings. The Group Risk Committee is scheduled to precede and feed into Committee and Board meetings where possible, so that risk information is current and overseen on a timely basis. People and Governance Committee Whilst the Board is responsible for the annual review of the principal risk of attracting and retaining key talent, as part of their responsibilities the People and Governance Committee continually reviews succession planning and the susceptibility of the Group to the risk. Legal & Regulatory Data Privacy Retail UK&I Cyber & IS Core Digital TradingLATAM HSSE Australia & New Zealand Safer Betting & Gaming ProcurementInternational Tax , Treasury & Insurance Technology Customer Service Product & Tech Property & Workplace Corporate Ethics & Compliance People Services Integration PLC Board  Execution of the group strategy Laws, regulations and compliance Attracting and retaining key talent Whilst not a principal risk, the Board also reviews the Group’s litigation risk on an ongoing basis Group Risk Committee Meets six times annually, prior to each Board and Board committee meeting Sustainability and Compliance Committee  Health, safety and well-being Safer betting and gaming Risk also reviewed continually  Regulatory compliance and licensing, anti-money laundering (“AML”), Responsible gambling, protection and  Audit Committee  Data privacy and cyber resilience Maintain technology platform resilience Taxes Trading, liability and pricing management Price and service of delivery from 3rd party suppliers Remuneration Committee Whilst the Board is responsible for the annual review of the principal risk of attracting and retaining key talent, as part of their responsibilities, the Remuneration Committee continually reviews this risk and the mitigating actions in place to prevent the risk crystalling. \*Delegated oversight and responsible for deep dive reviews of Group’s principal risks. Entain plc Annual Report 2023 79 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() Effective risk management supports us to meet our corporate objectives, it helps us to make risk-based decisions so that we operate with fewer shocks and allocate resources in line with our risk appetite. Our Risk Management Principles: 1 Tailor an enterprise risk management system that improves performance, encourages innovation, and supports the achievement of our objectives. 2 Integrate and align risk management across different strategic, functional, and operational disciplines, such as budgeting, compliance,  security, and so on. 3 Embed risk management as an integral part of the way we manage our business, people, and teams across all our operations. 4 Proactively manage our risks in our fast-changing business environment, updating and continuously improving our risk information to support decision making at all levels. Management Process We work together to use modern risk management methods (and Entain’s four-  part of our day-to-day decision making across our entire organisation, minimising threats to the delivery of our strategy, and maximising opportunities. Risk Strategy At Entain, we are committed to active and effective risk management, creating, and protecting value to the organisation and helping us deliver on our strategic priorities, managing threats, exploiting opportunities, and building resilience. We support risk taking where it is forecast to generate returns for the business and manage this in line with our values and ethics.  #### Risk        #### Risk Management Risk management is doing        Our risk landscapes Current risks Risks we are managing now that could stop us achieving our strategic objectives. Emerging risks Risks with a future impact from external or internal opportunities or threats. These can be slow moving, as well as rapid velocity. What we assess  each risk has a named owner Impact versus Action: globally applied scale measuring the amount of action required to manage the risk to an acceptable level Critical controls: subject to internal audit review and monitoring Current risk: after existing controls Risk acceptance: if the risk is acceptable with the current controls or if additional actions are needed to manage the risk to an acceptable level. Risk appetite: Actions: identify further actions if required, with action owners and due dates Our bottom-up registers The bedrock of our risk assessment. Owned by functions and super-regions, they identify, analyse, and evaluate risks and mitigating controls arising from day-to- day operations globally.  The main output of our risk assessment. Owned by functions and super-regions,  and opportunities via our ‘impact versus actions’ scales and subsequent controls needed to mitigate the threats and exploit the opportunities arising from day-to- day operations globally. They include a description of the risk, reference which corporate objectives are exposed to the risk, and what additional support and decisions are needed to manage the risk to an acceptable level. The Dashboards are used to make effective, risk-based decisions on allocation of resources.  As part of the ERM process, we assess  Financial Operational Reputation / Brand Legal / Regulation Health & Safety Entain plc Annual Report 202380 1 Overview 8 Strategic report 88 Governance 140 Financial statements Risk management process and methodology ![]()    This four step process allows us to ask, ‘Given the context in which we are operating, the risk we face and our ability to manage them – can we achieve our objectives?’ If we can, then we continue the good work. if we can’t, then we need to manage the risks further, or change the objectives.  #### decision #### making   Understanding both the external and internal context in which we are operating – what is happening and what might happen to make things  We clarify what we are trying to achieve – our objectives – whether it is for the entirety of a strategy, division or function. We think through how the context and objectives may impact each other, both positively and negatively.  #### and Report Ongoing checking of the status of risks and their controls. This step involves reviews, inspections, and audits of the status of risks, providing risk management information that is communicated to all necessary stakeholders. #### Assess risks  acknowledge, and describe risks (both potential opportunities and threats).  both individually and as a collective  risks as well as better understanding any triggers which may make the risk happen.  needs to be taken regarding a risk  acceptable level. #### Manage risks Active management of risk with decisions on the types of controls needed and the implementation of controls. Proactive risk management takes charge of and changes the nature  comes in line with the amount of risk we are willing to take in delivering our objectives. Where risks are out of line with the amount of risk we want to take, we can enhance or add new controls where necessary. 1423 Entain plc Annual Report 2023 81 1 Overview 8 Strategic report 88 Governance 140 Financial statements Risk management process and methodology ![]() Risk Management Whilst our Board owns and oversees our ERM programme, risk management accountability and responsibility are    through our Colleagues, who have responsibility to manage day-to-day risks in their own areas, they have the insight to risk that comes from experience and knowledge. The ERM process engages    procedures, control frameworks and risk appetite. Local management, and ultimately the Executive, ensure that risks are managed and carried out according to these frameworks. The second line of sight is provided by our advisory support teams who specialise in areas such as ERM, Compliance, Cyber Security, Legal and HSSE. These advisory support teams review the controls  whether the controls are adequate, they form a holistic view of risk across the Group and capture and escalate risks that could fall through silos, supporting and encouraging foresight of risk. This risk foresight is captured by the ERM and management teams, who review each risk register and dashboard on a regular basis, culminating in review by the Group Risk Committee, which then escalates   The third line of sight is through independent Internal and external audit, who provide assurance over the effectiveness of critical controls, which is provided through internal audits, supplemented by reports from external assurance providers. We use this hindsight to adjust our controls in the light of audit recommendations. Entain’s Group Code of Conduct and Whistleblowing Policies, in addition to our controls framework, are in place to promote and aid us to ‘Do what’s right’. Annually the Audit Committee reviews the adequacy and effectiveness of the Company’s policies, which sets our tone for desired risk culture.   A key cornerstone towards robust governance was accomplished, including the deployment of a new risk policy, framework, governance forums, and  Completed the ERM management system design and approval Began implementation of our ERM system through over 50 sessions of risk management training and workshops, with work ongoing into 2024 to implement in our Super Regions, giving a much clearer view of the company’s most  Reviewed and updated Entain’s risk scoring criteria, establishing new risk matrix covering ‘Impact vs Actions’ as a modern approach to ERM, ensuring focus on what can be done about the risk is embedded in our day-to-day risk management “bottom-up” process. Delivered new format risk registers,  and monitoring of actions needed to put further controls in place.   Dashboards and presented to the risk oversight Committees and Board during the year, facilitating decisions on risk appetite, required actions and resource allocation.   analysis, and evaluation of emerging risks, informed by functions, divisions, super-regions, subject matter experts and leadership, to provide a Group-wide view. In 2023, we undertook a series of workshops across our risk landscape to provide a deeper exploration of our emerging threats and opportunities and come to a consensus on our response. As such, the exercise to understand potential emerging risks has been carried out during each initial risk workshop, looking at risks that may occur over 3-, 5-,  the data, common themes have become apparent, which have been developed to display and better understand the information regarding emerging risks.  Our ERM team led the establishment and implementation of our refreshed approach to Enterprise Risk Management, which is aligned with the international risk standard ISO 31000. During 2023, we have progressed a consistent approach across our business through training, engagement, and application of our new ERM toolkit. Our colleagues are fundamental to the success of risk management at Entain. A positive risk aware culture enables colleagues at all levels of our organisation to deliver risk management as an integral part of their day-to-day activities. We do  Developing a compelling narrative on the  across the Group. Delivering targeted foundation of risk management training.   each function and region, the culmination being a robust risk register and dashboard highlighting those risks which  Collaborative working across the Groups functions and super-regions utilising the expertise of external insight. Articulating risks so they can be clearly understood so decisions are made on a more informed basis. Embedding the consideration of risk appetite through our risk prioritisation tool which indicates whether risks are deemed to be at acceptable levels.  reviewed at oversight Committees and Board. Embedding risk appetite in our ERM process has improved our ability to talk about risk appetite as part of our risk culture.  As part of the ERM process, the risks  set of criteria using an ‘Impact versus Action’ matrix which assesses both the impact to the business and the actions required to bring those risks within Entain’s risk appetite. In assessing ‘impact versus  performance, operational processes, legal and PR and health, safety, and security.  The impact of each risk is measured with  (underlying EBITDA and cash), its potential operational impact (including the security of our data), the effect on the reputation of our brands and whether it affects our commitment to health, safety, security, and well-being. The impact is measured on a scale, from ‘very low’, with limited damage to a minor stakeholder, and ‘very high’ being severe, which may have a substantial impact on the Group affecting many key stakeholders, including customers. The action is measured from a range of no action required to many actions needed and additional resource required, also on a scale from ‘very low’ to ‘very high’). Entain plc Annual Report 202382 1 Overview 8 Strategic report 88 Governance 140 Financial statements Risk management process and methodology ![]() #### Principal Risks    General Counsel  Organic Growth Margin Expansion US Market Growth Impact: Very High  Audit Committee  Our customers expect a great experience, including protecting their personal details, their privacy, their winnings and ensuring the integrity of our offering. Customers place a trust on our organisation and our operations, so it is of paramount importance that we protect our customers’ data by keeping it secure, in addition, personal data is subject to stringent data protection laws around the world, and we have compliance obligations in the jurisdictions in which we operate. A data or security breach could impede our operations and impact our ability to serve customers and would undermine trust in our business and brands, and could lead to loss of customers, prosecution, litigation (including class  impact our share price.  The Group has dedicated Cyber Security and Data Privacy functions entrusted with  of our customers and the company, whilst ensuring the availability of services and regulatory compliance. The experts in our Cyber Security team constantly scan and adapt our defences to emerging cyber threats. We operate to an ISO 27001 Information Security Management System  and associated policies are constantly being evaluated, aligned, and applied, where deemed relevant across the enlarged Group. The Data Privacy team, led by the Group’s  privacy programme through designing policies and training, including on the use of AI, giving up to date advice to the business, ensuring standards of compliance, partnering with the Chief  to improve our data management practices and providing regular updates to the Group’s Audit and Sustainability & Compliance Committees.  #### Licensing and Regulatory #### Compliance Group General Counsel  Organic Growth Margin Expansion US Market Growth Impact: Very High  Board  We operate in complex regulatory,  and have multiple licensing obligations, gambling and non-gambling laws and regulations, and tax regimes with which to comply. In addition, on a global basis, laws and regulations change continuously, and it can be operationally challenging to keep pace with legislative or regulatory change, particularly if we need to adjust our operations or product offering at short notice. As we expand into new markets or laws/ regulations change, our compliance requirements expand, we need to build constructive relationships with regulators, and we are likely to need additional effort, resource and/or investment into our internal compliance and governance efforts. In 2023, Entain entered into a deferred prosecution agreement (DPA) relating to historic bribery allegations in Turkey. All the above means that compliance efforts and having a strong, well-resourced compliance programme in place needs to remain a top priority.  Our strategy is to operate only in regulated or regulating markets, which reduces our exposure to unregulated markets that may undermine player safety and pose other legal risks. Our internal experts monitor for changes in legislation and regulation and develop policies, procedures, assurance programs, and training to enable us to adapt. They are engaged in due diligence when we engage new suppliers, onboard new customers, enter new markets or acquire  the commitments to compliance in our Code of Conduct. External legal expertise is sought when additional specialist support is necessary. We will ensure that we comply with all the terms of the DPA and continue to co- operate with regulators as required. We consider principal risks to be those risks, or combination of risks, that, were they to materialise and not be effectively controlled, would cause material disruption to our business model, threatening future performance, solvency, liquidity, or our ability to deliver our strategy. Risks at this  Risk dashboard. Group risks are considered,  our Principal Risks. During our periodic risk reviews, we  in 2022 remain relevant except for  ’, which now forms part of    and  . This is because a deep dive helped us understand that  key locations would be to our people or technology, and the controls for these risks will largely be managed in these areas.  namely  3rd Party Suppliers and added to the Group risk register in 2023.  Entain plc Annual Report 2023 83 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]()  #### Pricing Management   Organic Growth Margin Expansion US Market Growth Impact: Very High  Audit Committee   losses because of a failure to determine accurately the odds in relation to any particular event and/or any failure of its price risk management processes. Some bets are complex and have an accumulator effect which could    We have some of the leading expertise in trading liability management in the Gaming sector. The Group’s trading team has developed the skills and systems to be able to offer a wide range of betting opportunities. Events are priced to achieve an average return to the bookmaker over many events over the long-term. The Group’s gross win percentage has remained constant in recent years. Executive management monitor the gross win margin daily in order to ensure the long-term targets are achieved.      Organic Growth Margin Expansion US Market Growth Impact: Very High  Audit Committee  We are dependent on certain Third Parties to deliver key products and services. Some of our core capabilities are supplied by small, specialist providers, which include content providers who stream live events to our shops, results and other key data providers, League proprietors, industry bodies, and suppliers that ensure security and resilience of our locations and systems. Other key Third Parties include large technology and software suppliers which hold dominant market positions. Key suppliers could raise prices, become  which would limit the variety of gaming we can offer, leading to loss of revenue. To ensure robust management of service delivery and value creation through the life of the contract will allow better management of growing risk/opportunity  If suppliers are purchased by our competitors, access to services may be restricted or denied, or we may decide to withdraw from certain markets if they become uneconomical. Conversely, Third Party providers may present acquisition opportunities for the Group.  Strategic and critical suppliers are subject to regular business and quality reviews to ensure ongoing relationship and performance management. As part of our procurement processes, we employ dedicated resources supplemented by subject matter expertise within risk, compliance, legal and technology assurance to protect and enhance value, demonstrate our high standards of corporate integrity, and reinforce organisational resilience. Where possible, we limit reliance on a single supplier to reduce the potential single point of failure. We proactively manage our relationships with our specialists and key providers. Prices are subject to negotiation at the contracting stage, and we have deep industry expertise in our Procurement and Legal teams. We maintain good relationships with Industry bodies and suppliers that keep our key locations and services running.    Organic Growth Margin Expansion US Market Growth Impact: Very High  Audit Committee  The Group is subject to a wide range of taxes, duties, and levies in the countries where we operate. There may be adverse changes in tax rates, laws, or administrative practice. The Group is geographically diverse and there are complex tax regimes for the betting and gaming sector. Tax authorities may have a different interpretation to the Group regarding the scope and scale of taxation. These factors mean the levels of taxation to which the Group is exposed to may change in the future, and we may become liable for tax payments greater   The Group’s tax strategy is approved annually by the Board of Directors. Responsibility for the execution of the Group’s tax strategy is delegated to  the Group’s tax position to the Audit Committee and Board on a regular basis. To mitigate tax risks that arise, the Group  and monitors its tax risks.  and resourced tax team to manage its tax affairs.  uncertainty or complexity in relation to a tax risk, the Group may use the services of external, expert tax advisors. Entain plc Annual Report 202384 1 Overview 8 Strategic report 88 Governance 140 Financial statements Principal Risks ![]()     Organic Growth Margin Expansion US Market Growth Impact: Very High  Board  Our Group strategy establishes our direction and culture and sets us on a course of future growth through delivery of overarching corporate objectives. The corporate objectives guide our business and team objectives and facilitates our colleagues to be aligned in delivering desired outcomes. If we cannot understand or deliver our Group strategy, we risk wasted or  resources, strategic stagnation, and loss of competitive advantage.  Our refreshed Enterprise Risk Management process sets understanding and clarifying objectives as part of its   their effect on objectives.     Organic Growth Margin Expansion US Market Growth Impact: Very High  Audit Committee  The Group’s operations are highly dependent on information systems and technology. Should we fail to maintain the stability and availability of our technology platforms, this could have a material impact on customer-facing products and customer experience, with adverse impacts to our brands, revenue, and market share. Some of our technology is situated in locations which could be subject to physical threats.  Proactively, our strategy is to move to modern systems with higher levels of resilience where possible. We are enhancing our reactive responses and provision of fall-back solutions should our technology platforms fail. We monitor key global metrics on critical systems and platforms which identify any potential emerging issues on our brands or customer-facing technologies. When indications of vulnerability are detected, we escalate to resolve issues and create solutions. Our in-house experts are adept in knowledge of our platforms, systems and coding and can create solutions adaptively.     Organic Growth Margin Expansion Impact: High  Board  Our colleagues, their talents and skills are vital to helping our business succeed. Attracting, retaining, and developing the best and diverse talent is key to the success of delivering our strategic priorities – our people really do make the difference. Having clear leadership standards enabling a vibrant and inclusive organisational culture allows colleagues to do their best work and excel. Providing an open and inclusive environment allows us to attract new and different talent to join Entain but also creates a culture people want to be a part of. By creating the right standards of leadership and setting clear expectations around performance we are able to respond to challenges and opportunities faster and more effectively and therefore deliver on our critical strategic objectives.  Everything we do is anchored to our clearly stated purpose, supported by our shared values and behaviours. Our value of “do what’s right” underpins our commitment to setting the very highest standards for our people to adhere to. Our leadership framework drives higher levels of leadership capability allowing us to attract and retain great talent. Our commitments and actions are monitored by the Executive Committee and the Board. We are committed to ensuring all of our people have a safe place to work with the ability to raise any concern they may have. We regularly seek employee feedback through our Your Voice survey and translate that into actionable plans to ensure high levels of engagement and retention. We encourage and support diversity through Employee Resource Groups who help drive, support, and promote a focus on why diversity matters. We actively promote the opportunity to grow a career at Entain through promotion but also lateral movement across the business, providing meaningful career progression. Entain plc Annual Report 2023 85 1 Overview 8 Strategic report 88 Governance 140 Financial statements Principal Risks ![]() #### Gaming Group General Counsel  Organic Growth Margin Expansion US Market Growth Impact: Very High  Sustainability and Compliance Committee  Our Safer Gaming and Betting approach is central to our business. It is the cornerstone of our Sustainability Charter, and our most material ESG issue is to ensure market leading levels of player safety and protection. Failure to adequately protect our customers could  license to operate in some jurisdictions.  We have developed our in-house tool, ARC™, and other forms of support and customer interventions to facilitate us to manage our safer gaming commitments. Where risky behaviour is detected, we may offer a personalised gambling control tool, refer them for a chat with our player protection team, or suspend their account in real time. ARC™ is an intelligent and innovative platform that uses behavioural insight and research, data science and analytics to assess risk in play, enabling us to identify, interact and intervene early with customers who show signs of gambling- related harm. We have a range of initiatives in the area of player protection, including a $5m academic research partnership with the Harvard Medical School, to understand the causes and consequences of problem gambling, and donating up to 1% of our GGY to the treatment of gambling related issues. Our bonuses are calculated with reference to our Safer Gaming metric – to reach the threshold level for payout, minimum levels of completion of safer betting and gaming compulsory training modules must be achieved by our colleagues globally.    #### and Communities    Organic Growth Margin Expansion Impact: Very High  Sustainability and Compliance Committee  Failure to meet the requirements of the various domestic and international rules and regulations relating to the health and safety of our employees and our responsibilities and commitments towards customers and communities could expose the Company to material civil, criminal and/ or regulatory action with  consequences. While Entain is committed to high  harm in all that it does, it recognises that there is always the potential for safety or well-being related issues to arise in an operational business.  At Entain, we are committed to providing a safe work environment which promotes people’s health, safety, security, and well- being. We want everyone to feel healthy and supported at work, and at home. We have plans for each discipline to ensure that we maximise the opportunities and  Our health, safety and security strategy is focused on continual improvement of safety performance to reduce the number and severity of work-related injuries whilst keeping our colleagues and places of work secure. This is underpinned by our HSSE assurance programme to ensure our risk management system is effective and that we keep our colleagues safe and secure. Our well-being strategy is designed to help leaders and colleagues make positive changes to improve their physical, mental, and emotional health, in turn creating a better performing, energised and productive workforce. To achieve this, we provide tools, training, and targeted support to our colleagues. The Group’s Sustainability and Compliance Committee also oversees all aspects of Health, Safety, Security and Well-being practices. Entain plc Annual Report 202386 1 Overview 8 Strategic report 88 Governance 140 Financial statements Principal Risks ![]() #### Long-term viability statement  events has been assessed both individually  The impact of a change in the Group’s  gaming taxes in key geographies.   environment/further focus on AML legislation and breaches in data privacy regulations Cyber and data privacy failings. Downturns in trading as a result of a failure to protect customers and/or retain key staff. The Directors have also performed reverse stress tests to assess the level of liquidity and covenant headroom in the underlying forecasts as well as considering the broader economic landscape in forming their view on viability. Based on the results of this analysis and the mitigating actions available to the business,  reasonable expectation that the Company will be able to meet its liabilities as they fall due over the three-year assessment period to December 2026. In accordance with provision 31 of the 2018 Corporate Governance Code, the Board and Directors have completed an assessment of the prospects and viability of the Entain Plc Group over a longer period than the 12 months required by the “Going Concern” provision. The Directors have concluded that three years was an appropriate period for assessment, as this is aligned to the Group’s strategic planning process and is considered to be the period for which reliable estimates can be made for variations in both industry and customer dynamics, regulatory change, technological advancements and the economic backdrop in the betting and gaming industry taking into account the ever changing landscape. The objectives of the strategic planning process are to further develop the businesses understanding of the markets in which it operates, assess the risks and opportunities facing the business and develop a Group-wide strategy and  The Directors have utilised these strategic forecasts, the 2024 Board approved budget  Group to assess the potential impact on viability of certain severe, but plausible, “risk events” arising which represent the crystallisation of the Group’s principal risks  83 to 86 of this Annual Report. The robust assessment conducted considered the Group’s revenue, EBITDA, operating  and controls, its current debt maturity and mitigating actions should baseline assumptions change. Entain plc Annual Report 2023 87 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Chairman’s Governance Overview Entain continues to enhance its corporate governance practices and procedures to ensure the Board operates effectively and sets the right tone from the top. In 2023 a key focus for the Board has been managing its own succession and I was delighted to announce the appointment of Amanda Brown and Ricky Sandler, who joined the Board in November 2023 and January 2024 respectively. Amanda brings extensive commercial and human resource experience to us. Ricky knows our business extremely well and his focus will be on generating value for all shareholders. We have also overseen the departure of two executive directors during the year, Jette Nygaard-Andersen and Robert Hoskin. Under Jette’s leadership, Entain executed a strategic shift towards regulated or regulating markets and continued to improve its customer and product offering. Robert stepped down as Chief Governance Officer in August having been with the Group since 2005. I would like to express my thanks to both Jette and Rob for their roles as directors and everything they have done for me personally and the Group more widely. We have been hugely fortunate that Stella David agreed to take on the Interim Chief Executive role while we continue our search for a permanent replacement to Jette. Stella is an intensely commercial leader with a long track record of success across multiple industries. She has already made a significant impact refreshing the corporate strategy and sharpening management’s focus on operational execution. The strength and expertise of the Board members has allowed us to adjust quickly to these significant changes and I am thankful to Pierre Bouchut, who took on the role of Senior Independent Director, and Virginia McDowell, who replaced Stella as Chair of the Remuneration Committee. Further details regarding our continued search for Non-Executive Directors and our board succession planning appears in the People and Governance Committee report starting on page 101. The Board established a new Capital Allocation Committee in February 2024, which will provide additional oversight over the Company’s portfolio of assets, capital allocation and capital structure. I am the Chair of this Committee and I have been joined by Pierre Bouchut and Ricky Sandler. The Board remains confident about the Group’s future and is committed to our strategy, our purpose and is highly focused on developing sustained and sustainable shareholder value. #### “The Board remains #### confident about the Group’s future and #### is committed to our #### strategy, our purpose #### and is highly focused on #### developing sustained #### and sustainable #### shareholder value”. J M Barry Gibson Chairman J M Barry Gibson Chairman 1Overview 8Strategic report 88 Governance 140 Financial statements 88 Entain plc Annual Report 2023 ![]() 9 3881235 4 #### Board of Directors #### (as at 7 March 2024) #### Tenure Years: Barry Gibson Stella David Rob Wood Pierre Bouchut Amanda Brown Virginia McDowell Ricky Sandler David Satz Rahul Welde 0 1 2 3 4 5 6 7 Age and #### experience No. of Directors Experience/Skills: No. of Directors 40-44 60-64 50-5445-49 65-69 55-59 70+ 1221201 Gaming Sector Finance Technology/ Digital Global Business Legal/ Regulatory MarketingCustomer Media/ Entertainment Leadership #### Diversity Gender 3:6 No. of Directors 4 British 3 American 1 French 1 Indian Entain plc Annual Report 2023 89 1 Overview 8 Strategic report 88 Governance 140 Financial statements Chairman’s Governance Overview ![]() J M Barry Gibson Chairman Tenure: Appointed to the Board November 2019 and became Chairman February 2020. Age: 72 Nationality: British Committees: C P S Biography: Barry was previously a non-executive director of William Hill plc and bwin. party digital entertainment plc, where he was the senior independent director. Other listed company experience includes roles as the chairman of HomeServe plc, non-executive directorships of Somerfield plc and National Express plc and group chief executive of Littlewoods plc. He was formerly the group retailing director at BAA plc and non- executive chairman of Harding Brothers Holdings Ltd. Key strengths and experience: Barry has enjoyed a distinguished business career and has a deep understanding of the gaming and retail sectors. He is an experienced leader and board member with valuable insight on improving company performance and transformation programmes. Barry continues to create a Board environment of constructive challenge and oversight. Rob Wood Chief Financial Officer and Deputy CEO Tenure: Appointed to the Board as Chief Financial Officer March 2019; the role of Deputy CEO was added to his portfolio January 2021. Age: 44 Nationality: British Biography: Rob joined Entain in 2012 and worked in senior roles within finance, including as CFO of the Group’s retail business. Prior to Entain, he was senior vice president at Cerberus Capital, overseeing the private equity firm’s European portfolio companies and worked in restructuring advisory at Rothschild. Rob started his career at KPMG where he qualified as a chartered accountant and holds a degree in Mathematics and Management Studies from the University of Nottingham. Key strengths and experience: Rob’s financial expertise and deep knowledge of Entain’s business make him uniquely placed to manage his wide-ranging portfolio as Chief Financial Officer and Deputy CEO, providing insight to the Board on commercial, financial and operational issues. Key: A Audit Committee Member C Capital Allocation Committee Member R Remuneration Committee Member P People & Governance CommitteeMember S Sustainability & Compliance CommitteeMember A Audit Committee Chair C Capital Allocation Committee Chair R Remuneration Committee Chair P People & Governance Committee Chair S Sustainability & Compliance Committee Chair #### Board of Directors Stella David Interim Chief Executive Officer Tenure: Appointed to the Board March 2021 and became Interim Chief Executive Officer December 2023. Senior Independent Director until December 2023. Age: 61 Nationality: British Outside interests: Non-executive director of Norwegian Cruise Line Holdings Ltd where she is also chair of the Nominating and Governance Committee and non-executive director of the privately-owned Bacardi Ltd. Biography: Stella was previously CEO of William Grant & Sons, following more than 15 years with Bacardi Ltd. She was chair of C&J Clark Ltd (having previously acted as interim chief executive officer), non-executive director and senior independent director of HomeServe plc and non-executive director and remuneration committee chair at the Nationwide Building Society. Stella stepped down as a non-executive director and remuneration committee chair of Domino’s Pizza Group plc and as a non-executive chair of the privately-owned Vue International following her appointment as Interim Chief Executive Officer of Entain plc. Key strengths and experience: Stella is an intensely commercial leader with a long track record of success across multiple industries. She brings lengthy experience in management, consumer and regulatory environments, and marketing to the Board. Her non-executive roles in listed and privately owned companies give her a deep understanding of shareholder views and best practice standards of corporate governance, as well as enhancing the Board’s ability to support and oversee the delivery of Entain’s strategy. Committee membership details provided in these biographies are given as at the date of this Annual Report. For details of Committee membership during the financial year, see Committee reports on pages 101 to 112 and page 116. 1Overview 8Strategic report 88 Governance 140 Financial statements 90 Entain plc Annual Report 2023 ![]() Pierre Bouchut Independent Non-Executive Director & Senior Independent Director Tenure: Appointed to the Board September 2018 and became Senior Independent Director December 2023. Age: 68 Nationality: French Outside interests: Non-executive director and chairman of the audit committees at Pepco Group and GeoPost SA, a non-executive director and chairman of Profi Rom Food SRL, and a non-executive director of Rina Estate Italia SRL. Committees: A C Biography: Pierre was the chief operating officer for Europe at Koninklijke Aholddelhaize N.V. (2016-2018), chief financial officer at Delhaize Group Belgium (2012-2016), Carrefour SA (2009-2012), Schneider Electric Group (2005-2009), and CEO of Casino Group (1995-2003). He was also a non-executive director of Hammerson plc (2015-2021) and Firmenich SA (where he was also chairman of the audit committee) (2016-2023). Until it was acquired by KKR in 2022, he was the reference board member and chairman of the audit committee at Albioma SA. He has worked for Citibank, Bankers Trust and as a consultant with McKinsey. Key strengths and experience: Pierre has had a long career in senior executive and non-executive roles across fi nance, retail, logistics, information systems and property. His familiarity with the management of large, internationally listed companies gives him an extensive understanding of regulation, accounting standards and strategy, complementing his deep knowledge of corporate governance and audit committee practice. This broad experience makes him suited to chair Entain’s Audit Committee and to act as its financial expert. Ricky Sandler Non-Independent Non-Executive Director Tenure: Appointed January 2024. Age: 54 Nationality: American Outside interests: Chief Executive Officer and Chief Investment Officer of Eminence Capital, LP. Committees: C P Biography: Ricky founded Eminence Capital in 1999. Eminence is a USD6.5 billion global investment management organisation investing client capital across global financial markets. As Chief Executive Officer and Chief Investment Officer of Eminence, Ricky is responsible for setting the fi rm’s strategic direction as well as directly managing its 20+ person investment team and diversified investment portfolio. Prior to launching Eminence, Ricky was co-founder and co-general partner of Fusion Capital Management, a firm that managed a long/short hedge fund focused on global equity securities. Prior to that he was a research analyst at Mark Asset Management, where he began his investing career in 1991. Ricky received a BBA in Accounting and Finance graduating with honours from the University of Wisconsin. Key strengths and experience: Ricky brings over 30 years of experience in analysing and investing in public companies with a wealth of perspective on ways to maximise long term shareholder value and institute strong corporate governance oversight at the board level. In connection with his appointment, the Company, Eminence Capital and Ricky have entered into a relationship agreement, including customary governance, standstill and voting provisions. A summary of the main terms of the agreement is available on the Company’s website. David Satz Independent Non-Executive Director Tenure: Appointed October 2020. Age: 64 Nationality: American Outside interests: Member of the board of a commercial gaming and hospitality entity established by the Eastern Band of Cherokee Indians (EBCI) and a member of the board of Dreamscape Entertainment Integrated Resorts, Inc. Committees: A S Biography: David was senior vice president of Government Relations and Development for Caesars Entertainment Corporation in Las Vegas, where he worked from 2002 to 2019 and had responsibility for overseeing Caesars’ government activities for more than 52 properties in 15 states in the US and several other countries around the world. Prior to this he spent 16 years at the US law firm Saiber Schlesinger Satz Goldstein LLC, where he had a particular focus on the gaming industry and played a key role in numerous regulatory and legislative initiatives throughout the US. Key strengths and experience: David brings to the Board an exceptional perspective on the US gaming sector as well as expertise in gaming regulatory law and policy as it impacts the Group worldwide. His extensive career in regulation and legislation has allowed the Board to benefit from his insight and knowledge as Entain seeks to execute its strategy to grow market share in the US through its BetMGM joint venture. His regulatory experience has also provided insight into the many regulatory, responsible gaming and compliance issues that the Group faces. Rahul Welde Independent Non-Executive Director Tenure: Appointed July 2022. Age: 54 Nationality: Indian Outside interests: Non-Executive Director of Pantheon International Plc. Chair of the Advisory Board of Migrant Leaders, a UK charity. Committees: A P R Biography: Rahul spent over 30 years working with Unilever PLC, most recently in a global role as the Executive Vice President of Global Digital Transformation, building capabilities across the digital spectrum, including new business models, innovation, partnerships, processes and training. Previously, Rahul was Unilever’s Regional VP Media for Asia, Africa, Middle East, Turkey and Russia. Throughout his career he has worked in a diverse range of roles across functions and categories. He has been active in industry bodies, including as the Regional Vice President for The World Federation of Advertisers and chairman of the Mobile Marketing Association, Asia. Key strengths and experience: Rahul brings a lifetime career of knowledge from the global fast-moving consumer goods sector. He has proven experience of leveraging digital technologies for the benefit of business. Rahul has deep expertise in media and marketing as well as in digital and transformation, leading large change programmes encompassing technology, processes and people. Amanda Brown Independent Non-Executive Director Tenure: Appointed November 2023. Age: 55 Nationality: British Outside interests: Non-executive director and chair of the remuneration committee of Mitchells & Butlers plc and a non-executive director of Manchester Airport Group. Committees: R Biography: Amanda is an experienced senior executive with a background in consumer facing organisations and financial services. She served as Chief Human Resources Officer of Hiscox during a period of significant growth and transformation for the organisation and she has also held executive roles within Whitbread Group, PepsiCo and Mars Inc. Amanda was a Non-Executive Director and Chair of the Remuneration Committee of Micro Focus International Limited, a multinational software and information technology business, before stepping down when the business was sold in 2023. Key strengths and experience: Amanda brings a wealth of experience in human resources, remuneration strategy and managing organisations through significant change. Amanda has relevant consumer facing experience. Given her extensive experience as a Remuneration Committee Chair, Amanda was appointed as Designate Chair of the Remuneration Committee at the time of her Board appointment and, subject to her election, will become Chair of Entain’s Remuneration Committee following the AGM. Virginia McDowell Independent Non-Executive Director and Designated Workforce Director Tenure: Appointed June 2018. Age: 66 Nationality: American Outside interests: Vice-president of Global Gaming Women, a non-profit organisation with a mission to support, inspire and influence the development of women in the gaming industry through education and mentoring, and a trustee of St Louis University. Committees: R S P Biography: Virginia was the president and CEO of Isle of Capri Casinos, Inc. in the United States from 2011 until her retirement in 2016, and the president and COO of Isle of Capri (2007-2011). Prior to this she was the chief information officer at Trump Entertainment Resorts (2005- 2007) and senior vice president of operations. Virginia was the first woman to be inducted into the Mississippi Gaming Hall of Fame and in 2022 she was inducted into the American Gaming Association’s Hall of Fame. Key strengths and experience: Virginia’s 40-year career and accomplishments in the gaming sector have been recognised by a number of prestigious awards. Virginia has actively engaged with our stakeholders in her role as Designated Workforce Director. Throughout her career she has maintained a tireless focus on developing the next generation of women leaders in the gaming industry and this understanding of the diversity and regulatory challenges of the sector has greatly assisted the Board and the Sustainability & Compliance Committee. Entain plc Annual Report 2023 91 1Overview 8Strategic report 88 Governance 140 Financial statements Board of Directors ![]() #### Summary of 2023 Details of progress and our deliverables on the key areas for focus set out in our last annual report are set out below: 2023 Goals 2023 Result Undertake a follow-up independent audit of the Group’s governance and compliance processes, following on from the 2021 Alvarez & Marsal review. Entain instructed PWC to carry out a comprehensive assessment of the overall design and efficacy of its compliance framework, with particular focus on gambling industry requirements and good practice. The review encompasses the following key elements: governance and tone from the top; risk assessment and response; policy and strategy; compliance culture and standards of behaviour; training and communications; procedure and control activities; issue reporting and management; monitoring and assurance; and the use of technology. The report is expected to be completed by the end of March 2024. Continue to embed the evolved risk management programme throughout the business. The Enterprise Risk team have further developed the Enterprise Risk Management (“ERM”) policy, manual, process, risk toolkit and programme during 2023. Our refreshed approach to ERM is creating a more ‘risk aware’ culture’ and aligned to the international standards on risk management. We have undertaken formal risk training and workshops with all functions at Entain, the outputs of which have led to a more substantive risk register and significant risk dashboard, focussing on ‘impact’ and ‘action’ to support informed risk-based decisions. Further develop the global Compliance and AML team structures, with further recruitment where required, and the alignment of acquired businesses with the Group’s policies, procedures and risk appetite. We conducted a comprehensive restructuring of the compliance organisation with consolidation of departments and alignment across our acquired businesses. We have also enhanced our capabilities with key hires and strengthened our compliance monitoring and assurance programme. We restructured and centralised the Anti-Financial Crime (“AFC”) function to ensure it remains robust, sustainable and proportionate in managing and mitigating financial crime risks faced by Entain. We have also revised the organisational structure to ensure staff globally with financial crime responsibility, have a reporting line into Group AFC team. Recruit a new Company Secretary. We welcomed James Morris as Group Company Secretary in July. Finalise a new strategy for ARC TM which provides a path of development for the next three years. We continued to refine ARC TM during the year and worked with lived experience experts, academics and third party behavioural scientists to improve our player protection offering for customers. Progress the HMRC investigation towards a conclusion. We reached final settlement of the HMRC investigation into our legacy Turkish- facing business and entered into a Deferred Prosecution Agreement (“DPA”) with the Crown Prosecution Service that was approved by the Crown Court on 5 December 2023. Since the conduct giving rise to the DPA, the Group has undertaken a comprehensive review of its anti-bribery policies and procedures and has taken decisive action to significantly strengthen its wider compliance programme and related controls. Hold an Entain: Sustain update interaction in Q4. In December 2023, we held our annual Entain Sustain update event virtually, providing updates on several topics to our key stakeholders including investors, analysts, regulators, media, colleagues and customers. A report on this event can be found in our discussion on Board Leadership and Company Purpose on page 97. Entain plc Annual Report 202392 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() Regulated Markets On 12 November 2020, Entain announced a clear strategy for sustainability, growth and innovation. As part of that strategy, the Group made a commitment to only do business in countries where it had a local licence or those countries that were on a path to revise their laws and regulations, which would allow us to then apply for a domestic licence in the near to mid-term. Throughout 2023, the Group continued with this process by exiting its few remaining markets where there is no clear path to market liberalisation via domestic regulation. Since 2020 the Group has closed its offering into more than 150 markets where we do not see the prospect of regulation allowing the Company to obtain a licence or find a locally-licensed operator to partner with on attractive commercial terms. We have also doubled the number of countries where we hold a licence and currently hold domestic licences in 34 markets and now hold licences in 26 US States. We remain active in only five small markets where we do not currently hold a domestic licence, and by the end of 2024 we will have either exited these markets or have obtained, or be in the process of obtaining, a domestic licence. More specifically, in 2023, we obtained a licence to offer our bwin brand in Mexico and completed the acquisition of STS to enter the regulated market in Poland. We also announced an exclusive 25-year deal with the New Zealand TAB to provide licenced online sports betting services in New Zealand. At the end of the year, the Brazilian Government passed its long-awaited online gambling bill and we expect licences to be made available in 2024. In parallel, the Finnish Government also formally announced that it will dismantle its gambling monopoly and launch an open licensing system for online gambling in the next two years. Governance Team With Robert Hoskin’s departure, Simon Zinger, our Group General Counsel, has taken over leadership of the Governance, Legal and Compliance function. Simon is a member of the Executive Committee and brings a wealth of experience and leadership to the team. He was instrumental in the resolution of the HMRC investigation and agreeing the terms of the DPA with the Crown Prosecution Service and has overseen significant organisational changes and improvements as the Company has continued to strengthen its governance and compliance standards and capabilities. Under Simon’s leadership, the global Governance team is highly-engaged in supporting the Company’s objectives and has focused on a number of unique initiatives such as complementing the Company’s efforts in the area of Diversity & Inclusion, undertaking pro bono activities to support charities, and creating unique learning and development opportunities for team members, During the year we have continued to make good progress embedding our ERM framework (see page 79) and enhanced our global Compliance and AML team structures. Our Head of International Compliance, Florian Sauer, has conducted a comprehensive restructuring of the compliance organisation with consolidation of departments and alignment across our recently acquired businesses. We have focused on pursuing and maintaining constructive relationships with all of our regulators, continued to enhance our capabilities with key hires, and strengthened our compliance monitoring and assurance programme. We welcomed Karen Nightingale as Group Director of Ethics and Compliance at the beginning of the year. Under her leadership we have developed a three-year strategy to achieve our vision of a best-in-class Ethics and Compliance programme and have created a Charter that explicitly sets out the independence and authority of the Ethics and Compliance function required to implement the programme effectively. We have updated our approach to on-boarding vendors and suppliers in order to better identify and mitigate third party risk exposure and will continue to develop this going forward. We have also appointed Edward Maguire as our new Group MLRO and Global Head of AFC as part of our commitment to combat financial crime. During the year we have developed a holistic Anti- Financial Crime Risk Management Programme with enhanced coverage, governance and reporting protocols. We have also created a centralised function to drive consistency of standards, whilst ensuring effective oversight and control. We were also pleased to welcome James Morris as Group Company Secretary in July 2023. Regulatory Settlement A key area of focus during 2023 was overseeing resolution of the HMRC’s investigation in relation to the Group’s legacy Turkish- facing business. The Board was proactively engaged throughout the process and has reviewed and challenged the work done to significantly strengthen the Company’s compliance programme and controls. We are now a fundamentally different and profoundly changed Company and we can move forward with confidence as we concentrate on our future. Entain plc Annual Report 2023 93 1 Overview 8 Strategic report 88 Governance 140 Financial statements Summary of 2023 ![]() Entain plc: The Board must act with integrity and is collectively responsible for establishing the Company’s purpose, values and strategy as well as overseeing the conduct of its business and promoting the long-term sustainable success of the Group, generating value for shareholders and contributing to wider society. The Board sets the strategic direction of the Group, approves the strategy and takes appropriate action to ensure that the Group is suitably resourced to achieve its strategic aspirations. The Board considers the impact of its decisions and its responsibilities to all its stakeholders, including colleagues, shareholders, regulators, customers, suppliers and the communities in which we operate. The Board discharges its responsibilities directly or, in order to assist it in carrying out its function of ensuring effective independent oversight and stewardship, delegates specified responsibilities to its committees. Details of how the Board fulfilled its responsibilities in 2023, as well as key topics discussed and considered by the Board committees, can be found in this Directors’ report. Audit Committee Oversight and review of financial reporting processes, the Group’s system of internal control, including internal financial controls, the appropriateness and effectiveness of the enterprise risk management framework and principal risks and the work undertaken by Internal Audit and the Group’s Statutory Auditor, KPMG. Read more: pages 104 to 109 Sustainability & Compliance Committee Oversight and review of the Company’s Sustainability and Compliance programme, the Company’s relationships and engagement with a wide range of stakeholders, progress against internal KPIs and external Sustainability and Compliance index results. Furthermore, it ensures that the ESG Strategy remains fit for the future. Read more: pages 110 to 112 People & Governance Committee Oversight and review of Board and executive succession, overall board effectiveness, workforce policies and practices and corporate governance issues. Read more: pages 101 to 103 Remuneration Committee Oversight and review of the Group’s overall remuneration strategy, including share plans and other incentives. Further maintains dialogue with shareholders and workforce on remuneration related matters. Read more: pages 116 to 117 Capital Allocation Committee Oversight over the Group’s portfolio of assets, capital allocation and capital structure. Chairman’s Committee Provides the opportunity for the Chairman to discuss and consider topical ad hoc matters with the Non-Executive Directors without the Executive Directors being present. The topics discussed during the year have varied from performance and strategic related matters, including executive succession planning and shareholder feedback. Interim Chief Executive Officer The Interim Chief Executive Officer is responsible for the management of all aspects of the Group’s business, developing strategy in conjunction with the Chairman and the Board, and leading its execution. The Board delegates authority for the operational management of the Group’s business to the Interim Chief Executive Officer for further delegation in respect of matters that are necessary for the effective day-to- day operations and management of the business. The Board holds the Interim Chief Executive Officer accountable in discharging her delegated authorities. Executive Committee The Executive Committee comprises of the Interim Chief Executive Officer, Chief Financial Officer, Group Chief Commercial Officer, Chief Product & Technology Officer, Group General Counsel, Chief People Officer and Chief Investor Relations & Communications Officer. It supports the Interim Chief Executive Officer in the day-to-day management of the business and implementation of strategy. Entain Leadership Team Business Leaders who own delivery of business strategy and communications across the Group. Board and Committee Structure: Decisions, #### responsibilities and delegated authority Entain plc Annual Report 202394 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() J M Barry Gibson Chairman Provides effective leadership of the Board and promotes the highest standards of corporate governance practices. Leads the Board in providing strong strategic oversight and setting the Board’s agenda, culture and values. Leads the Board in challenging management’s thinking and proposals, and fosters open and constructive debate among Directors. Maintains internal and external relationships with key stakeholders, and communicates shareholders’ views to the Board. Organises periodic monitoring and evaluation, including externally facilitated evaluation, of the performance of the Board, its committees and individual Directors. Leads on succession planning for the Board and its committees, ensuring appointments reflect diverse cultures, skills and experiences. Senior Independent Director Pierre Bouchut Independent Non-Executive Director & Senior Independent Director Supports the Chairman, acting as intermediary for Non-Executive Directors when required. Leads the Non-Executive Directors in evaluating the performance of the Chairman, supporting the clear division of responsibility between the Chairman and the Chief Executive Officer. Listens to shareholders’ views if they have concerns that cannot be resolved through the normal channels. Leads an orderly succession process for the Chairman. Non-Executive Directors Constructively challenge and contribute to the development and approval of Group strategy. Challenge and oversee the performance of management. Ensures that financial information is accurate and that both controls and the system of risk management are effective and robust. Contribute to the assessment and monitoring of culture. Maintain internal and external relationships with the Group’s key stakeholders. Stella David Interim Chief Executive Officer Leads and directs the implementation of the Group’s business strategy, embedding the organisation’s culture and values. Leads the Group Executive Committee with responsibility for the day-to-day operations of the Group and financial performance. Maintains relationships with key internal and external stakeholders including the Chairman, the Board, customers, regulators and shareholders. Maintains responsibility and accountability for the Group’s and its employees’ compliance with applicable laws, codes, rules and regulations, good market practice and Entain’s own standards. Executive directorsThe Chairman Rob Wood Chief Financial Officer and Deputy CEO Supports the Group Chief Executive in developing and implementing the Group strategy and recommends the annual budget and long-term strategic plan. Leads the Finance function and is responsible for effective financial reporting, including the effectiveness of the processes and controls, to ensure the financial control framework is robust and fit for purpose. Maintains relationships with key stakeholders including shareholders. Leads the Disclosure Committee to ensure the Group meets its disclosure and reporting requirements pursuant to the Financial Conduct Authority’s Listing Rules and Disclosure Guidance and Transparency Rules, as well as complying with UK Market Abuse Regulations. Board composition, roles and attendance in 2023 The Chairman is committed to ensuring the highest standards of Board effectiveness. A key mechanism to drive this is the appropriate composition and balance of individuals. The Board is comprised of a majority of independent directors, who provide an independent perspective, constructive challenge and monitor performance and delivery of the strategy within risk appetite and the controls set by the Board. Entain plc Annual Report 2023 95 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Board Leadership and Company Purpose Over the year the Board focused on a strategy of growth and sustainability bringing moments of excitement into people’s lives. As we go into 2024 there has been a shift in strategy to deliver organic growth, EBITDA margin expansion and US market growth. The Board will continue to ensure the customer is at the heart of all we do as we continue to develop and provide market-leading player protection. The Board has also sought to promote our purpose and strategy and made decisions in the interests of all stakeholders, having considered the matters set out in s172 of the Companies Act 2006 (UK). Employee Forum Global Conference Our Global Engagement Conference invites employee engagement advocates to share their insights with the Board and Executive Committee. This year’s event was hosted on 31 January by Melanie Tansey, Chief People Officer, and was attended by Board members Virginia McDowell, our Designated Workforce Director, and Rahul Welde, and more than 40 employees representing 22 countries. Attendees heard a business update which focused on our strategic direction, goals, culture and employee engagement. Following this, the group then had an open conversation with the Board on topics such as how to build engagement and trust, communication, diversity, equity & inclusion, goal setting, leadership, networking and recognition. A number of proposals were taken away by the representatives of the Board for further consideration. A video recording of the Global Conference was posted on the Entain intranet to ensure all employees have an opportunity to watch the discussion. Employee Forum AGM Each year the elected representatives from our forums come together with members of the Board and Executive Committee for the Forum AGM. During this year’s meeting, each forum presented their main achievements during the year and had an open conversation with the Board. This meeting took place in January 2024. It was hosted by Melanie Tansey, Chief People Officer and welcomed 80 Forum Representatives to join two of our Directors, Virginia McDowell and Rahul Welde. Key topics discussed included communications, company performance, customer feedback, leadership, listening and strategy. The meeting was an important opportunity to build connections between the Board and our employees. Shareholders The Board receives feedback on shareholder views in different ways, including through the Chairman and executive management, who meet regularly with shareholders throughout the year, as well as an investor study compiled by an independent third party. Board members listen to results and trading updates held by the Group for analysts and institutional investors and can hear directly the questions and comments on Company performance. The Chairman and Senior Independent Director held regular meetings with a variety of institutional investors to discuss the execution of strategy and delivering shareholder value. Key takeaways and feedback from shareholder meetings were shared with the rest of the Board. Stakeholders The Board has responsibility for leading the Group’s stakeholder engagement and considering the implications of key decisions on the Company and its stakeholders. The Board recognises that effective engagement with our stakeholders will drive long-term value creation, making Entain a company that people want to invest in, buy from, partner with and work for. Entain has identified six stakeholder categories and our report on ‘Board activities’ provides an overview of how the Group’s key stakeholders are considered in Board discussions and deliberations as part of its decision making. Our People Listening to and engaging our people is a key priority at Entain. We are committed to listening to employees across the globe to drive positive change throughout the organisation. We focus on this through our Employee Forums, Global Engagement Conference and global engagement survey. Employee forums exist in many of the locations in which we operate. Our Employee Forums continue to be a key pillar of our employee listening and engagement strategy. The forums enable our people to discuss and agree how their teams connect with the Company purpose, strategy and values, as well as discussing topics that impact them and their colleagues. Our UK & Ireland Retail Forums and UK & Gibraltar Office Forums host quarterly meetings where elected representatives come together to share feedback on all aspects of life at Entain. During these meetings they also hear updates from the business on topics ranging from company purpose, strategy and values to financial performance and operational initiatives. Our Directors are encouraged to attend employee forums and during the year have attended listening sessions that provide feedback and insight into the realities of everyday working life at Entain. As per our forum constitution, every two years we refresh our forums by electing new representatives. This election process was held in December 2023, and we now have a new forum team for 2024/25, who have been fully trained in readiness for their role. Entain plc Annual Report 202396 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() Director meeting attendance for 2023 The Board had six scheduled meetings in 2023 and a further eleven ad-hoc meetings. Scheduled Meetings attended Meetings eligible to attend Ad hoc Meetings Ad hoc Meetings eligible to attend Chairman Barry Gibson 6 6 11 11 Executive Directors Stella David 6 6 9 11 Rob Wood 6 6 10 11 Jette Nygaard- Andersen 5589 Robert Hoskin 2 2 Non-Executive Directors Pierre Bouchut 6 6 10 11 Rahul Welde 6 6 9 11 Virginia McDowell 6 6 10 11 David Satz 66911 Rahul Welde 6 6 9 11 Amanda Brown 1122 \* Directors are expected to attend all scheduled Board meetings. Where Directors are indicated as not having attended Ad Hoc Board meetings, this is attributable to pre- existing and unavoidable commitments, typically as a result of the short notice given. In each case the Director was provided with all Board papers and the opportunity to provide comments to the Chairman as appropriate. In December 2023, we gave our annual Entain Sustain updates, providing a deep dive into key business developments that touch on the important ESG initiatives, including regulation and environmental progress. The update provided an overview of our double materiality assessment held throughout H1 2023 where key stakeholders including investors, analysts, regulators, business partners, customers and colleagues were given the opportunity to share their views. The process was fundamental in mapping Entain’s material risks and opportunities, which underpinned the development of our new Sustainability strategy released during Entain Sustain in December. The new strategy focuses on four core areas: Being a market leader on player protection – providing industry leading customer protection through innovative features, customer support, communications and our culture. Provide a secure and trusted platform – lead on integrity in everything that we do. From having the highest ethical standards, to only operating in regulated markets, to having a high standard of data protection and cyber security. Create the environment for everyone to do their best work – to attract a broad and diverse audience from the inside out. To be an employer of choice, build an inclusive and supportive culture where talent from all backgrounds can thrive. Positively impact our communities – Play our role in limiting global warming to no more than 1.5 degrees and create a positive impact on our communities. We developed this strategy to strengthen our sustainability leadership role and articulate our approach to focus actions across our business and value chain. AGM All resolutions put to the 2023 Annual General Meeting received overwhelming support of those investors who voted, being approximately 80% of our shareholder base (slightly higher than the voting level of 77% in 2022). The results of the voting at all general meetings are published on our website: www.entaingroup.com. Entain plc Annual Report 2023 97 1 Overview 8 Strategic report 88 Governance 140 Financial statements Board Leadership and Company Purpose ![]() As an Isle of Man incorporated company, Entain is not subject to the reporting obligations under Section 172 of the Companies Act 2006 (UK). Nevertheless, the Board recognises the importance of effective governance and intends to operate in line with the UK reporting regulations. The Group has complied with the principles and provisions of the 2018 UK Corporate Governance Code. During 2023 the People & Governance Committee was composed of a majority of independent members, in compliance with Provision 17. However, as we began 2024, the composition of this Committee changed (further details can be found on page 102) and the Committee now comprises the Chairman, two independent non-executive directors and one non-executive director. Whilst not strictly in adherence with Provision 17, the Board is of the view that the composition of the People & Governance Committee complies with the spirit of the Code given that it is comfortable that sufficient independent judgement is applied by the four Committee members to the consideration of appointments to the Board. The Board will keep this matter under review and address the matter of independence of the Committee as additional non-executive directors are appointed to the Board. The Code can be found on the FRC’s website at www.frc.org.uk. The Board had six scheduled in-person meetings in 2023. In addition there were a further eleven videoconference meetings during the year concerning urgent matters such as the review and approval of M&A transactions, overseeing resolution of the HMRC’s investigation and entering into the Deferred Prosecution Agreement with the Crown Prosecution Services as well as receiving updates on trading. Board meetings are a key mechanism for Directors to discharge their duties, notably under Section 172 of the Companies Act 2006 (UK). An overview of the Board’s discussions and how these considered the Group’s key stakeholders is set out below. #### Board Activities #### during 2023 During 2023, the Board remained focused on  the implementation of safer gambling activities and controls, and progress with embedding the enterprise risk management framework. #### Strategy Execution of Group Strategy S C Cu Tc R Su Regular updates on priorities and improving capabilities for execution of core digital and retail business strategies. Oversight of customer centric initiatives to better serve customers and enable moments of excitement. Oversight and challenge to proposed steps and progress accelerating sportsbook product and platform enhancements. Continued oversight of steps being taken to exit markets with no domestic licences. Two-day session revising strategy around the three pillars of organic growth, EBITDA margin expansion and US market growth. Deep Dives on the Retail segment, competitive landscape, marketing initiatives and value drivers of the Entain business. M&A Activity S C Cu R Su Received regular updates on potential M&A opportunities. Reviewed and approved five M&A transactions recommended by management. Approved equity raise of £600m through a non-pre-emptive placing of new ordinary shares to institutional and retail investors to fund the acquisition of STS Holdings S.A (“STS”) 1 1. Entain consulted with a number of its major institutional shareholders prior to the placing and has respected pre-emption principles through the allocation process in so far as possible. Financial Plan S C Cu Su Discussed and approved the three- year plan. Key to stakeholder groups: S Shareholders Cu Customers Su Suppliers TC The Community R Regulators C Colleagues Entain plc Annual Report 202398 1 Overview 8 Strategic report 88 Governance 140 Financial statements ![]() #### Performance Business updates S Cu R Su Undertook segment reviews of the retail and core digital businesses. Discussed and debated challenges with financial and operational performance in H2 2023. Conducted a detailed review of the competitive landscape, including both global and local operators’ strategic priorities and associated threats. Monitored performance and debated strategic opportunities relating to BetMGM. Financial updates S Cu R Su Reviewed and approved the 2024 Budget. Discussed and approved the continued progressive dividend policy. Monitored and debated the wider macroeconomic and geopolitical environment and its potential impact on our business. Received monthly financial performance updates. Regulatory Developments S C Cu TC R Su Received regular regulatory and legal updates from the Chief Governance Officer and Group General Counsel. Closely monitored progress with the proposed settlement of HMRC’s investigation into the Group’s legacy Turkish-facing business before approving the final terms of the Deferred Prosecution Agreement. Risk S C Cu TC R Su Approved the Group’s principal risks and kept under review the Group Risk Register considering new and emerging risks. Conducted a deep dive into the controls and processes adopted by the Company to comply with regulatory, licencing and compliance regimes. Reviewed and agreed the Principal Risks for 2024 and their allocation for monitoring between the Board and its Committees (see page 79 for more details) Reviewed and approved the Group’s annual long-term viability statement. People and Culture S Cu C TC Comprehensive review of the strategic people agenda and priorities, including steps being taken to attract and retain talent. Oversight of organisation design and review of ways of working initiatives and performance culture. Received updates and provided feedback on the revised values as well as the results of the annual employee survey. Responsible Gambling S C Cu TC R Received regular updates on the Group’s safer gambling activities, including the effectiveness of our ARC TM programme. Player Protection remained a key area of focus for the Board during 2023. A review of the methodology and key metrics for ensuring high standards of player protection is a standing board agenda item, including the proactive measures being taken to enhance controls and monitor player behaviours. Product & Technology S C Cu R Su Received regular updates on the new technology blueprint and target operating model as part of ensuring Entain has the right platform capability needed to support the Company’s growth ambitions and evolving business needs. Kept under review the Tech debt plan to address identified issues in areas of compliance and cybersecurity. Monitored progress with migrating to a cloud embedded architecture. Received reports and provided input on actions being taken to enhance player experience and the quality of sportsbook product. #### Governance Market Updates & Regulatory Disclosures S Cu TC R Approved the Notice of Meeting for the AGM. Reviewed and approved the Annual Report & Accounts following recommendations from the Audit Committee. Considered key market updates and disclosure obligations in respect to Full Year and Half Year results, M&A transactions, trading performance and CEO succession. Investor Feedback S Received feedback from investor meetings and roadshows from the Chair, Senior Independent Director, Executive Directors and Chief IR & Communications Officer. Considered external reviews of investor feedback on Entain’s performance and governance. Board Governance S R C Kept under review the Schedule of Matters Reserved for the Board. Conducted its annual evaluation covering the effectiveness of the Board, its Committees and the performance of the Chair and individual directors. Established and approved the Terms of Reference for the Sustainability & Compliance Committee, People & Governance Committee and Capital Allocation Committee. Conflicts of Interest Policy S C Cu TC R Su Reviewed and approved the Board’s Conflicts of Interest Register. Board Succession S C R Engaged with Spencer Stuart throughout the year as part of ongoing succession planning and appointed two new Non-Executive Directors. 1 Overview 8 Strategic report 88 Governance 140 Financial statements 99Entain plc Annual Report 2023 Board Activities during 2023 ![]() Board Evaluation and Effectiveness The Board undertakes an annual evaluation review in order to increase its effectiveness and to identify areas for improvement. Entain engaged Lintstock Ltd in 2023 to conduct a review of the performance of the Board and its committees. Lintstock is an advisory firm that specialises in Board reviews and has no other connection with the Company or individual Directors. The scope and objectives of the review were agreed following a briefing meeting between the Company Secretary and Lintstock. Lintstock collaborated with Entain to design a bespoke line of enquiry tailored to the business needs of the company, and to follow up on themes identified in Lintstock’s previous reviews. The Chairman and the Committee Chairs were given the opportunity to input into the focus of the exercise. As well as covering core aspects of governance such as information, composition and dynamics, the review considered people, strategy and risk areas relevant to the performance of Entain. The review had a particular focus on the following areas: The ongoing CEO succession process The Board’s dynamics and relationship with management The Board’s oversight of growth opportunities Board members completed bespoke surveys assessing the performance of the Board and each of its Committees, as well as the performance of the Chairman. Each director also completed a self-assessment questionnaire addressing their own performance. Lintstock analysed the findings from the surveys and delivered focused reports documenting the findings, including a number of recommendations to increase effectiveness. Lintstock’s findings were presented and discussed at the Board meeting in February. Actions were agreed for implementation and monitoring. Lintstock found that the Entain Board engaged well with the Board evaluation process, with the Directors taking the opportunity to reflect on lessons learned over the past year. The Chairman was rated highly and the Board identified improvements in the management of meetings since Lintstock’s last review. There was a strong focus on further enhancing the Board’s visibility of the business, and recent improvements in the Board’s dynamics and engagement with management were commented on. The Board identified a number of priorities for 2024, including: Appointing and successfully onboarding a new CEO Reviewing information flows to ensure optimal coverage of all aspects of the business Continuing to develop the Board’s understanding of investor sentiment and the visibility of other key stakeholders, including customers and employees Supporting management in delivering Entain’s key strategic imperatives. Board Commitment, Balance and Independence The Board keeps under review and remains satisfied that each Non-Executive Director devotes sufficient time to the role in order to discharge his or her responsibilities and duties effectively. The Chairman, Senior Independent Director and other Non- Executive Directors each have letters of appointment and do not serve in an executive capacity. Excluding the Chairman, of the remaining eight Directors, five are independent Non-Executive Directors. Due to his relationship with Eminence Capital LP, a shareholder holding more than 3% of the Company’s issued share capital, Ricky Sandler is considered as a Non-Independent Non-Executive Director. The People & Governance Committee, having considered the matter carefully, is of the opinion that the Board has an appropriate combination of executive and non-executive, in particular independent non-executive, directors and complies with the 2018 Code recommendations. During the year, the Board considered requests for additional external appointments by Non-Executive Directors. In opining on these requests, the Board took into account the likely time commitment and any conflicts of interest these external appointments might raise. The Board agreed requests for David Satz and Rahul Welde to take on additional roles outside Entain. Conflicts of Interest policy The Board has a Conflicts of Interest policy and an annual conflicts authorisation process, whereby the Board reviews and approves Entain’s Conflicts of Interest Register and seeks confirmation from each Director of any changes or updates to their position. This authorisation process informs the People & Governance Committee’s assessment of a Non-Executive Director’s independence and ability to devote sufficient time to their role when proposing that Director for re-election at the AGM. Director Induction, Training and Development The Chairman is assisted by the Company Secretary in providing all new Directors with a comprehensive induction programme on joining the Board. The induction programme provides new Directors with an understanding of their duties as Directors, the Group, its businesses and the markets and regulatory environments in which it operates. This includes meeting with senior executives and their direct reports. The programme also provides an overview of the Group’s governance practices. Non- Executive Directors will have further content tailored to the Board Committees that they will join. Amanda Brown and Ricky Sandler have both received a tailored induction programme following their appointment. This included one to one meetings with our Executive Committee, segment and functional leaders and our Internal and External Auditors. The Chairman has overall responsibility for ensuring that Directors receive suitable training to enable them to carry out their duties. Training is also provided by way of reports and presentations prepared for each Board meeting, as well as meetings with Group employees and external advisers. During 2023 we have arranged lunch and learn sessions during the board meeting agenda that have given the Directors the opportunity to discuss and receive a deeper understanding of our Ethics and Compliance programme as well as a broader overview of the UK Retail Business and Competitive Landscape. The Directors have access to independent professional advice at the Group’s expense, as well as the advice and services of the Company Secretary, who advises the Board on regulatory and corporate governance matters. Entain plc Annual Report 2023100 1 Overview 8 Strategic report 88 Governance 140 Financial statements Board Activities during 2023 ![]() #### People & Governance Committee Report Introduction I am pleased to introduce the first report of the People & Governance Committee since it was established in April 2023. A key action arising from last year’s internal evaluation of the effectiveness of the ESG Committee (now called the Sustainability & Compliance Committee) was to consider how best to focus the wide remit of the ESG committee. Following a review, it was agreed that the Nomination Committee be retired and, in its place, a new Committee, the People & Governance Committee, be established. The remit of this new Committee is wider than that of the Nomination Committee as it includes diversity, equity and inclusion matters previously covered by the ESG Committee in addition to those areas covered by the Nomination Committee. Details of the membership of the Committee are set out on page 102. During the year we have spent significant time reviewing the current composition of the Board to ensure we have the right balance of skills, experience and diversity to lead the Company and continue to deliver shareholder value. Further to our comprehensive succession planning and ongoing search for new directors, I was delighted to welcome Amanda Brown as an independent Non-Executive Director in November and more recently Ricky Sandler, who joined the Board as a Non-Executive Director in early January. On joining the Group, Amanda became a member of the Remuneration Committee and Ricky became a member of the People & Governance Committee and has recently joined the newly established Capital Allocation Committee. Diversity, equity and inclusion are core considerations for the Committee. Following Rahul Welde’s appointment as a Non- Executive Director in July 2022, Entain is fully compliant with the Parker Review’s target to appoint at least one Board member from an ethnic minority background. Entain remains committed to achieving the external target laid out in the FTSE Women Leaders Review (the successor to the Hampton-Alexander Review) and the board diversity targets laid out in the Listing Rules and, whilst as at the date of this report female representation on the Board is at 33.3%, I am confident that we shall continue to strengthen diversity in all forms on the Board, Executive Committee and the extended leadership team as we go through 2024. We are particularly focused on increasing female representation on the Board as part of our ongoing Non-Executive Director search. At the point of its establishment, the Committee was chaired by Stella David. Following her appointment as Interim Chief Executive Officer with effect from 13 December 2023, I became Chair of the Committee. #### During the year we have #### spent significant time #### reviewing the current #### composition of the Board #### to ensure we have the right balance of skills, experience and diversity to lead the #### Company and continue #### to deliver shareholder #### value.” J M Barry Gibson Chair of the People & Governance Committee J M Barry Gibson Chair of the People & Governance Committee 1Overview 8Strategic report 88 Governance 140 Financial statements 101Entain plc Annual Report 2023 ![]() The role of the Committee The Committee actively reviews the composition and diversity of the Board and leadership team and has oversight of the succession process. It ensures that appropriate procedures are in place for the training and evaluation of directors; reviews workforce policies and practices and monitors their consistency with the Company’s purpose, strategy and values; and reviews developments in law, regulation, and business practice relating to corporate governance. Key responsibilities of the Committee Ensuring that there is a formal, rigorous and transparent procedure for appointments to the Board. Leading the process for appointments and making recommendations to the Board. Assisting the Board in ensuring its composition is regularly reviewed and refreshed, taking into account the length of service of the Board as a whole, so that it is effective and able to operate in the best interests of shareholders. Overseeing the development of a diverse pipeline for succession for appointments to the Board and senior management positions. In conjunction with the Board, setting measurable targets for diversity and inclusion in relation to the Board and senior management positions. Reviewing workforce policies and practices, in particular those which have an impact on diversity and inclusion, culture, employee engagement and wellbeing. The Committee’s terms of reference can be found on the Company’s website at www.entaingroup.com. Committee membership and attendance From the date that it was established on 26 April 2023 until 15 December 2023 the Committee comprised of the following three members: Stella David, who chaired the Committee, Barry Gibson, the Board Chairman (who had previously been Chair of the Nomination Committee), and Virginia McDowell, the Designated Workforce Director. Following her appointment as Interim Chief Executive Officer, Stella David stepped down from the Committee. Barry Gibson replaced Stella David as chair of the Committee and Rahul Welde was appointed as a member of the Committee. Post year end, on joining the Board, Ricky Sandler was appointed as a member of the Committee in accordance with the Relationship Agreement governing his appointment to the Board (see below). The Committee had four meetings during 2023, all of which took place before the membership changes in December 2023. Attendance at the meetings was as follows. Member Number of meetings attended Number of meetings eligible to attend Stella David (Chair) 44 Barry Gibson 44 Virginia McDowell 44 Regular attendees at Committee meetings included the Chief Executive Officer and the Chief People Officer. Other individuals and external advisers were invited to attend as and when appropriate and necessary. #### Activities Board appointments Following a tender process, the Committee engaged Spencer Stuart to support the recruitment of additional Non-Executive Directors. Following an extensive search against a specified remit, Spencer Stuart presented a list of potential candidates to the Committee. Meetings were held between shortlisted candidates and the Committee and the Chief Executive Officer. The Committee concluded that Amanda Brown would be an excellent addition to the Board, bringing a wealth of experience in human resources, remuneration strategy, and managing organisations through significant change, and therefore recommended Amanda’s appointment to the Board. Amanda Brown was subsequently appointed as an independent Non-Executive Director of the Board on 8 November 2023. She was also appointed as a member and Designate Chair of the Remuneration Committee on this date, as recommended by the Committee. Aside from supporting the Group’s 360 Leadership Assessment and Development Programme Spencer Stuart has no other connections with the Company or individual Directors. It remains accredited under the enhanced voluntary code of conduct for Executive search firms. Post financial year end, Ricky Sandler was, on the recommendation of the Committee, appointed as a Non-Executive Director of the Board and as a member of the Committee. Ricky has a deep knowledge of the business and believes in the quality of Entain’s operations and substantial growth opportunities. In connection with his appointment, due to being the Chief Executive Offi cer and Chief Investment Officer of Eminence Capital LP, a shareholder of the Company, Entain entered into a Relationship Agreement with Eminence Capital and Ricky Sandler, which covers matters including customary governance, standstill and voting provisions. In accordance with this agreement Ricky was appointed as a member of the People & Governance Committee and, following its formation in February 2024, as a member of the Capital Allocation Committee. A summary of the principal terms of the agreement is available on the Company’s website. The Committee continues to work closely with Spencer Stuart to identify potential Non-Executive Director candidates that would add further value, bench strength and diversity to the Board. Board composition and Board Committees The Committee keeps the composition of the Board and its Committees under regular review to ensure that the directors, in their roles as members of the Board and members of the Board Committees, as a collective, have the right skills, experience and knowledge to discharge their responsibilities. The Committee also keeps under review longer term succession planning for the Board and its Committees. The Committee has kept the membership of each Board Committee under review during the year and has considered Committee membership planning as part of the broader Board succession planning process. Due to the expertise and flexibility of the current directors, we were able to reconfigure the composition of the Board Committees as a result of Stella David stepping down as Chair of the People & Governance and Remuneration Committees. During the financial year the composition of Entain’s Board Committees met the requirements of the UK Corporate Governance Code and Entain’s own Terms of Reference for each Committee. Entain plc Annual Report 2023102 1 Overview 8 Strategic report 88 Governance 140 Financial statements People & Governance Committee Report ![]() Director re-appointment for the 2024 Annual GeneralM eeting The Committee considered the independence of each Non- Executive Director as part of its recommendation to the Board for Director re-election at the 2024 Annual General Meeting. It considered the Board Conflicts of Interest register and concluded that there were no obvious conflict situations or outside business interests which would negatively impact the independence of the directors. In making its recommendation, the Committee also considered the time commitment and performance evaluation of each Director standing for appointment. Diversity, equity and inclusion The Committee received regular diversity, equity and inclusion reports including details of key initiatives such as the establishment of employee networks; the progress of such initiatives; the implementation of new policies such as the Group’s global menopause policy; action plans to improve employee attraction, engagement and retention; action plans to improve gender diversity within the senior leadership team; the Group’s apprenticeship programme; and employment data including headcount, attrition rates, people relations cases, and people- related issues raised by the Internal Audit team. Further details on diversity, equity and inclusion can be found on pages 48 and 49. The Committee reviewed the Group Diversity, Equity & Inclusion Policy (including Board diversity) which was subsequently approved by the Board on the recommendation of the Committee. This can be found on our website at www.entaingroup.com. Other reviews The Committee reviewed the Policy on Outside Appointments for Directors and confirmed compliance with this policy throughout the financial year. The Committee reviewed the data submitted to the FTSE Women Leaders Review and also reviewed and approved for recommendation to the Board the proposal for the 2023 evaluation of the Board and its Committees. Towards the end of the financial year the Group commenced a 360 Leadership Assessment and Development Programme for all Executive Committee members. The Committee was briefed on the contents of the assessment and the programme of which the key findings will prove valuable as the Company undertakes its search for a new permanent Chief Executive Officer. Committee evaluation A review of the Committee’s performance and effectiveness during the year was undertaken using a questionnaire facilitated by an external board review firm, Lintstock. Lintstock managed the evaluation process and produced the evaluation report. The feedback from the Committee evaluation was positive in terms of Committee composition, the quality of the meetings and the information provided to the Committee members and the workings of the Committee. The effectiveness of the Chair was rated highly and it was recognised that the Committee had worked well over the year. Areas of focus for 2024 include ensuring that the Committee has a good understanding of Entain’s culture and the issues affecting employees, ensuring that management is receiving the support that it needs, and improving oversight of future executive succession and development plans. The importance of a rigorous CEO selection process was also highlighted. Chairman’s Committee report The Chairman’s Committee is the forum for the Non-Executive Directors and Chairman to meet in executive session. Three Committee meetings were held during 2023. Topics discussed included succession planning for the Executive Directors, business performance, and strategy. Entain plc Annual Report 2023 103 1 Overview 8 Strategic report 88 Governance 140 Financial statements People & Governance Committee Report ![]() #### Audit Committee Report Introduction I am pleased to introduce the Audit Committee report setting out the key matters and issues considered in 2023. In addition to the Audit Committee’s obligations for financial reporting and ensuring the integrity of the Company’s financial and narrative statements, the Committee has continued to monitor progress with the implementation of the Group’s Enterprise Risk Management Framework and challenged management on the identification and assessment of principal and significant risks relevant to Entain. The Audit Committee received assurance through focused deep dives that there has been good progress raising risk awareness throughout the organisation. We received regular updates on emerging financial and non-financial risks that has kept the Committee informed and focused on ensuring relevant controls and mitigating actions are in place and operating effectively. The Committee has challenged management and our external auditors across a range of topics, in particular, key accounting judgments and control matters relating to M&A activity as well as the accounting treatment for the HMRC settlement arising from the investigation into the Group’s legacy Turkish-facing business. The Committee has also worked closely with the Sustainability & Compliance Committee when considering non-financial reporting and disclosures. As Entain focuses on returning to organic growth in 2024, the Audit Committee will continue to play an important role monitoring the effectiveness of the control environment. I am confident that we have the right mix of financial, accounting, risk and sector experience, to enable the Committee to continue to perform effectively and deal with the challenges of the changing regulatory and operating environment that we face as we go into 2024. Pierre Bouchut Chair of the Audit Committee #### “As Entain focuses on #### returning to organic growth in 2024, the #### Audit Committee will continue to #### play an important role monitoring the effectiveness of the #### control environment.” Pierre Bouchut Chair of the Audit Committee 1Overview 8Strategic report 88 Governance 140 Financial statements1Overview 8Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023104 ![]() The role of the Audit Committee The Audit Committee oversees the effectiveness of the Group’s financial reporting, systems of internal control and risk management and the integrity of external and internal audit processes. Key responsibilities of the Audit Committee Monitor the integrity of Entain plc’s financial statements and any formal announcements relating to the Company’s financial performance. Review and challenge, where necessary, the significant financial reporting issues and judgements in relation to the half-year and annual financial statements. Review the effectiveness of, and ensure that management has appropriate internal controls over, fi nancial reporting. Make recommendations to the Board concerning any proposed, new or amended accounting policies. Review and monitor the relationship with the external auditor and oversee its appointment, tenure, rotation, remuneration, independence and engagement for non-audit services. Oversee the work of Internal Audit and assess the effectiveness, performance, resourcing, independence and standing of the function. Review and monitor the implementation and effectiveness of risk management systems and conduct a robust assessment of emerging and principal risks facing the Company. Oversee policies, procedures and arrangements for capturing and responding to whistleblower concerns and ensuring they are operating effectively. Assess and report on the Group’s viability. The Audit Committee Terms of Reference can be found on the Company’s website at www.entaingroup.com. Audit Committee membership and attendance As at 31 December 2023 the Audit Committee comprised three members, all of whom are independent Non-Executive Directors. Pierre Bouchut is Chair of the Committee. He has a strong financial background, having been chief financial officer at Schneider Electric, Carrefour and Delhaize and extensive experience as an audit committee chair, currently serving at Pepco Group, Firmenich S.A. and GeoPost S.A. in this role. The Board is satisfied that he has the required level of relevant financial experience, as outlined in the UK Corporate Governance Code, and competence in accounting and auditing as required by the FCA’s Corporate Governance Rules in DTR7. The Board remains satisfied that the Audit Committee as a whole has an appropriate level of independence and experience and relevant financial and commercial experience across various industries, including the gaming sector, to assess the issues it is required to consider. Committee members continue to receive relevant training to ensure competence relevant to the business, in addition to the other skills they bring to the Board and Committees. Regular attendees at the meetings include the Chief Financial Officer & Deputy CEO, Director of Financial Control, Group General Counsel, Director of Internal Audit, the external auditor and the Chair of the Sustainability & Compliance Committee. During the year the Audit Committee met for private discussions with the external auditor and the Director of Internal Audit. The Committee had five meetings during 2023. Member Number of meetings attended Number of meetings eligible to attend Pierre Bouchut (Chair) 55 David Satz 55 Rahul Welde 44 In February 2023, Mark Gregory and Vicky Jarman stepped down from the Committee and the Board prior to any 2023 Audit Committee meetings being convened. Rahul Welde joined the Committee on 23 February 2023. Entain plc Annual Report 2023 105 1 Overview 8 Strategic report 88 Governance 140 Financial statements Audit Committee Report ![]() #### Audit Committee Report Responsibility for Entain’s financial statements: Fair, Balanced and Understandable The Board is ultimately responsible for presenting a fair, balanced and understandable assessment of Entain’s position and prospects, which extends to the half-year and annual financial statements and Annual Report. Delegation Entain’s finance department, led by the CFO & Deputy CEO, prepares and reviews the financial statements. Management coordinates with the CEO, CFO & Deputy CEO and Chairman on the preparation of any business model and strategy. The Company Secretary with the Chairman of the Board, the Chair of the various Board Committees, prepares the corporate governance statements and all Board Committee reports. External Review Entain’s external auditors audit the Annual Report and financial statements and review the half-year accounts. A report to the Audit Committee is prepared. Committees’ Review The Audit Committee reviews the Annual Report, draft financial statements and accompanying statements and meets with the external auditors to review their report. The Audit Committee proposes amendments and makes recommendations to the Board and further approves the Audit Committee’s Report. For the annual report the Remuneration Committee, People & Governance Committee and Sustainability & Governance Committee respectively review their Committee Reports, propose changes and make recommendations to the Board. Board Review The Board reviews the Annual Report and financial statements, accompanying reports and recommendations from its committees and makes changes to the disclosure where appropriate. Auditor Reporting to The Board The External auditors prepare their final report (Annual Auditor’s Report) or review report (half-year results). Audit/Board Approval and Publish The Board and auditors approve the Annual Report, year-end financial statements and disclosures and the half-year report and these are then released to the stock exchange and published on Entain’s website on receipt of the final audit report. In respect of the financial statements and accompanying reports for the year ended 31 December 2023, the Company has followed the process detailed above. Following the review and challenge of the disclosures, the Committee recommended to the Board that the financial statements taken as a whole, were fair, balanced and understandable. The financial statements provided the shareholders with the necessary information to assess the Group’s performance, business model, strategy and risks facing the business. These include the ever increasing importance of ESG considerations. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023106 Audit Committee Report ![]() External audit The Audit Committee has primary responsibility for overseeing the relationship with the Group’s external auditor, KPMG. KPMG completed its sixth financial reporting audit, providing robust challenge on specific financial reporting judgements and the control environment, with continued specific focus on the design and operation of IT systems and controls. The lead audit partner is Mark Flanagan who has been in role since 2021. The Committee reviewed the external auditor’s approach and strategy for the annual audit and also received regular updates on the audit, including observations on the control environment and the core platform and IT capabilities. Key audit matters discussed with KPMG are set out in its report on page 147. The Audit Committee reviews the fee structure, resourcing and terms of engagement for the external auditor annually. It further considers the reappointment of the external auditor each year before making a recommendation to the Board. It is anticipated that a retender for audit services will be completed by 2028 or sooner, in line with relevant guidelines. The Committee believes that the anticipated timeline for the retender of audit services is in the best interests of shareholders. It provides an appropriate balance of factors such as the auditor’s knowledge of controls and risks, maintaining audit quality, independence and objectivity, and providing value for money. The Group is in compliance with the requirements of the Statutory Audit Services for Large Companies Market Investigation Order 2014. Effectiveness of the external audit The Audit Committee evaluated the effectiveness of the external audit process during the year in consultation with the Chief Financial Officer and members of the senior finance team. The key areas of focus were: Safeguards against independence threats being sufficient and comprehensive. Quality and transparency of communications being timely, clear, concise and relevant and that any suggestions for improvements or changes are constructive. The exercise of professional scepticism and the willingness of the auditor to challenge management’s assumptions. The quality of the audit engagement team – including the continuity of appropriate industry, sector and technical expertise or where there have been new areas of activity and changes in regulation or professional standards. The Committee concluded that the external audit process had been effective and noted the positive enhancements and improvements made to the audit process during the year. Due to the growing complexity of the Group, it was agreed that a more global audit relationship with KPMG was required going forwards in order to enhance the quality and transparency of key audit matters and provide broader real time oversight of local statutory audits in the main jurisdictions of the Group’s geographic footprint. #### Activities Financial disclosure The Audit Committee reviewed the full and half-year financial statements with management before proposing them to the Board for approval. In undertaking its review, the Audit Committee received reports from management and the external auditor outlining significant financial judgements and estimates, including the appropriateness of Group’s revenue from online operations and recoverability of the carrying value of the investment in the Parent Company. In undertaking its review, the Committee focused on the integrity of the Group’s financial reporting process, the clarity of disclosure and compliance with relevant reporting standards. The Audit Committee reviewed the assessment and reporting of longer-term viability, systems of risk management and internal control, including the reporting and classification of risk across the Group and the examination of what might constitute a significant failing or weakness in the system of internal control. During the year, the Audit Committee considered the affordability of the Company’s progressive dividend policy, in particular, the implications of the HMRC settlement provision related to the Turkish facing business. The Committee further challenged and debated cash flow forecasts and consideration of relevant downside scenarios informed by long term viability modelling prior to approving the interim dividends paid for the full year 2023. The Committee gave consideration and challenge to the appropriateness of adopting the going concern assumption in preparing the financial statements. The Committee agreed with the conclusions reached and the going concern statement for the year ended 31 December 2023 is set out on page 77. In considering the Annual Report and Accounts, the Committee assessed whether the report was fair, balanced and understandable. The process undertaken is outlined on page 106. The Committee reviewed the consistency of the narrative disclosures and financial statements. It received a report from management on the verification process undertaken in respect of the annual report. The Committee then made a recommendation to the Board, which in turn reviewed the report as a whole, confirmed the assessment and approved the report’s publication. Risk During the year the Committee received regular updates on the progress implementing the Enterprise Risk Management Framework and reports from the Group Risk Committee. The Committee conducted deep dives assessments on the principal risks allocated by the Board relating to Data Breach and Cybersecurity, Trading Liability and Pricing Management, Technology Failure and Taxes. During these assessments, the Committee challenged management and sought assurances that suitable measures were in place to monitor, manage and mitigate the relevant risks. The Committee conducted a year end review of principal risks and emerging risks facing the business and will continue to work with management to ensure that all Entain specific risks are identified with robust processes and controls implemented to effectively manage them. Further details on the Group’s principal risks are set out on pages 83-86. Entain plc Annual Report 2023 107 1 Overview 8 Strategic report 88 Governance 140 Financial statements Audit Committee Report ![]() The Board with the support of the Audit Committee, completed its annual review of the effectiveness of the system of internal control, including the effectiveness of internal audit and consideration of whether it had the appropriate level of independence and its importance in assessing the Company’s culture. The Board concluded that it was satisfied that the system of internal control remains robust and fit for purpose and have selected areas on a risk basis for inclusion in the 2024 Internal Audit Plan. Effectiveness of Internal Audit The Audit Committee continued to monitor and review the effectiveness and capability of the Internal Audit function over the year. In assessing and determining effectiveness, the Committee met privately with the Director of Internal Audit, considered and approved the Internal Audit annual plan and surveyed management on their view of the effectiveness of Internal Audit. The Committee concluded that Internal Audit had unrestricted scope and access to information and sufficient resources to fulfil its annual work plan. This conclusion was strengthened by management’s positive feedback on the quality of the work performed and the additional assurance provided to management by the scope of Internal Audit’s processes. Whistleblowing policy The Group has a formal whistleblowing procedure by which employees can, in confidence, raise concerns about possible malpractice and misconduct. This is set out in the Group’s Code of Conduct and is approved by the Audit Committee. The Speak Out policy sets out the type of disclosure which is protected and also specifies to whom disclosures should be made and the process that will be followed. The Group actively encourages individuals, where they believe that malpractice has taken place, to make protected disclosures either internally through HR and Internal Audit or externally through an outsourced service provider. The Audit Committee receives regular reports from the Director of Internal Audit on the number of cases raised and the outcome of investigations. During 2023, the Company’s whistleblowing procedures have been further strengthened in order to assess complaints that might present an ethics issue. The Audit Committee continues to be satisfied that robust and appropriate arrangements are in place for the proportionate and independent investigation of such matters and for appropriate follow-up action. Committee evaluation The Committee undertook a review of its effectiveness through an online questionnaire administered by an external facilitator (Lintstock). The feedback from the Committee evaluation was positive in terms of Committee composition, the quality of the meetings, ways of working and the information provided to the Committee members. The effectiveness of the Chair was rated highly and it was recognised that the Committee had worked well over the year. There continued to be a good level of engagement with management and the external audit partner. Areas of focus for 2024 included close monitoring of financial performance, oversight of safer gambling controls, challenging management on progress automating key processes and controls, and spending more time to assess operational effectiveness and resiliency. Non-audit services The Audit Committee is responsible for the Group’s policy on non- audit services and the approval of non-audit services. The policy states that in the Company’s financial year, the total fees for non-audit services provided by the external auditors, excluding non-audit fees for due diligence for acquisitions and other specific matters noted below, should not exceed 70% of the average of the total fees for audit services they provided in the preceding three- year period. The policy is kept under annual review and the Audit Committee receives regular reports on non-audit services provided by KPMG and other audit firms. In the year ended 31 December 2023, the total non-audit fees as a percentage of the audit fees paid to the external auditors was 4.9%. In addition to their statutory duties, KPMG is also employed where, as a result of their position as auditors or for their specific expertise, they either must, or the Audit Committee accepts they are best placed to, perform the work in question. This is primarily work in relation to matters such as shareholder circulars, Group borrowings, regulatory filings and certain business acquisitions and disposals. In such circumstances the Audit Committee will separately review the specific service requirements and consider any impact on objectivity and independence of the auditors and any appropriate safeguards to this. As such the Audit Committee believes it is appropriate for these non-audit services to be excluded from the 70% cap set out above. In the year ended 31 December 2023 the fees paid in respect of due diligence for acquisitions to the external auditors was £nil. Internal Audit Internal Audit provides assurance to the Board, through the Audit Committee, that effective and efficient control processes are in place to identify and manage business risks that may prevent the business from achieving its objectives and strategy. The Director of Internal Audit is a standing attendee of the Committee and provides regular reports on Internal Audit findings, including the assessment of issues raised in previous reports. The work completed by Internal Audit during the year focused on key areas of the Group (disclosed on pages 83 to 86 under Principal Risks), which included: Reviews of anti-money laundering and safer gambling processes across various jurisdictions and businesses. Digital fraud management. Recruitment, talent resilience and retention practices. Data governance and retention management. Safer gambling interactions management. IT governance, including privileged access controls. Command Centre Management and performance of core production systems Disaster Recovery. Stadia health and safety and animal welfare Review of the Group’s compliance with the UK Modern Slavery Act and adequacy of provisions to mitigate risks of slavery. Compliance with Ontario licence requirements Ongoing reviews of key financial controls’ operating effectiveness. Entain plc Annual Report 2023108 1 Overview 8 Strategic report 88 Governance 140 Financial statements Audit Committee Report ![]() Accounting and key areas of judgement and estimate Throughout the course of the year, the Audit Committee determined the following areas of the financial statements were of significant interest. These issues were discussed with management and the external auditors to ensure that the required level of disclosure has been provided and that appropriate rigour has been applied where any judgement may be exercised. Matter considered Action Separately disclosed items and Alternative Performance Measures The Group separately discloses certain items in order to allow a clearer understanding of the underlying trading performance of the business. In 2023, the Group has recorded a net charge in respect of items which have been separately disclosed from continuing activities of £1,217.8m after tax in the Income Statement. As part of their assessment that the treatment of separately disclosed items in the financial statements is appropriate, the Audit Committee has considered each of the items disclosed and challenged, where necessary, the treatment adopted by management. The Audit Committee has also considered the conclusions reached by KPMG as part of its audit in this area and are satisfied with the treatment and disclosure adopted. In addition, non-GAAP measures have been provided within the Annual Report and Accounts to assist in the articulation of the underlying business performance. Non- GAAP measures relate to industry standard KPIs which are commonly used by the Group’s peers and market analysts. Management’s use of non-GAAP measures in explaining the underlying business performance has been considered by the Audit Committee, along with the views of KPMG on their use and prominence. Whilst the Committee understands the challenges associated with the use of non-GAAP measures, they are satisfied with the balance of the disclosure provided. IFRS 3 Fair Value of Business Combinations During the year, the Group completed a number of acquisitions as detailed in Note 32 to the financial statements. Included within the IFRS 3 fair value exercise are a number of judgements and estimates including: • the assessment that future revenue shares in Tab NZ form part of consideration • the estimate of consideration, including contingent consideration, particularly on Tab NZ • the estimates of the fair value of acquired intangibles and goodwill The Audit Committee has reviewed the judgements and estimates made in connection with the accounting treatment for business combinations including what items constitute consideration, the value of contingent consideration recognised, the assets and liabilities identified on acquisition and the appropriateness of fair values derived. In assessing the valuations, the Audit Committee has reviewed the working papers provided by management and the work of the Group’s external valuation specialists as well as the conclusions reached by KPMG. In addition, the Audit Committee has assessed the appropriateness of the assumptions used by management in reassessing the value of contingent consideration obligations as at the year end date. Following review of all of these items, the Audit Committee has concluded that the treatment within the financial statements is appropriate. Impairment The Group has significant value in enduring and indefinite life assets such as UK brands and goodwill which need to be reviewed for impairment annually. In 2023, as part of the annual impairment exercise, the Group has recognised a non-cash impairment charge of £190.0m against the goodwill in the Australian business. Inherent in any impairment of a CGU is a degree of estimation. The carrying value of all enduring and indefinite life assets have been tested for impairment as part of the annual cycle. In assessing that the conclusions reached are appropriate, the Committee have reviewed the forecasts, key assumptions and methodology adopted by management in preparing their impairment assessment and, in particular, determining the impairment charge recognised against the Australian business. As part of their assessment, the Committee have also reviewed KPMG’s audit findings and deem that both the treatment and disclosure of the impairment within Note 14 are appropriate. Entain plc Annual Report 2023 109 1 Overview 8 Strategic report 88 Governance 140 Financial statements Audit Committee Report ![]() Introduction In April 2023 the name of the Committee was changed from the ESG Committee to the Sustainability & Compliance Committee and matters relating to diversity, equity and inclusion, previously covered by the ESG Committee, were transferred to the newly established People & Governance Committee (see page 101). These changes reflected feedback arising from last year’s internal evaluation of the ESG Committee and were made to make the increasingly wide remit of the ESG Committee more manageable. During the year, the Committee continued to monitor and provide focus, support and challenge on sustainability and compliance issues. The Committee remained guided by Entain’s Sustainability Charter which outlines Entain’s ESG leadership ambitions. The Charter remains an important part of Entain’s ESG leadership position within the gaming sector. The Committee continued to monitor the management and mitigation of the Principal Risks allocated to it by the Board and ensure that its observations were fed back to the Board. During the year the Principal Risks were ‘Safer Betting and Gaming’, ‘Health, Safety & Wellbeing of Customers, Communities and Employees’, and ‘Loss of Key Locations’. Following review by the Board it was determined that Loss of Key Locations would no longer be treated as a standalone Principal Risk and that it should form part of the Principal Risks ‘Ensure Health, Safety, Security and Well- being of Employees, Customers, and Communities’ and ‘Maintain Technology Platforms Resilience’ – further detail can be found on page 83. As a result of the reconfiguration of the Board Committees following Stella David’s appointment as Interim Chief Executive Officer, Rahul Welde stepped down from the Committee in December and I welcomed our Chairman, Barry Gibson, as a member of the Committee. #### We developed this strategy to #### strengthen our #### sustainability #### leadership role – #### which plays a crucial #### enabling role in our #### long-term growth.” Virginia McDowell Chair of the Sustainability & Compliance Committee #### Sustainability & Compliance Committee Report Virginia McDowell Chair of the Sustainability & Compliance Committee 1Overview 8Strategic report 88 Governance 140 Financial statements1Overview 8Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023110 ![]() The role of the Committee The Committee provides oversight of the Company’s Sustainability and Compliance programme, overseeing the effective management of the Company’s ongoing relationship and engagement with a wide spectrum of stakeholders. It monitors progress against internal key performance indicators and external Sustainability & Compliance index results. Key responsibilities of the Committee Consider the adequacy of the Group’s Sustainability and Compliance policies and processes by reviewing reports prepared by management on a range of issues such as responsible gambling, data protection and the Company’s impact on the environment. Ensure that sufficient focus and resource is given to implementing, monitoring and managing the Company’s Sustainability and Compliance policies and processes and that these remain effective. Consider the appointment of third parties to advise on Sustainability and Compliance policies and practices and/or audit the Group’s Sustainability and Compliance policies. Liaise and work with the Board’s other Committees to ensure the Board’s duties and responsibilities are carried out effectively. Prepare an ESG report for inclusion in the Annual Report and Accounts and oversee that any public disclosures on Sustainability and Compliance issues made by the Group accurately reflect the Group’s policies and processes. The Committee’s terms of reference were reviewed and updated by the Committee and subsequently approved by the Board during the financial year. These can be found on the Company’s website at www.entaingroup.com. The Committee has operated in line with its Terms of Reference throughout the financial year. Committee membership and attendance The Committee has three members, two independent Non- Executive Directors plus the Chairman of the Board. Stella David stepped down from the Committee on 26 April 2023 following the establishment of the People & Governance Committee which she chaired until December 2023 (see the People & Governance Committee report on pages 101 to 103 for further information). Following changes to Board Committee memberships agreed in December 2023, Rahul Welde stepped down from the Committee with effect from 15 December 2023 and Barry Gibson joined the Committee with effect from the same date. Regular attendees at the meetings include the Director of Internal Audit and the Group General Counsel. Other individuals and external advisers are invited to attend as and when appropriate and necessary. The Committee had six meetings during the year, all of which took place before the membership changes agreed in December 2023. Attendance at the meetings was as follows: Member Number of meetings attended Number of meetings eligible to attend Virginia McDowell (Chair) 66 Stella David 1 22 David Satz 66 Rahul Welde 2 66 1 Resigned from the Committee on 26 April 2023. 2 Resigned from the Committee on 15 December 2023. #### Activities Safer betting and gaming The Committee received regular updates on the Group’s responsible betting and gaming programme. Briefings were held on the continued development and impact of the ARC TM programme and the Committee was given a demonstration of the customer journey under a range of scenarios. A deep dive review of the Principal Risk: Safer Betting & Gaming was undertaken, where the Committee considered potential developments in technology and regulatory guidance in key areas such as affordability and customer protection. As in the previous financial year, the Committee undertook a half-year and a full-year review of the delivery of safer betting and gaming project metrics as part of the responsible gaming element of the Group-wide annual bonus structure which has a 15% weighting. This review included an external assessment by EPIC Risk Management on the Company’s performance against targets. With more challenging metrics having been put in place for 2023, at its year-end assessment the Committee determined it was satisfied that these metrics had been met and made a positive recommendation to the Remuneration Committee as part of its assessment. Further information on the responsible betting and gaming remuneration metric is outlined on page 131 of the Directors’ Remuneration Report. Sustainability During the financial year the Sustainability Team completed a comprehensive sustainability materiality assessment which was reviewed by the Committee. The assessment has helped Entain to better identify the sustainability issues that are most material to the business and its stakeholders and will support its preparation for the incoming reporting requirements, such as the EU Corporate Sustainability Reporting Directive. Following the sustainability materiality assessment the four pillars of the Sustainability Charter were updated to: Be a leader on player protection Provide a secure and trusted platform Create the environment for everyone to do their best work Positively impact on our communities More information on Entain’s Sustainability strategy can be found on pages 40 and 41. Gaming licence compliance The Committee considered key elements of the Group’s gaming licence compliance programme, including the development and update of Entain’s Sports Betting Integrity Policy and the measures being taken to reduce the threats posed by Sports Betting Integrity issues. Compliance governance The Committee received quarterly reports on international, UK, Retail and digital compliance developments and monitoring of the Group’s compliance management. It continued to review the impact of M&A activity on the Group’s compliance programme and the regulatory risks associated with new market entry. The Committee received updates on the progress of the application for a compliance management system certification against ISO 37301 and on the progress of the Compliance Assessment by the UK Gambling Commission. Entain plc Annual Report 2023 111 1 Overview 8 Strategic report 88 Governance 140 Financial statements Sustainability & Compliance Committee Report ![]() Ethics & compliance Ethics and integrity are at the core of our organisation and culture. The Committee received regular updates on the key regulatory issues and trends around ethics, compliance and anti-money laundering from the expanded Ethics & Compliance team. The Committee approved the new Ethics & Compliance Charter which sets out the mission of the Group’s Ethics & Compliance Programme and the independence and authority of the Ethics & Compliance team, which ensures that they are able to request information and access resources and colleagues to enable them to effectively undertake monitoring, testing activity and investigations. The Committee reviewed and approved the Group’s Global Anti-Money Laundering & Counter-Terrorist Financing Policy and the Ethics & Compliance Three Year Strategy. Privacy and data protection Regular updates on privacy and data protection were given to the Committee, covering matters such as the steps being taken to improve data governance, the ongoing development of the Group’s cybersecurity strategy, and key legal and regulatory developments around data legislation. The Committee completed its annual review of the Group Data Retention Policy and the Group Data Protection Policy. Health, Safety, Security and the Environment (“HSSE”) The Committee discussed the Group’s environmental strategy and its commitment to being carbon net zero by 2035. HSSE performance was monitored by the Committee through regular updates on the Group’s HSSE performance indicators and initiatives. The Committee reviewed and approved the proposed HSSE strategy for 2023 as well as agreeing the Group’s HSSE KPIs for the forthcoming year. The Committee reviewed and approved the Health, Safety, Wellbeing & Workplace Policy Statement and the Environmental Policy Statement, both of which can be found on the Company’s website at www.entaingroup.com. During the financial year further workshops were held to support the Group’s work on meeting the TCFD requirements. The Committee received updates on the progress of the workshops and how they were informing the Group’s environmental strategy. The Committee undertook deep dive reviews on the two Principal Risks: health, safety and the wellbeing of customers, communities and employees, and loss of key locations. The former focused on addressing key risks and facilitating management solutions relating to HSE matters whilst the latter focused on the findings arising from assurance checks undertaken by the HSSE team and the actions taken to resolve any issues that had come to light from those checks. Modern Slavery Act statement review The Committee reviewed the Group’s Modern Slavery and Human Traf ficking Transparency Statement for the financial year ended 31 December 2022, noting the key mitigation activities undertaken in 2022 including the continued monitoring of risks across the Group’s supply chains, enhanced mandatory training for all employees, and updated policies including a new Code of Conduct which sets out the Group’s commitment to preventing modern slavery. Entain continued to partner with Unseen, a UK anti-slavery charity. During 2022 steps were taken to implement the majority of the recommendations arising from the 2021 gap analysis undertaken by Unseen. During the year, the Committee received updates on the development of the multi-year Modern Slavery Strategy and the Modern Slavery Programme to support the Group’s work combating modern slavery. More details can be found on page 51. The Modern Slavery statement can be viewed on our website at www.entaingroup.com/modern-slavery-statement Other reviews The Committee oversaw the annual ESG report, reviewing the content and giving feedback to management on its content. It also received an overview of the current IT infrastructure and the key IT projects underway as well as an overview of the work of the Group Payment Processing Committee. The Committee meeting packs included the quarterly Internal Audit reports for information purposes. As and when appropriate, the Director of Internal Audit brought key matters to the attention of the Committee. The Committee received an update on the progress of the Group’s commitment to fi nancially support areas such as research into safer gambling and education initiatives, grassroots sports, diversity in tech and community projects through the Entain Foundation. Committee evaluation A review of the Committee’s performance and effectiveness during the year was undertaken using a questionnaire provided by an external board review firm, Lintstock. Lintstock managed the evaluation process and produced the evaluation report. The feedback from the Committee evaluation was positive in terms of Committee composition, the quality of the meetings and the information provided to the Committee members, and the workings of the Committee. The Chair was rated highly and it was felt that the Committee had a good oversight of the policies and controls that fell within its scope of responsibilities. The changes to the Committee’s remit made following feedback from last year’s Committee evaluation had been positively received. Areas of focus for 2024 included ensuring a continued focus on safer betting and gaming, supporting the management of environmental goals and programmes, addressing the significant regulatory issues faced by the Company, undertaking tailored training, and receiving more of an external perspective on best practices relating to key issues. Entain plc Annual Report 2023112 1 Overview 8 Strategic report 88 Governance 140 Financial statements Sustainability & Compliance Committee Report ![]() Annual Statement from the Chair of the Remuneration Committee On behalf of the Board, I am pleased to present the Directors’ Remuneration Report (the “Report”) for the year ended 31 December 2023.  having taken on this role on 14 December 2023 upon appointment      shareholders to vote on our Annual Report on Remuneration at our AGM on 24 April 2024. The Report summarises remuneration  Policy for 2024. The Policy is set out in our 2022 Directors’  at www.entaingroup.com. In a year of transition for  have been mindful of #### the experience of our  #### making remuneration  a strong alignment of  #### performance.” Virginia McDowell  #### Directors’ Remuneration Report In this section        124 Remuneration in context 130 Annual Report on Remuneration  8Strategic report 88 Governance 140 Financial statements 113Entain plc Annual Report 2023 ![]() 2023 incentive outcomes 2023 annual bonus   performance). Our results in 2023 failed to meet the threshold level of the stretching performance conditions that had been set, and so     progress continued to be made in both of these areas, resulting in a full payout in relation to these metrics.     Further details can be found on page 131. 2021 Long-Term Incentive Plan (“LTIP”)  relative Total Shareholder Return (“TSR”) targets over the three- year period ended 31 December 2023.  lapsed in full. Full details are set out on page 132. 2023 Group performance    shareholder value. Key performance highlights in 2023 include:         Our joint venture in the US, BetMGM, delivered a strong            bringing total for the year to 17.8p per share.    derived from regulated or regulating markets, and have  deliver market leading player protection in the markets in     outstanding track record of success across multiple industries. While this is an interim appointment, Stella is focused on driving   Entain plc Annual Report 2023114   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]()     date of 31 August 2023. Looking ahead to 2024 Directors’ salaries     to our UK Retail colleagues).  Annual bonus  annual bonus and concluded that it is appropriate to make some      of BetMGM is being included as a standalone metric this year to emphasise the importance of this business to the future value of        the business during the year. Long-Term Incentive Plan          100 and a bespoke peer group) as they continue to represent the most appropriate market reference points. Conclusion         and in the interests of, our stakeholders.   Virginia McDowell  Board changes Stella David            recruitment, this commitment is being replicated. Jette Nygaard-Andersen    contribution to the business over the last three years, including   operating only in regulated or regulating markets and overhauling our governance approach.  this context and further details are set out in the payments for loss         plan rules in respect of her outstanding LTIP and Annual and  pro-rated bonus in respect of 2023, determined in the same  and half in deferred shares, as normal.      13 December 2024. Robert Hoskin     remuneration arrangements in the light of this. Further details of Robert’s leaving arrangements are set out in the payments for loss    medical insurance continues until the end of the plan year (31 March 2024).           Directors and paid half in cash and half in deferred shares, as normal.   8 Strategic report 88 Governance 140 Financial statements 115Entain plc Annual Report 2023 Directors’ Remuneration Report ![]() #### Role of the Committee The Committee oversees the Company’s overall remuneration strategy to ensure it is aligned to the Company’s purpose and values and is linked to the successful delivery of the Company’s long-term strategy. The Committee has delegated responsibility for designing and determining remuneration for the Chairman, the Executive Directors and senior executive management. It also reviews the remuneration of the wider workforce and related policies and the alignment of incentives and rewards with culture, taking these factors into account when setting the remuneration policy for the executive team. #### The Remuneration Committee Committee membership and attendance during 2023 Member Number of meetings attended Number of meetings eligible to attend  1 67 Stella David 2 66  3 22 Mark Gregory 4 11   11 Rahul Welde 6  6   December 2023.                        Key responsibilities Recommending to the Board the Remuneration Policy for       Overseeing the Remuneration Policy for all colleagues.  www.entaingroup.com. Entain plc Annual Report 2023116   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Key areas of Remuneration Committee focus in 2023 A summary of the matters considered during the year is set  Our workforce   Forum representatives Receiving updates on all-colleague remuneration arrangements throughout the Group   Gap Report Approval of the launch of the 2023 ShareSave  Determination of the payouts from the 2022 annual bonus  Approval of the 2023 annual bonus plan and 2023  and targets         Approval of the remuneration package for Stella David as     of approval by the full Board Committee governance Approval of the 2022 Directors’ Remuneration Report Receiving updates on external market developments in remuneration and governance, including international compensation practices           Remuneration Committee evaluation    facilitator Linstock.       variable pay.   key stakeholders.   decision making. Priorities for change and improvements to strengthen          themes and remuneration topics that are important for motivating     on key topics such as setting incentive plan targets that motivate shareholder value creation and understanding the markets for  Advice to the Committee Advisers are appointed independently by the Remuneration  that the advice it receives is independent, objective and free from    advice included provision of market data, advice on content of  market and best practice. Deloitte LLP also provided a range of tax and advisory services to  assistance to the Group’s internal audit function.  relation to executive remuneration consulting in the UK. Further details can be found at www.remunerationconsultantsgroup.com.   Shareholder voting and consideration of shareholder views   Resolution Date Votes for % of votes for Votes against % of votes against Votes withheld Annual Report on Remuneration  461,233,616     Remuneration Policy     6.4% 2,146,077 Entain plc Annual Report 2023 117   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() The remuneration framework for Executive Directors at Entain is intended to incentivise them to execute the Company’s strategy and create long-term sustainable value for shareholders.  Year 1 Year 2 Year 3 Year 4 Year 5 Total pay Fixed Pay Base salary  Pension Annual Bonus One-year performance period Key performance metrics Malus provisions apply Three-year deferral period   LTIP Three-year performance period Key performance metrics Malus provisions apply    Shareholding Requirement  #### 2023 – Executive Directors’ remuneration The full explanatory notes for each element of remuneration are detailed on pages 130 to 132 in the Annual Report on Remuneration. £000s Base Salary  Pension Annual Bonus LTIP Total  1 4613–   2 813   407 –    16  222 – 821  3 211 2 –  –        #### Executive remuneration at Entain Entain plc Annual Report 2023118   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### 2023 Incentive outcomes The full explanatory notes for the annual bonus and LTIP outcomes are detailed on pages 131 to 132 in the Annual Report on Remuneration. 2023 Annual Bonus Underlying Group Operating  0% of maximum Group NGR 1 (20%) 0% of maximum Safer Betting and Gaming (15%) 100% of maximum Customer (5%) 100% of maximum Total payout 20% of maximum 2021–23 LTIP Cumulative EPS (33.3%) 0% of maximum Relative TSR vs. FTSE 100 (33.3%) 0% of maximum Relative TSR vs. Bespoke peer group (33.3%) 0% of maximum Total payout 0% of maximum    Threshold  Target  Stretch  Outcome £5,409m Outcome £642m Threshold  Target  Stretch  Threshold  Target  Stretch  Outcome 3.6 Outcome (15.5%) Threshold Median: 8.4% Stretch Upper quartile: 46.1% Threshold Median: 13.0% Stretch  Outcome (15.5%) Threshold  Stretch  Outcome 225.3p Entain plc Annual Report 2023 119   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Implementation of the Remuneration Policy for Executive Directors   Element Operation How we implemented the Policy in 2023 How we plan to implement the Policy in 2024 Salary To provide competitive           annually by the  increases normally take  To the extent that   be no higher than the typical level of increase across the     –  –   –    her appointment on 13 December 2023):       To provide competitive      is based on the cost to the Group and there is no pre-determined maximum limit   receive standard  and life insurance and       Pension      have the opportunity to participate in a company-provided   to other employees, or may receive a cash        salary company contribution  2023 then 6% of salary of  paid into the pension plan   1          Annual Bonus        Maximum annual incentive opportunity of      threshold performance.  opportunity is payable for target performance    into shares for three years Dividend equivalents are payable on deferred shares   provisions apply Maximum opportunities: –  –  Directors – 200% Performance metrics (as a percentage of total): – Underlying Group  joint venture) (60%) –  venture (20%) – Safer Betting and Gaming  –     20% of their maximum opportunity. See page 131 for further information Maximum opportunities: –  –    of bonuses Performance metrics (as a percentage of total): –  US joint venture) (60%) –  –  – Safer Betting and Gaming (10%) – Individual Objectives (10%) – Any payment is subject to the completion of mandatory training relating to safer  Targets are considered commercially  Directors’ Remuneration Report 1. See page 130 for more details. Y1  Y2 Y3 Y4 Y5 Y1  Y2 Y3 Y4 Y5 Y1  Y2 Y3 Y4 Y5 Y1  Y2 Y3 Y4 Y5 Y1  Y2 Y3 Y4 Y5 Entain plc Annual Report 2023120   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Element Operation How we implemented the Policy in 2023 How we plan to implement the Policy in 2024 LTIP         and 400% of base salary for  Threshold performance       and maximum   and are subject to a three- year performance period    vesting period Dividend equivalents are    provisions apply   –  –  –  in 2023 Performance conditions: –   – Relative TSR vs. a bespoke  The performance period for the 2021 LTIP ended in  lapse in full. See page 132 for further information   –  –  Performance conditions: –   – Relative TSR vs. a bespoke  See page 123 for details on  in 2024 Shareholding Guidelines         post-tax number of vested  incentive plans until the minimum shareholding requirement is met and maintained   required to maintain 100% of their guideline (or their   cessation of employment Shareholding guidelines: –  –     interests as at 31 December 2023 are detailed on page 134 Shareholding guidelines: –  –  Y1  Y2 Y3 Y4 Y5 Y1  Y2 Y3 Y4 Y5 Y1   Y2 Y3 Y4 Y5 Entain plc Annual Report 2023 121   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Performance metrics and link to strategy   Strategic pillars Element of reward Link to reward Growth Sustainability Bonus   Safer betting and gaming Individual objectives Deferral of bonus into shares LTIP Total shareholder return  Bonus and LTIP    ShareSave for all employees   Learning and development opportunities Entain plc Annual Report 2023122   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### 2024 Incentive plan metricsAnnual bonus  annual bonus?     by splitting out the element relating to BetMGM as a separate metric. This further emphasises the importance of BetMGM’s   annual bonus?   betting and gaming metric and individual objectives. In order to have a sustainable business, the protection of our  continuing to include a safer betting and gaming metric reinforces the importance of this to all our colleagues.     of key activities. What is the underpin? In previous years, the threshold for our safer betting and gaming metric has required a minimum number of colleagues to complete    any payment under the annual bonus plan. This further drives personal accountability.  for 2024?    been reduced, as described above, the previous threshold has   impacts on our safer betting and gaming and customer agendas,   in these areas. How will the safer betting and gaming metric work for 2024?  around our colleagues’ completion of relevant training.    When will targets for the 2024 annual bonus be disclosed? The targets for the annual bonus, including individual objectives   year’s Directors’ Remuneration Report. #### 2024 LTIP What metrics will be used for the 2024 LTIP?       relative TSR metrics. This aligns management’s interests closely  enhance long-term value creation.        What are the targets for the 2024 LTIP?   Metric Weighting Threshold 1 (16.7% vesting) Maximum 1 (100% vesting)   Median  TSR vs. peer group  Median      factors, including consideration of underlying performance. Entain plc Annual Report 2023 123   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Committed to good governance    Clarity       Simplicity     There is clear line of sight for management and shareholders. Risk         Predictability    Proportionality       Alignment to culture       gaming agenda.      #### Remuneration in context Entain plc Annual Report 2023124   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Understanding our colleague reward framework  principles applied to all levels.      We aim for transparency and a fair cascade of remuneration throughout the Group.    Element Wider workforce Executive Directors and senior management Base salary Our base salary is the basis for a competitive     factors such as country budget, relevant  and experience of each individual, relativity  legislative requirements.     relative to market rates, forecasts of any further market increases and attrition rates.   and senior management forms the basis of  salaries annually.           Directors and senior management are aligned     are eligible to participate in the pension arrangement in their country of employment on the same basis as local employees. Short-term incentives     and senior management, although depending on role, greater emphasis may be placed on business unit performance. We operate local incentive arrangements  market practice.   management participate in the same Group annual bonus plan as eligible members of the    subject to deferral into shares for three years.   Long-term incentives A proportion of this population is eligible to be considered for LTIP or Restricted Stock      in the Group’s all-employee ShareSave plan.    senior management, and vesting is subject to Group performance outcomes.       pages 116-117 Entain plc Annual Report 2023 125   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Consideration of colleague and stakeholder views      remuneration arrangements. During the year, this included   Retail colleagues.                representatives from across the Group and gave them the    provided very informative input on their experiences and  ongoing active participation of these colleagues and the insights received and thank them for their input. All-employee remuneration and actions in response to cost- of-living pressures  employer and the focus on this is heightened in the current    remuneration initiatives during 2023:      market conditions.      All of our colleagues have the opportunity to share in the value they create. A third cycle of our all-employee ShareSave plan      colleagues in delivering the Group’s objectives, and the  people in the coming year. Entain plc Annual Report 2023126   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() CEO pay ratio (unaudited)    the second provides further information on the total colleague    mainly attributable to the increase in the median pay of our UK colleagues. Our UK employee population is predominantly made   retail organisations. Method 25th percentile 50th percentile 75th percentile 2023 Option A  78  2022 Option A 101 87 73 2021 Option A  122  2020 Option A 106    Option A 278  170 UK colleagues – pay element 25th percentile 50th percentile 75th percentile Salary   20,301 Total remuneration   28,663      calculate total remuneration for all of our UK colleagues and rank them accordingly on this basis.   calculated based on full-time equivalent data as at 31 December 2023. Salary excludes any statutory payments such as       and that the overall picture presented by the ratios is consistent    colleague population are fair and reasonable and receives regular  We aim to provide a market-competitive remuneration package in  appropriate to the local market and the ability for many colleagues  We successfully launched the third cycle of our all-employee    subject to continued employment. Structures are in place to support salary progression, and regular    Relative importance of the spend on pay    2023 2022 % change  1 753.8    2 106.9  113.8% 1. Increase in staff costs is largely due to an increase in employee numbers and an   2023 compared to only one in 2022. Gender pay gap reporting   male and female colleagues in the UK is 4.0% (2022: 3.2%),    (2022: 38.7%). From further analysis it is clear that these gaps largely remain   are continuing to invest in initiatives to create greater diversity at senior levels. Further information on these is provided on pages    www.entaingroup.com. Entain plc Annual Report 2023 127   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() 01/02/16 £0 £250 £200 £100 £50 £150 £300 £350 £400 £450 31/12/2031/12/1931/12/1831/12/1731/12/16 Entain FTSE 100 FTSE 350 Travel & Leisure Index Source: Thompson Reuters DataStream 31/12/21 31/12/22 31/12/23 #### Summary of performance        Entain plc Annual Report 2023128   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Summary of CEO remuneration outcomes: 2015–2023 Year 2023 2022 2021 2020 2019 2018 2017 2016 2015  S David 1  Andersen 2  Andersen  Andersen 2 S Segev 3 S Segev 3 K Alexander 4 K Alexander K Alexander K Alexander K Alexander K Alexander  of total remuneration  £0.55m £1.33m           Annual bonus payout 6 (% of maximum) –20%48.8% 100% – – – 100%  100% – – LTIP vesting (% of maximum) –– ––––  ––––  vesting (% of maximum) ––– – – – – – 100% 100% 100% 100%     entitlement to receive a bonus payment in respect of 2023.          Change in Directors’ pay for the year in comparison to all Entain colleagues    2023 2022 2021 2020 Base salary/ fees  Annual bonus Base salary/ fees  Annual bonus Base salary/ fees  Annual bonus Base salary/ fees  Annual bonus Executive Directors S David 1 –– ––––––––––  2 –– –––––––––– R Wood 3 3.0% 1.3% (57.8%) 3.6% 1.4%  27.2% 2.2% n/a – – –  4 –– –   –––––– Non-Executive Directors 5 B Gibson 6,7 0% – – 0% – –  ––– –– P Bouchut 7, 8 5.1% – – (1.2)% – –  ––(3.8)% ––   –– – M Gregory 10 –– ––––––––––  10 –– ––––––––––  7 0.9% – – 0% – –  –– –– D Satz 11 (0.4%) – – 11.3% – – – – – – – – R Welde 12 –– –––––––––– All colleagues 13 10.9% (5.2%) (9.7%) (0.1)%   0.1%  132.4%  (1.4)%          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 Entain plc Annual Report 2023 129   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]()          elements is provided in subsequent sections. Executive Directors Base salary  Pension Annual bonus Long-term incentive 4 Total  remuneration Total variable remuneration         Stella David 1 20234613–    2022–––––– – –  2 2023 813   407 –   407 2022 820 36  1,000 –   1,000 Rob Wood 2023  16  222 – 821  222 2022          3 2023 211 2 –  –  213  2022 410  –4001,2632,078  1,663               Base salary                  expenses incurred in undertaking her duties as a Director. The table above includes these expenses and the related tax.       #### Annual Report on Remuneration Entain plc Annual Report 2023130   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() 2023 annual bonus         Metric Weighting Threshold Target Stretch Actual  maximum for each metric Payout as a % of maximum bonus opportunity  60%     0% 0%  20%     0% 0% Safer betting and gaming   100%    0233.6100%  Total as a % of maximum opportunity 20.0%  In summary: UK market – based on the usage of our active account management tools amongst risk-assessed online customers and the     requirements, culture and maturity, giving an opportunity to offer the same targeted interactions and overall experiences to a large number of our players around the globe. In addition, a minimum level of completion of safer betting and gaming and other relevant training modules had to be achieved by our colleagues globally.       in maximum payout for this metric.                 Entain plc Annual Report 2023 131   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]()  J Nygaard-Andersen R Wood R Hoskin Bonus opportunity (% of salary)  200% 200% Salary eligible for 2023 bonus    Outcome: – As % of maximum bonus 20% 20% 20% – As % of salary  40% 40%           Metric Weighting Threshold (25% vesting) Maximum (100% vesting) Entain performance Vesting as a % of maximum for each metric Vesting  One-third Median: 13.0% Upper quartile:   0% 0% Relative TSR vs. bespoke peer group 1 One-third Median: 8.4% Upper quartile: 46.1%  0% 0%  One-third    0% 0% Total as a % of maximum opportunity 0%       Entain plc Annual Report 2023132   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]()  Share awards granted during 2023 (audited)  Plan (“ADBP”). Name Award type Grant date Face value of award Shares awarded 1,2 % vesting at threshold performance % vesting at maximum performance Performance conditions  LTIP    16.7% 100%  ADBP 21 March 2023   n/a n/a  R Wood LTIP    16.7% 100%  ADBP 21 March 2023  20,372 n/a n/a   ADBP 21 March 2023   n/a n/a        1 October to 31 December 2022).          Metric Weighting Threshold (16.7% vesting) Maximum (100% vesting)   Median  Relative TSR vs. bespoke peer group 1        the terms of the Policy, to exercise discretion to override the formulaic outcomes if it believes that the formulaic outturn is not appropriate. Entain plc Annual Report 2023 133   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Shareholdings and share interests      deferred bonus shares (on an after-tax basis). The current shareholding requirements are:         in the implementation of the post-employment shareholding guideline our policy includes the potential to require leavers to deposit the requisite number of shares into a trust or nominee arrangement. In the case of good leavers, future vestings may be made subject to adherence to the shareholding requirement.      Share interests subject to performance conditions 2 Share interests not subject to performance conditions 3 Name Number of  owned shares 1 Share awards Share options Share awards Share options   2023 Value of shares   4 Shareholding requirement met? S David 112,186 – – – – 112,186 128%     612,828 –  –  130%  R Wood   –47,866 –   Y  6  –  –36,686 472,381  Y                employment on 13 December 2024.   Executive Directors’ service contracts and external appointments  Director Date appointed Arrangement Notice period S David 13 December 2023 Service contract 12 months R Wood  Service contract 12 months      Entain plc Annual Report 2023134   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]()  Jette Nygaard-Andersen           Policy and the provisions of the incentive plan rules. As such, she retained her eligibility to receive an annual bonus in respect of 2023,          her termination.      Robert Hoskin    Salary paid up until 31 August 2023, and medical insurance continuing until the end of the plan year (31 March 2024). Salary and     Pay Order.     the Remuneration Policy and the provisions of the incentive plan rules. As such, he retained his eligibility to receive a time pro-rated       leaver treatment if this requirement is not met.   his termination. Entain plc Annual Report 2023 135   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Chairman and Non-Executive Directors   Non-Executive Directors Fees 1 £000  £000 Annual bonus £000 Long-term incentives £000 Pension £000 Total £000  remuneration Total variable remuneration Barry Gibson 2023  ––––  – 2022  ––––  – Pierre Bouchut 2 2023112––––112 112 – 2022106––––106 106 –  3 202313––––13 13 – 2022 –––––– – – Stella David 4 2023176––––176 176 – 2022  ––––  – Mark Gregory  202318––––18 18 – 2022106––––106 106 –   202314––––14 14 – 2022  ––––  –  2023107––––107 107 – 2022106––––106 106 – David Satz 6 2023  ––––  – 2022  ––––  – Rahul Welde 7 2023  ––––  – 202242––––42 42 – Former  8 2023 –––––– – – 202242––––42 42 –                   Entain plc Annual Report 2023136   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() Fee structure      As at 1 January 2023 As at 1 January 2024       Board member       1 –     Letters of appointment    Director Date appointed Arrangement Notice period B Gibson  Letter of appointment 3 months P Bouchut 13 September 2018 Letter of appointment 3 months   Letter of appointment 3 months   Letter of appointment 3 months R Sandler  Letter of appointment 3 months D Satz 22 October 2020 Letter of appointment 3 months R Welde  Letter of appointment 3 months Share interests (audited)    Director  owned shares 1 B Gibson  P Bouchut   – M Gregory 2 7,4 46  2 1,700   D Satz   R Welde 21,644     Virginia McDowell  Entain plc Annual Report 2023 137   8 Strategic report 88 Governance 140 Financial statements Directors’ Remuneration Report ![]() #### Directors’ Report Customer and creditor payment policy The Group is committed to prompt payment of customer cash-out requests and maintains adequate cash reserves to cover customer withdrawals and balances.  and withdrawal timescales with payments typically being made to customers in most markets within 12 hours of receiving a customer instruction. In the case of other creditors, it is the Group’s policy to agree terms at the outset of a transaction and ensure compliance with such agreed terms. In the event that an invoice is contested then the Group informs the supplier without delay and seeks to settle the dispute quickly. Articles of Association The Company’s Articles of Association may only be amended  Directors  are disclosed on page 89. The Company’s Articles of Association provide that any new Director appointed by the Board during the year, having not been  next AGM, when that Director must retire and stand for election at the meeting. The Articles also require one third of the Directors not newly appointed since the last AGM to seek re-election. In compliance with the recommendation of the Code, all Directors will seek reappointment at the 2024 AGM, as they did in 2023. Directors’ remuneration The Executive Directors have Service Agreements and all the Non-Executive Directors have Letters of Appointment and the details of their key terms are set out in the Directors’ Remuneration Report. Details of remuneration of each Director are provided in the Remuneration Report on pages 113 to 137. Powers of directors Subject to company law and the Company’s articles, the Directors may exercise all of the powers of the Company and may delegate their power and discretion to Committees. The articles give the Directors power to appoint and replace Directors. Directors’ interests This is reported in the Directors’ Remuneration Report on pages 133 and 134 and provides details of the interests of each Director, including details of current incentive schemes and long- term incentive schemes, the interests of Directors in the share capital of the Company and details of their share interests as at 31 December 2023. Principal activity Entain plc (the “Company”) and its subsidiaries (together the “Group”) is a major international sports-betting and gaming company operating both online and in the retail sector. The Company is registered as a public limited company under the Isle of Man Companies Act 2006 and is listed in the Premium category on the Main Market of the London Stock Exchange. Results and future performance A review of the Group’s results and activities is covered within the Strategic Report on pages 8 to 87. This incorporates the Chairman’s  which include an indication of likely future developments. Key performance indicators Key performance indicators in relation to the Group’s activities are continually reviewed by senior management and are presented on page 23. Dividends An interim dividend of 8.9p per ordinary share was paid on 22 September 2023 and a second interim dividend for 2023 of 8.9p per ordinary share was approved by the Board on 29 February 2024, making a total dividend payment of £113m for the 2023 full-year. The Board recognises the importance of dividends to shareholders, the strength of the operational performance of the business and our future prospects. The Board expects to continue with its progressive dividend policy during 2024. Corporate Governance The Directors recognise the importance of corporate governance and their associated report is set out on pages 88 to 139. The information in that section is deemed to form part of this  statement for the purposes of DTR 7.2.1. As a company quoted on the Premium Main Market of the London Stock Exchange, the Company has adopted the 2018 UK Corporate Governance Code (“Code”), as amended from time to time, and will seek to comply with premium listed company norms to the extent appropriate for the size and nature of the Company. Engagement with Employee Statements This is discussed in the s172 Statement on pages 64 to 67, pages 96 to 97 and page 126. Engagement with Stakeholder Statements This is discussed in the s172 Statement on pages 64 to 67 and pages 96 to 97. Research and development The Group’s research and development is focused on the development and maintenance of the Entain platform and the production of its product portfolio, including ARC TM . The Group will continue to invest in research and development to ensure it remains well positioned to deliver sustainable growth. For further details on the Group’s strategic priorities, see the Strategic Report. Entain plc Annual Report 2023138 1 Overview 14 Strategic report 88 Governance 146 Financial statements ![]() Substantial shareholdings – Interests in voting rights  accordance with Chapter 5 of the Disclosure and Transparency Rules of the following interests in the Company’s Shares: Shareholder Number of Shares % of Issued Share Capital & Total Voting rights 1 The Capital Group Companies 85,626,652 13.40% Dodge & Cox 58,512,293 9.16% Blackrock Inc 45,562,418 7.13% Janus Henderson Group plc 32,126,154 5.03% Eminence Capital, LP 30,054,030 4.7% The Vanguard Group, Inc 26,991,121 4.23% 1. The Company had 638,799,891 ordinary shares in issue on 21 February 2024.  The risk management objectives and policies of the Group are set  Political donations The Company did not make any political donations or incur any political expenditure during 2023 (2022: Nil). Insurance  policy in respect of any legal costs that may be incurred against  Annual General Meeting The Company’s Annual General Meeting will be held on 24 April 2024 at etc. venues, 200 Aldersgate, London, EC1A 4HD. Independent Auditors KPMG LLP (“KPMG”) has expressed its willingness to continue  proposed at the forthcoming AGM. So far as the Directors are aware, there is no relevant audit  of which the Company’s auditors are unaware, and each Director has taken all the steps that he or she ought to have taken as a Director in order to make himself or herself aware of any relevant audit information and to establish that the Company’s auditors are aware of that information. On behalf of the Board: J M Barry Gibson Chairman  On appointment, each Director must notify the Company of their     relevant Director does not receive Board papers and is excluded from discussions and voting on the subject matter that gives rise   Directors’ Indemnities The Company has entered into deeds of indemnity with each   Diversity Entain remains committed to establishing a 40% female Board in accordance with its own Board diversity policy and the external target of 40% as laid out in the FTSE Women Leaders Review by 2025. With female representation on the Board at 33.3% as at the date of this report, the Board notes that it has not met all of the FCA board diversity targets laid out in the Listing Rules, however, it has met the targets relating to senior Board positions and ethnic diversity (see tables below). Number of board members Percentage of the board Number of senior positions on the board # Number in executive management\* Percentage of executive management\* Men 6 66.6% 3 6 75% Women 3 33.3% 1 2 25% Number of board members Percentage of the board Number of senior positions on the board # Number in executive management\* Percentage of executive management\* White British or other White (including minority- White Groups) 8 89% 4 6 75% Asian/ Asian British 111% 2 25%    \* For the purposes of the FCA disclosures, ‘executive management’ refers to the Group’s executive committee, including the company secretary, but excluding administrative and support staff. Share capital Details of the Company’s authorised and issued share capital, together with details of the movement therein, are set out in  obligations attaching to shares and restrictions on the transfer of shares. Entain plc Annual Report 2023 139 1 Overview 14 Strategic report 88 Governance 146 Financial statements Directors’ Report ![]() ## Financial ## statements In this section 141 Independent Auditor’s Report 160 Consolidated income statement 161 Consolidated statement  162 Consolidated  163 Consolidated statement  164 Consolidated statement       statement             225 Corporate information       140 Financial statements Entain plc Annual Report 2023140 ![]()  In our opinion:            Companies Act 2006. What our opinion covers   Group Parent Company (Entain plc) Consolidated income statement                   Basis for opinion             140 Financial statements Entain plc Annual Report 2023 141 Independent  ![]() 2. Overview of our audit Factors driving our view of risks                             Key Audit Matters Vs FY22 Item  online operations  4.1        4.2     4.3       140 Financial statements Entain plc Annual Report 2023142 Independent  ![]() Audit committee interaction       Our independence    applied to listed public interest entities.     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 £0.2m          2028             140 Financial statements Entain plc Annual Report 2023 143 Independent  ![]() Materiality (item 6 below)           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                19% 8% 4% 81% 88% Net assets 2% 3% 98% 97% Revenue 17% 22% 9% 83% 69% Revenue including share of revenue from joint ventures 1 15% 7% 19% 85% 74%       140 Financial statements Entain plc Annual Report 2023 145 Independent  ![]() The impact of climate change                3. Going concern, viability and principal risks and uncertainties     Going concern                 We also considered less predictable but realistic second order impacts,                Our conclusions                       statement in note 2 to          concern disclosure in note 2 to be acceptable.       140 Financial statements Entain plc Annual Report 2023146 Independent  ![]() Disclosures of emerging and principal risks and longer-term viability Our responsibility      attention to in relation to:                  or assumptions.        Our reporting         4. Key audit matters What we mean              4.1 Revenue from online operations (group) Financial Statement Elements  from online operations FY23 £3,366.6m  £2,998.5m Our assessment of risk vs FY22     operations is stable     operations.   errors in the recording of revenue transactions for the revenue from Online operations        140 Financial statements Entain plc Annual Report 2023 147 Independent  ![]() 4.1 Revenue from online operations (group) continued Description of the Key Audit Matter Risk of data processing error         errors in calculations could result  from online operations. Risk of fraud   operations could be manipulated    Our response to the risk Our procedures included: Controls:                         Tests of details (tracing and vouching):              Communications with the Entain plc’s Audit Committee       Areas of particular auditor judgement               140 Financial statements Entain plc Annual Report 2023148 Independent  ![]() 4.2 complex accounting and sensitivity  assumptions relating to the acquisiton of tab new zealand and sts holdings s.A. Financial Statement Elements     S.A.  assets –    S.A Deferred and  consideration     FY23 £374.1m £401.3m £1,112.1m  £nil £nil £nil Our assessment of risk vs FY22                assumptions.  FY23: Balanced  Description of the Key Audit Matter Complexity and sensitivity TAB New Zealand             Our response to the risk     procedures described. TAB New Zealand Tests of details:              and discount rate. Our valuation expertise:             140 Financial statements Entain plc Annual Report 2023 149 Independent  ![]() STS Holdings S.A.      STS Holdings S.A. Tests of details:                         TAB New Zealand and STS Holdings S.A. Assessing valuer’s credentials: We assessed   Assessing transparency:            140 Financial statements Entain plc Annual Report 2023150 Independent  ![]() Communications with the Entain plc’s Audit Committee         Areas of particular auditor judgement                    140 Financial statements Entain plc Annual Report 2023 151 Independent  ![]() 4.3 Recoverability of parent company’s invesments in subsidiaries (parent company) Financial Statement Elements  in subsidiaries FY23 £5,635.2m  £4,845.6m Our assessment of risk vs FY22          FY23: Balanced  Description of the Key Audit Matter Low risk, high value          Our response to the risk     procedures described. Our procedures included:         Communications with the Entain plc’s Audit Committee       Areas of particular auditor judgement             140 Financial statements Entain plc Annual Report 2023152 Independent  ![]() 5. Our ability to detect irregularities, and our response Fraud – identifying and responding to risks of material misstatement due to fraud Fraud risk assessment   assessment procedures included:                 Risk communications      Fraud risks        Link to KAMS   Procedures to address fraud risks    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  Direct laws context and link to audit     statement items.  indirect law/ regulation areas   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Our determination of materiality    £45m (FY22: £40m) Materiality for  statements as a whole What we mean  Basis for determining materiality and judgements applied               £33.75m (FY22: £30m) Performance materiality What we mean     Basis for determining performance materiality and judgements applied       £2.25m (FY22: £2.0m) Audit misstatement posting threshold What we mean    of fraud.  Audit Committee. Basis for determining the audit misstatement posting threshold and judgements applied     Total Group Revenue  from continuing operations Total Group Assets FY23 FY22 FY23 FY22 FY23 FY22 Amount £4,769.6m £4,296.9m (£842.6)m £102.9m £10,850.6m £8,740.1m Group Materiality as % of amount 0.9%  (5.3%)  0.4%        140 Financial statements Entain plc Annual Report 2023 155 Independent  ![]() 7. The scope of our audit Group scope What we mean                    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Other information in the annual report    All other information Our responsibility    Our reporting    Directors’ remuneration report Our responsibility       Our reporting            Corporate governance disclosures Our responsibility               Our reporting               140 Financial statements Entain plc Annual Report 2023158 Independent  ![]() 9. Respective responsibilities Directors’ responsibilities       Auditor’s responsibilities      www.frc.org.uk/auditorsresponsibilities.    The purpose of our audit work and to whom we owe our responsibilities       Mark Flanagan for and on behalf of KPMG LLP, Statutory Auditor  EastWest           140 Financial statements Entain plc Annual Report 2023 159 Independent  ![]() | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | 2023 | | | 2022 | | | | | | Separately | | | Separately | | | | | | disclosed | | | disclosed | | | | | Underlying | items | | Underlying | items | | | | | items | (Note 6) | Total | items | (Note 6) | Total | | | Notes | £m | £m | £m | £m | £m | £m | | Net Gaming Revenue | | 4,833.1 | – | 4,833.1 | 4,348.9 | – | 4,348.9 | | VAT/GST | | (63.5) | – | (63.5) | (52.0) | – | (52.0) | | Revenue | 5 | 4,769.6 | – | 4,769.6 | 4,296.9 | – | 4,296.9 | | Cost of sales | 7 | (1,862.6) | – | (1,862.6) | (1,582.2) | – | (1,582.2) | | Gross profit | | 2,907.0 | – | 2,907.0 | 2,714.7 | – | 2,714.7 | | Administrative costs | 7 | (2,222.3) | (1,286.5) | (3,508.8) | (1,978.8) | (213.2) | (2,192.0) | | Contribution | | 2,279.4 | – | 2,279.4 | 2,128.9 | – | 2,128.9 | | Administrative costs excluding marketing | | (1,594.7) | (1,286.5) | (2,881.2) | (1,393.0) | (213.2) | (1,606.2) | | Group operating profit/(loss) before share | | | | | | | | | of results from joint ventures and associates | | 684.7 | (1,286.5) | (601.8) | 735.9 | (213.2) | 522.7 | | Share of results from joint ventures and associates | 16,17 | (42.9) | – | (42.9) | (194.1) | – | (194.1) | | Group operating profit/(loss) | | 641.8 | (1,286.5) | (644.7) | 541.8 | (213.2) | 328.6 | | Finance expense | 8 | (241.8) | (1.0) | (242.8) | (89.0) | (5.7) | (94.7) | | Finance income | 8 | 12.4 | – | 12.4 | 4.3 | – | 4.3 | | (Losses)/gains arising from change in fair value | | | | | | | | | of financial instruments | 8 | (90.6) | – | (90.6) | (23.1) | – | (23.1) | | Gains/(losses) arising from foreign exchange | | | | | | | | | on debt instruments | 8 | 123.1 | – | 123.1 | (112.2) | – | (112.2) | | Profit/(loss) before tax | | 444.9 | (1,287.5) | (842.6) | 321.8 | (218.9) | 102.9 | | Income tax | 10 | (105.8) | 69.7 | (36.1) | (97.9) | 27.9 | (70.0) | | Profit/(loss) from continuing operations | | 339.1 | (1,217.8) | (878.7) | 223.9 | (191.0) | 32.9 | | Loss for the year from discontinued operations | | | | | | | | | after tax | 21 | – | (57.8) | (57.8) | – | (13.4) | (13.4) | | Profit/(loss) for the year | | 339.1 | (1,275.6) | (936.5) | 223.9 | (204.4) | 19.5 | | Attributable to: | | | | | | | | | Equity holders of the parent | | 304.1 | (1,232.7) | (928.6) | 225.6 | (201.4) | 24.2 | | Non-controlling interests | | 35.0 | (42.9) | (7.9) | (1.7) | (3.0) | (4.7) | | | | 339.1 | (1,275.6) | (936.5) | 223.9 | (204.4) | 19.5 | | Earnings per share on profit/(loss) for the year | | | | | | | | | from continuing operations | | 44.3p | | (141.4p) | 60.9p | | 6.4p | | From profit/(loss) for the year | 12 | 44.3p | | (150.7p) | 60.9p | | 4.1p | | Diluted earnings per share on profit/(loss) for the year | | | | | | | | | from continuing operations | | 44.2p | | (141.4p) | 60.5p | | 6.3p | | From profit/(loss) for the year | 12 | 44.2p | | (150.7p) | 60.5p | | 4.1p | | Memo | | | | | | | | | EBITDA | | 1,007.9 | (742.9) | 265.0 | 993.2 | (89.3) | 903.9 | | Share-based payments | | (21.7) | – | (21.7) | (19.2) | – | (19.2) | | Depreciation, amortisation and impairment | | (301.5) | (543.6) | (845.1) | (238.1) | (123.9) | (362.0) | | Share of results from joint ventures and associates | | (42.9) | – | (42.9) | (194.1) | – | (194.1) | | Group operating profit/(loss) | | 641.8 | (1,286.5) | (644.7) | 541.8 | (213.2) | 328.6 | 1 1 1 1 1 1 1 1 1. The calculation of underlying earnings per share has been adjusted for separately disclosed items, and for the removal of foreign exchange volatility arising on financial instruments as it provides a better understanding of the underlying performance of the Group. See Note 12 for further details. The notes on pages 165 to 214 form an integral part of these consolidated financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023160 Consolidated income statement for the year ended 31 December 2023 ![]() | | | | | | --- | --- | --- | --- | | | | 2023 | 2022 | | | Notes | £m | £m | | (Loss)/profit for the year | | (936.5) | 19.5 | | Other comprehensive (expense)/income: | | | | |  | | | | | Currency differences on translation of foreign operations | | (83.5) | 182.9 | | Total items that may be reclassified to profit or loss | | (83.5) | 182.9 | |  | | | | | Re-measurement of defined benefit pension scheme | 30 | (3.7) | (24.7) | | Tax on re-measurement of defined benefit pension scheme | 10 | 1.3 | 8.6 | | Surplus/(deficit) on revaluation of other investment | 17 | 1.1 | | | Share of associate other comprehensive expense | 17 | (1.1) | (2.6) | | Total items that will not be reclassified to profit or loss | | (2.4) | (18.7) | | Other comprehensive (expense)/income for the year, net of tax | | (85.9) | 164.2 | | Total comprehensive (expense)/income for the year | | (1,022.4) | 183.7 | | Attributable to: | | | | | Equity holders of the parent | | (1,020.8) | 182.3 | | Non-controlling interests | | (1.6) | 1.4 | The notes on pages 165 to 214 form an integral part of these consolidated financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 161 Consolidated statement of comprehensive income for the year ended 31 December 2023 ![]() | | | | | | --- | --- | --- | --- | | | | | 2022 | | | | | Restated | | | | 2023 | (Note 32) | | | Notes | £m | £m | | Assets | | | | | Non-current assets | | | | | Goodwill | 13 | 4,716.0 | 3,980.9 | | Intangible assets | 13 | 3,960.1 | 2,676.2 | | Property, plant and equipment | 15 | 533.4 | 507.2 | | Interest in joint venture | 16 | – | – | | Interest in associates and other investments | 17 | 47.1 | 53.5 | | Trade and other receivables | 18 | 31.8 | 38.6 | | Other financial assets | 26 | – | 0.2 | | Deferred tax assets | 10 | 493.2 | 157.3 | | Retirement benefit asset | 30 | 61.8 | 63.8 | | | | 9,843.4 | 7,477.7 | | Current assets | | | | | Trade and other receivables | 18 | 503.2 | 500.3 | | Income and other taxes recoverable | | 71.5 | 30.7 | | Derivative financial instruments | 26 | 31.9 | 72.9 | | Cash and cash equivalents | 19 | 400.6 | 658.5 | | | | 1,007.2 | 1,262.4 | | Total assets | | 10,850.6 | 8,740.1 | | Liabilities | | | | | Current liabilities | | | | | Trade and other payables | 20 | (878.6) | (720.0) | | Balances with customers | 27 | (196.8) | (200.5) | | Lease liabilities | 22 | (65.7) | (65.1) | | Interest-bearing loans and borrowings | 23 | (319.2) | (424.9) | | Corporate tax liabilities | | (48.6) | (45.3) | | Provisions | 24 | (20.9) | (20.6) | | Derivative financial instruments | 26 | (117.5) | (79.2) | | Deferred and contingent consideration and other financial liabilities | 26 | (157.0) | (208.8) | | | | (1,804.3) | (1,764.4) | | Non-current liabilities | | | | | Trade and other payables | 20 | (433.8) | – | | Interest-bearing loans and borrowings | 23 | (3,038.8) | (2,689.1) | | Lease liabilities | 22 | (210.2) | (215.8) | | Deferred tax liabilities | 10 | (825.1) | (495.4) | | Provisions | 24 | (4.2) | (5.4) | | Deferred and contingent consideration and other financial liabilities | 26 | (1,741.5) | (253.4) | | | | (6,253.6) | (3,659.1) | | Total liabilities | | (8,057.9) | (5,423.5) | | Net assets | | 2,792.7 | 3,316.6 | | Equity | | | | | Issued share capital | 28 | 5.2 | 4.8 | | Share premium | | 1,796.7 | 1,207.3 | | Merger reserve | | 2,527.4 | 2,527.4 | | Translation reserve | | 150.4 | 240.2 | | Retained earnings | | (2,211.7) | (846.9) | | Equity shareholders’ funds | | 2,268.0 | 3,132.8 | | Non-controlling interests | 35 | 524.7 | 183.8 | | Total shareholders’ equity | | 2,792.7 | 3,316.6 | The financial statements on pages 160 to 214 were approved by the Board of Directors on 7 March 2024 and signed on its behalf by S David R Wood Interim Chief Executive Officer Deputy Chief Executive Officer/Chief Financial Officer (Company number 4685V) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023162 Consolidated balance sheet for the year ended 31 December 2023 ![]() 1 | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | Non- | | | | Issued | | | | | Equity | controlling | Total | | | share | Share | Merger | Translation | Retained | shareholders’ | interests | shareholders’ | | | capital | premium | reserve | reserve | earnings | funds | (Note 35) | equity | | | £m | £m | £m | £m | £m | £m | £m | £m | | At 1 January 2022 | 4.8 | 1,207.3 | 2,527.4 | 63.4 | (635.8) | 3,167.1 | 1.4 | 3,168.5 | | Profit for the year | – | – | – | – | 24.2 | 24.2 | (4.7) | 19.5 | | Other comprehensive income/ | | | | | | | | | | (expense) | – | – | – | 176.8 | (18.7) | 158.1 | 6.1 | 164.2 | | Total comprehensive income | – | – | – | 176.8 | 5.5 | 182.3 | 1.4 | 183.7 | | Share-based payments charge | – | – | – | – | 18.3 | 18.3 | – | 18.3 | | Business combinations | – | – | – | – | – | – | 178.9 | 178.9 | | Recognition of put liability | – | – | – | – | (181.2) | (181.2) | – | (181.2) | | Purchase of non-controlling interests | | | | | | | | | | (Note 35) | – | – | – | – | (3.7) | (3.7) | 2.1 | (1.6) | | Equity dividends (Note 11) | – | – | – | – | (50.0) | (50.0) | – | (50.0) | | At 31 December 2022 | 4.8 | 1,207.3 | 2,527.4 | 240.2 | (846.9) | 3,132.8 | 183.8 | 3,316.6 | | At 1 January 2023 | 4.8 | 1,207.3 | 2,527.4 | 240.2 | (846.9) | 3,132.8 | 183.8 | 3,316.6 | | Loss for the year | – | – | – | – | (928.6) | (928.6) | (7.9) | (936.5) | | Other comprehensive income/ | | | | | | | | | | (expense) | – | – | – | (89.8) | (2.4) | (92.2) | 6.3 | (85.9) | | Total comprehensive income | – | – | – | (89.8) | (931.0) | (1,020.8) | (1.6) | (1,022.4) | | Issue of shares (Note 28) | 0.4 | 589.4 | – | – | – | 589.8 | – | 589.8 | | Share-based payments charge | – | – | – | – | 23.6 | 23.6 | – | 23.6 | | Business combinations (Note 32) | – | – | – | – | – | – | 354.0 | 354.0 | | Recognition of put option liability | – | – | – | – | (350.5) | (350.5) | – | (350.5) | | Purchase of non-controlling interests | | | | | | | | | | (Note 35) | – | – | – | – | – | – | (4.1) | (4.1) | | Equity dividends (Note 11) | – | – | – | – | (106.9) | (106.9) | (7.4) | (114.3) | | At 31 December 2023 | 5.2 | 1,796.7 | 2,527.4 | 150.4 | (2,211.7) | 2,268.0 | 524.7 | 2,792.7 | 1. The translation reserve is used to record exchange differences arising from the translation of the financial statements of subsidiaries with non-sterling functional currencies. The notes on pages 165 to 214 form an integral part of these consolidated financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 163 Consolidated statement of changes in equity for the year ended 31 December 2023 ![]() | | | | | | --- | --- | --- | --- | | | | 2023 | 2022 | | | Notes | £m | £m | | Cash generated by operations | 29 | 810.0 | 846.9 | | Income taxes paid | | (137.3) | (106.1) | | Net finance expense paid | | (224.6) | (100.6) | | Net cash generated from operating activities | | 448.1 | 640.2 | | Cash flows from investing activities: | | | | | Acquisitions | | (1,315.4) | (738.6) | | Cash acquired on business combinations | | 87.9 | 29.9 | | Dividends received from associates | | 9.6 | 3.6 | | Purchase of intangible assets | | (191.5) | (129.9) | | Purchase of property, plant and equipment | | (69.1) | (82.1) | | Proceeds from the sale of property, plant and equipment including disposal of shops | | 0.7 | – | | Purchase of investments in associates and other investments | | (3.1) | – | | Investment in joint ventures | | (40.7) | (175.1) | | Net cash used in investing activities | | (1,521.6) | (1,092.2) | | Cash flows from financing activities: | | | | | Proceeds from issue of ordinary shares | | 589.8 | – | | Net proceeds from borrowings | | 1,780.3 | 838.4 | | Repayment of borrowings | | (1,419.2) | (109.0) | | Repayment of borrowings on acquisition | | (9.4) | (162.8) | | Subscription of funds from non-controlling interests | | 350.5 | 174.3 | | Settlement of derivative financial instruments | | (13.2) | 41.6 | | Settlement of other fi nancial liabilities | | (266.7) | (32.9) | | Payment of lease liabilities | | (68.5) | (83.0) | | Dividends paid to shareholders | | (106.9) | (50.0) | | Dividends paid to non-controlling interests | | (7.4) | – | | Net cash used in financing activities | | 829.3 | 616.6 | | Net (decrease)/increase in cash and cash equivalents | | (244.2) | 164.6 | | Effect of changes in foreign exchange rates | | (13.7) | 6.8 | | Cash and cash equivalents at beginning of the year | | 658.5 | 487.1 | | Cash and cash equivalents at end of the year | | 400.6 | 658.5 | 1 1. Included within cash flows from acquisitions is £5 . 4m relating to the purchase of minority holdings in STS Holdings SA (2022: £1 .7m relating to the purchase of minority holdings in Scout Gaming AB and Global Gaming Limited). The notes on pages 165 to 214 form an integral part of these consolidated financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023164 Consolidated statement of cash flows for the year ended 31 December 2023 ![]() 1 Corporate information Entain plc (“the Company”) is a company incorporated and domiciled in the Isle of Man on 5 January 2010 whose shares are traded publicly on the London Stock Exchange. The principal activities of the Company and its subsidiaries (“the Group”) are described in the strategic report. The consolidated financial statements of the Group for the year ended 31 December 2023 were authorised for issue in accordance with a resolution of the Directors on 7 March 2024. The nature of the Group’s operations and its principal activities are set out in Note 5. 2 Basis of preparation The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies to the European Union and in accordance with the requirements of the Isle of Man Companies Act 2006 applicable to companies reporting under IFRSs. The accounting policies set out in this section as detailed have been applied consistently year on year other than for the changes in accounting policies set out in Note 3. The consolidated financial statements are presented in Pounds Sterling (£). All values are in millions (£m) rounded to one decimal place except where otherwise indicated. The separately disclosed items have been included within the appropriate classifications in the consolidated income statement. Further details are given in Note 6. Going concern In adopting the going concern basis of preparation in the financial statements, the Directors have considered the current trading performance of the Group, the fi nancial forecasts and the principal risks and uncertainties. In addition, the Directors have considered all matters discussed in connection with the long-term viability statement including the modelling of ‘severe but plausible’ downside scenarios such as legislation changes impacting the Group’s Online business and severe data privacy and cybersecurity breaches. Given the level of the Group’s available cash post the recent extension of certain financing facilities (see Note 36) and the forecast covenant headroom even under the sensitised downside scenarios, the Directors believe that the Group and the Company are well placed to manage the risks and uncertainties that it faces. As such, the Directors have a reasonable expectation that the Group and the Company will have adequate financial resources to continue in operational existence, for at least 12 months (being the going concern assessment period) from date of approval of the financial statements, and have, therefore, considered it appropriate to adopt the going concern basis of preparation in the financial statements. 3 Changes in accounting policies From 1 January 2023 the Group has applied, for the first time, certain standards, interpretations and amendments. The adoption of the following standards and amendments to standards did not have a material impact on the current period or any prior period upon transition: – Amendments to IAS 1 Presentation of Financial Statements; disclosure of accounting policies; – Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors; definition of accounting estimates; – Amendments to IAS 12 Income Taxes; deferred tax related to assets and liabilities arising from a single transaction; – Amendments to IAS 12 International Tax Reform Pillar Two Model Rules; – IFRS 17 Insurance Contracts; original issue. #### 4 Summary of significant accounting policies 4.1 Basis of consolidation The consolidated financial statements comprise the financial statements of the Group at 31 December each year. The consolidation has been performed using the results to 31 December for all subsidiaries, using consistent accounting policies. With the exception of a small number of immaterial subsidiaries, the fi nancial statements of those subsidiaries are prepared to 31 December. Control is achieved where the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect these returns through its power over the investee. All intragroup transactions, balances, income and expenses are eliminated on consolidation. Subsidiaries are consolidated, using the acquisition method of accounting, from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred from the Group. On acquisition, the assets and liabilities and contingent liabilities of a subsidiary are measured at fair value at the date of acquisition. Any excess of the cost of acquisition over the fair values of the separately identifi able net assets acquired is recognised as goodwill. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used in line with those used by the Group. 4.2 Critical accounting estimates and judgements The preparation of financial information requires the use of assumptions, estimates and judgements about future conditions. Use of available information and application of judgement are inherent in the formation of estimates. Actual results in the future may differ from those reported. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 165 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.2 Critical accounting estimates and judgements (continued) Judgements Management believes that the areas where judgement has been applied are: – separately disclosed items (Note 6). – business combinations (Note 32) Separately disclosed items To assist in understanding the underlying performance of the Group, management applies judgement to identify those items that are deemed to warrant separate disclosure due to either their nature or size. Whilst not limited to, the following items of pre-tax income and expense are generally disclosed separately: – amortisation of acquired intangibles resulting from IFRS 3 “Business Combinations” fair value exercises; – profits or losses on disposal, closure, or impairment of non-current assets or businesses; – corporate transaction and restructuring costs; – legal, regulatory and tax litigation; – changes in the fair value of contingent consideration; and – the related tax effect of these items. Any other non-recurring items are considered individually for classification as separately disclosed by virtue of their nature or size. During 2023 the Group separately disclosed a net charge on continuing operations before tax of £1,287.5m including £254.6m of amortisation of acquired intangibles resulting from IFRS 3. The separate disclosure of these items allows a clearer understanding of the trading performance on a consistent and comparable basis, together with an understanding of the effect of non-recurring or large individual transactions upon the overall profitability of the Group. The separately disclosed items have been included within the appropriate classifications in the consolidated income statement. Further details are given in Note 6. Business combinations – Acquisition consideration For business combinations, in assessing the relevant consideration transferred, certain judgements are required to assess whether transfers of assets reflect payments for future service or elements of acquisition consideration. Specifically, for the Tab NZ acquisition, the Group has committed to make minimum guaranteed funding payments to Tab NZ in the first five years post completion, with further contingent payments subject to revenue performance due up to and including year 25. As there are no ongoing obligations or service requirements on the selling party, these payments have been deemed to form part of consideration under IFRS 3 rather than ongoing deductions on profi ts. Further details are provided in Note 32. Estimates Included within the financial statements are a number of areas where estimation is required. Management believes that the area where this is most notable within the financial statements is the accounting for business combinations (Note 32). Business combinations For business combinations, the Group estimates the fair value of the consideration transferred, which can include assumptions about the future business performance of the business acquired and an appropriate discount rate to determine the fair value of any contingent consideration. The Group then estimates the fair value of assets acquired and liabilities assumed in the business combination. The area of most notable estimation within the fair value exercise relates to separately identifiable intangible assets including brands, customer lists and licences. These estimates also require inputs and assumptions to be applied within the relief from royalty calculation of fair values with the more significant assumptions relating to future earnings, customer attrition rates and discount rates. The Group engages external experts to support the valuation process, where appropriate. IFRS 3 ‘Business Combinations’ allows the Group to recognise provisional fair values if the initial accounting for the business combination is incomplete. The fair value of contingent consideration recognised in business combinations is reassessed at each reporting date, using updated inputs and assumptions based on the latest financial forecasts and other relevant information for the businesses acquired. Fair value movements and the unwinding of the discounting is recognised within the income statement as a separately disclosed item. See Note 6 and Note 32 for further details. Goodwill on acquisition is initially measured at cost, being the excess of the cost of the business combination over the Group’s interest in the net fair value of the separately identifiable assets, liabilities and contingent liabilities at the date of acquisition in accordance with IFRS 3 Business Combinations. Goodwill is not amortised but reviewed for impairment at the first reporting period after acquisition and then annually thereafter. As such it is stated at cost less any provision for impairment of value. Any impairment is recognised immediately in the consolidated income statement and is not subsequently reversed. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023166 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.2 Critical accounting estimates and judgements (continued) Business combinations (continued) On acquisition, any goodwill acquired is allocated to cash-generating units for the purpose of impairment testing. Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposal is included in the carrying amount of the assets when determining the gain or loss on disposal. On the current year acquisitions, any non- controlling interests where put options are in place are recognised using the present access method where the Group assesses that the non-controlling shareholder has present access to the returns associated with their equity interests. Impairment On acquisition, any goodwill acquired is allocated to cash-generating units for the purpose of impairment testing. Where goodwill forms part of a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposal is included in the carrying amount of the assets when determining the gain or loss on disposal. An impairment review is performed for goodwill and other indefinite life assets on at least an annual basis. For all other non-current assets an impairment review is performed where there are indicators of impairment. This requires an estimation of the recoverable amount which is the higher of an asset’s fair value less costs to sell and its value in use. Estimating a value in use amount requires management to make an estimate of the expected future cash flows from each cash-generating unit and to discount cash flows by a suitable discount rate in order to calculate the present value of those cash flows. Estimating an asset’s fair value less costs to sell is determined using future cash flow and profit projections as well as industry observed multiples and publicly observed share prices for similar betting and gaming companies. See Note 14 for details on sensitivity analysis performed around these estimates. Impairment losses are recognised in the consolidated income statement and during the current year, the Group has recognised an impairment charge of £289.0m primarily against the Group’s Australian CGU, the closed B2C operations in Africa, and under the Unirkn B2C offering. See Note 14 for further details. 4.3 Other accounting policies ‘Put’ options over the equity of subsidiary companies The potential cash payments related to put options issued by the Group over the equity of subsidiary companies are accounted for as financial liabilities. The amounts that may become payable under the option on exercise are initially recognised at the present value of the expected gross obligation with the corresponding entry being recognised in retained earnings. Such options are subsequently measured at amortised cost, using the effective interest method, in order to accrete the liability up to the amount payable under the option at the date at which it first becomes exercisable. The present value of the expected gross obligation is reassessed at the end of each reporting period and any changes are recorded in the income statement. In the event that an option expires unexercised, the liability is derecognised with a corresponding adjustment to retained earnings. Intangible assets Intangible assets acquired separately are capitalised at cost and those acquired as part of a business combination are capitalised separately from goodwill. The costs relating to internally generated intangible assets, principally software costs, are capitalised if the criteria for recognition as assets are met. Other expenditure is charged in the year in which the expenditure is incurred. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. The useful lives of these intangible assets are assessed to be either finite or indefinite. Indefinite lived assets are not amortised and are subject to an annual impairment review from the year of acquisition. Where amortisation is charged on assets with finite lives, this expense is taken to the consolidated income statement through the ‘operating expenses, depreciation and amortisation’ line item. The useful lives applied to the Group’s intangible assets are as follows: | | | | --- | --- | | Exclusive New Zealand licence | 25–year duration of licence | | Other licences | Lower of 15 years, or duration of licence | | Software – purchased & internally capitalised costs | 2–15 years | | Trademarks & brand names | 10–25 years, or indefinite life | | Customer relationships | 3–15 years | The useful lives of all intangible assets are reviewed at each financial period end. Impairment testing is performed annually for intangible assets which are not subject to systematic amortisation and where an indicator of impairment exists for all other intangible assets. An intangible asset is derecognised on disposal, with any gain or loss arising (calculated as the difference between the net disposal proceeds and the carrying amount of the item) included in the consolidated income statement in the year of disposal. Pensions and other post-employment benefits The Group’s defined benefit pension plan holds assets separately from the Group. The pension cost relating to the plan is assessed in accordance with the advice of independent qualified actuaries using the projected unit credit method. Actuarial gains or losses are recognised in the consolidated statement of comprehensive income in the period in which they arise. Any past service cost is recognised immediately. The retirement benefit asset recognised in the balance sheet represents the fair value of scheme assets less the value of the defined benefit obligations. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 167 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.3 Other accounting policies (continued) Pensions and other post-employment benefits (continued) There is a degree of estimation involved in predicting the ultimate benefits payable under defined benefit pension arrangements. The pension scheme liabilities are determined using actuarial valuations. The actuarial valuation involves making assumptions about discount rates, mortality rates and future pension increases. Due to the long-term nature of this plan, such estimates are subject to uncertainty. See Note 30 for details on sensitivity analysis performed around these estimates. In making these estimates and assumptions, management considers advice provided by external advisers, such as actuaries. Where actual experience differs to these estimates, actuarial gains and losses are recognised directly in other comprehensive income. Refer to Note 30 for details of the values of assets and obligations and key assumptions used. The Gala Coral Pension Plan has a net asset position when measured on an IAS 19 basis. Judgement is applied, based on legal, actuarial, and accounting guidance in IFRIC 14, regarding the amounts of net pension asset that is recognised in the consolidated balance sheet. The Ladbrokes Pension Plan was bought out in 2021. Further details are given in Note 30. Although the Group anticipates that plan surpluses will be utilised during the life of the plans to address member benefits, the Group recognises its pension surplus in full on the basis that there are no substantive restrictions on the return of residual plan assets in the event of a winding up of the plan after all member obligations have been met. The Group’s contributions to defined contribution scheme are charged to the consolidated income statement in the period to which the contributions relate. Investments in joint ventures A joint venture is an entity in which the Group holds an interest on a long-term basis, and which is jointly controlled by the Group and one or more other venturers under a contractual agreement. Joint control exists only when decisions about the relevant activities require the unanimous consent of the parties that collectively control the arrangement. The Group’s share of results of joint ventures is included in the Group consolidated income statement using the equity method of accounting. Investments in joint ventures are carried in the Group consolidated balance sheet at cost plus post-acquisition changes in the Group’s share of net assets of the entity less any impairment in value. The carrying value of investments in joint ventures includes acquired goodwill. If the Group’s share of losses in the joint venture equals or exceeds its investment in the joint venture, the Group does not recognise further losses, unless it has obligations to continue to provide financial support to the joint venture. Investments in associates Associates are those businesses in which the Group has a long-term interest and is able to exercise significant influence over the financial and operational policies but does not have control or joint control over those policies. The Group’s share of results of associates is included in the Group’s consolidated income statement using the equity method of accounting. Investments in associates are carried in the Group’s consolidated balance sheet at cost plus post-acquisition changes in the Group’s share of net assets of the entity less any impairment in value. The carrying value of investments in associates includes acquired goodwill. If the Group’s share of losses in the associate equals or exceed its investments in the associate, the Group does not recognise further losses, unless it has obligations to continue to provide financial support to the associate. Property, plant and equipment Land is stated at cost less any impairment in value. Buildings, plant and equipment are stated at cost less accumulated depreciation and any impairment in value. Depreciation is applied using the straight-line method to specific classes of asset to reduce them to their residual value over their estimated useful economic lives. | | | | --- | --- | | Land and buildings | Lower of 50 years, or estimated useful life of the building, or lease. Indefinite lives are | | | attached to any freehold land held and therefore it is not depreciated. | | Plant and equipment | 3–5 years | | Fixtures and fittings | 3–10 years | ROU assets arising under lease contracts are depreciated over the lease term (as defined in IFRS 16) being the period to the expiry date of the lease, unless it is expected that a break clause will be exercised when the lease term is the period to the date of the break. The carrying values of property, plant and equipment are reviewed for impairment where an indicator of impairment exists, being events or changes in circumstances indicating that the carrying values may not be recoverable. If any such indication exists and where the carrying values exceed the estimated recoverable amount, the assets or cash-generating units are written down to their recoverable amount. The recoverable amount of property, plant and equipment is the greater of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023168 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.3 Other accounting policies (continued) Property, plant and equipment (continued) An item of property, plant and equipment is derecognised upon disposal, with any gain or loss arising (calculated as the difference between the net disposal proceeds and the carrying amount of the item) included in the consolidated income statement in the year of disposal. Leases The Group has applied IFRS 16 only to those contracts that were previously identified as a lease under IAS 17 Leases; any contracts not previously identified as leases have not been reassessed for the purposes of adopting IFRS 16. Accordingly, the definition of a lease under IFRS 16 has only been applied to contracts entered into on or after 1 January 2019. Leases, other than those with a lease period of less than one year at inception, or where the original cost of the asset acquired would be a negligible amount (see Note 22), are capitalised at inception at the present value of the minimum lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income. ROU assets are included within property, plant and equipment at cost and depreciated over their estimated useful lives, which normally equates to the lives of the leases, after considering anticipated residual values. ROU assets which are sub-leased to customers are classified as finance leases if the lease agreements transfer substantially all the risks and rewards of usage to the lessee. All other sub-leases are classified as operating leases. When assets are subject to finance leases, the present value of the sub-lease is recognised as a receivable, net of allowances for expected credit losses and the related ROU asset is derecognised. The difference between the gross receivable and the present value of the receivable is recognised as unearned finance lease income. Finance lease interest income is recognised over the term of the lease using the net investment method (before tax) so as to give a constant rate of return on the net investment in sub-leases. Operating lease rental income is recognised on a straight-line basis over the life of the lease. Cash and cash equivalents Cash and cash equivalents consist of cash at bank and in hand, short-term deposits (and customer balances). Financial assets Financial assets are recognised when the Group becomes party to the contracts that give rise to them. The Group classifies financial assets at inception as financial assets at amortised cost, financial assets at fair value through profit or loss or financial assets at fair value through other comprehensive income. Financial assets at amortised cost are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. On initial recognition, financial assets at amortised cost are measured at fair value net of transaction costs. Trade receivables are generally accounted for at amortised cost. Expected credit losses are recognised for financial assets recorded at amortised cost, including trade receivables. Expected credit losses are calculated by using an appropriate probability of default, taking accounts of a range of possible future scenarios and applying this to the estimated exposure of the Group at the point of default. Financial assets at fair value through profit or loss include derivative financial instruments. Financial assets through profit or loss are measured initially at fair value with transaction costs taken directly to the consolidated income statement. Subsequently, the fair values are remeasured, and gains and losses are recognised in the consolidated income statement. Financial assets at fair value through other comprehensive income comprise equity investments that are designated as such on acquisition. These investments are measured initially at fair value. Subsequently, the fair values are remeasured, and gains and losses are recognised in the consolidated statement of comprehensive income. Financial liabilities Financial liabilities comprise trade and other payables, interest-bearing loans and borrowings, contingent consideration, ante-post bets, guarantees and derivative financial instruments. On initial recognition, financial liabilities are measured at fair value net of transaction costs where they are not categorised as financial liabilities at fair value. Financial liabilities measured at fair value include contingent consideration, derivative financial instruments, ante-post bets and guarantees. Financial liabilities at fair value are measured initially at fair value, with transaction costs taken directly to the consolidated income statement. Subsequently, the fair values are remeasured and gains and losses from changes therein are recognised in the consolidated income statement. Trade and other payables are held at amortised cost and include amounts due to clients representing customer deposits and winnings, which are matched by an equal and opposite amount within cash and cash equivalents. All interest-bearing loans and borrowings are initially recognised at fair value net of issue costs associated with the borrowing. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective interest rate method. All financial liabilities are recorded as cash flows from financing activities. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 169 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.3 Other accounting policies (continued) Derecognition of financial assets and liabilities Financial assets are derecognised when the right to receive cash flows from the assets has expired or when the Group has transferred its contractual right to receive the cash flows from the financial assets or has assumed an obligation to pay the received cash flows in full without material delay to a third party, and either: – substantially all the risks and rewards of ownership have been transferred; or – substantially all the risks and rewards have neither been retained nor transferred but control is not retained. Financial liabilities are derecognised when the obligation is discharged, cancelled or expires. Derivative financial instruments The Group uses derivative financial instruments such as cross currency swaps, foreign exchange swaps and interest rate swaps, to hedge its risks associated with interest rate and foreign currency fluctuations. Derivative financial instruments are recognised initially and subsequently at fair value. The gains or losses on re-measurement are taken to the consolidated income statement. Derivative financial instruments are classified as assets where their fair value is positive, or as liabilities where their fair value is negative. Derivative assets and liabilities arising from different transactions are only offset if the transactions are with the same counterparty, a legal right of offset exists, and the parties intend to settle the cash flows on a net basis. Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the Directors’ best estimate of the expenditure required to settle the obligation at the balance sheet date and are discounted to present value where the effect is material using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance expense. Foreign currency translation The presentational currency of Entain plc and the functional currencies of its UK subsidiaries is Pounds Sterling (£). Other than Sterling the main functional currencies of subsidiaries are the Euro (€), the US Dollar ($) and the Australian Dollar (A$). At the reporting date, the assets and liabilities of non-sterling subsidiaries are translated into Pounds Sterling (£) at the rate of exchange ruling at the balance sheet date and their cash flows are translated at the weighted average exchange rates for the year. The post-tax exchange differences arising on the retranslation are taken directly to other comprehensive income. Transactions in foreign currencies are initially recorded in the subsidiary’s functional currency and translated at the foreign currency rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the foreign currency rate of exchange ruling at the balance sheet date. All foreign currency translation differences are taken to the consolidated income statement. Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rate at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rate at the date when the fair value was determined. On disposal of a foreign entity, the deferred cumulative retranslation differences previously recognised in equity relating to that particular foreign entity are recognised in the consolidated income statement as part of the profit or loss on disposal. The following exchange rates were used in 2023 and 2022: | | | | | | | --- | --- | --- | --- | --- | | | 2023 | | 2022 | | | Currency | Average | Year end | Average | Year end | | Euro (€) | 1.149 | 1.151 | 1.175 | 1.128 | | US Dollar ($) | 1.242 | 1.274 | 1.245 | 1.208 | | Australian Dollar (A$) | 1.873 | 1.866 | 1.788 | 1.775 | | NZ Dollars (NZD) | 2.024 | 2.010 | 1.955 | 1.904 | Income tax Deferred tax is provided on all temporary differences at the balance sheet date, between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes except: – on the initial recognition of goodwill; – where the deferred tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor the tax profit; and – associated with investments in subsidiaries, joint ventures and associates, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023170 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.3 Other accounting policies (continued) Income tax (continued) Deferred tax assets are recognised for all deductible temporary differences and carry forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and carry forward of unused tax assets and unused tax losses can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date. Deferred tax balances are not discounted. Interest or penalties payable and receivable in relation to income tax are recognised as an income tax expense or credit in the consolidated income statement. Income tax expenses are recognised within profit or loss except to the extent that they relate to items recognised in other comprehensive income or directly in equity, in which case they are recognised in other comprehensive income or directly in equity. Revenues, expenses and assets are recognised net of the amount of sales tax except: – where the sales tax incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and – receivables and payables are stated with the amount of sales tax included. The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the consolidated balance sheet. Accounting for uncertain tax positions The Group is subject to various forms of tax in a number of jurisdictions. Given the nature of the industry within which the Group operates, the tax and regulatory regimes are continuously changing and, as such, the Group is exposed to a small number of uncertain tax positions. Judgement is applied to adequately provide for uncertain tax positions where it is believed that it is more likely than not that an economic outflow will arise. In particular, judgement has been applied in the Group’s accounting for Greek tax and further disclosure is given in Note 33. Equity instruments and dividends Equity instruments issued by the Company are recorded at the fair value of proceeds received net of direct issue costs. Final dividends proposed by the Board of Directors and unpaid at the year end are not recognised in the financial statements until they have been approved by shareholders at the Annual General Meeting. Interim dividends are recognised when paid.. Revenue The Group reports the gains and losses on all betting and gaming activities as revenue, which is measured at the fair value of the consideration received or receivable from customers less free bets, promotions, bonuses and other fair value adjustments. Revenue is net of VAT/GST. The Group considers betting and gaming revenue to be out of the scope of IFRS 15 Revenue, and accounts for those revenues within the scope of IFRS 9 Financial Instruments. For LBOs, on course betting, Core Telephone Betting, mobile betting and Digital businesses (including sportsbook, betting exchange, casino, games, other number bets), revenue represents gains and losses, being the amounts staked and fees received, less total payouts recognised on the settlement of the sporting event or casino gaming machine roulette or slots spin. Open betting positions (“ante-post”) are carried at fair value and gains and losses arising on these positions are recognised in revenue. See Note 26 for details of ante-post positions at the year end. The following forms of revenue, which are not significant in the context of Group revenue, are accounted for within the scope of IFRS 15 Revenue. Revenue from the online poker business reflects the net income (rake) earned from poker hands completed by the year end. In the case of the greyhound stadia, revenue represents income arising from the operation of the greyhound stadia in the year, including broadcasting rights, admission fees and sales of refreshments, net of VAT. Given the nature of these revenue streams they are not considered to be subject to judgement over the performance obligations, amount received or timing of recognition. Finance expense and income Finance expense and income arising on interest-bearing financial instruments carried at amortised cost are recognised in the consolidated income statement using the effective interest rate method. Finance expense includes the amortisation of fees that are an integral part of the effective fi nance cost of a financial instrument, including issue costs, and the amortisation of any other differences between the amount initially recognised and the redemption price. All finance expenses are recognised over the availability period. Share-based payment transactions Certain employees (including Directors) of the Group receive remuneration in the form of equity settled share-based payment transactions, whereby employees render services in exchange for shares or rights over shares (equity settled transactions). The cost of equity settled transactions is measured by reference to the fair value at the date on which they are granted, further details of which are given in Note 31. In valuing equity settled transactions, no account is taken of any performance conditions, other than conditions linked to the price of the shares of Entain plc (market conditions). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 171 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 4 Summary of significant accounting policies (continued) 4.3 Other accounting policies (continued) Share-based payment transactions (continued) The cost of equity settled transactions is recognised in the consolidated income statement, with a corresponding credit in equity, over the period in which the performance conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (vesting date). The cumulative expense recognised for equity settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the number of awards that, in the opinion of the Directors of the Group at that date, based on the best available estimate of the number of equity instruments, will ultimately vest. No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other performance conditions are satisfied. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of earnings per share as shown in Note 12. 4.4 Future accounting developments The standards and interpretations that are issued, but not yet effective, excluding those relating to annual improvements, up to the date of issuance of the Group’s financial statements, are disclosed below. The Group intends to adopt these standards, if applicable, when they become effective. None of these are expected to have a significant effect on the consolidated financial statements of the Group as set out below: | | | | | | --- | --- | --- | --- | | IFRS 16 | Leases | Lease liability in a sale and leaseback transaction | 1 January 2024 | | IAS 1 | Presentation of Financial Statements | Classification of liabilities as current or non-current | 1 January 2024 | | | | Non-current liabilities regarding long-term debt with covenants | | | IFRS 10 | Consolidated Financial Statements | Sale or contribution of assets between an investor and its associate or | Date deferred | | | | joint venture | | | IAS 28 | Investments in Associates and Joint | Sale or contribution of assets between an investor and its associate or | Date deferred | | | Ventures | joint venture | | | IFRS 7 | Financial Instrument Disclosures | Supplier Financial Arrangements | 1 January 2024 | | IAS 7 | Statement of Cash Flows | Supplier Financial Arrangements | 1 January 2024 | #### 5 Segment information The Group’s operating segments are based on the reports reviewed by the Executive Management Team (which is collectively considered to be the Chief Operating Decision Maker (“CODM”)) to make strategic decisions, and allocate resources. IFRS 8 requires segment information to be presented on the same basis as that used by the CODM for assessing performance and allocating resources. The Group’s operating segments are split into the five reportable segments as detailed below: – Online: comprises betting and gaming activities from online and mobile operations. Brands include bwin, Coral, Crystalbet, Eurobet, Ladbrokes, Sportingbet, SuperSport, Sports Interaction, STS, Tab NZ and BetCity, CasinoClub, Foxy Bingo, Gala, Gioco Digitale, partypoker and PartyCasino, Optibet, and Ninja; – Retail: comprises betting and retail activities in the shop estates in Great Britain, Northern Ireland, Jersey, Republic of Ireland, Belgium, Italy, Croatia, New Zealand and Poland; – New opportunities: Unikrn and innovation spend; – Corporate: includes costs associated with Group functions including Group executive, legal, Group finance, US joint venture, tax and treasury; and – Other segments: includes activities primarily related to Stadia. The Executive Management Team of the Group has chosen to assess the performance of operating segments based on a measure of NGR, EBITDA, and operating profit with finance costs and taxation considered for the Group as a whole. See page 69 of this annual report for further considerations of the use of Non-GAAP measures. Transfer prices between operating segments are on an arm’s-length basis in a manner similar to transactions with third parties. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023172 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 5 Segment information (continued) The segment results for the year ended 31 December were as follows: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | Elimination | | | | | | All other | New | | of internal | Total | | | Online | Retail | segments | opportunities | Corporate | revenue | Group | | 2023 | £m | £m | £m | £m | £m | £m | £m | | NGR | 3,426.5 | 1,386.7 | 26.7 | – | – | (6.8) | 4,833.1 | | VAT/GST | (59.9) | (3.6) | – | – | – | – | (63.5) | | Revenue | 3,366.6 | 1,383.1 | 26.7 | – | – | (6.8) | 4,769.6 | | Gross profit | 1,980.1 | 900.2 | 26.7 | – | – | – | 2,907.0 | | Contribution | 1,369.8 | 890.3 | 26.3 | (7.0) | – | – | 2,279.4 | | Operating costs excluding | | | | | | | | | marketing costs | (512.4) | (606.1) | (21.0) | (22.3) | (109.7) | – | (1,271.5) | | Underlying EBITDA before separately disclosed items | 857.4 | 284.2 | 5.3 | (29.3) | (109.7) | – | 1,007.9 | | Share-based payments | (7.3) | (2.4) | – | (0.7) | (11.3) | – | (21.7) | | Depreciation and amortisation | (160.2) | (132.1) | (2.7) | (5.7) | (0.8) | – | (301.5) | | Share of joint ventures | | | | | | | | | and͙associates | (1.4) | – | 2.0 | (1.5) | (42.0) | – | (42.9) | | Operating profit/(loss) before separately disclosed items | 688.5 | 149.7 | 4.6 | (37.2) | (163.8) | – | 641.8 | | Separately disclosed items (Note 6) | (481.1) | (22.8) | – | (44.3) | (738.3) | – | (1,286.5) | | Group operating profit/(loss) | 207.4 | 126.9 | 4.6 | (81.5) | (902.1) | – | (644.7) | | Net finance expense | | | | | | | (197.9) | | Loss before tax | | | | | | | (842.6) | | Income tax | | | | | | | (36.1) | | Loss for the year from continuing operations | | | | | | | (878.7) | | Loss for the year from discontinued | | | | | | | | | operations after tax (Note 21) | | | | | | | (57.8) | | Loss for the year after discontinued operations | | | | | | | (936.5) | 1 2 1. Included within NGR are amounts of £68.1m (2022: £65.6m) in relation to online poker services and £26.7m (2022: £25.1m) arising from the operation of greyhound stadia recognised under IFRS 15 Revenue. 2. Contribution represents gross profit less marketing costs and is a key performance metric used by the Group, particularly in Online. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 173 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 5 Segment information (continued) | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | Elimination | | | | | | All other | New | | of internal | Total | | | Online | Retail | segments | opportunities | Corporate | revenue | Group | | 2022 | £m | £m | £m | £m | £m | £m | £m | | NGR | 3,050.5 | 1,277.8 | 25.1 | – | – | (4.5) | 4,348.9 | | VAT/GST | (52.0) | – | – | – | – | – | (52.0) | | Revenue | 2,998.5 | 1,277.8 | 25.1 | – | – | (4.5) | 4,296.9 | | Gross profit | 1,829.6 | 860.0 | 25.1 | – | – | – | 2,714.7 | | Contribution | 1,254.2 | 852.1 | 25.0 | (2.4) | – | – | 2,128.9 | | Operating costs excluding | | | | | | | | | marketing costs | (426.0) | (571.9) | (20.1) | (26.7) | (91.0) | – | (1,135.7) | | Underlying EBITDA before separately disclosed items | 828.2 | 280.2 | 4.9 | (29.1) | (91.0) | – | 993.2 | | Share-based payments | (7.8) | (2.3) | – | (0.3) | (8.8) | – | (19.2) | | Depreciation and amortisation | (118.3) | (112.4) | (2.7) | (4.5) | (0.2) | – | (238.1) | | Share of joint ventures | | | | | | | | | and associates | (0.2) | – | 0.4 | (0.4) | (193.9) | – | (194.1) | | Operating profit/(loss) before separately disclosed items | 701.9 | 165.5 | 2.6 | (34.3) | (293.9) | – | 541.8 | | Separately disclosed items (Note 6) | (114.0) | (57.4) | (0.7) | – | (41.1) | – | (213.2) | | Group operating profit/(loss) | 587.9 | 108.1 | 1.9 | (34.3) | (335.0) | – | 328.6 | | Net finance income | | | | | | | (225.7) | | Profit before tax | | | | | | | 102.9 | | Income tax | | | | | | | (70.0) | | Profit for the year from continuing operations | | | | | | | 32.9 | | Loss for the year from discontinued | | | | | | | | | operations after tax (Note 21) | | | | | | | (13.4) | | Profit for the year after discontinued operations | | | | | | | 19.5 | 1 2 Geographical information Revenue by destination and non-current assets on a geographical basis for the Group, are as follows: | | | | | | | --- | --- | --- | --- | --- | | | | 2023 | | 2022 | | | | Non-current | | Non-current | | | Revenue | assets | Revenue | assets | | | £m | £m | £m | £m | | United Kingdom | 1,953.8 | 3,076.8 | 2,032.7 | 3,022.3 | | Australia and New Zealand | 515.1 | 1,475.4 | 463.0 | 528.8 | | Italy | 517.4 | 512.2 | 472.6 | 523.3 | | Rest of Europe | 1,443.4 | 3,930.2 | 968.7 | 2,922.4 | | Rest of the world | 339.9 | 293.8 | 359.9 | 259.6 | | Total | 4,769.6 | 9,288.4 | 4,296.9 | 7,256.4 | 3 3 1 2 1. Rest of Europe is predominantly driven by markets in Croatia, Belgium, The Netherlands, Georgia, Germany, and Spain. 2. Rest of the world is predominantly driven by the markets in Brazil and Canada. 3. Non-current assets excluding other financial assets, deferred tax assets and retirement benefit assets. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023174 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 6 Separately disclosed items | | | | | | | --- | --- | --- | --- | --- | | | | 2023 | | 2022 | | | | Tax impac t | | Tax impac t | | | £m | £m | £m | £m | | Legal settlement | 585.0 | – | – | – | | Amortisation of acquired intangibles | 254.6 | (41.6) | 116.9 | (16.5) | | Impairment loss | 289.0 | – | 7.0 | – | | Restructuring costs | 49.7 | (9.6) | 11.8 | (1.4) | | Corporate transaction costs | 17.8 | – | 23.9 | (0.6) | | Legal and onerous contract provisions | 17.6 | (3.0) | 8.1 | (0.8) | | Movement in fair value of contingent consideration | 71.8 | (15.5) | (1.0) | – | | Loss on disposal of property, plant and equipment | 1.0 | – | 1.0 | – | | Financing | 1.0 | – | 5.7 | – | | Furlough | – | – | 45.5 | (8.6) | | Separately disclosed items for the year from continuing operations | 1,287.5 | (69.7) | 218.9 | (27.9) | | Separately disclosed items for the year from discontinued operations (Note 21) | 57.8 | – | 13.4 | – | | Total before tax | 1,345.3 | (69.7) | 232.3 | (27.9) | | Separately disclosed items for the year after tax | 1,275.6 | | 204.4 | | 1 2 3 4 5 6 7 8 9 10 1. On 5 December 2023, Entain plc entered into a Deferred Prosecution Agreement (“DPA”) with the Crown Prosecution Service (“CPS”) in relation to historical conduct of the Group, thereby resolving the HM Revenue & Customs (“HMRC”) investigation into the Group. As a result of the agreement reached, the Group has recognised a £585.0m discounted liability during the current year in relation to amounts it has agreed to be pay in relation to the disgorgement of profits, charitable donations and contributions to CPS costs. Further details are provided in Note 20. 2. Amortisation charges in relation to acquired intangible assets arising from the various acquisitions made by the Group in recent years, including Ladbrokes Coral, Crystalbet, Neds, Enlabs, Avid, SuperSport, STS, NZ Tab and 365Scores. 3. Relates to impairments recorded against the Group’s Australian business of £190.0m, the assets associated with the Group’s Unikrn and Africa operations which have closed as B2C operations during the year, of £78.1m, an £11.0m impairment of the Group’s ROI retail portfolio, an impairment against the Group’s Polish operation (excluding STS) of £5.1m and a number of smaller impairments against ROU assets that the Group no longer intends to use following their closure, including UK Retail shops. Further details are provided in Note 14. 4. Primarily relates to costs associated with the Group’s restructuring programme Project Romer. 5. Transaction costs associated with the M&A activity including the acquisition of 365Scores, NZ Tab, STS and Angstrom (see Note 32). 6. Relates primarily to costs associated with the Group’s legal expenses in cooperating with the HMRC investigation. 7. Reflects the movement in the fair value of contingent consideration arrangements on recent acquisitions as well as the associated discount unwind. Further details of contingent consideration liabilities are provided in Note 26. 8. Relates to the loss on disposal of certain assets within the Group’s retail estates. 9. Fees incurred in respect of bridging loans and other financing activities. 10. Relates to the repayment of monies received under the Government furlough scheme in the prior year. The items above reflect incomes and expenditures which are either exceptional in nature or size or are associated with the amortisation of acquired intangibles. The Directors believe that each of these items warrants separate disclosure as they do not form part of the day- to-day underlying trade of the Group. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 175 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() 7 Administrative costs Profit before tax, net finance expense and separately disclosed items has been arrived at after charging: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Betting and gaming taxes and duties | 1,104.3 | 909.8 | | Revenue share arrangements (including content providers) | 537.8 | 555.6 | | Software royalties | 200.1 | 113.3 | | Other cost of sales | 20.4 | 3.5 | | Cost of sales | 1,862.6 | 1,582.2 | | Salaries and payroll-related expenses (Note 9) | 725.0 | 652.0 | | Property expenses | 92.7 | 80.0 | | Content and levy expenses | 163.6 | 176.6 | | Marketing expenses | 627.6 | 585.8 | | Depreciation and amortisation – owned assets | 239.9 | 173.1 | | Depreciation and amortisation – leased assets | 61.6 | 65.0 | | Other operating expenses | 311.9 | 246.3 | | Administrative costs | 2,222.3 | 1,978.8 | | Separately disclosed items before tax and finance expense (Note 6) | 1,286.5 | 213.2 | | Total | 5,371.4 | 3,774.2 | Fees payable to KPMG were as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Audit and audit-related services: | | | | Audit of the parent Company and Group financial statements | 0.6 | 0.6 | | Audit of the Company’s subsidiaries | 3.0 | 2.6 | | Audit-related assurance services | 0.7 | 0.5 | | Total fees | 4.3 | 3.7 | 8 Finance expense and income | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Interest on term loans, bonds and bank facilities | (229.2) | (76.2) | | Interest on lease liabilities | (12.6) | (12.8) | | Other financing (Note 6) | (1.0) | (5.7) | | Total finance expense | (242.8) | (94.7) | | Interest receivable | 12.4 | 4.3 | | Losses arising on financial derivatives | (90.6) | (23.1) | | Gains/(losses) arising on foreign exchange on debt instruments | 123.1 | (112.2) | | Net finance expense | (197.9) | (225.7) | 1 1. Interest on lease liabilities of £12.6m (2022: £12.8m) is net of £0.2m of sub-let interest receivable (2022: £0.2m). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023176 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 9 Employee staff costs The average monthly number of employees (including Executive Directors) was: | | | | | --- | --- | --- | | | 2023 | 2022 | | | Number | Number | | Online | 14,328 | 11,868 | | Retail | 14,190 | 14,184 | | Other | 467 | 390 | | Corporate | 1,350 | 1,012 | | | 30,335 | 27,454 | The number of people employed by the Group at 31 December 2023 was 31,180 (2022: 28,940). | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Wages and salaries | 623.9 | 560.6 | | Redundancy costs | 28.8 | 6.2 | | Social security costs | 58.0 | 49.9 | | Other pension costs | 21.4 | 18.6 | | Share-based payments (Note 31) | 21.7 | 19.2 | | | 753.8 | 654.5 | 1 1. Included within redundancy costs are £28.8m (2022: £2.5m) which are included within separately disclosed items. In addition to salary, employees may qualify for various benefit schemes operated by the Group. Eligibility for benefits is normally determined according to an employee’s length of service and level of responsibility. Benefits may include insured benefits that can cover private healthcare for the employee and their immediate family, long-term disability, personal accident and death in service cover. Company cars, including fuel benefits, are provided predominantly to meet job requirements but also to certain executives. 10 Income tax Analysis of expense for the year: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current income tax: | | | | – current tax charge | 114.3 | 91.4 | | – adjustments in respect of previous years | (19.6) | (7.9) | | Deferred tax: | | | | – relating to origination and reversal of temporary differences | (58.8) | (17.5) | | – adjustments in respect of previous years | 0.2 | 4.0 | | Income tax expense reported in the income statement | 36.1 | 70.0 | | Income tax expense is attributable to: | | | | Profit from continuing operations | 36.1 | 70.0 | | Loss from discontinued operations | – | – | | | 36.1 | 70.0 | | Deferred tax credited directly to other comprehensive income | (1.3) | (8.6) | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 177 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 10 Income tax (continued) A reconciliation of income tax expense applicable to loss (2022: profit) before tax at the UK statutory income tax rate to the income tax expense for the years ended 31 December 2023 and 31 December 2022 is as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | 2023 | | | 2022 | | | | | Separately | | | Separately | | | | | disclosed | | | disclosed | | | | Underlying | (Note 6) | Total | Underlying | (Note 6) | Total | | | £m | £m | £m | £m | £m | £m | | Profit/(loss) from continuing operations before income tax | 444.9 | (1,287.5) | (842.6) | 321.8 | (218.9) | 102.9 | | Loss from discontinued operations before tax | – | (57.8) | (57.8) | – | (13.4) | (13.4) | | Profit/(loss) before tax | 444.9 | (1,345.3) | (900.4) | 321.8 | (232.3) | 89.5 | | Corporation tax expense thereon at 23.52% (2022: 19.00%) | 104.6 | (316.4) | (211.8) | 61.1 | (44.1) | 17.0 | | Adjusted for the effects of: | | | | | | | | – Higher/(lower) effective tax rates on overseas͙earnings | (7.4) | 19.9 | 12.5 | 4.6 | 6.8 | 11.4 | | – Non-deductible expenses | 12.7 | 8.5 | 21.2 | 25.9 | 9.3 | 35.2 | | – Non-deductible legal settlement | – | 137.6 | 137.6 | – | – | – | | – Fair value adjustment to contingent consideration | – | 10.5 | 10.5 | – | (0.6) | (0.6) | | – Goodwill impairment | – | 68.6 | 68.6 | – | – | – | | – Impact of additional 50% deduction for marketing | | | | | | | | expenditure in Gibraltar | – | – | – | (20.3) | – | (20.3) | | – Increase in unrecognised tax losses relating to US joint | | | | | | | | venture | 8.9 | – | 8.9 | 40.7 | – | 40.7 | | – Increase/(decrease) in other unrecognised tax losses | 4.2 | 0.9 | 5.1 | (12.1) | 1.0 | (11.1) | | – Increase/(decrease) in unrecognised deferred interest | 5.8 | – | 5.8 | 0.4 | – | 0.4 | | – Difference in current and deferred tax rates | (3.0) | 0.1 | (2.9) | 0.7 | 0.5 | 1.2 | | Adjustments in respect of prior years: | | | | | | | | – Deferred tax | (0.4) | 0.6 | 0.2 | 4.8 | (0.8) | 4.0 | | – Current tax | (19.6) | – | (19.6) | (7.9) | – | (7.9) | | Income tax expense | 105.8 | (69.7) | 36.1 | 97.9 | (27.9) | 70.0 | Deferred tax Deferred tax at 31 December relates to the following: | | | | | | | --- | --- | --- | --- | --- | | | Deferred tax | | Deferred tax | | | | liabilities | | assets | | | | 2023 | 2022 | 2023 | 2022 | | | £m | £m | £m | £m | | Property, plant and equipment | – | – | (31.0) | (45.1) | | Intangible assets | 731.8 | 410.6 | (22.3) | (25.1) | | Retirement benefit assets | 21.6 | 22.3 | – | – | | Losses | – | – | (59.7) | (56.9) | | Contingent and deferred revenue share payments | – | – | (321.5) | – | | Other temporary difference | 71.7 | 62.5 | (58.7) | (30.2) | | Deferred tax liabilities/(assets) | 825.1 | 495.4 | (493.2) | (157.3) | 1 2 3 1. This deferred tax asset reflects tax deductions that will arise on future payment of the deferred and contingent consideration amounts by Tab NZ (see Note 32). 2. The deferred tax liability includes a provision for tax on unremitted earnings from overseas subsidiaries of £71.4m (2022: £61.8m) and other temporary differences of £0.3m (2022: £0.7m). The deferred tax asset comprises deferred interest relief of £52.2m (2022: £22.9m) and other temporary differences of £6.5m (2022: 7.3m). 3. Deferred tax assets and liabilities have been offset only where there is a legally enforceable right to do so, and the assets and liabilities relate to the same taxable entity or tax grouping. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023178 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 10 Income tax (continued) Movements in deferred tax during the year ended 31 December 2023 were recognised as follows: Net deferred tax liabilities/(assets): | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | Contingent | | | | | Property, | | | | and deferred | Other | | | | plant and | Intangible | Retirement | | revenue share | temporary | | | | equipment | assets | benefit assets | Losses | payments | differences | Total | | | £m | £m | £m | £m | £m | £m | £m | | At 31 December 2021 | (62.3) | 305.7 | 33.3 | (27.0) | – | 16.9 | 266.6 | | Income statement | 17.7 | (14.5) | 0.1 | (28.7) | – | 11.9 | (13.5) | | Other comprehensive income | – | – | (8.6) | – | – | – | (8.6) | | Arising on business combinations | – | 85.4 | – | – | – | 0.5 | 85.9 | | Settlement of tax on pension asset | – | – | (2.5) | – | – | – | (2.5) | | Exchange adjustment | (0.5) | 8.9 | – | (1.2) | – | 3.0 | 10.2 | | At 31 December 2022 | (45.1) | 385.5 | 22.3 | (56.9) | – | 32.3 | 338.1 | | Income statement | 13.9 | (46.7) | 0.6 | (3.3) | (5.1) | (18.0) | (58.6) | | Other comprehensive income | – | – | (1.3) | – | – | – | (1.3) | | Arising on business combinations | | | | | | | | | (Note 32) | – | 368.9 | – | – | (309.8) | – | 59.1 | | Exchange adjustment | 0.2 | 1.8 | – | 0.5 | (6.6) | (1.3) | (5.4) | | At 31 December 2023 | (31.0) | 709.5 | 21.6 | (59.7) | (321.5) | 13.0 | 331.9 | 1 Amounts presented on the consolidated balance sheet: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Deferred tax liabilities | 825.1 | 495.4 | | Deferred tax assets | (493.2) | (157.3) | | Net deferred tax liability | 331.9 | 338.1 | The average standard rate of UK corporation tax during the period was 23.52% (2022: 19.0%). The deferred tax assets and liabilities are measured at the tax rates of the respective territories which are expected to apply in the year in which the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date. Deferred tax assets have been recognised based on the ability of future offset against deferred tax liabilities or against future taxable profits, to the extent they relate to the same taxable entity. The assessment of future taxable profits is based on forecasts and assumptions consistent with those used for impairment testing as set out in Note 14. As at 31 December 2023, the Group had £1,760.9m (2022: £1,764.6m) of gross unrecognised deferred tax assets. This unrecognised deferred tax asset consists of £213.3m of capital losses (2022: £213.3m), £1,479.5m of income losses (2022: £1,538.3m), £66.2m of deferred interest relief (2022: £13.0m) and £1.9m of other deferred tax assets (2022: £nil). These assets arise in entities that do not have deferred tax liabilities they can be set against, and where there are either no forecast future taxable profits, or the potential future profits are not sufficiently certain to support the deferred tax asset recognition. There are no significant unrecognised taxable temporary differences associated with investments in subsidiaries. With effect from 1 April 2023 the standard rate of UK Corporation Tax was increased from 19% to 25%. The 25% rate has therefore been used in measuring the UK deferred tax items at the date of this Report. Deferred tax on retirement benefit assets is provided at 35.0%, which is the rate applicable to refunds at the date of this Report. In Gibraltar, a temporary enhanced tax deduction for qualifying business marketing and promotion costs was introduced in July 2021, which applied for the years ended 31 December 2021 and 31 December 2022. The total impact of this measure for the Group has been a cumulative tax credit of £48.4m. In a subsequent Gibraltar Budget on 28 June 2022 the Chief Minister unexpectedly announced the retrospective removal of this enhanced deduction, except in very limited circumstances. This change had not been substantively enacted by the balance sheet date and so is not reflected in the tax charge for the year. The impact of this change, once enacted, will depend on how it is implemented and to which periods the change applies, but could result in a tax charge of up to £48.4m. The Group’s future tax charge, and effective tax rate, will be affected by a number of factors including the geographic mix of profits, changes to statutory corporate tax rates and the impact of continuing global tax reforms. During 2023 the UK enacted legislation to implement the OECD’s global minimum tax model rules for multinational groups (“Pillar Two” ). This will apply from 1 January 2024 and is not expected not significantly increase the Group’s future Effective Tax Rate. The Group has applied the temporary exception required under IAS 12 Income Taxes in relation to the accounting for deferred taxes arising from the implementation of the Pillar Two rules. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 179 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 11 Dividends | | | | | | | --- | --- | --- | --- | --- | | | | | 2023 | 2022 | | | | | Shares in | Shares in | | | 2023 | 2022 | issue | issue | | Pence per share | pence | pence | number | number | | 2022 interim dividend paid | – | 8.5 | – | 588.8 | | 2022 second interim dividend paid | 8.5 | n/a | 588.8 | n/a | | 2023 interim dividend paid | 8.9 | n/a | 638.8 | n/a | A second interim dividend of 8.9p (2022: 8.5p) per share, amounting to £56.9m (2022: £50.0m) in respect of the year ended 31 December 2023, was proposed by the Directors on 7 March 2024. The estimated total amount payable in respect of the final dividend is based on the expected number of shares in issue on 7 March 2024. There are no income tax implications for the Group and Company arising from the proposed second interim dividend. The 2022 second interim dividend of 8.5p per share (£50.0m) was paid on 26 April 2023. The 2023 interim dividend of 8.9p per share (£56.8m) was paid on 18 September 2023. In the year, the Group paid a dividend totalling £7.4m to non-controlling interests (2022: £nil). #### 12 Earnings per share Basic earnings per share has been calculated by dividing the loss for the year attributable to shareholders of the Company of £928.6m (2022: £24.2m profit) by the weighted average number of shares in issue during the year of 617.5m (2022: 588.2m). The dilutive effects of share options and contingently issuable shares are not considered when calculating the diluted loss per share. At 31 December 2023, there were 638.8m €0.01 ordinary shares in issue. The calculation of adjusted earnings per share which removes separately disclosed items and foreign exchange gains and losses arising on financial instruments has also been disclosed as it provides a better understanding of the underlying performance of the Group. Separately disclosed items are defi ned in Note 4 and disclosed in Note 6. Total earnings per share | | | | | --- | --- | --- | | Weighted average number of shares (millions) | 2023 | 2022 | | Shares for basic earnings per share | 616.0 | 588.2 | | Potentially dilutive share options and contingently issuable shares | 1.5 | 4.5 | | Shares for diluted earnings per share | 617.5 | 592.7 | | | | | | --- | --- | --- | | | 2023 | 2022 | | Total profit | £m | £m | | (Loss)/profit attributable to shareholders | (928.6) | 24.2 | | – from continuing operations | (870.8) | 37.6 | | – from discontinued operations | (57.8) | (13.4) | | Losses arising from financial instruments | 90.6 | 23.1 | | (Gains)/losses arising from foreign exchange debt instruments | (123.1) | 112.2 | | Associated tax charge on (losses)/gains arising from financial instruments and foreign exchange debt instruments | 1.1 | (2.4) | | Separately disclosed items net of tax (Note 6) | 1,232.7 | 201.4 | | Adjusted profit attributable to shareholders | 272.7 | 358.5 | | – from continuing operations | 272.7 | 358.5 | | – from discontinued operations | – | – | | | | | | | | --- | --- | --- | --- | --- | | | | Standard earnings | | Adjusted earnings | | | | per share | | per share | | Earnings per share (pence) | 2023 | 2022 | 2023 | 2022 | | Basic earnings per share | | | | | | – from continuing operations | (141.4) | 6.4 | 44.3 | 60.9 | | – from discontinued operations | (9.3) | (2.3) | – | – | | From profit for the period | (150.7) | 4.1 | 44.3 | 60.9 | | Diluted earnings per share | | | | | | – from continuing operations | (141.4) | 6.3 | 44.2 | 60.5 | | – from discontinued operations | (9.3) | (2.2) | – | – | | From profit for the period | (150.7) | 4.1 | 44.2 | 60.5 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023180 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 12 Earnings per share (continued) The earnings per share presented above is inclusive of the performance from the US joint venture BetMGM. Adjusting for the removal of the BetMGM performance would result in a basic adjusted earnings per share of 51.1p (2022: 93.9p) and a diluted adjusted earnings per share of 51.0p (2022: 93.2p) from continuing operations. 13 Goodwill and intangible assets | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | Customer | Trade-marks & | | | | Goodwill | Licences | Software | relationships | brand names | Total | | | £m | £m | £m | £m | £m | £m | | Cost | | | | | | | | At 1 January 2022 | 3,492.5 | 49.7 | 622.0 | 1,005.0 | 2,017.5 | 7,186.7 | | Exchange adjustment | 153.6 | 7.1 | 28.3 | 34.1 | 44.9 | 268.0 | | Additions | – | – | 129.9 | – | – | 129.9 | | Additions from business combinations (Note 32) 1 | 624.0 | 149.1 | 7.4 | 201.9 | 207.0 | 1,189.4 | | Disposals | – | (0.5) | (13.9) | – | – | (14.4) | | Reclassification | – | – | (1.0) | – | – | (1.0) | | At 31 December 2022 (restated) | 4,270.1 | 205.4 | 772.7 | 1,241.0 | 2,269.4 | 8,758.6 | | Exchange adjustment | (68.2) | 11.8 | (12.7) | (12.3) | (17.4) | (98.8) | | Additions | – | – | 191.5 | – | – | 191.5 | | Additions from business combinations (Note 32) | 1,067.5 | 747.8 | 49.8 | 275.5 | 439.5 | 2,580.1 | | Disposals | – | – | (2.9) | – | – | (2.9) | | At 31 December 2023 | 5,269.4 | 965.0 | 998.4 | 1,504.2 | 2,691.5 | 11,428.5 | | Accumulated amortisation and impairment | | | | | | | | At 1 January 2022 | 275.5 | 13.3 | 405.8 | 942.0 | 180.6 | 1,817.2 | | Exchange adjustment | 13.7 | 0.3 | 19.8 | 23.6 | 11.7 | 69.1 | | Amortisation charge | – | 12.7 | 109.1 | 52.4 | 54.9 | 229.1 | | Impairment charge | – | 0.5 | – | – | – | 0.5 | | Disposals | – | (0.5) | (13.9) | – | – | (14.4) | | At 31 December 2022 | 289.2 | 26.3 | 520.8 | 1,018.0 | 247.2 | 2,101.5 | | Exchange adjustment | (13.3) | (0.1) | (9.1) | (13.8) | (7.3) | (43.6) | | Amortisation charge | – | 45.3 | 138.0 | 141.4 | 90.4 | 415.1 | | Impairment charge | 277.5 | – | 2.2 | 0.5 | 2.1 | 282.3 | | Disposals | – | – | (2.9) | – | – | (2.9) | | At 31 December 2023 | 553.4 | 71.5 | 649.0 | 1,146.1 | 332.4 | 2,752.4 | | Net book value | | | | | | | | At 31 December 2022 | 3,980.9 | 179.1 | 251.9 | 223.0 | 2,022.2 | 6,657.1 | | At 31 December 2023 | 4,716.0 | 893.5 | 349.4 | 358.1 | 2,359.1 | 8,676.1 | 1 1. Restatement of prior year intangible valuations has been made in relation to the prior year SuperSport acquisition during the subsequent measurement period. See note 32 for further details. At 31 December 2023 the Group had not entered into contractual commitments for the acquisition of any intangible assets (2022: £nil). Included within trade-marks and brand names are £1,398.4m (2022: £1,398.4m) of intangible assets considered to have indefinite lives. These assets relate to the UK Ladbrokes and Coral brands which are considered to have indefinite durability that can be demonstrated, and their value can be readily measured. The brands operate in longstanding and profitable market sectors. The Group has a strong position in the market and there are barriers to entry due to the requirement to demonstrate that the applicant is a fit and proper person with the ‘know-how’ required to run such operations. Goodwill reflects the value by which consideration exceeds the fair value of net assets acquired as part of a business combination including the deferred tax liability arising on acquisitions. Licences comprise the cost of acquired betting shop and online licences, as well as licences acquired as part of the NZ Tab acquisition (see Note 32). Software relates to the cost of acquired software, through purchase or business combination, and the capitalisation of internally developed software. Additions of £191.5m (2022: £128.8m) include £92.6m of internally capitalised costs (2022: £58.0m). Customer relationships, trade-marks and brand names relate to the fair value of customer lists, trade-marks and brand names acquired as part of business combinations, primarily relating to the bwin, Ladbrokes Coral Group, Enlabs, Sport Interaction, SuperSport, BetCity, 365Scores, and Tab NZ businesses. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 181 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() 14 Impairment testing of goodwill and indefi nite life intangible assets An impairment loss is recognised for any amount by which an asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Within UK, European Retail, CEE, and Tab NZ Retail, the cash-generating units (“CGUs”) are generally an individual Licensed Betting Office (“LBO”) and, therefore, impairment is first assessed at this level for licences (intangibles) and property, plant and equipment, with any impairment arising booked to licences and property, plant and equipment on a pro-rata basis. Since goodwill and brand names have not been historically allocated to individual LBOs, a secondary assessment is then made to compare the carrying value of the segment against the recoverable amount with any additional impairment then taken against goodwill first. For Online the CGU is the relevant geographical location or business unit, for example Australia, European digital (defined as websites hosted by proprietary platforms based in European constituent countries), Digital (defined as websites hosted by Entain proprietary platforms) etc. and any impairments are made firstly to goodwill, next to any capitalised intangible asset and then finally to property, plant and equipment. The expected cash flows generated by the assets are discounted using appropriate discount rates that reflect the time value of money and risks associated with the group of assets. For both tangible and intangible assets, the future cash flows are based on the forecasts and budgets of the CGU or business discounted to reflect time value of money. The key assumptions within the UK and European Retail budgets are OTC wagers (customer visits and spend per visit), the average number of machines per shop, gross win per shop per week, salary increases, the potential impact of the shop closures and the fixed costs of the LBOs. The key assumptions within the budgets for Online are the number of active customers, net revenue per head, win percentage, marketing spend, revenue shares and operating costs. All forecasts take into account the impact of the Group’s commitment to be Net Zero by 2035 as well as the impact of climate change. The value in use calculations use cash flows based on detailed, Board approved, financial budgets prepared by management covering a three-year period. These forecasts have been extrapolated over years 4 to 8 representing a declining growth curve from year 3 until the long-term forecast growth rate is reached. The growth rates used from years 4 to 8 range from 0% to 10%. From year 9 onwards long-term growth rates used are between 0% and 2% (2022: between 0% and 2%) and are based on the long-term GDP growth rate of the countries in which the relevant CGUs operate or the relevant outlook for the business. An eight-year horizon is considered appropriate based on the Group’s history of underlying profit as well as ensuring there is an appropriate decline to long-term growth rates from those growth rates currently observed in our key markets. A 0% growth rate has been used for the UK Retail operating segment. All key assumptions used in the value in use calculations reflect the Group’s past experience unless a relevant external source of information is available. Whilst the same approach is adopted for Tab NZ impairment reviews, the value-in-use is assessed over the 25-year life of the licence rather than into perpetuity. The discount rate calculation is based on the specific circumstances with reference to the WACC and risk factors expected in the industry in which the Group operates. The pre-tax discount rates used, which have remained consistent year-on-year, and the associated carrying value of goodwill by CGU is as follows: | | | | | | | --- | --- | --- | --- | --- | | | 2023 | 2022 | 2023 | 2022 | | | | | | restated | | Goodwill | % | % | £m | £m | | Digital | 11.1 | 12.6–12.9 | 2,263.4 | 2,230.7 | | UK Retail | 12.6 | 12.6 | 76.4 | 76.4 | | Australia | 13.5 | 13.5 | 145.0 | 347.5 | | European Retail | 9.5–13.3 | 9.5–13.3 | 147.1 | 161.5 | | European Digital | 9.5–13.3 | 9.5–13.3 | 343.3 | 350.4 | | Enlabs | 11.8 | 11.8 | 205.3 | 209.6 | | BetCity | 12.7 | n/a | 200.1 | n/a | | SuperSport | 11.5 | 11.8 | 527.8 | 538.4 | | STS | 11.7 | n/a | 389.1 | n/a | | 365Scores | 12.3 | n/a | 86.8 | n/a | | Tab NZ | 11.1 | n/a | 255.5 | n/a | | All other segments | 11.1–12.6 | 12.4 | 76.2 | 66.4 | | | | | 4,716.0 | 3,980.9 | 1 1. Restatement of prior year intangible valuations has been made in relation to the prior year SuperSport acquisition during the subsequent measurement period. See note 32 for further details. It is not practical or material to disclose the carrying value of individual licences by LBO. Impairment recognised during the year Impairments of intangible assets and property, plant and equipment are recognised as separately disclosed items within operating expenses. Australia impairment During the current year, the Group recorded a non-cash impairment charge of £190.0m against the Online division. The charge has arisen in the Group’s Australian CGU and is a result of the impact of ongoing increases in the rate of Point of Consumption tax across certain states and a forecast decline in Australian revenues in 2024 as a result of a reduced market outlook. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023182 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 14 Impairment testing of goodwill and indefi nite life intangible assets (continued) Whilst our Australian business continues to be profitable and strategically important, market conditions and tax headwinds have reduced the value in use of the business resulting in the impairment charge. Post the annualisation of the tax increases and stabilisation of local market conditions, we expect our Australian business to return to growth. Impairment testing across the business | | | | | | | | --- | --- | --- | --- | --- | --- | | | Licences/ | | Customer | | | | | Franchisees | PPE & Software | relationships | Goodwill | Brand name | | UK Digital | | Digital Impairment review | | | Combined | | | | | | | Digital/UK Retail | | | | | | | Impairment | | UK Retail | UK Retail site by site Impairment review | | UK Retail Impairment review | | review | | ROI | | | ROI Impairment review | | | | Eurobet | | Eurobet Digital Impairment review | | | | | Digital | | | | | Eurobet | | | | | | | Impairment | | Eurobet | | Eurobet Retail Impairment review | | | review | | Retail | | | | | | | Belgium | | Belgium Digital Impairment review | | | | | Digital | | | | | Belgium | | | | | | | Impairment | | Belgium | | Belgium Retail Impairment review | | | review | | Retail | | | | | | | Australia | | | Australia Impairment review | | | | Enlabs | | | Enlabs Impairment review | | | | BetCity | | | BetCity Impairment review | | | | SuperSport | SuperSport Digital Impairment review | | | | | | Digital | | | | SuperSport | | | SuperSport | SuperSport Retail Impairment review | | Impairment review | | | | Retail | | | | | | | STS | | | STS Impairment review | | | | 365Scores | | 365Scores Impairment review | | | | | Tab NZ | | Tab NZ Digital Impairment review | | | | | Digital | | | | | Tab NZ | | | | | | | Impairment | | Tab NZ | | Tab NZ Retail Impairment review | | | review | | Retail | | | | | | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 183 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 14 Impairment testing of goodwill and indefi nite life intangible assets (continued) Unikrn impairment During the year, the Group took the decision to close its B2C eSports business operating under the Unikrn brand, in favour of developing a leading eSports proposition on existing labels. As a result of the decision to turn off its B2C operations, the Group has recorded an £43.2m impairment of goodwill and £1.1m impairment of trade-marks and brands associated with the Unikrn operation during the current year within the New Opportunities segment. Impala impairment The Group has also taken the decision during 2023 to close its B2C operations in Zambia and Kenya, operations that were run out of the previously acquired African subsidiary. As a result of the decision to close these operations and focus resources to drive growth in other markets, the Group has recorded an impairment against the value of assets carried against this business. The resulting impairment has been booked against goodwill of £29.9m, and against software of £4.0m within the Online segment. In addition, an impairment charge of £11.0m has been recognised during the current year against our Retail estate in ROI as a result of a reduced outlook for this market, and £5.0m against Totolotek following its closure post the STS acquisition. Sensitivity analysis With the exception of Australia, no reasonable change in assumptions would cause an additional impairment, including A 5% decrease in all cash flows or a 0.5pp increase in discount rates. For Australia, a 10% increase in revenue would reduce the impairment by £110.0m, whereas a 5% decrease in revenue would increase the impairment by £48.0m. Each 0.5pp movement in the discount rate impacting the charge by £20.0m. 15 Property, plant and equipment | | | | | | | | --- | --- | --- | --- | --- | --- | | | Land and | Plant and | Fixtures | Leased | | | | buildings | equipment | and fittings | assets | Total | | | £m | £m | £m | £m | £m | | Cost | | | | | | | At 1 January 2022 | 26.8 | 102.5 | 188.3 | 572.3 | 889.9 | | Exchange adjustment | 0.7 | 3.2 | 7.0 | 5.2 | 16.1 | | Additions | 24.9 | 50.6 | 11.1 | 61.8 | 148.4 | | Additions from business combinations | 0.2 | 3.2 | 4.4 | 9.5 | 17.3 | | Disposals | (10.4) | (20.2) | (16.1) | (3.5) | (50.2) | | Reclassification | (1.6) | 1.9 | 42.9 | (42.2) | 1.0 | | At 31 December 2022 | 40.6 | 141.2 | 237.6 | 603.1 | 1,022.5 | | Exchange adjustment | (0.3) | (2.1) | (3.5) | (1.4) | (7.3) | | Additions | 18.0 | 27.0 | 45.9 | 45.6 | 136.5 | | Additions from business combinations (Note 32) | 4.9 | 8.1 | 2.2 | 26.9 | 42.1 | | Disposals | (4.5) | (6.7) | (5.7) | (49.8) | (66.7) | | Reclassification | – | 0.9 | (0.9) | – | – | | At 31 December 2023 | 58.7 | 168.4 | 275.6 | 624.4 | 1,127.1 | | Accumulated depreciation | | | | | | | At 1 January 2022 | 11.3 | 38.3 | 52.2 | 320.9 | 422.7 | | Exchange adjustment | 0.5 | 2.7 | 2.0 | 4.2 | 9.4 | | Depreciation charge | 11.4 | 23.5 | 26.0 | 65.0 | 125.9 | | Impairment | – | 0.1 | 1.9 | 4.5 | 6.5 | | Disposals | (10.3) | (20.0) | (16.1) | (2.8) | (49.2) | | Reclassification | – | – | 21.7 | (21.7) | – | | At 31 December 2022 | 12.9 | 44.6 | 87.7 | 370.1 | 515.3 | | Exchange adjustment | (0.2) | (1.5) | (2.0) | (0.6) | (4.3) | | Depreciation charge | 13.7 | 29.4 | 36.6 | 61.3 | 141.0 | | Impairment | 0.9 | 0.7 | 0.4 | 4.7 | 6.7 | | Disposals | (4.5) | (6.0) | (5.1) | (49.4) | (65.0) | | Reclassification | – | (0.2) | 0.2 | – | – | | At 31 December 2023 | 22.8 | 67.0 | 117.8 | 386.1 | 593.7 | | Net book value | | | | | | | At 31 December 2022 | 27.7 | 96.6 | 149.9 | 233.0 | 507.2 | | At 31 December 2023 | 35.9 | 101.4 | 157.8 | 238.3 | 533.4 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023184 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 15 Property, plant and equipment (continued) At 31 December 2023, the Group had not entered into contractual commitments for the acquisition of any property, plant and equipment (2022: £nil). Included within fixtures, fittings and equipment are assets in the course of construction which are not being depreciated of £17.1m (2022: £10.6m), relating predominantly to self-service betting terminals and the new point of sale system in UK Retail. An impairment charge of £6.5m (2022: £6.5m) has been made against closed retail shops and office buildings included within leased assets in the year. See Notes 6 and 14 for further details. Analysis of leased assets: | | | | | | --- | --- | --- | --- | | | Land and | Plant and | | | | buildings | equipment | Total | | | £m | £m | £m | | Cost | | | | | At 1 January 2022 | 520.7 | 51.6 | 572.3 | | Exchange adjustment | 5.0 | 0.2 | 5.2 | | Additions | 60.0 | 1.8 | 61.8 | | Additions from business combinations | 9.5 | – | 9.5 | | Disposals | (2.0) | (1.5) | (3.5) | | Reclassification | – | (42.2) | (42.2) | | At 31 December 2022 | 593.2 | 9.9 | 603.1 | | Exchange adjustment | (1.3) | (0.1) | (1.4) | | Additions | 32.8 | 12.8 | 45.6 | | Additions from business combinations | 26.0 | 0.9 | 26.9 | | Disposals | (49.8) | – | (49.8) | | At 31 December 2023 | 600.9 | 23.5 | 624.4 | | Accumulated depreciation | | | | | At 1 January 2022 | 299.8 | 21.1 | 320.9 | | Exchange adjustment | 4.1 | 0.1 | 4.2 | | Depreciation charge | 55.1 | 9.9 | 65.0 | | Impairment | 4.5 | – | 4.5 | | Disposals | (2.0) | (0.8) | (2.8) | | Reclassification | – | (21.7) | (21.7) | | At 31 December 2022 | 361.5 | 8.6 | 370.1 | | Exchange adjustment | (0.6) | – | (0.6) | | Depreciation charge | 59.0 | 2.3 | 61.3 | | Impairment | 4.7 | – | 4.7 | | Disposals | (49.4) | – | (49.4) | | At 31 December 2023 | 375.2 | 10.9 | 386.1 | | Net book value | | | | | At 31 December 2022 | 231.7 | 1.3 | 233.0 | | At 31 December 2023 | 225.7 | 12.6 | 238.3 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 185 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() 16 Interest in joint venture | | | | --- | --- | | | Share of joint | | | venture’s net | | | assets | | | £m | | Cost | | | At 1 January 2022 | 9.7 | | Additions | 175.1 | | Exchange adjustment | 3.7 | | Share of loss after tax | (193.9) | | Share of other comprehensive loss | (0.4) | | Contributions to be made | 5.8 | | At 31 December 2022 | – | | Additions | 40.7 | | Exchange adjustment | 0.5 | | Share of loss after tax | (42.0) | | Share of other comprehensive loss (movement in translation reserve) | (0.6) | | Contributions to be made | 1.4 | | At 31 December 2023 | – | The joint venture represents the Group’s investment in BetMGM set up in the US in which a 50% stake is held. The Group has committed to provide its final committed equity injection to BetMGM over the course of 2024, with $25.0m additional contributions expected ($50.0m split between both joint venture partners). This will take the Group’s total investment to $705.0m ($1.41bn across both joint venture partners). Given the net liabilities position of the joint venture, the Group has recorded £7.2m of these future contributions as a liability at the year end, an increase of £1.4m on the prior year. Summarised financial information in respect of the Group’s joint venture’s net assets is set out below: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Non-current assets | 118.1 | 148.6 | | Cash and cash equivalents | 138.7 | 308.7 | | Other current assets | 182.7 | 92.4 | | Current assets | 321.4 | 401.1 | | Balances with customers | (208.6) | (234.4) | | Other current liabilities | (224.0) | (310.0) | | Current liabilities | (432.6) | (544.4) | | Non-current liabilities | (21.2) | (17.0) | | Net liabilities | (14.3) | (11.7) | | Group’s share of net liabilities | (7.2) | (5.8) | | | | | | --- | --- | --- | | | 2023 | 2022 | | Summarised statement of comprehensive income | £m | £m | | Revenue | 1,582.4 | 1,174.8 | | Depreciation and amortisation | (8.2) | (28.5) | | Other operating expenses | (1,658.1) | (1,534.1) | | Loss for the year | (83.9) | (387.8) | | Other comprehensive loss | (1.2) | (0.8) | | Total comprehensive loss | (85.1) | (388.6) | | Group’s share of loss | (42.6) | (194.3) | There are no contingent liabilities relating to the Group’s interest in the joint venture (2022: £nil). The risks associated with the Group’s interest in joint ventures are aligned to the same risks the Group is exposed to on the basis that they operate wholly within the betting and gaming market. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023186 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() 17 Interest in associates and other investments | | | | | | --- | --- | --- | --- | | | Share of | | | | | associates’ | Other | | | | net assets | investments | Total | | | £m | £m | £m | | Cost | | | | | At 1 January 2022 | 44.2 | 14.2 | 58.4 | | Revaluation loss | – | (5.1) | (5.1) | | Arising on business combinations | – | 4.9 | 4.9 | | Dividends received | (3.6) | – | (3.6) | | Share of loss after tax | (0.2) | – | (0.2) | | Foreign exchange | (0.9) | – | (0.9) | | At 31 December 2022 | 39.5 | 14.0 | 53.5 | | Revaluation gain | – | 2.6 | 2.6 | | Additions | – | 3.1 | 3.1 | | Dividends received | (9.8) | – | (9.8) | | Share of loss after tax | (0.9) | – | (0.9) | | Share of other comprehensive expense | (1.1) | – | (1.1) | | Foreign exchange | – | (0.3) | (0.3) | | At 31 December 2023 | 27.7 | 19.4 | 47.1 | Revaluation loss includes £1.1m (2022: £2.6m) recognised through other comprehensive income with the remaining loss of £2.5m (2022: £2.5m) recognised through profit or loss. Associates Summarised financial information in respect of the associates is set out below: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Non-current assets | 42.5 | 52.0 | | Current assets | 78.0 | 132.4 | | Non-current liabilities | (5.7) | (2.5) | | Current liabilities | (73.1) | (90.1) | | Net assets | 41.7 | 91.8 | | Group’s share of net assets | 27.7 | 39.4 | | Revenue for the year | 370.1 | 337.1 | | Profit for the year | 10.4 | 0.1 | | Other comprehensive expense | (4.7) | – | | Total comprehensive income | 5.7 | 0.1 | | Group’s share of total comprehensive expense | (2.0) | (0.2) | Further details of the Group’s associates are listed in Note 34. The financial year end of Sports Information Services (Holdings) Limited (SIS), an associate of the Group, is 31 March. The Group has included the results for SIS for the 12 months ended 31 December 2023. All associates are private companies and there are no quoted market prices available for their shares. The risks associated with associate investments are considered to be aligned to the same risks the Group is exposed to on the basis that they operate wholly within the betting and gaming market. Other investments of £19.4m (2022: £14.0m) consist of investments which have no fixed maturity date or coupon rate. 18 Trade and other receivables | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Trade receivables | 40.6 | 34.1 | | Other receivables | 399.0 | 430.8 | | Finance lease receivable | 4.3 | 3.5 | | Prepayments | 91.1 | 70.5 | | | 535.0 | 538.9 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 187 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 18 Trade and other receivables (continued) Trade and other receivables are presented on the Balance Sheet as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current | 503.2 | 500.3 | | Non-current | 31.8 | 38.6 | | Total | 535.0 | 538.9 | Trade and other receivables are non-interest bearing and are generally on 30–90 day terms. Trade and other receivables are reviewed for impairment on an ongoing basis, taking account of the ageing of outstanding amounts and the credit profile of customers. Impaired receivables, including all trade receivables that are a year old, are provided for in an allowance account. Impaired receivables are derecognised when they are assessed as irrecoverable. The expected credit losses arising from receivables are not considered to be significant. The balance of other receivables consists of the receivable for Greek tax of €34.9m (2022: €34.9m), amounts receivable from payment service providers of £176.0m (2022: £149.8m), and other smaller items such as regulatory deposits, security deposits, rent deposits and balances due from affiliates and partners. The Group does not perceive there to be a material credit risk against these items. #### 19 Cash and cash equivalents | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Cash and short-term deposits | 400.6 | 658.5 | Cash and cash equivalents in the consolidated statement of cash flows comprises cash at bank, overdrafts net of short-term investments and includes £154.6m (2022: £52.1m) restricted in respect of customers. 20 Trade and other payables | | | | | --- | --- | --- | | | 2023 | 2022 | | | | Restated | | | £m | £m | | Trade payables | 56.9 | 64.4 | | Other payables | 719.9 | 135.4 | | Social security and other taxes | 197.6 | 181.0 | | Accruals | 338.0 | 339.2 | | | 1,312.4 | 720.0 | 1 1 1. Restatement of prior year intangible valuations increasing prior year other payables by £0.2m has been made in relation to the prior year SuperSport acquisition during the subsequent measurement period. See Note 32 for further details. Trade and other payables are presented on the Balance Sheet as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | | Restated | | | £m | £m | | Current | 878.6 | 720.0 | | Non-current | 433.8 | – | | Total | 1,312.4 | 720.0 | 1 HMRC settlement liability within other payables On 5 December 2023, Entain plc entered into a Deferred Prosecution Agreement (“DPA”) with the Crown Prosecution Service (“CPS”) in relation to historical conduct of the Group, thereby resolving the HM Revenue & Customs (“HMRC”) investigation into the Group. The DPA relates to alleged offences under Section 7 of the Bribery Act 2010 and, in particular, a failure by the Company to have adequate procedures in place to prevent bribery in relation to its legacy Turkish-facing business. The Turkish-facing business was sold by a former management team in 2017. Under the terms of the DPA, the Group has agreed to pay a financial penalty plus disgorgement of profits totalling £585 million, to make a charitable donation of £20 million and to pay a contribution of £10 million to HMRC’s and the CPS’s costs. The financial penalty, disgorgement of profits and the charitable donation will be paid in instalments over the term of the DPA, which will be four years from the date of the DPA. During the current financial year, the Group has provided for £585m representing the discounted value of all future payments over the four-year term. Since the conduct giving rise to the DPA, the Group has undertaken a comprehensive review of its anti-bribery policies and procedures and has taken decisive action to significantly strengthen its wider compliance programme and related controls. Recognition of the significant improvements made by the Company is an integral feature of achieving a DPA. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023188 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 21 Discontinued operations During the current year, the Group recorded a £57.8m loss in discontinued operations relating to its former business Intertrader which was disposed of in November 2021. The loss recorded primarily reflects legal costs associated with historic matters as well as a provision liability for a potential settlement with the former owners of the business following a long-running legal dispute. The charge has been recognised in within separately disclosed items in the year (Note 6). In 2022, loss on disposal was £13.4m relating to ongoing costs of disposal of the Intertrader business and the settlement of various associated legal matters. #### 22 Lease liabilities | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current | | | | Lease liabilities | 65.7 | 65.1 | | Non-current | | | | Lease liabilities | 210.2 | 215.8 | | Total lease liabilities | 275.9 | 280.9 | The Group’s leasing activity consists of leases on property, cars, self-service betting terminals and office equipment. The majority of those relate to the leasing of LBOs within the Retail estates and office buildings. Each lease is reflected on the balance sheet as a right-of-use asset and a lease liability. Variable lease payments which do not depend on an index or a rate (such as lease payments on gaming machines based on a percentage of revenue) are excluded from the measurement of the lease liability and asset. The Group classifies its right-of-use assets in a consistent manner to its property, plant and equipment (see Note 15). Leases of vehicles and IT equipment are generally limited to a new lease term of 3 to 5 years. Leases of property generally have a lease term ranging from 5 to 10 years, with some legacy leases extending out to 20 years and beyond. Most new leases of property are now generally expected to be limited to no more than 10 years, with a break option after no more than 5 years, except in special circumstances. The maturity analysis of lease liabilities at 31 December 2023 is as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | Minimum lease payments due | | | Within | | | | | | | 1 year | 1–2 years | 2–5 years | > 5 years | Total | | | £m | £m | £m | £m | £m | | 2023 | | | | | | | Net present value | 65.7 | 57.8 | 106.7 | 45.7 | 275.9 | | 2022 | | | | | | | Net present value | 65.1 | 56.2 | 106.5 | 53.1 | 280.9 | The Group secures the use of its retail premises primarily through taking out leases for these premises. Typically, the leases are for a duration between 5 and 10 years. In respect of the UK property portfolio there is commonly a right to negotiate replacement leases on expiry, by virtue of the Landlord and Tenant Act 1954. Details of undiscounted amounts payable under leases are set out in Note 25. Certain lease payments are not recognised as a liability. This arises when the Group continues to pay rents and occupy properties after the lease has expired. Payments made under such leases are expensed on a straight-line basis. In addition, certain variable lease payments and irrecoverable VAT are not permitted to be recognised as lease liabilities and are expensed as incurred. The use of extension and termination options gives the Group added flexibility in the event it has identifi ed more suitable premises in terms of cost and/or location or determined that it is advantageous to remain in a location beyond the original lease term. An option is only exercised when consistent with the Group’s regional markets strategy and the economic benefits of exercising the option exceeds the expected overall cost. Amounts paid for short-term and low-value leases not included within the lease liability are immaterial. The Group incurred rent and associated costs of £20.8m (2022: £15.3m). These are predominantly driven by VAT on rental charges not being recoverable and held over leases. Details of total cash outflow relating to leases, are disclosed in the consolidated statement of cash flows. Group as lessor: Finance lease receivables are included in the statement of financial position within trade and other receivables and is as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current | 1.1 | 1.0 | | Non-current | 3.2 | 2.5 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 189 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 22 Lease liabilities (continued) The maturity analysis of lease receivables, including the undiscounted lease payments to be received, are as follows: | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | Minimum lease payments due | | | Within | | | | | | | 1 year | 1–2 years | 2–5 years | > 5 years | Total | | | £m | £m | £m | £m | £m | | 2023 | | | | | | | Lease payments receivable | 1.4 | 1.3 | 2.0 | 0.8 | 5.5 | | Interest | (0.3) | (0.3) | (0.5) | (0.1) | (1.2) | | Present value of lease payments receivable | 1.1 | 1.0 | 1.5 | 0.7 | 4.3 | | 2022 | | | | | | | Lease payments receivable | 1.1 | 0.9 | 1.1 | 0.9 | 4.0 | | Interest | (0.1) | (0.1) | (0.2) | (0.1) | (0.5) | | Present value of lease payments receivable | 1.0 | 0.8 | 0.9 | 0.8 | 3.5 | Operating lease commitments – Group as lessor A number of the sublease agreements for unutilised space in the UK shop estate are not classified as finance leases within IFRS 16. These non-cancellable leases have remaining lease terms of between one and six years. The future minimum rentals receivable under these non-cancellable operating leases at 31 December are as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Within one year | 0.4 | 0.6 | | After one year but not more than fi ve years | 0.6 | 1.0 | | After five years | 0.1 | 0.1 | | | 1.1 | 1.7 | 23 Interest-bearing loans and borrowings | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current | | | | Euro-denominated loans | 0.4 | 0.9 | | USD-denominated loans | 23.4 | 17.7 | | Sterling-denominated loans | 295.4 | 406.3 | | | 319.2 | 424.9 | | Non-current | | | | Euro-denominated loans | 869.4 | 994.7 | | USD-denominated loans | 2,172.1 | 1,694.4 | | Sterling-denominated loans | (2.7) | – | | | 3,038.8 | 2,689.1 | As at 31 December 2023 there were £515.0m (2022: £515.0m) of committed bank facilities of which £295.0m (2022: £nil) were drawn down and £5.2m (2022: £52.1m) of facilities which have been utilised for letters of credit. On 6 December 2022, the Group agreed pricing and allocation of two new tranches of First Lien Term Loans, namely a EUR tranche of €800m with a maturity in June 2028 and a USD tranche of $375m which was added to the $1,000m term loan which had an October 2029 maturity. These new loans were issued on 11 January 2023 and used to repay the existing €1,125m loan in January 2023, ahead its March 2024 maturity. On 26 June 2023, the Group agreed pricing and allocation of add ons to existing First Lien Term Loans. €230m was added onto the €800m term loan, with maturity remaining in June 2028 and $385m was added onto the $1,375m term loan, with maturity remaining in October 2029. A total of c£500m GBP equivalent was issued and these funds were part used to fund the repayment of the Ladbrokes Group Finance plc £400m bond in July 2023, a bond which was due for repayment in September 2023. The Group’s senior facilities agreement contains a single financial covenant: a springing leverage covenant (subject to customary cure rights) and solely for the benefit of the lenders under the revolving credit facility (“RCF”). The financial covenant is tested only in respect of a quarter-end date where the aggregate outstanding principal amount of all loans under the RCF (excluding utilisations of the RCF by way of letters of credit or bank guarantees) exceeds 40% of the total RCF commitments as at that date. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023190 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 24 Provisions 1 2 | | | | | | | --- | --- | --- | --- | --- | | | | | Litigation and | | | | Property | Restructuring | regulation | | | | provisions | provisions | provisions | Total | | | £m | £m | £m | £m | | At 1 January 2022 | 9.1 | 0.8 | 40.0 | 49.9 | | Provided | 10.1 | 1.8 | 33.6 | 45.5 | | Utilised | (7.5) | (2.0) | (35.9) | (45.4) | | Released | (4.5) | (0.6) | (1.9) | (7.0) | | Reclassification | – | – | (17.0) | (17.0) | | At 31 December 2022 | 7.2 | – | 18.8 | 26.0 | | Provided | 4.4 | 28.8 | 28.2 | 61.4 | | Utilised | (5.3) | (25.5) | (30.4) | (61.2) | | Released | (1.0) | – | (0.1) | (1.1) | | At 31 December 2023 | 5.3 | 3.3 | 16.5 | 25.1 | 3 1. The Group is party to a number of leasehold property contracts. Provision has been made against the unavoidable non-rent costs on those leases where the property is now vacant. Provisions have been based on management’s best estimate of the minimum future cash flows to settle the Group’s obligations, considering the risks associated with each obligation, discounted at a risk-free interest rate of 3.5%. The periods of vacant property commitments range from 1 to 12 years (2022: 1 to 13 years). In accordance with IFRS 16, the rental elements of certain property provisions are included within lease liabilities. 2. Restructuring provisions relate to redundancy costs. 3. Litigation and regulation provisions relate to estimates for potential liabilities which may arise in the Group as a result of customer claims and past practices. Whilst the nature of legal claims means that the timing of settlement can be uncertain, we expect all claims to be settled in the next 1 to 2 years. Whilst the provisions are based on management’s best estimate of the likely liability for obligations that exist at the year end date, the maximum potential exposure is not expected to be materially different to the provision made. Of the total provisions at 31 December 2023, £20.9m (2022: £20.6m) is current and £4.2m (2022: £5.4m) is non-current. Provisions expected to be settled in greater than one year are discounted at the risk-free rate. 25 Financial risk management objectives and policies The Group’s treasury function provides a centralised service for the provision of finance and the management and control of liquidity, foreign exchange rates and interest rates. The function operates as a cost centre and manages the Group’s treasury exposures to reduce risk in accordance with policies approved by the Board. The Group’s principal financial instruments comprise term loans, bank facilities, overdrafts, loan notes, bonds, financial guarantee contracts, and cash and short-term deposits, together with certain derivative financial instruments. The main purpose of these financial instruments is to raise finance for the Group’s operations. The Group has various other financial instruments such as trade receivables, trade payables and accruals that arise directly from its operations. Details of derivatives are set out in Note 26. It is, and has been throughout the year under review, the Group’s policy that no trading in fi nancial instruments shall be undertaken other than betting. Activity of this nature is only undertaken by the customer and is not speculative activity of the Group. The Group’s exposure to ante-post betting and gaming transactions is not significant. The main financial risks for the Group are exchange rate risk, interest rate risk, credit risk and liquidity risk. The Board reviews and agrees policies for managing each of these risks and they are summarised below. The Group also monitors the market price risk arising from all financial instruments. Interest rate risk The Group is exposed to interest rate risk on certain of its interest-bearing loans and borrowings and on cash and cash equivalents. The Group uses derivative financial instruments such as interest rate swaps to hedge its interest rate risk. At 31 December 2023, 65% (2022: 50%) of the Group’s post-swap gross debt (excluding leases) was at fixed interest rates. Interest on financial instruments at floating rates is repriced at intervals of less than six months. Interest on financial instruments at fixed rates is fixed until the maturity of the instrument. The table below demonstrates the sensitivity to reasonably possible changes in interest rates on income for the year when this movement is applied to the carrying value of financial liabilities: | | | | | --- | --- | --- | | | | Profit before tax | | Effect on: | 2023 | 2022 | | 25 basis points decrease | 1.1 | 4.1 | | 100 basis points increase | (4.6) | (16.3) | Foreign currency risk Given the multi-national nature of the business, the Group is exposed to foreign exchange gains and losses on its trading activities, the net assets of its overseas subsidiaries and its non-GBP-denominated financing facilities. The primary currencies that the Group is exposed to fluctuations in are the Euro, Australian Dollar and US Dollar. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 191 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 25 Financial risk management objectives and policies (continued) Foreign currency risk (continued) Whilst the Group does not actively hedge the foreign exposure on its trading cash flows, it continuously monitors exposures to individual currencies, taking remediating actions as necessary to manage any significant risks as they arise. In the event that the Group anticipates large transactions in currencies other than GBP, forward exchange contracts are taken out to manage the potential foreign exchange exposure. The Group’s exposure to the translation of net assets on foreign currency subsidiaries into its reporting currency is partially offset by the opposite exposure on the Group’s financing facilities providing a natural economic hedge, even though the Group does not apply hedge accounting. The Group’s policy on borrowings is broadly aligned to the underlying cash flows of the business. The Group has financing facilities in GBP, Euros and US Dollars. As the Group’s overseas subsidiaries largely report in Euros, the Group has taken out swap contracts to hedge the US Dollar debt into Euros in order to align the foreign currency exposure on the Group’s financing facilities with that on the net assets of its subsidiaries. The Group has also taken out swap contracts to hedge US Dollar debt into GBP and Australian Dollars. A 5% weakening in the Euro would reduce Group operating profit by £21.6m (2022: £27.7m) and net assets by £22.0m (2022: £0.8m) when applied to the results of the year in question. A 5% weakening in the Australian Dollar would reduce Group operating profit by £3.4m (2022: £4.6m) and net assets by £7.1m (2022: £19.0m) when applied to the results of the year in question. A 5% weakening in the US Dollar would increase Group operating profit by £2.0m (2022: £9.2m) arising from the share of loss of joint venture. There are no material net assets held in US Dollar as at 31 December 2023 and 31 December 2022. Credit risk The Group is not subject to significant concentration of credit risk, with exposure spread across a large number of counterparties and customers. Receivable balances are monitored on an ongoing basis. Any changes to credit terms are assessed and authorised by senior management on an individual basis. With respect to credit risk arising from the other financial assets of the Group, which comprise cash and cash equivalents, the Group’s exposure to credit risk arises from default of the counterparty, with a primary exposure equal to the carrying amount of these instruments. Credit risk in respect of cash and cash equivalents is managed by restricting those transactions to banks that have a defined minimum credit rating and by setting an exposure ceiling per bank. Liquidity risk The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of borrowings with a range of maturities. The Group’s policy on liquidity is to ensure that there are sufficient medium-term and long-term committed borrowing facilities to meet the medium-term funding requirements. At 31 December 2023, there were undrawn committed borrowing facilities of £220.0m (2022: £515.0m). Total committed facilities had an average maturity of 4.5 years (2022: 3.7 years). The total gross contractual undiscounted cash flows of financial liabilities, including interest payments, fall due as follows. Cash flows in respect of financial guarantee contracts reflect the probability weighted cash flows. | | | | | | | | --- | --- | --- | --- | --- | --- | | | On demand | | | | | | | or within | | | | | | | 1 year | 1–2 years | 2–5 years | > 5 years | Total | | 2023 | £m | £m | £m | £m | £m | | Interest-bearing loans and borrowings | 573.7 | 558.1 | 1,223.1 | 1,401.9 | 3,756.8 | | Other financial liabilities | 252.7 | 692.4 | 378.5 | 2,855.8 | 4,179.4 | | Trade and other payables | 681.0 | 151.3 | 302.5 | – | 1,134.8 | | Lease liabilities | 77.5 | 66.8 | 122.9 | 54.0 | 321.2 | | Total | 1,584.9 | 1,468.6 | 2,027.0 | 4,311.7 | 9,392.2 | | | | | | | | | --- | --- | --- | --- | --- | --- | | | On demand | | | | | | | or within | | | | | | | 1 year | 1–2 years | 2–5 years | > 5 years | Total | | 2022 | £m | £m | £m | £m | £m | | Interest bearing loans and borrowings | 548.4 | 1,310.6 | 1,131.2 | 914.5 | 3,904.7 | | Other financial liabilities | 210.7 | 56.5 | 205.5 | 1.7 | 474.4 | | Trade and other payables | 538.8 | – | – | – | 538.8 | | Lease liabilities | 72.4 | 61.6 | 116.6 | 59.8 | 310.4 | | Total | 1,370.3 | 1,428.7 | 1,453.3 | 976.0 | 5,228.3 | Details of discounted contractual cash flows of leasing liabilities are set out in Note 22. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023192 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 25 Financial risk management objectives and policies (continued) Capital risk management The primary objective of the Group’s capital management is to ensure that it maintains a credit quality that enables the Group to raise funds at an economic interest rate and to maintain healthy capital ratios in order to support its business and maximise shareholder value. The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, adjust borrowings, return capital to shareholders or issue new shares. The Group monitors capital using an adjusted net debt to underlying EBITDA ratio. The ratio at 31 December 2023 was 3.3 times (2022: 2.8 times). See Note 27 for further details. The Group’s funding policy is to raise funds centrally to meet the Group’s anticipated requirements. These are planned so as to mature at different stages in order to reduce refinancing risk. The Board reviews the Group’s capital structure and liquidity periodically. 26 Financial instruments and fair value disclosures The table below analyses the Group’s financial instruments into their relevant categories: | | | | | | | --- | --- | --- | --- | --- | | | | Assets/ | Assets at | | | | | (liabilities) | fair value | | | | | at fair value through other | | | | | Amortised | through | comprehensive | | | | cost | profit and loss | income | Total | | 31 December 2023 | £m | £m | £m | £m | | Assets | | | | | | Non-current: | | | | | | Other investments (Note 17) | 1.3 | 10.9 | 7.2 | 19.4 | | Current: | | | | | | Trade and other receivables | 443.9 | – | – | 443.9 | | Derivative financial instruments | – | 31.9 | – | 31.9 | | Cash and short-term investments (including customer funds) | 400.6 | – | – | 400.6 | | Total | 845.8 | 42.8 | 7.2 | 895.8 | | Liabilities | | | | | | Current: | | | | | | Customer balances | (196.8) | – | – | (196.8) | | Interest-bearing loans and borrowings | (319.2) | – | – | (319.2) | | Trade and other payables | (681.0) | – | – | (681.0) | | Derivative financial instruments | – | (117.5) | – | (117.5) | | Other financial liabilities | – | (157.0) | – | (157.0) | | Lease liabilities (Note 22) | (65.7) | – | – | (65.7) | | Non-current: | | | | | | Interest-bearing loans and borrowings | (3,038.8) | – | – | (3,038.8) | | Trade and other payables | (433.8) | – | – | (433.8) | | Other financial liabilities | (905.7) | (835.8) | – | (1,741.5) | | Lease liabilities (Note 22) | (210.2) | – | – | (210.2) | | Total | (5,851.2) | (1,110.3) | – | (6,961.5) | | Net financial (liabilities)/assets | (5,005.4) | (1,067.5) | 7.2 | (6,065.7) | 1 2 2 1. The fair value of interest-bearing loans and borrowings at 31 December 2023 and 31 December 2022 is not materially different to their original cost. 2. Other financial liabilities include £1,335.5m deferred and contingent consideration (2022: £261.7m), a put liability of £536.3m (2022: £180.4m), £9.6m of financial guarantees (2022: £2.9m) and £17.1m of ante-post liabilities (2022: £17.2m). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 193 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 26 Financial instruments and fair value disclosures (continued) | | | | | | | --- | --- | --- | --- | --- | | | | Assets/ | Assets at | | | | | (liabilities) | fair value | | | | | at fair value through other | | | | | Amortised | through | comprehensive | | | | cost | profit and loss | income | Total | | 31 December 2022 | £m | £m | £m | £m | | Assets | | | | | | Non-current: | | | | | | Other investments (Note 17) | 1.3 | 6.6 | 6.1 | 14.0 | | Other financial assets | 0.2 | – | – | 0.2 | | Current: | | | | | | Trade and other receivables | 464.9 | – | – | 464.9 | | Derivative financial instruments | – | 72.9 | – | 72.9 | | Cash and short-term investments (including customer funds) | 658.5 | – | – | 658.5 | | Total | 1,124.9 | 79.5 | 6.1 | 1,210.5 | | Liabilities | | | | | | Current: | | | | | | Customer balances | (200.5) | – | – | (200.5) | | Interest-bearing loans and borrowings | (424.9) | – | – | (424.9) | | Trade and other payables | (538.8) | – | – | (538.8) | | Derivative financial instruments | – | (79.2) | – | (79.2) | | Other financial liabilities | – | (208.8) | – | (208.8) | | Lease liabilities (Note 22) | (65.1) | – | – | (65.1) | | Non-current: | | | | | | Interest-bearing loans and borrowings | (2,689.1) | – | – | (2,689.1) | | Other financial liabilities | (183.3) | (70.1) | – | (253.4) | | Lease liabilities (Note 22) | (215.8) | – | – | (215.8) | | Total | (4,317.5) | (358.1) | – | (4,675.6) | | Net financial (liabilities)/assets | (3,192.6) | (278.6) | 6.1 | (3,465.1) | 1 2 2 Fair value hierarchy IFRS 13 requires financial assets and liabilities recorded at fair value to be categorised in three levels according to the inputs used in the calculation of their fair value: – Level 1 – uses quoted prices as the input to fair value calculations – Level 2 – uses inputs other than quoted prices, that are observable either directly or indirectly – Level 3 – uses inputs that are not observable The following tables illustrate the Group’s financial assets and liabilities measured at fair value after initial recognition at 31 December 2023 and 31 December 2022: | | | | | | | --- | --- | --- | --- | --- | | | | | | 2023 | | | Level 1 | Level 2 | Level 3 | Total | | | £m | £m | £m | £m | | Assets measured at fair value | | | | | | Derivative financial instruments | – | 31.9 | – | 31.9 | | Other investments | 7.1 | 2.5 | 8.5 | 18.1 | | | 7.1 | 34.4 | 8.5 | 50.0 | | Liabilities measured at fair value | | | | | | Derivative financial instruments | – | (117.5) | – | (117.5) | | Other financial liabilities | – | – | (992.8) | (992.8) | | | – | (117.5) | (992.8) | (1,110.3) | | Net assets/(liabilities) measured at fair value | 7.1 | (83.1) | (984.3) | (1,060.3) | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023194 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 26 Financial instruments and fair value disclosures (continued) | | | | | | | --- | --- | --- | --- | --- | | | | | | 2022 | | | Level 1 | Level 2 | Level 3 | Total | | | £m | £m | £m | £m | | Assets measured at fair value | | | | | | Derivative financial instruments | – | 72.9 | – | 72.9 | | Other investments | 5.5 | 1.8 | 5.4 | 12.7 | | | 5.5 | 74.7 | 5.4 | 85.6 | | Liabilities measured at fair value | | | | | | Derivative financial instruments | – | (79.2) | – | (79.2) | | | – | – | (278.9) | (278.9) | | Other financial liabilities | – | (79.2) | (278.9) | (358.1) | | Net assets/(liabilities) measured at fair value | 5.5 | (4.5) | (273.5) | (272.5) | There have been no transfers of assets or liabilities recorded at fair value between the levels of the fair value hierarchy. Included within other financial assets and derivative financial instruments measured at fair value are: the Group’s currency swaps held against debt instruments as an asset of £31.9m (2022: asset of £72.9m) and a liability of £117.5m (2022: £79.2m), investment in RAS Technology, designated as fair value through other comprehensive income, £2.1m (2022: £1.0m), an investment in Scout Gaming of £0.3m (2022: £0.3m), a convertible equity instruments with Visa Inc. for £2.5m (2022: £1.8m) and Greenrun Inc. for £3.1m (2022: £nil),and an investment fund of £5.0m (2022:£4.9m), all designated as fair value through profit and loss. During the year, the Group disposed of its investment in Hui10 (2022: £5.1m) as a share-for-share exchange with Intuitive Investment Group plc (“IIG) at a £nil profit or loss. The investment in IIG of £5.1m is designated as fair value through other comprehensive income. The fair value of the investments at 31 December 2023 and 31 December 2022 is not materially different to their original cost. Contingent and deferred consideration Contingent and deferred consideration arises through business combinations, the fair value for which is reassessed at each reporting date using updated inputs and assumptions based on the latest financial forecasts of each respective business. As at 31 December 2023 contingent and deferred consideration included within other financial liabilities was £1,335.5m (2022: £261.7m), including £1,155.1m on Tab NZ as well as from the Group’s acquisitions of SuperSport in the prior year, and in year acquisitions of ASF Limited, BetCity, and 365Scores. The valuation of the contingent element of consideration is subject to estimation uncertainty as the amount payable is based on various factors, including future profitability. With the exception of Tab NZ, based on the current profit forecast and reasonable upside and downside sensitivities, the range of potential valuations is not expected to be materially different from that provided for in the financial statements. For Tab NZ where the range of potential outcomes could be materially different from the amounts provided as it is subject to the future performance of the business over a 25-year time period. The fair value of contingent consideration for Tab NZ at 31 December 2023 was £788.3m. The valuation technique used for calculating the contingent consideration was a discounted cash flow model. The key unobservable inputs for the calculation are revenue growth rates, adjusted gross profit margin and discount rate. A 5% movement in forecast cash flows, both positive and negative, would impact the contingent consideration liability by approximately £50m, whereas the 0.5pp movement in the discount rate would affect the liability by approximately £40m. During the year, the Group paid £266.7m (2022: £32.9m) of deferred and contingent consideration in relation to the aforementioned acquisitions. Put option liability The amortised costs of the put option liability recognised is not materially different to fair value. Ante-post Ante-post liabilities are valued using methods and inputs that are not based upon observable market data. The principal assumptions relate to anticipated gross win margins on unsettled bets. There are no reasonably probable changes to assumptions or inputs that would lead to material changes in the fair value determined, although the final value will be determined by future sporting results. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 195 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 27 Net debt The components of the Group’s adjusted net debt are as follows: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Current assets | | | | Cash and short-term deposits | 400.6 | 658.5 | | Current liabilities | | | | Interest-bearing loans and borrowings | (319.2) | (424.9) | | Non-current liabilities | | | | Interest-bearing loans and borrowings | (3,038.8) | (2,689.1) | | Net debt | (2,957.4) | (2,455.5) | | Cash held on behalf of customers | (196.8) | (200.5) | | Fair value swaps held against debt instruments (derivative financial (liability)/asset) | (85.6) | (6.5) | | Deposits | 48.8 | 43.8 | | Balances held with payment service providers | 176.0 | 149.8 | | Sub-total | (3,015.0) | (2,468.9) | | Lease liabilities | (275.9) | (280.9) | | Adjusted net debt including lease liabilities | (3,290.9) | (2,749.8) | Cash held on behalf of customers represents the outstanding balance due to customers in respect of their online gaming wallets. 28 Share capital | | | | | | --- | --- | --- | --- | | | Number of | | | | | €0.01 | | | | | ordinary | Total | Total | | | shares | €m | £m | | Authorised: | | | | | At 31 December 2022 and 31 December 2023 | 773,000,000 | 7.7 | 6.4 | | Issued and fully paid: | | | | | At 1 January 2022 | 586,550,219 | 5.9 | 4.8 | | Exercise of share options | 2,296,623 | – | – | | At 31 December 2022 | 588,846,842 | 5.9 | 4.8 | | Allotment of shares | 48,827,271 | 0.5 | 0.4 | | Exercise of share options | 1,125,778 | – | – | | At 31 December 2023 | 638,799,891 | 6.4 | 5.2 | 1 1. Share options exercised in the year included 56,527 (2022: 239,116) deferred bonus shares not disclosed as part share options exercised in Note 31. The Company’s share capital consists entirely of ordinary shares, accordingly all shares rank pari passu in all respects. On 16 June 2023, the Company issued an additional 48,827,271 of ordinary shares for net proceeds of £589.8m. See Note 31 for further information on terms and amounts of shares reserved for issue under options. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023196 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 29 Notes to the statement of cash flows 29.1 Reconciliation of (loss)/profit to net cash inflow from operating activities: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | (Loss)/profit before tax from continuing operations | (842.6) | 102.9 | | Net finance expense | 197.9 | 225.7 | | (Loss)/profit before tax and net finance expense from continuing operations | (644.7) | 328.6 | | Loss before tax and net finance expense from discontinued operations | (57.8) | (13.4) | | Loss/(profit) before tax and net fi nance expense including discontinued operations | (702.5) | 315.2 | | Adjustments for: | | | | Impairment | 289.0 | 7.0 | | Loss on disposal | 1.0 | 1.0 | | Depreciation of property, plant and equipment | 141.0 | 125.9 | | Amortisation of intangible assets | 415.1 | 229.1 | | Share-based payments charge | 23.6 | 19.2 | | Decrease/(increase) in trade and other receivables | 42.2 | 44.7 | | Increase in other financial liabilities | 62.7 | 2.2 | | (Decrease)/increase in trade and other payables | 506.0 | (85.9) | | Decrease in provisions | (1.9) | (6.9) | | Share of results from joint venture and associate | 42.9 | 194.1 | | Pension settlement | – | 7.0 | | Other | (9.1) | (5.7) | | Cash generated by operations | 810.0 | 846.9 | 29.2 Cash flows arising from discontinued operations: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Cash used in operating activities | (57.8) | (13.4) | | Cash used in investing activities | – | – | | Net cash outflow arising from discontinued operations | (57.8) | (13.4) | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 197 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 29 Notes to the statement of cash flows (continued) 29.3 Reconciliation of movements of liabilities to cash flows arising from financing activities: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | 2023 | | | | 2022 | | | | | Other | | Other | | Other | | Other | | | | loans and | Lease | financial | | loans and | Lease | financial | | | | borrowings | liabilities | liabilities | Total | borrowings | liabilities | liabilities | Total | | | £m | £m | £m | £m | £m | £m | £m | £m | | Balance at 1 January | 3,114.0 | 280.9 | 462.2 | 3,857.1 | 2,282.4 | 293.7 | 88.7 | 2,664.8 | | Changes from financing cash flows | | | | | | | | | | Proceeds from borrowings, net of issue costs | 1,780.3 | – | – | 1,780.3 | 838.4 | – | – | 838.4 | | Repayments | (1,419.2) | – | (266.7) | (1,685.9) | (109.0) | – | (32.9) | (141.9) | | Repayment of borrowings on acquisition | (9.4) | – | – | (9.4) | (162.8) | – | – | (162.8) | | Repayment of lease liabilities | – | (68.5) | – | (68.5) | – | (83.0) | – | (83.0) | | Total changes from financing cash flows | 351.7 | (68.5) | (266.7) | 16.5 | 566.6 | (83.0) | (32.9) | 450.7 | | Other changes | | | | | | | | | | Business combination consideration (Note 32) | – | – | 1,254.4 | 1,254.4 | – | – | 216.7 | 216.7 | | Recognition of put option liability (Note 32) | – | – | 350.5 | 350.5 | – | – | 181.2 | 181.2 | | Interest expense/discount unwind | 229.2 | 12.8 | 70.4 | 312.4 | 76.2 | 13.0 | 2.9 | 92.1 | | Interest paid | (224.2) | (12.8) | – | (237.0) | (91.9) | (13.0) | – | (104.9) | | New lease liabilities | – | 45.6 | – | 45.6 | – | 61.8 | – | 61.8 | | Finance fees | 1.0 | – | – | 1.0 | 5.7 | – | – | 5.7 | | Re-measurement adjustments | – | (7.4) | 1.4 | (6.0) | – | (5.0) | (6.1) | (11.1) | | Total other changes | 6.0 | 38.2 | 1,676.7 | 1,720.9 | (10.0) | 56.8 | 394.7 | 441.5 | | Arising through business combinations | 9.4 | 26.9 | 7.0 | 43.3 | 162.8 | 9.5 | – | 172.3 | | The effect of changes in foreign exchange | (123.1) | (1.6) | 19.3 | (105.4) | 112.2 | 3.9 | 11.7 | 127.8 | | Balance at 31 December | 3,358.0 | 275.9 | 1,898.5 | 5,532.4 | 3,114.0 | 280.9 | 462.2 | 3,857.1 | 1 2 1. In addition to the above, the Group received £0.2m (2022: £0.2m) in respect of lease receivables resulting in a net repayment of finance leases of £68.3m (2022: £82.8m). 2. In addition to the above, the Group received £12.4m (2022: £4.3m) of interest income resulting in a net finance expense paid of £224.6m (2022: £100.6m). Non-cash movements include amounts acquired as a result of business combinations and the amortisation of issue costs incurred in respect of debt instruments. #### 30 Retirement benefit schemes Defined contribution schemes During the year the Group charged £23.1m of contributions (2022: £18.9m) to the consolidated income statement in relation to the defined contribution pension schemes. Defined benefit plans Judgement is applied, based on legal, actuarial, and accounting guidance in IFRIC 14, regarding the amounts of net pension asset that are recognised in the consolidated balance sheet. Following the buy-out of the Ladbrokes Pension Plan, the Group now only has one pension scheme, the Gala Coral Pension Plan, which is a final salary pension plan for UK employees and closed to new employees and future accrual. At retirement each member’s pension is related to their ‘career average earnings’ for the Gala Coral Pension Plan. The weighted average duration of the expected benefit payments from the plan is around 15 years (2022: 15 years). The plan’s assets are held separately from those of the Group. The plan is approved by HMRC for tax purposes, and is managed by independent Trustees. The plan is subject to UK regulations, which require the Group and Trustees to agree a funding strategy and contribution schedule at least every three years. Under the current contribution schedule in place, the Group does not pay contributions to Gala Coral Pension Plan but is paying the administrative costs. There is a risk to the Group that adverse circumstances, such as a disconnect between changes in asset investment values and required funding obligations, could lead to a requirement for the Group to make additional contributions to fund any deficit that arises. As at the date of signing the financial statements no such event has arisen. The results of the latest formal actuarial valuation 30 June 2022 for the Gala Coral Pension Plan was updated to 31 December 2023 by an independent qualified actuary in accordance with IAS 19 (Revised) Employee Benefits. The value of the defined benefit obligation and current service cost have been measured using the projected unit credit method, as required by IAS 19 (Revised). Actuarial gains and losses are recognised immediately through other comprehensive income. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023198 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 30 Retirement benefit schemes (continued) The amounts recognised in the balance sheet are as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | Total | (Coral) | (Ladbrokes) | Total | | | £m | £m | £m | £m | £m | £m | | Present value of funded obligations | (262.6) | – | (262.6) | (259.4) | – | (259.4) | | Fair value of plan assets | 324.4 | – | 324.4 | 323.2 | – | 323.2 | | Net asset | 61.8 | – | 61.8 | 63.8 | – | 63.8 | | Disclosed in the balance sheet as: Retirement | | | | | | | | benefit͙asset | 61.8 | – | 61.8 | 63.8 | – | 63.8 | The Group has considered the appropriate accounting treatment in respect of the pension plan surplus, considering the current agreement with the Trustees, and concluded the recognition of the surplus is appropriate. Whilst the Trustees have discretionary rights over the use of any surplus, the nature of the plan means that any surplus that exists once all liabilities have been settled is for the benefit of the Group. The amounts recognised in the income statement are as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | Total | (Coral) | (Ladbrokes) | Total | | | £m | £m | £m | £m | £m | £m | | Analysis of amounts charged to the income statement | | | | | | | | Other administrative expenses | 1.3 | – | 1.3 | 1.3 | – | 1.3 | | Net interest on net asset | (3.0) | – | (3.0) | (1.6) | – | (1.6) | | Total charge/(credit) recognised | | | | | | | | in the income statement | (1.7) | – | (1.7) | (0.3) | – | (0.3) | The actual return on plan assets including interest over the year was a £14.5m gain (2022: loss of £183.4m). The amounts recognised in the statement of comprehensive income are as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | Total | (Coral) | (Ladbrokes) | Total | | | £m | £m | £m | £m | £m | £m | | Actual return on assets less interest on plan assets | (0.7) | – | (0.7) | (192.6) | (0.1) | (192.7) | | Actuarial gains on defined benefit obligation due to changes in demographic assumptions | 3.8 | – | 3.8 | 6.0 | – | 6.0 | | Actuarial gains on defined benefit obligation due to changes in financial assumptions | (3.2) | – | (3.2) | 175.0 | – | 175.0 | | Experience adjustments on benefit obligation | (3.6) | – | (3.6) | (13.0) | – | (13.0) | | Actuarial gains/(losses) recognised in the statement | | | | | | | | of comprehensive income | (3.7) | – | (3.7) | (24.6) | (0.1) | (24.7) | Changes in the present value of the defined benefit obligation are as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | Total | (Coral) | (Ladbrokes) | Total | | | £m | £m | £m | £m | £m | £m | | At 1 January | (259.4) | – | (259.4) | (430.5) | – | (430.5) | | Interest on obligation | (12.2) | – | (12.2) | (7.7) | – | (7.7) | | Actuarial gains due to changes in demographic | | | | | | | | assumptions | 3.8 | – | 3.8 | 6.0 | – | 6.0 | | Actuarial gains/(losses) due to changes in financial | | | | | | | | assumptions | (3.2) | – | (3.2) | 175.0 | – | 175.0 | | Experience adjustments on obligations | (3.6) | – | (3.6) | (13.0) | – | (13.0) | | Benefits paid | 12.0 | – | 12.0 | 10.8 | – | 10.8 | | At 31 December | (262.6) | – | (262.6) | (259.4) | – | (259.4) | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 199 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 30 Retirement benefit schemes (continued) Changes in the fair value of plan assets are as follows: | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | Total | (Coral) | (Ladbrokes) | Total | | | £m | £m | £m | £m | £m | £m | | At 1 January | 323.2 | – | 323.2 | 518.6 | 7.0 | 525.6 | | Interest on plan assets | 15.2 | – | 15.2 | 9.3 | – | 9.3 | | Administrative expenses | (1.3) | – | (1.3) | (1.3) | – | (1.3) | | Actual return less interest on plan assets | (0.7) | – | (0.7) | (192.6) | (0.1) | (192.7) | | Scheme buy-out | – | – | – | – | (6.9) | (6.9) | | Benefits paid | (12.0) | – | (12.0) | (10.8) | – | (10.8) | | At 31 December | 324.4 | – | 324.4 | 323.2 | – | 323.2 | The Group does not expect to contribute to the plan in 2024. The Group will however continue to meet the administrative expenses of the Gala Coral Pension Plan scheme. The major categories of plan assets as a percentage of total plan assets are as follows: | | | | | | | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | (Coral) | (Ladbrokes) | | | % | % | % | % | | Equities | 2.0 | – | 6.0 | – | | Diversified growth funds | 5.0 | – | 16.0 | – | | Liability-driven investment | 48.0 | – | 36.0 | – | | Multi-asset credit | 3.0 | – | 12.0 | – | | Corporate bonds | 34.0 | – | 22.0 | – | | Private credit | 8.0 | – | 8.0 | – | | Cash and cash equivalents | – | – | – | – | | | 100.0 | – | 100.0 | – | At 31 December 2023, the plan assets were categorised as Level 2 of £297.5m (2022: £296.1m) and as Level 3 of £26.9m (2022: £27.1m). Definition of fair value level categories are set out in Note 25. The plan does not invest directly in property occupied by the Group or in financial securities issued by the Group. Although, as the plan holds pooled investment vehicles, there may at times be indirect employer-related investment. At 31 December 2023 these represented less than 0.1% (2022: 0.1%) of the plan’s total assets. The investment strategy is set by the Trustees of the plans in consultation with the Group. For the Gala Coral Plan the current long-term strategy is to invest in a low-risk matching bond portfolio with a relatively small investment in return seeking funds. Principal actuarial assumptions at the balance sheet date (expressed as weighted averages where appropriate): | | | | | | | | --- | --- | --- | --- | --- | --- | | | | 2023 | 2023 | 2022 | 2022 | | | | (Coral) | (Ladbrokes) | (Coral) | (Ladbrokes) | | | | % p.a. | % p.a. | % p.a. | % p.a. | | Discount rate | | 4.6 | n/a | 4.8 | n/a | | Price inflation (CPI) | | 2.0 | n/a | 2.2 | n/a | | Price inflation (RPI) | | 3.0 | n/a | 3.2 | n/a | | Future pension increases | – LPI 5% (CPI) | 2.9 | n/a | 3.1 | n/a | | | – LPI 2.5% (CPI) | 2.0 | n/a | 2.1 | n/a | Post-retirement mortality assumed for most members is based on the standard SAPS mortality table with the CMI 2022 projections which considers future improvements, adjusted to reflect plan specific experience. The assumption used implies that the expected lifetime of members for the two schemes is: | | | | | | | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | (Coral) | (Ladbrokes) | | Male aged 45 for year ended | 87.0 | – | 87.4 | n/a | | Female aged 45 for year ended | 89.5 | – | 89.9 | n/a | | Male aged 65 for year ended | 85.8 | – | 86.2 | n/a | | Female aged 65 for year ended | 88.1 | – | 88.5 | n/a | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023200 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 30 Retirement benefit schemes (continued) Changes to the assumptions will impact the amounts recognised in the consolidated balance sheet and the consolidated statement of comprehensive income in respect of the plan. For the significant assumptions, the following sensitivity analysis provides an indication of the impact on the defined benefit obligation for the year ended 31 December 2023: | | | | | | | --- | --- | --- | --- | --- | | | 2023 | 2023 | 2022 | 2022 | | | (Coral) | (Ladbrokes) | (Coral) | (Ladbrokes) | | | % | % | % | % | | – 0.5% p.a. decrease in the discount rate | 7.1 | – | 7.4 | – | | – 0.5% p.a. increase in price inflation | 5.0 | – | 5.0 | – | | – One-year increase in life expectancy | 3.4 | – | 3.3 | – | These sensitivities have been calculated to show the movement in the defined benefit obligation in isolation, and assuming no other changes in market conditions at the accounting date. This is unlikely in practice, for example, a change in discount rate is unlikely to occur without any movement in the value of the assets held by the plan. #### 31 Share-based payments The following options to purchase €0.01 ordinary shares in the Group were granted, exercised, forfeited or existing at the year end: | | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | Existing at | | Cancelled | | Existing at | Exercisable at | | | | | 1 January | Granted | or forfeited | Exercised | 31 December | 31 December | Vesting | | Date of grant | Exercise price | 2023 | in the year | in the year | in the year 2023 | | 2023 | criteria | | 16-Dec-2016 | 422p | 351,338 | – | – | (12,000) | 339,338 | 339,338 | Note a | | 28-Dec-2017 | 0p | 3,392 | – | – | – | 3,392 | 3,392 | Note b | | 26-Mar-2019 | 0p | 67,188 | – | – | (46,783) | 20,405 | 20,405 | Note c | | 10-Jun-2020 | 0p | 1,243,557 | – | (199,624) | (1,005,447) | 38,486 | 38,486 | Note d | | 24-Mar-2021 | 0p | 908,930 | – | (73,955) | – | 834,975 | – | Note e | | 04-May-2021 | 1264p | 667,231 | – | (142,070) | (3,746) | 521,415 | – | Note f | | 18-Mar-2022 | 0p | 1,208,514 | – | (170,300) | – | 1,038,214 | – | Note g | | 26-Apr-2022 | 1333p | 628,363 | – | (87,477) | (701) | 540,185 | – | Note h | | 28-Jun-2022 | 0p | 483,032 | – | (97,566) | – | 385,466 | – | Note i | | 25-Apr-2023 | 1008p | – | 1,008,148 | (122,029) | (574) | 885,545 | – | Note j | | 04-May-2023 | 0p | – | 902,200 | (172,794) | – | 729,406 | – | Note k | | 16-Jun-2023 | 0p | – | 1,275,465 | – | – | 1,275,465 | – | Note k | | Total Schemes | | 5,561,545 | 3,185,813 | (1,065,815) | (1,069,251) | 6,612,292 | 401,621 | | Note a: 2016 MIP Plan – These equity settled awards were issued on completion of the acquisition of bwin.party. The options vest and became exercisable, subject to the satisfaction of a performance condition, over 30 months, with one-ninth vesting six months after the date of grant and a further ninth vesting at each subsequent quarter. The options lapse, if not exercised, on 2 February 2026. The performance condition is comparator total shareholder return (“TSR”) of the Group against the FTSE 250. Each ninth of the shares will have its TSR condition reviewed from the date of grant until the relevant testing date. To the extent the TSR is not met at that time, it is tested again the following quarter and, if necessary, at the end of the 30-month vesting period. In order to vest, the TSR of the Group must rank at median or above against the FTSE 250. Note b: 2017 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards to vest are conditional on both cumulative Earnings Per Share (“EPS”) exceeding 180 euro cents, with a pro-rata increase in the amount vesting between 180 cents and 214 cents, and TSR performance conditions being met which are split with equal weighting. Note c: 2019 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards that vested was conditional on both cumulative three-year Earnings Per Share (“EPS”) exceeding 184p, with a pro-rata increase in the amount vesting between 184p and 214p, and TSR performance conditions being met which are split with equal weighting. Note d: 2020 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards to vest are conditional on both cumulative three-year Earnings Per Share (“EPS”) exceeding 267p, with a pro-rata increase in the amount vesting between 267p and 295p, and certain TSR performance conditions being met which are split with the weighting of one third based on EPS and two thirds relating to TSR conditions. There were also a number of restricted share plan shares issued during 2020 against which service conditions apply. Note e: 2021 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards to vest are conditional on both cumulative three-year Earnings Per Share (“EPS”) exceeding 255p, with a pro-rata increase in the amount vesting between 255p and 296p, and certain TSR performance conditions being met which are split with the weighting of one-third based on EPS and two-thirds relating to TSR conditions. Note f: 2021 Employee Sharesave Plan – During 2021 the Group set up an Employee Sharesave plan. Under this plan employees of the Group are able to subscribe up to a maximum of £100 a month to invest in share purchases at a price representing a discount of 20% from the share price at the commencement of the plan. The vesting period is three years. The right to purchase shares will vest conditional upon continued employment at the end of the three years. Note g: 2022 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards to vest are conditional on certain TSR performance conditions being met. Note h: 2022 Employee Sharesave Plan – During 2022 the Group set up an Employee Sharesave plan. Under this plan employees of the Group are able to subscribe up to a maximum of £100 a month to invest in share purchases at a price representing a discount of 20% from the share price at the commencement of the plan. The vesting period is three years. The right to purchase shares will vest conditional upon continued employment at the end of the three years. Note i: 2022 Employee Free Share Plan – During 2022 the Group set up an Employee Free Share plan. Under this plan each employee of the Group has been granted 22 free shares for a vesting period of two years. The shares will vest conditional upon continued employment at the end of the two years. Note j: 2023 Employee Sharesave Plan – During 2023 the Group set up an Employee Sharesave plan. Under this plan employees of the Group are able to subscribe up to a maximum of £100 a month to invest in share purchases at a price representing a discount of 20% from the share price at the commencement of the plan. The vesting period is three years. The right to purchase shares will vest conditional upon continued employment at the end of the three years. Note k: 2023 LTIP Plan – These equity settled awards were awarded to certain Directors and employees and vest over a three-year period from the date of grant. The number of awards to vest are conditional on certain TSR performance conditions being met. The charge to share-based payments within the consolidated income statement in respect of these options in 2023 was £21.7m (2022: £19.2m) which related entirely to equity settled options. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 201 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 31 Share-based payments (continued) Weighted average exercise price of options The number and weighted average exercise prices of share options are as follows: | | | | | | | --- | --- | --- | --- | --- | | | Weighted | | Weighted | | | | average | Number | average | Number | | | exercise price | of options | exercise price | of options | | | 31 December | 31 December | 31 December | 31 December | | | 2023 | 2023 | 2022 | 2022 | | Outstanding at the beginning of the year | 329p | 5,561,545 | 31p | 6,167,742 | | Granted during the year | 319p | 3,185,813 | 366p | 2,468,119 | | Exercised during the year | 11p | (1,069,251) | 21p | (2,057,507) | | Cancelled or forfeited in the year | 393p | (1,065,815) | 426p | (1,016,809) | | Outstanding at the end of the year | 365p | 6,612,292 | 329p | 5,561,545 | | Exercisable at the end of the year | 357p | 401,621 | 351p | 421,918 | The options outstanding at 31 December 2023 have a weighted average contractual life of 1.5 years (31 December 2022: 1.4 years). Valuation of options The fair value of services received in return for share options granted are measured by reference to the fair value of share options granted. The Group engaged third-party valuation specialists to provide a fair value for the options. All LTIP plans are valued using both a Black Scholes valuation model and Monte Carlo valuation for the cumulative EPS and TSR conditions respectively. Fair value of share options and assumptions: | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | Fair value at | | | Share price at | | Expected | | | | measurement | | | date of grant | Exercise price | volatility | Exercise | Expected | Risk-free rate | date | | Date of grant | (£) | (£) | % | multiple | dividend yield | % | (£) | | Dec-16 | 6.48 | 4.22 | 28%–30% | n/a | n/a | – | 1.43–1.94 | | Dec-17 | 9.34 | – | 26.6% | n/a | n/a | 0.40% | 7.39–9.34 | | Mar-19 | 4.96 | – | 31.5% | n/a | n/a | 0.70% | 1.90–4.96 | | Jun-20 | 7.86 | – | 33.2% | n/a | n/a | 0.30% | 3.54–7.86 | | Mar-21 | 15.25 | – | 52.8% | n/a | 2.0% | 0.01% | 10.03–11.27 | | May-21 | 16.46 | 12.64 | 51.3% | n/a | 2.0% | 0.02% | 6.75 | | Mar-22 | 16.66 | – | 51.5% | n/a | 1.2% | 1.4% | 10.77–12.35 | | Apr-22 | 14.74 | 13.33 | 50.1% | n/a | 1.3% | 1.60% | 5.66 | | Jun-22 | 13.04 | – | n/a | n/a | n/a | n/a | 13.04 | | Apr-23 | 14.39 | 10.08 | 41.3% | n/a | 1.4% | 3.59% | 6.39 | | May-23 | 14.70 | – | 41.0% | n/a | 1.7% | 4.68% | 5.48 | | Jun-23 | 12.21 | – | 41.0% | n/a | 1.7% | 4.68% | 5.48 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023202 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 32 Business combinations Business combinations are accounted for using the acquisition method. Identifiable assets and liabilities acquired, and contingent liabilities assumed in a business combination are measured at their fair values at the acquisition date. The identification and valuation of intangible assets arising on business combinations is subject to a degree of estimation. We engaged independent third parties, including Kroll, to assist with the identification and valuation process. This was performed in accordance with the Group’s policies. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable assets acquired is recorded as goodwill. Costs related to the acquisition are expensed as incurred; see Note 6 for details. SuperSport Measurement period adjustment The initial value of goodwill recognised was £518.8m on acquisition. Subsequent to this a measurement period adjustment has been applied to increase the goodwill by £1.7m, increase licences by £1.5m, increase trade-marks & brand names by £1.0m, decrease customer relationships by £4.0m, and increase other liabilities by £0.2m. Due to these measurement period adjustments, in line with IFRS 3 ‘Business Combinations’ it has been necessary to present a restated 2022 balance sheet and related notes to the accounts for those balances affected. Transactions with minority shareholders During the period, the Group received by way of an equity injection into Entain Holdings (CEE) Limited £42.6m from EMMA Capital in relation to their 25% share of the 2022 earn-out under the SuperSport acquisition. As EMMA Capital holds a put option over its equity, which is enforceable on the Group from November 2025, a financial liability equivalent to the equity injection has been recognised to reflect the future liability within equity. Summary of acquisitions in the period: Acquisitions during the year relate primarily to online gaming activities. Tab NZ, an STS also have retail estates. Fair values were determined on the basis of an initial assessment performed by an independent professional expert. NZ Ent Limited (trading as Tab NZ) On 1 June, the Group completed the acquisition of a business (NZ Ent Limited) which entitles them to the exclusive license to operate and run the brand of Tab NZ in New Zealand for 25 years for an initial payment of £85.3m with a further £10.6m paid following acquisition. As part of the acquisition, the Group has also committed to make minimum guaranteed funding payments to Tab NZ (the seller) in the first five years post completion, with further contingent payments due up to and including year 25. As there are no ongoing obligations or service requirements on the selling party, these payments have been deemed to form part of consideration under IFRS 3 rather than ongoing deductions on profits. As such, based on forecast performance for the Group’s New Zealand business and the estimated returns on the potential introduction of geo-blocking, which could be significant, the discounted estimate of consideration for the Tab NZ acquisition is £1,208.7m, which is considered to be equal to the fair value. In accordance with IFRS 3, as control has been obtained, the business has been consolidated from the point of acquisition. Details of the purchase consideration, and the values of net , the net assets acquired and goodwill are as follows: | | | | --- | --- | | | Fair value | | | £m | | Intangible assets (excluding goodwill) | 894.6 | | Property, plant and equipment | 17.4 | | Trade and other receivables | 24.6 | | Cash and cash equivalents | 10.2 | | Deferred tax asset | 309.8 | | Deferred tax liability | (242.6) | | Trade and other payables | (45.3) | | Lease liabilities | (10.5) | | Total | 958.2 | | Net assets acquired | 958.2 | | Goodwill | 250.5 | | Total net assets acquired | 1,208.7 | | Consideration: | | | Cash | 96.6 | | Deferred consideration | 386.5 | | Contingent consideration | 725.6 | | Total consideration | 1,208.7 | 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 203 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 32 Business combinations (continued) STS Holdings SA On 23 August, a Group subsidiary, Entain CEE, acquired 99.28% of STS Holdings S.A. (“STS”) at a purchase price of PLN 24.80 per share. As part of the acquisition and the funding of Entain CEE’s purchase of STS, the majority shareholder in STS acquired a 10% economic stake in the enlarged Entain CEE business for cash with the existing minority shareholder, EMMA Capital, also subscribing for additional equity in Entain CEE for cash to fund their economic proportion of the acquisition. Total consideration for the acquisition of STS was £748.6m, with minority holdings, including the remaining 0.72% of shares not acquired as part of the initial purchase, contributing £313.5m of the consideration. As the former majority shareholder in STS and EMMA Capital have put options on their equity stake in Entain CEE, the Group has recognised an equivalent financial liability for these two put options (see Note 26). Post the acquisition, the remaining 0.72% of equity in STS has been acquired by Entain CEE, with each parent contributing in line with their economic interest in Entain CEE. In accordance with IFRS 3, as the Entain Group exercises control of CEE and therefore indirectly controls STS, the business has been consolidated from the point of acquisition. Details of the purchase consideration, and the values the of net assets acquired and the goodwill are as follows: | | | | --- | --- | | | Fair value | | | £m | | Intangible assets (excluding goodwill) | 401.3 | | Property, plant and equipment | 22.6 | | Trade and other receivables | 5.6 | | Cash and cash equivalents | 56.7 | | Deferred tax liability | (74.8) | | Trade and other payables | (21.5) | | Lease liabilities | (15.4) | | Total | 374.5 | | Net assets acquired | 374.5 | | Goodwill | 374.1 | | Total net assets acquired | 748.6 | | Consideration: | | | Cash | 435.1 | | Non-controlling interest | 313.5 | | Total consideration | 748.6 | Other business combinations BetCity On 11 January, the Group acquired 100% of the share capital of BetCity for initial consideration of €305m, including working capital adjustments, with further contingent amounts payable in 2024 and beyond subject to financial performance. Based on financial forecasts at the point of acquisition, total discounted consideration has been assessed as €362m. Amounts payable are capped at €550m. In accordance with IFRS 3, as control has been obtained, the business has been consolidated from the point of acquisition. 365Scores On 30 March, the Group acquired 100% of the share capital of 365Scores for $157m including working capital adjustments, with further contingent payments payable subject to the achievement of certain financial targets capped at $10m. Based on financial forecasts at the point of acquisition, total discounted consideration has been assessed as $161m. In accordance with IFRS 3, as control has been obtained, the business has been consolidated from the point of acquisition. Tiidal Gaming On 9 June, the Group acquired 100% of the share capital of Tiidal Gaming for £7.8m. There are no contingent consideration elements in the acquisition. In accordance with IFRS 3, as control has been obtained, the business has been consolidated from the point of acquisition. ASF Limited (trading as Angstrom) On 29 September the Group completed the acquisition of ASF Ltd, acquiring 100% of the share capital of the business for initial consideration of $93.5m with up to an additional $65.0m ($82.7m undiscounted) payable subject to the achievement of certain milestones. Based on forecasts for the business’ performance post acquisition, total discounted consideration has been assessed as $138.5m. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023204 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() In accordance with IFRS 3, as control has been obtained, the business has been consolidated from the point of acquisition. Details of the total purchase consideration, and the values of the net assets acquired and goodwill on the acquisition of BetCity, 365Scores, Tiidal Gaming, and Angstrom are as follows: | | | | --- | --- | | | Fair value | | | £m | | Intangible assets (excluding goodwill) | 216.7 | | Property, plant and equipment | 2.1 | | Trade and other receivables | 26.2 | | Cash and cash equivalents | 21.0 | | Deferred tax liability | (51.5) | | Loans and borrowings | (9.4) | | Trade and other payables | (49.3) | | Lease liability | (1.0) | | Total | 154.8 | | Net assets acquired | 154.8 | | Goodwill | 442.9 | | Total net assets acquired | 597.7 | | Consideration: | | | Cash | 455.4 | | Deferred consideration | 142.3 | | Total consideration | 597.7 | All of the acquired businesses contributed revenues of £357.6m and underlying profit before tax of £34.9m. Had the acquisitions occurred on the first day of the financial year the revenue for the Group would have been £4,990.2m with an underlying profit before tax of £493.4m. Included in the valuation of goodwill is the value attributed to acquired workforce, and the benefit of future trading potential including synergies arising as part of the acquisition. 33 Commitments and contingencies AUSTRAC In October 2020, AUSTRAC initiated a compliance assessment of Entain Group Pty Ltd, the Group’s subsidiary in Australia (“Entain Australia”). Following two years of assisting AUSTRAC with the assessment, Entain Australia was notified in September 2022 that AUSTRAC would be commencing an enforcement investigation. The investigation is focused on whether Entain Australia complied with its obligations under the AML/CTF Act. Entain Australia continues to co-operate fully with AUSTRAC’s enforcement team, and is liaising regularly with AUSTRAC’s regulatory operations teams as it implements a detailed remediation plan. As AUSTRAC are still conducting their investigation and reviewing documentation, it is too early to predict the likely timing and potential outcome of the investigation. Whilst the details of the investigation into Entain Australia are different to other AUSTRAC investigations in the bookmaking industry, the directors note that previous penalties in AUSTRAC civil penalty proceedings have been significant. Therefore, as at the Balance Sheet date, uncertainty exists over both the timing and outcome of the investigation, with any potential penalty, should one arise, potentially material. The Group remains fully engaged, working collaboratively with AUSTRAC and providing detailed quarterly updates on enhancements to its AML/CTF program. Whilst significant progress has been made since 2022, this remains a key area of focus. As a leading gambling operator, the Group recognises that it has a responsibility to keep financial crime out of gambling, and remains committed to our customers, our shareholders and the communities that we operate in to ensure we act as a gatekeeper for safer betting. Greek Tax In November 2021, the Athens Administrative Court of Appeal ruled in favour of the Group’s appeal against the tax assessment raised by the Greek tax authorities in respect of 2010 and 2011. In February 2022, the Greek tax authorities appealed against the judgements to the Greek Supreme Administrative Court. While the Group expects to be successful in defending the appeal by the Greek authorities, should the Greek Supreme Administrative Court rule in favour of the Greek tax authorities, then the Group could become liable for the full 2010-2011 assessment plus interest, an estimated total of €283.6m at 31 December 2023. #### 32 Business combinations (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 205 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() 34 Related party disclosures Other than its associates and joint venture, the related parties of the Group are the Executive Directors, Non-Executive Directors and members of the Executive Committee of the Group. Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note. Transactions between the Group and its associates and joint venture and other related parties are disclosed below. During the year, Group companies entered into the following transactions with related parties who are not members of the Group: | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Equity investment | | | | – Joint venture | 40.7 | 175.1 | | Sundry income | | | | – Associates | 21.5 | – | | Sundry expenditure | | | | – Associates | (51.4) | (55.5) | 1 2 2 1. Equity investment in BetMGM. 2. Payments in the normal course of business made to Sports Information Services (Holdings) Limited. Details of related party outstanding balances | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Other amounts outstanding | | | | – Joint venture receivable | 54.7 | 87.8 | | – Associates receivables | 3.2 | 4.4 | | – Associates payables | (0.1) | (0.3) | Terms and conditions of transactions with related parties Sales to, and purchases from, related parties are made at market prices and in the ordinary course of business. Outstanding balances at 31 December 2023 are unsecured and settlement occurs in cash. For the year ended 31 December 2023, the Group has not raised any provision (2022: £nil) for doubtful debts relating to amounts owed by related parties as the payment history has been good. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. Transactions with Directors and key management personnel of the Group For details of Directors’ remuneration please refer to the Directors’ remuneration table included on pages 118 to 121 of this report. The remuneration of key management personnel is set out below in aggregate for each of the categories specified in IAS 24 Related Party Disclosures. Key management personnel comprise Executive Directors and members of the Executive Management Team. Further information about the remuneration of individual Directors is provided in the Directors’ remuneration report. | | | | | --- | --- | --- | | | 2023 | 2022 | | | £m | £m | | Short-term employee benefits | 7.3 | 7.9 | | Redundancy/loss of office | 1.6 | – | | Pension-related costs | 0.3 | 0.1 | | Share-based payments | 10.7 | 7.6 | | Total compensation paid to key management personnel | 19.9 | 15.6 | The consolidated financial statements include the financial statements of Entain plc and its subsidiaries. The companies listed below are those which were part of the Group at 31 December and therefore the results, cash flows and balance sheets of all subsidiaries listed are consolidated into the Group financial statements, furthermore the results of joint ventures and associates are accounted for in accordance with the policy set out in Note 4. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023206 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() Subsidiaries based in the United Kingdom | | | | | | --- | --- | --- | --- | | | | | % equity interest | | Registered address | Company | 2023 | 2022 | | 7th Floor, | Arthur Prince (Turf Accountants) Limited | 100.0 | 100.0 | | One Stratford Place, | Bartletts Limited | 100.0 | 100.0 | | Westfield Stratford City, Montfichet Road, | Birchgree Limited | 100.0 | 100.0 | | London, | Bloxhams Bookmakers Limited | 100.0 | 100.0 | | United Kingdom, E20 1EJ | Brickagent Limited | 100.0 | 100.0 | | | ASF Limited | 100.0 | 100.0 | | | Cashcade Limited | 100.0 | – | | | CE Acquisition 1 Limited | 100.0 | 100.0 | | | Chas Kendall (Turf Accountant) Limited | 100.0 | 100.0 | | | Choicebet Limited | 100.0 | 100.0 | | | C L Jennings (1995) Limited | 100.0 | 100.0 | | | Competition Management Services Co. Limited | 97.5 | 97.5 | | | Coral (Holdings) Limited | 100.0 | 100.0 | | | Coral (Stoke) Limited | 100.0 | 100.0 | | | Coral Estates Limited | 100.0 | 100.0 | | | Coral Eurobet Limited | 100.0 | 100.0 | | | Coral Eurobet Holdings Limited | 100.0 | 100.0 | | | Coral Group Limited | 100.0 | 100.0 | | | Coral Group Trading Limited | 100.0 | 100.0 | | | Coral Limited | 100.0 | 100.0 | | | Coral Racing Limited | 100.0 | 100.0 | | | Coral Stadia Limited | 100.0 | 100.0 | | | E.F. Politt & Son Limited | 100.0 | 100.0 | | | Electraworks Maple Limited | 100.0 | 100.0 | | | Entain Holdings (UK) Limited | 100.0 | 100.0 | | | Entain Marketing (UK) Limited | 100.0 | 100.0 | | | Entain Services Limited | 100.0 | 100.0 | | | Entain Wave Limited | 100.0 | 100.0 | | | Gable House Estates Limited | 100.0 | 100.0 | | | Ganton House Investments Limited | 100.0 | 100.0 | | | Greatmark Limited | 100.0 | 100.0 | | | Hillford Estates Limited | 75.0 | 75.0 | | | Hindwain Limited | 100.0 | 100.0 | | | Impala Digital Limited | 100.0 | 100.0 | | | Interactive Sports Limited | 100.0 | 100.0 | | | J G Leisure Limited | 100.0 | 100.0 | | | J. Ward Hill & Company | 100.0 | 100.0 | | | Jack Brown (Bookmaker) Limited | 100.0 | 100.0 | | | Jerusalem Development (Mamilla) Co. Limited | 100.0 | 100.0 | | | Jerusalem Development Corporation (Holdings) Limited | 100.0 | 100.0 | | | Joe Jennings Limited | 100.0 | 100.0 | | | Krullind Limited | 100.0 | 100.0 | | | Ladbroke & Co., Limited | 100.0 | 100.0 | | | Ladbroke (Rentals) Limited | 100.0 | 100.0 | | | Ladbroke City & County Land Company Limited | 100.0 | 100.0 | | | Ladbroke Dormant Holding Company Limited | 100.0 | 100.0 | | | Ladbroke Entertainments Limited | 100.0 | 100.0 | | | Ladbroke Group | 100.0 | 100.0 | | | Ladbroke Group Homes Limited | 100.0 | 100.0 | 5 5 4 5 4 5 5 5 5 4 5 4 4 4 4 4 5 1,2,4 4 5 5 5 5 5 3 5 5 5 5 4,5 5 5 5 5 5 4,5 4 5 #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 207 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() | | | | | | --- | --- | --- | --- | | | | | % equity interest | | Registered address | Company | 2023 | 2022 | | | Ladbroke Group Properties Limited | 100.0 | 100.0 | | | Ladbroke Land Limited | 100.0 | 100.0 | | | Ladbroke US Investments Limited | 100.0 | 100.0 | | | Ladbrokes Betting & Gaming Limited | 100.0 | 100.0 | | | Ladbrokes Contact Centre Limited | 100.0 | 100.0 | | | Ladbrokes Coral Corporate Director Limited | 100.0 | 100.0 | | | Ladbrokes Coral Corporate Secretaries Limited | 100.0 | 100.0 | | | Ladbrokes Coral Group Life Benefits Trustee Limited | 100.0 | 100.0 | | | Ladbrokes Coral Group Limited | 100.0 | 100.0 | | | Ladbrokes Coral Group Pension Trustee Limited | 100.0 | 100.0 | | | Ladbrokes E-Gaming Limited | 100.0 | 100.0 | | | Ladbrokes Group Finance plc | 100.0 | 100.0 | | | Ladbrokes Investments Holdings Limited | 100.0 | 100.0 | | | Ladbrokes IT & Shared Services Limited | 100.0 | 100.0 | | | Ladbrokes Trustee Company Limited | 100.0 | 100.0 | | | Lightworld Limited | 100.0 | 100.0 | | | London & Leeds Estates Limited | 100.0 | 93.5 | | | Margolis and Ridley Limited | 100.0 | 100.0 | | | New Angel Court Limited | 100.0 | 100.0 | | | Paddington Casino Limited | 100.0 | 100.0 | | | Reg. Boyle Limited | 100.0 | 100.0 | | | Reuben Page Limited | 100.0 | 100.0 | | | Romford Stadium Limited | 100.0 | 100.0 | | | Rousset Capital Limited | 100.0 | 100.0 | | | Sponsio Limited | 100.0 | 100.0 | | | Sporting Odds Limited | 100.0 | 100.0 | | | Sportingbet (IT Services) Limited | 100.0 | 100.0 | | | Sportingbet (Management Services) Limited | 100.0 | 100.0 | | | Sportingbet Holdings Limited | 100.0 | 100.0 | | | Sportingbet Limited | 100.0 | 100.0 | | | Sports (Bookmakers) Limited | 100.0 | 100.0 | | | Techno Land Improvements Limited | 100.0 | 100.0 | | | Town and County Factors Limited | 100.0 | 100.0 | | | Vegas Betting Limited | 100.0 | 100.0 | | | Ventmear Limited | 100.0 | 100.0 | | 1 Bartholomew Lane, London, United Kingdom | Techno Limited | 84.0 | 84.0 | | EC2N 2AX | | | | | 77A Andersonstown Road, | Ladbrokes (Northern Ireland) (Holdings) Limited | 100.0 | 100.0 | | Belfast, United Kingdom | 5 | | | | BT11 9AH | Ladbrokes (Northern Ireland) Limited | 100.0 | 100.0 | | | North West Bookmakers Limited | 100.0 | 100.0 | 4,5 5 4 2,3,4 5 5 5 2,4 5 2 4,5 5 5 4,5 5 5 5 5 4,5 5 5 2,3 5 5 4 4 5 5 5 5 4 2,3 Subsidiaries based overseas | | | | | | --- | --- | --- | --- | | | | | % equity interest | | Registered address | Company | 2023 | 2022 | | c/o Corporate & Trust Services (Caribbean) | Green Sand Limited | 100.0 | 100.0 | | Limited, Thomas, John & Co, PO Box 990, FD, ICIC | | | | | Bldg, Lower Factory Road, St John’s, Antigua and Barbuda | | | | 5 #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023208 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() #### 34 Related party disclosures (continued) | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | % equity interest | | Registered address | | | Company | | 2023 | 2022 | | East Tower, Level 2, | | | Ennovate Investments Pty Limited | | 100.0 | 100.0 | | 25 Montpelier Road, | | | Ennovate Labs Pty Limited | | 100.0 | 100.0 | | Bowen Hills, QLD 4006 | | | Entain Group Pty Limited | | 100.0 | 100.0 | | Australia | | | Esports Australia Pty Limited | | 100.0 | 100.0 | | | | | Gaming Investments Pty Limited | | 100.0 | 100.0 | | | | | Ladbrokes Racing Club Pty Limited | | 100.0 | 100.0 | | | | | LB Australia Holdings Pty Limited | | 100.0 | 100.0 | | | | | Neds International Pty Limited | | 100.0 | 100.0 | | | | | Neds.com.au Pty Limited | | 100.0 | 100.0 | | 17 Atlantic Dr, Keysborough, VIC | 3173 | Australia | Full House Group Pty Limited | | 33.0 | 33.3 | | 2 Kosmala Close, Newington, NSW | 2127 | , Australia | Innquizitive Pty Limited | | 100.0 | 100.0 | | Suite 902, Level 9, 146 | Arthur Street, North Sydney, | | Angstrom Sports Australia Pty Ltd | | 100.0 | – | | NSW | 20 | 60, Australia | | | | | | Marxergasse 1b, | | | Entain Services Australia GmbH | | 100.0 | 100.0 | | 1030 | Vienna, | | | | 100.0 | | | Austria | | | | | 100.0 | | | Chaussée de Wavre 1100 Box 3, | | | Ladbroke Belgium SA | | 100.0 | 100.0 | | 1160 | Auderghem, | | Pari Mutuel Management Services S.A. | | 100.0 | 100.0 | | Belgium | | | N.V. Derby S.A. | | 100.0 | 100.0 | | | | | Redsports.be SRL/BV | | 100.0 | 100.0 | | | | | Tiercé Ladbroke S.A. | | 100.0 | 100.0 | | | | | Tilt SRL/BV | | 100.0 | 100.0 | | Alameda Rio Negro 111 1030, Andar 2 Conj 206 Torre Stadium Corpor, Alphaville | | | 365 | Scores Midia Ltda | 100.0 | – | | Industrial Barueri; Sao Paulo, 06454911, Brazil | | | | | | | | Belmont Chambers, | | | Creative Trend Limited | | 100.0 | 100.0 | | Road Town, | | | CTL Holdings International Limited | | 100.0 | 100.0 | | Tortola, | | | SRL Holdings International Limited | | 100.0 | 100.0 | | British Virgin Islands | | | Sunrise Resources Limited | | 100.0 | 100.0 | | Jayla Place, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands | | | Westman Holdings Limited | | 100.0 | 100.0 | | Sea Meadow House, Blackbourne Highway, PO Box 116, Road Town, Tortola, British Virgin Islands | | | Wavecrest Providers Limited | | 100.0 | 100.0 | | 55 Nikola Vaptsarov Blvd, Office Park Expo 2000, Building Phase 4, Floor 3, Lozenets Area, Sofia 1407 | , | Bulgaria | Entain Services (Bulgaria) EOOD | | 100.0 | 100.0 | | 1565 | | Carling Avenue, Suite 400, Ottawa, | Entain Operations Canada Limited | | 100.0 | 100.0 | | Ontario K1Z 8R1, Canada | | | | | 100.0 | | | 100-2006 Old Malone Road, Kahnawake, Quebec | | | Kahnawake Management Services Inc | | 100.0 | 100.0 | | J0L1B0, Canada | | | | | | | | 1500 | | Royal Centre, 1055 West Georgia Street, | Angstrom Sports Canada Inc. | | 100.0 | – | | Vancouver | | | | | | | | BC V6E 4N7, Canada | | | | | | | | 5B, First Floor, St Anne’s House, Victoria | | | Interactive Sports (C.I.) Limited | | 100.0 | 100.0 | | Street, Alderney, GY9 3UF, Channel Islands | | | | | | | | Quay House, South Esplanade | | | Longfrie Limited | | 100.0 | 100.0 | | St, Peter Port, Guernsey, GY1 4EJ, PO Box 132, Channel Islands | | | | | | | | 1st Floor, Liberation House, | | | Ladbroke (Channel Islands) Limited | | 100.0 | 100.0 | | Castle Street, St. Helier, JE1 1GL, Jersey,Channel | | | Maple Court Investments (Jersey) Limited | | | | | Islands | | | | | | | 2,3 4 4 4 4 4 3 5 5 5 5 4,5 5 4 3 5 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 209 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | % equity interest | | Registered address | | | Company | 2023 | 2022 | | Block 3, The Forum, Grenville Street, St. Helier JE2 4UF, Jersey | | | Avid International Limited | 100.0 | 100.0 | | 13/F, Gloucester Tower, The Landmark, 15 Queen’s | | | GVC Technology Consulting (Asia) Co Limited | 100.0 | 100.0 | | Road, Central Hong Kong, China | | | | | | | CR 15 # 106 32 Of P H 3, BOGOTA D.C., Colombia | | | Bwin Latam S.A.S. | 100.0 | 100.0 | | Krcka Ulica 18d 10000 | | | Emma Gamma Adriatic d.o.o. | 67.5 | 75.0 | | Zagreb, Croatia | | | Puni Broj d.o.o. | 67.5 | 75.0 | | | | | SuperSport d.o.o. | 67.5 | 75.0 | | | | | SuperSport marketing d.o.o. | 67.5 | 75.0 | | Ulica Josipa Marohnića 1/1, Zagreb, Croatia | | | minus5 d.o.o | 75.0 | 75.0 | | Emancipatie Boulevard Dominico F. “Don” Martina | | | GVC Services BV | 100.0 | 100.0 | | 29, Curaçao | | | | | | | Heelsumstraat 51 E-Commerce Park | | | Best Global N.V. | 100.0 | 100.0 | | Curaçao PO Box 422 | | | | | | | Kaya Richard J. Beajon Z/N Landhuls Joonchi II, Curaçao P.O Box 6248 | | | Elec Games N.V. | 100.0 | 100.0 | | 15 Agion Omologiton, Nicosia, 1080 Cyprus | | | Bellingrath Enterprises Limited | 100.0 | 100.0 | | Na Zatorka, 672/24, Bubeneÿ | | | Sporticon Development s.r.o. | 67.5 | – | | Prague, 18600, Karolinská 650/1, Kralín, | | Czech Republic | Betsys, s.r.o. | 50.0 | – | | Prague, 18600, Fruebjergvej 3, Copenhagen, 2100, Denmark | | Czech Republic | Interactive Sports (Denmark) ApS | 100.0 | 100.0 | | Lootsa tn 1a, Lasnamae Linnaosa, | | | Ninja Global OU | 100.0 | 100.0 | | 11415 | Estonia | | 3 | | | | | | | Optiwin OU | 100.0 | 100.0 | | Unioninkatu 24, Helsinki, 00130 Finland | | | Finnplay Technologies Oy | 100.0 | 100.0 | | 19 Boulevard Malesherbes, 75008, Paris, France | | | B.E.S. S.A.S. | 100.0 | 100.0 | | Linden Palais, Unter den Linden 40, 10117 Berlin, Germany | | | Entain (Germany) GmbH | 100.0 | 100.0 | | Apt. 48, N19, Vake District, Kavtaradze Str., Tbilisi, Entain Georgia LLC 4 | | | | 100.0 | 100.0 | | Georgia | | | | | | | Vake District, Kavtaradze Str., No 5, Entrance 2, Floor 2, Office Space No 2, Tbilisi, Georgia | | | MARS LLC | 100.0 | 100.0 | | Suite 6 Atlantic Suites, | | | Balltree (International) Limited | 100.0 | 100.0 | | Europort Avenue, | | | 5 | | | | Gibraltar | | | Bingo Marketing Limited | 100.0 | 100.0 | | | | | bwin.party holdings Limited | 100.0 | 100.0 | | | | | bwin.party services (Gibraltar) Limited | 100.0 | 100.0 | | | | | Coral Interactive (Gibraltar) Limited | 100.0 | 100.0 | | | | | ElectraGames Limited 4 | 100.0 | 100.0 | | | | | ElectraWorks Limited | 100.0 | 100.0 | | | | | Gala Coral Interactive (Gibraltar) Limited 4,5 | 100.0 | 100.0 | | | | | Gala Interactive (Gibraltar) Limited | 100.0 | 100.0 | | | | | Greyjoy Limited | 100.0 | 100.0 | | | | | Entain Corporate Services Limited | 100.0 | 100.0 | | | | | Entain Holdings (Gibraltar) Limited | 100.0 | 100.0 | | | | | Entain Operations Limited | 100.0 | 100.0 | | | | | Entain Trustees Limited | 100.0 | 100.0 | | | | | Fusionex Limited | 100.0 | 100.0 | | | | | IGM Domain Name Services Limited | 100.0 | 100.0 | | | | | ISG (Gibraltar) Limited | 100.0 | 100.0 | | | | | LC International Limited | 100.0 | 100.0 | 4 5 2,3 5 4 5 5 2,3 4,5 1,2,4 2,3,4 2,3,4 #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023210 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | % equity interest | | Registered address | | | Company | | 2023 | 2022 | | | | | PartyGaming IA Limited | | 100.0 | 100.0 | | 7th Floor, Madison building, Midtown, Queensway, GX11 1AA, Gibraltar | | | The Entain Foundation | | 100.0 | 100.0 | | 1st Floor Otter House, | | | Avid Ecom Solutions Limited | | 100.0 | 100.0 | | Naas Road, Dublin 22 Ireland | | | Avid Studios Limited | | 100.0 | 100.0 | | | | | Ladbroke (Ireland) Limited | | 100.0 | 100.0 | | 3 Dublin Landings, North Wall Quay, D01 C4EO Ireland | | | Fort Anne Limited | | 100.0 | 100.0 | | | | | M.L.B. Limited | | 100.0 | 100.0 | | 5th Floor, Divyasree Omega Block – B, | | | IVY Comptech Private Limited | | 100.0 | 100.0 | | Hitec City Road, Kondapur, Hyderabad | | | IVY Software Development Services Private Limited | | 100.0 | 100.0 | | Andhra Pradesh, 500081 India | | | IVY Foundation Limited | | 100.0 | 100.0 | | | | | Ivy Mobitech Services Private Limited | | 100.0 | 100.0 | | | | | IVY Global Shared Services Private Limited | | 100.0 | 100.0 | | 32 Athol Street, Douglas, IM1 1JB Isle of Man | | | Entain (IOM) Limited | | 100.0 | 100.0 | | Menahem Begin Road 121 & 125, Tel Aviv, Jaffa, Israel | | | Gala Interactive (Services) Limited | | 100.0 | 100.0 | | | | | GVC Impala R&D Limited | | 100.0 | 100.0 | | | | | Ladbrokes Israel Limited | | 100.0 | 100.0 | | 2 Nahalat Yitchak, Tel-Aviv Yaffo, 674 | 48 | 01, Israel | 365 | Scores Limited | 100.0 | – | | Via Lungotevere Arnaldo da Brescia 12, | | | Agenzia M3 S.R.L. | | 100.0 | 100.0 | | 00196 | Rome, Italy | | Eurobet Holding S.R.L. | | | | | | | | | | 100.0 | 100.0 | | | | | Eurobet Italia S.R.L. | | 100.0 | 100.0 | | Via Gaetano Previati 9, 20149 | Milan, Italy | | bwin European Markets Holding SpA | | 3 | 100.0 | 100.0 | | | | | bwin Italia S.R.L. | | 100.0 | 100.0 | | ALN House Eldama Ravine Close, | | | Wave Operations (Kenya) Limited | | 100.0 | 100.0 | | Off Eldama Ravine Road, Westlands, Nairobi, PO Box 200, Kenya | | | Wave Online (Kenya) Limited | | 100.0 | 100.0 | | Setekles iela, | | | SIA Klondaika | | 100.0 | 100.0 | | Riga LV-1050 | | | SIA Klondaika Café | | 100.0 | 100.0 | | Latvia | | | SIA Laimz | | 100.0 | 100.0 | | | | | SIA Optibet | | 100.0 | 100.0 | | Orsos g. 4-101, Vilnius, Lithuania | | | UAB Baltic Bet | | 100.0 | 100.0 | | | | | UAB Party Casino | | 100.0 | 100.0 | | Penthouse, Palazzo Spinola Business Centre, | | | bwin.party holding Malta Limited | | 100.0 | 100.0 | | Number 46, St Christopher Street, Valletta, VLT | | | bwin.party International Malta Limited | | 100.0 | 100.0 | | 14 | 64, Malta | | | | | | | Unit 6 ST Business Centre, | | | bwin (Deutschland) Limited | | 100.0 | 100.0 | | 120 | The Strand, | | 2 | | | | | Gzira GZR 1027 | | | bwin.gr Limited | | 100.0 | 100.0 | | Malta | | | bwin Holdings (Malta) Limited | | 100.0 | 100.0 | | | | | bwin.party services (Malta) Limited | | 100.0 | 100.0 | | | | | Online-Wetten (Austria) Limited | | 100.0 | 100.0 | | | | | Deis Limited | | 100.0 | 100.0 | | | | | ElectraWorks (France) Limited | | 100.0 | 100.0 | | | | | ElectraWorks (Kiel) Limited | | 100.0 | 100.0 | | | | | ElectraWorks (Svenska) Limited | | 100.0 | 100.0 | | | | | ElectraWorks Europe Ltd | | 100.0 | 100.0 | | | | | Entain Holdings (Malta) Limited | | 100.0 | 100.0 | | | | | Entertainments Technologies Group Limited | | 100.0 | 100.0 | | | | | Gaming VC Corporation Limited | | 100.0 | 100.0 | | | | | Ladbrokes (Deutschland) Limited | | 100.0 | 100.0 | | | | | Martingale Europe Limited | | 100.0 | 100.0 | 5 2,3,4 1 1,4 4 2,3 3 3 3 3 1,4 4 4 #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 211 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() | | | | | | | | --- | --- | --- | --- | --- | --- | | | | | | | % equity interest | | Registered address | | | Company | 2023 | 2022 | | | | | Martingale Malta 2 Limited | 100.0 | 100.0 | | | | | Sportingbet (Deutschland) Limited | 100.0 | 100.0 | | | | | Scandic Bookmakers Limited | 100.0 | 100.0 | | | | | Spread Your Wings Bravo Limited | 100.0 | 100.0 | | | | | STS Gaming Group Limited | 67.5 | – | | | | | STS.Bet Limited | 67.5 | – | | | | | Entain (Romania) Limited | 100.0 | 100.0 | | | | | VistaBet Limited | 100.0 | 100.0 | | 120 | The Strand, Unit 6, | | BestBet Limited 3 | 100.0 | 100.0 | | Trig Ix-Xat t, | | | 3 | | | | Gzira GZR 1027 | | | Elec Games C1 Limited | 100.0 | 100.0 | | Malta | | | Elec Games Holdings Limited | 100.0 | 100.0 | | | | | Elec Games Limited | 100.0 | 100.0 | | | | | Evora International Limited | 100.0 | 100.0 | | | | | Future Domain Lead Generation Limited | 100.0 | 100.0 | | | | | Future Lead Generation Limited 4 | 100.0 | 100.0 | | | | | Lifland Holdings Limited 4 | 100.0 | 100.0 | | | | | Ninja Global Limited 3 | 100.0 | 100.0 | | | | | Entain Holdings (CEE) Limited | 67.5 | 100.0 | | | | | West African Gaming Limited | 100.0 | 100.0 | | San Francisco 1005, Dolonia Del Valle, | | | Bwin Operations Mexico, S.A. de C.V. | 100.0 | 100.0 | | Alcaldía Benito Juárez, Mexico City, C.P. 03100 | Mexico | | Entain Mexico, S.A. de C.V. | 100.0 | 100.0 | | Johan Cruijff Boulevard 61, Amsterdam | | | Entain Holdings (Netherlands) B.V. | 100.0 | 100.0 | | 110 | 1Dl | Netherlands | | | | | Keurenplein 4, Unit D1442, 1069CD, Amsterdam, Netherlands | | | Betent B.V. | 100.0 | – | | 106-110 Jackson Street, Petone, Lower Hutt, 5012, Entain New Zealand Limited | | | | 100.0 | – | | New Zealand | | | | | | | Floor 6 Exchange Place, 5 Willeston Street, Wellington Central, Wellington, 6011, New | | | TIIDAL GAMING NZ LIMITED | 100.0 | – | | Zealand | | | | | | | 6F Tower 3 Double Dragon Plaza EDSA | | | InteractiveSports Asia Limited Inc. | 100.0 | 100.0 | | Ext. cor. Macapagal Avenue, Pasay City | | | NCH Customer Support Services, Inc | 100.0 | 100.0 | | Philippines | | | | | | | Porcelanowa 8, 40-246 Katowice, Poland | | | BetSys Poland Sp. Z.o.o. | 50.0 | – | | | | | STS Holdings S.A. | 67.5 | – | | | | | STS S.A. | 67.5 | – | | UI. Taneczna 18A, 02-829 Warsaw Poland | | | bwin Poland S.A. | 100.0 | 100.0 | | Praceta António Gedeão, 1 B, Paiões, | | | Infield – Servicos de Consultoria Marketing Unipessoal | 100.0 | 100.0 | | 2635 – 002 Sintra, Portugal | | | LDA. | | | | Avenida D João II, Lote 1.07.2.1, 5ºA, | | | Gobet Entretenimento SA | 100.0 | 100.0 | | Parque das Nações | | | Entain Operations Portugal SA | 100.0 | 100.0 | | 1990-096 Lisbon, Portugal | | | | | | | 1 Harbourfront Avenue, Keppel Bay Tower | | | Cozy Games Pte Limited | 100.0 | 100.0 | | 14-03/07, 098632 Singapore | | | Florent Pte Limited | 100.0 | 100.0 | | Calle Amador de los Ríos n°1, 6 planta | | | bwin Interactive Marketing Espana S.L. | 100.0 | 100.0 | | 28010 | | Madrid, Spain | | | | | Calle Josep Plá, número 2, planta 5ªD | | | Entain Services Iberia S.I. | 100.0 | 100.0 | | Edificio Torre Diagonal Litoral, 08019 | | | | | | | Barcelona, Spain | | | | | | | Castello 82 4 IZQ, 28006 Madrid, Spain | | | Ladbrokes Betting and Gaming Spain, S.A. | 100.0 | 100.0 | 2 4 3 4 5 3 #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023212 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | | | | | | % equity interest | | Registered address | | | | Company | 2023 | 2022 | | Calle Real Numero 74, 51001 Ceuta, Spain | | | | Electraworks (Ceuta) S.A. | 100.0 | 100.0 | | Avenida de Fuencarral 44, Edificio Tribeca 1 | | | | Winners Apuestas SA | 100.0 | 100.0 | | Modulo B, CP 28108 Alcobendas Madrid, Spain | | | | | | | | Cl Conde de Aranda 20, 28001 | | | | Sportinbet Spain S.A. | 100.0 | 100.0 | | Madrid, Spain | | | | | | | | San Justo Desvern, calle de la Constitución 1, 5º | | | | Atlantic Version 2014 SLU | 100.0 | 100.0 | | planta, local 3, 08960, Barcelona, Spain | | | | | | | | Suite 4 Constantia House, Steenbert Office Park, Constantia, 7800 South Africa | | | | SBT Software Operations (SA) (Pty) | 100.0 | 100.0 | | 24A 18th Street, Menlo Park, Pretoria, 0081 | | South Africa | | Ladbrokes (SA) (Pty) Limited | 100.0 | 60.0 | | Office 519, Spaces, Dock Road Junction, Corner | | | | Wave SA (Pty) Limited | 85.0 | 100.0 | | of Stanley & Dock Road, Waterfront, Cape Town, 8 | | 001, South Africa | | | | | | Stora Gatan 46, Sigtuna | | | | Enlabs AB | 100.0 | 100.0 | | Kommun, 19330, | | Sweden | | | | | | | | | | Entraction AB | 100.0 | 100.0 | | | | | | Score24 AB | 100.0 | 100.0 | | Royal Park Serviced Office, Frosundaviks alle 15, 15903 Solna, Sweden | | | | Scout Gaming AB | 100.0 | 100.0 | | c/o The Corporation Trust Company, | | | | GVC Finance LLC | 100.0 | 100.0 | | 1209 | Orange Street, Country of New Castle, | | | GVC Holdings (USA) Inc | 100.0 | 100.0 | | Wilmington DE 19891, United States | | | | Ladbrokes Holdco. Inc. | 100.0 | 100.0 | | 7251 | Amigo Strees, Suite 100, Las Vegas | | | Stadium Technology Group, LLC | 100.0 | 100.0 | | NV | 89119, | United States | | | | | | 1013 | Centre Road, Suite 403-B, Wilmington DE | | | Angstrom Sports Inc | 100.0 | – | | 19805 | | , United Estates | | | | | | 4445 | Corporation Ln Ste 264, Viriginia | | | Angstrom Sports Virginia LLC | 100.0 | – | | Beach VA 23462-3262, United States | | | | | | | | Five Greentree Centre, 525 Route 72 North, STE | | | | Angstrom Sports NJ LLC | 100.0 | – | | 104 | Marlton, New Jersey 08053, United States | | | | | | | 701 | S.Carson Street, Suite 200, | | | bwin.party (USA) Inc | 100.0 | 100.0 | | Carson City, NV 90801, United States | | | | bwin.party entertainment (NJ) LLC | 100.0 | 90.0 | | | | | | bwin.party services (NJ) Inc | 100.0 | 100.0 | | | | | | Ladbrokes Subco LLC | 100.0 | 100.0 | | c/o Saiber LLC, 18 Columbia Turnpike, Suite 200, Florham Park, New Jersey, United States | | | | The Entain Foundation US, Inc | 100.0 | 100.0 | | 2 Mykoly Solovtsova St, Office 38/1 | | | | Entain (Ukraine) LLC | 100.0 | 100.0 | | 01014 | Kyiv, Ukraine | | | | | | | Office 13, 39 Dzhona Makkeina, Steer | | Kyiv, Ukraine | 01042 | LLC Bwin | 100.0 | 100.0 | | Dr Luis Bonavita, 1294, Torre 2 WTC | | | | Gomifer S.A. | 100.0 | 100.0 | | Free Zone, Oficina 631, Montevideo, Uruguay | | | | | | | | 34972 | | Longacres, Lusaka | | Wave Digital Zambia Limited | 100.0 | 100.0 | | Lusaka Province, Zambia | | | | | | | 4 3 3 1 4 3 1. Company that is directly owned by Entain plc. 2. Company that forms part of the Group as at 31 December 2023 and which, principally affected the Group’s reported results for the year. 3. Trading entity engaged in activity associated with betting and gaming. 4. Holding company. 5. Dormant company . #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 213 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() Joint ventures | | | | | | | --- | --- | --- | --- | --- | | | | | | % equity interest | | Registered address | | Company | 2023 | 2022 | | Corporation Service Company, 251 | Little Falls Drive, | BetMGM, LLC | 50.0 | 50.0 | | Wilmington, Delaware 19808, United States | | | | | Associates | | | | | | --- | --- | --- | --- | | | | | % equity interest | | Country of incorporation | Company | 2023 | 2022 | | China | Asia Gaming Technologies (Beijing) Co., Ltd | 49.0 | 49.0 | | | Asia Gaming Technologies Limited | 49.0 | 49.0 | | Germany | bwin E.K. Neugersdorf | 50.0 | 50.0 | | Belgium | Gran Casino de Dinant SA | 20.0 | 20.0 | | | Infiniti Casino Oostende NV | 20.0 | 20.0 | | | Leaderbet NV | 20.0 | 20.0 | | | Professional Gaming Services SRL/BV | 19.0 | 19.0 | | United Kingdom | Draw & Code Limited | 40.0 | 40.0 | | | Games For Good Causes PLC | 36.3 | 36.3 | | | Sports Information Services (Holdings) Limited | 23.4 | 23.4 | 1 1. Subsidiary of Asia Gaming Technologies Limited. #### 35 Non-controlling interests The principal non-controlling interests at 31 December 2023 held investments in Entain Holdings (CEE) Limited (32.5%). Details of the business combinations resulting in the recognition of these non-controlling interests are set out in Note 32. The total assets relating to subsidiaries with a non-controlling interest were £2,024.0m (2022: £1,237.9m) of which there were related liabilities of £412.2m (2022: £512.5m). The loss attributable to non-controlling interests was £7.9m (2022: loss of £4.7m). The balance attributable to non-controlling interest is disclosed in the table below: | | | | --- | --- | | | Total | | | £m | | As at January 2022 | 1.4 | | Profit attributable to non-controlling interests | (4.7) | | Business combinations | 178.9 | | Purchase of non-controlling interests | 2.1 | | Foreign exchange | 6.1 | | As at January 2023 | 183.8 | | Profit attributable to non-controlling interests – underlying items | 35.0 | | Separately disclosed items attributable to non-controlling interests | (42.9) | | Dividends paid | (7.4) | | Minority interest contribution to SuperSport earnout (Note 32) | 42.6 | | Minority interest in STS acquisition (Note 32) | 313.5 | | Other | (6.2) | | Foreign exchange | 6.3 | | As at 31 December 2023 | 524.7 | #### 36 Subsequent events On 1 March 2024, the Group raised an additional £300m of borrowings under a bank loan facility and used the proceeds to repay all amounts drawn under the Group’s revolving credit facility. On 1 March 2024, the commitments available under the Group’s revolving credit facility (disclosed in Note 23) were increased by £45m further increasing the Group’s available liquidity. Following these transactions, the Group’s revolving credit facility had total commitments of £635m which, as at 1 March 2024 was completely undrawn save £5m carved out for letters of credit and guarantees. #### 34 Related party disclosures (continued) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023214 Notes to the consolidated financial statements for the year ended 31 December 2023 ![]() Note 2023 £m 2022 £m Other operating income 13.0 18.7 Dividends received – 150.0 Operating expense (22.7) (17.3) Operating (loss)/profit before separately disclosed items 6 (9.7) 151.4 Administrative costs – separately disclosed items 7 (645.5) (13.1) (Loss)/profit before tax and net finance expense (655.2) 138.3 Finance expense 8 (88.6) (104.1) Finance income 8 90.1 12.2 (Losses)/gains arising from change in fair value of financial instruments 8 (75.7) 86.7 Losses arising from foreign exchange on debt instruments 8 (0.1) (1.6) (Loss)/profit before tax (729.5) 131.5 Income tax 9 – (0.2) (Loss)/profit for the year (729.5) 131.3 All items included above relate to continuing operations. There were no other items of comprehensive income in the year. The notes on pages 218 to 222 are an integral part of these financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 215 Company income statement for the year ended 31 December 2023 ![]() Note 2023 £m 2022 £m Assets Non-current assets Investments 11 5,635.2 4,845.6 Trade and other receivables 12 297.9 633.3 Interest-bearing loans and borrowings 7.0 5.0 5,940.1 5,483.9 Current assets Trade and other receivables 12 371.3 145.3 Interest-bearing loans and borrowings 0.1 – Derivative financial assets 33.4 96.2 Cash and cash equivalents 0.1 0.1 404.9 241.6 Total assets 6,345.0 5,725.5 Liabilities Current liabilities Trade and other payables 13 (202.1) (1,135.5) Interest-bearing loans and borrowings (0.4) – (202.5) (1,135.5) Net current assets/(liabilities) 202.4 (893.9) Non-current liabilities Trade and other payables 13 (2,411.6) (651.3) Other financial liabilities 13 (15.2) – (2,426.8) (651.3) Net assets 3,715.7 3,938.7 Shareholders’ equity Called up share capital 16 5.2 4.8 Share premium account 1,796.7 1,207.3 Merger reserve 2,527.4 2,527.4 Retained earnings (613.6) 199.2 Total shareholders’ equity 3,715.7 3,938.7 Under the Companies Act 2006 section 49 (Isle of Man), the Directors are satisfied that the Company satisfies the solvency test for distributions to be made. The notes on pages 218 to 222 are an integral part of these financial statements. The financial statements on pages 215 to 222 were approved by the Board of Directors on 7 March 2024 and signed on its behalf by S David RM Wood Interim Chief Executive Officer Deputy Chief Executive Officer/Chief Financial Officer (Company number 4685V) 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023216 Company balance sheet at 31 December 2023 ![]() Called up share capital £m Share premium account £m Merger reserve account £m Retained earnings £m Total £m At January 2022 4.8 1,207.3 2,527.4 99.6 3,839.1 Profit for the year – – – 131.3 131.3 Total comprehensive income – – – 131.3 131.3 Share-based payments charge 18.3 18.3 Equity dividends – – – (50.0) (50.0) At 31 December 2022 4.8 1,207.3 2,527.4 199.2 3,938.7 Loss for the year – – – (729.5) (729.5) Total comprehensive expense – – – (729.5) (729.5) Issue of shares (Note 16) 0.4 589.4 – – 589.8 Share-based payments charge – – – 23.6 23.6 Equity dividends – – – (106.9) (106.9) At 31 December 2023 5.2 1,796.7 2,527.4 (613.6) 3,715.7 The notes on pages 218 to 222 form an integral part of these financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 217 Company statement of changes in equity for the year ended 31 December 2023 ![]() #### 1 General information Entain plc (“the Company”) is a limited company incorporated and domiciled in the Isle of Man. The address of its registered office and principal place of business is disclosed in the Directors’ report. The financial statements of the Company for the year ended 31 December 2023 were authorised for issue in accordance with a resolution of the Directors on 7 March 2024. The Company has taken advantage of the exemption from preparing a cash flow statement under paragraph 8(g) of the disclosure exemptions from UK-adopted IFRS for qualifying entities included in Financial Reporting Standard 101 Reduced Disclosure Framework (FRS 101). The Entain plc consolidated financial statements for the year ended 31 December 2023 contain a consolidated statement of cash flows. The Company is exempt under paragraph 8(k) of the disclosure exemptions from UK-adopted IFRS included in FRS 101 for qualifying entities from disclosing related party transactions with entities that form part of the Entain plc Group of which Entain plc is the ultimate parent undertaking. The Company’s financial statements are presented in Pounds Sterling (£). All values are in millions (£m) rounded to one decimal place except where otherwise indicated. The Company’s financial statements are individual entity financial statements. #### 2 Basis of preparation These financial statements were prepared in accordance with FRS 101 and Isle of Man Companies Act 2006. The financial statements are prepared on a going concern basis under the historical cost convention except for certain financial liabilities measured at fair value. For details on the going concern considerations made, see Note 2 of the consolidated financial statements. The accounting policies which follow in Note 3 set out those policies which apply in preparing the financial statements for the year ended 31 December 2023 and have been applied consistently to all years presented. The Company has taken advantage of the following disclosure exemptions under FRS 101 in respect of: (a) IFRS 2 Share-based Payments; (b) IFRS 3 Business Combinations; (c) IFRS 5 Non-current Assets Held for Sale; (d) IFRS 7 Financial Instruments: Disclosure; (e) IFRS 13 Fair Value Measurement; (f) IFRS 15 Revenue from Contracts with Customers; (g) IFRS 16 Leases; (h) IAS 1 Presentation of Financial Statements; (i) IAS 7 Statement of Cash Flows; (j) IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors; (k) IAS 16 Property, Plant and Equipment; (l) IAS 24 Related party transactions; (m) IAS 36 Impairment of Assets. #### 3 Summary of significant accounting policies Investments Investments comprise interests in subsidiary companies and are held as non-current assets stated at cost less provision for impairment. The values used in any impairment review are based on the same principles and methods as described in the Group accounting policies and in Note 14 of the consolidated financial statements. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised. The Company assesses these investments for impairment wherever events or changes in circumstances indicate that the carrying value of an investment may not be recoverable. If any such indication of impairment exists, the Company makes an estimate of the recoverable amount. If the recoverable amount is less than the value of the investment, the investment is considered to be impaired and is written down to its recoverable amount. An impairment loss is recognised immediately in the income statement. Cash and cash equivalents Cash and short-term deposits in the balance sheet consist of cash at banks and in hand, short-term deposits with an original maturity of less than three months. Financial assets Financial assets are recognised when the Company becomes party to the contracts that give rise to them. The Company classifies financial assets at inception as either financial assets at fair value or loans and receivables. Financial assets at fair value through profit or loss are measured initially at fair value, with transaction costs taken directly to the income statement. Subsequently, the fair values are remeasured and gains and losses from changes therein are recognised in the income statement. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023218 Notes to the Company financial statements for the year ended 31 December 2023 ![]() #### 3 Summary of significant accounting policies (continued) Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. On initial recognition, loans and receivables are measured at fair value plus directly attributable transaction costs. Subsequently, such assets are measured at amortised cost, using the effective interest (“EIR”) method, less any allowance for impairment. Financial liabilities Financial liabilities comprise predominantly amounts due to other Group companies. On initial recognition, financial liabilities are measured at fair value plus transaction costs where they are not categorised as financial liabilities at fair value through profit or loss. Financial liabilities at fair value through profit or loss are measured initially at fair value, with transaction costs taken directly to the income statement. Subsequently, the fair values are remeasured and gains and losses from changes therein are recognised in the income statement. Derecognition of financial assets and liabilities Financial assets are derecognised when the right to receive cash flows from the assets has expired or when the Company has transferred its contractual right to receive the cash flows from the financial assets or has assumed an obligation to pay the received cash flows in full without material delay to a third party, and either: – Substantially all the risks and rewards of ownership have been transferred; or – Substantially all the risks and rewards have neither been retained nor transferred but control is not retained. Financial liabilities are derecognised when the obligation is discharged, cancelled or expires. Derivative financial instruments The Group policy and disclosure of financial risk are set out in Notes 4.3 and Note 25 of the consolidated financial statements. Current and deferred income tax The Company is tax resident in the United Kingdom. The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in shareholders’ funds. In this case, the tax is also recognised in other comprehensive income or directly in shareholders’ funds, respectively. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred income tax is recognised on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill; or arise from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is recognised using the tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are only recognised to the extent it is probable that there will be suitable taxable profits from which they can be recovered. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax’s assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. Deferred tax balances are not discounted. Foreign currency translation Transactions in foreign currencies are initially recorded in Pounds Sterling (£) at the foreign currency rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into Pounds Sterling (£) at the rates of exchange ruling at the balance sheet date (the closing rate). Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rate at the date when the fair value was determined. Dividends Final dividends proposed by the Board of Directors and unpaid at the year end are not recognised in the financial statements until they have been approved by shareholders at the Annual General Meeting. Interim dividends are recognised when paid. Equity instruments Equity instruments issued by the Company are recorded as the proceeds received net of direct issue costs. Share-based payments The cost of equity settled transactions with employees is measured by reference to the fair value at the date on which they are granted (see Note 31 of the consolidated financial statements for further details). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 219 Notes to the Company financial statements for the year ended 31 December 2023 ![]() #### 3 Summary of significant accounting policies (continued) Separately disclosed items To assist in understanding its underlying performance, the Company has defined the following items of pre-tax income and expense as separately disclosed items as they reflect items which are exceptional in nature or size. The separate disclosure of these items allows a clearer understanding of the trading performance on a consistent and comparable basis, together with an understanding of the effect of non-recurring or large individual transactions upon the overall profitability of the Company. The separately disclosed items have been included within the appropriate classifications in the income statement. Further details are given in Note 7. Finance expense and income Finance expense and income arising on interest-bearing financial instruments carried at amortised cost are recognised in the income statement using the effective interest rate method. Finance expense includes the amortisation of fees that are an integral part of the effective finance cost of a financial instrument, including issue costs, and the amortisation of any other differences between the amount initially recognised and the redemption price. All finance expenses are recognised over the availability period. #### 4 Judgements and key sources of estimation uncertainty The preparation of financial statements requires management to make assumptions, estimates and judgements that affect the amounts reported as assets and liabilities as at the balance sheet date and the amounts reported as revenues and expenses during the year. Use of available information and application of judgement are inherent in the formation of estimates. Actual results in the future may differ from those reported. Judgement applied to separately disclosed items is set out in the Note 4.2 of the consolidated financial statements. #### 5 Future accounting developments The standards and interpretations that are issued, but not yet effective, excluding those relating to annual improvements, are not expected to have a material impact on the parent Company fi nancial statements. The Company intends to adopt these standards, if applicable, when they become effective as set out in the Note 4.4 of the consolidated financial statements. #### 6 Operating profit before separately disclosed items This is stated after crediting/(charging): 2023 £m 2022 £m Management fees 13.0 18.7 Audit fees (0.6) (0.6) #### 7 Separately disclosed items 2023 £m 2022 £m Legal and onerous contract costs 54.7 0.6 Corporate transaction costs 5.8 12.5 Legal settlement (see Note 6 and Note 20 of the consolidated financial statements) 585.0 – 645.5 13.1 #### 8 Finance expense and income 2023 £m 2022 £m Loan interest income 38.7 12.2 Gains arising from change in fair value of financial instruments – 86.7 Intercompany foreign exchange gain 51.4 – Total finance income 90.1 98.9 Intercompany interest expense (82.3) (3.5) Intercompany foreign exchange loss – (98.4) Losses arising from change in fair value of financial instruments (75.7) – Losses arising from foreing exchange on debt instruments (0.1) (1.6) Loan interest expense (6.3) (2.2) Net finance expense (74.3) (6.8) The Group manages currency exposure through a number of derivative financial instruments, some of which are taken out in the name of Entain plc as well as other Group companies. The financial instruments taken out in the name of Entain plc are used to swap the foreign exchange risk on intercompany loans, which are back-to-back with the Group’s external debt held in other Group companies. The net change in fair value of financial instruments during the year was £75.7m (2022: £86.7m). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023220 Notes to the Company financial statements for the year ended 31 December 2023 ![]() #### 9 Income tax The tax charge for the year presented is £nil (2022: tax credit of £0.2m). A reconciliation of income tax applicable to loss (2022: profit) before tax at the UK statutory income tax rate to the income tax for the years ended 31 December 2023 and 31 December 2022 is as follows: 2023 £m 2022 £m (Loss)/profit before tax (729.5) 131.5 Corporate tax (credit)/charge thereon at 23.52% (2022: 19.00%) (171.4) 25.0 Adjusted for the effects of: – Non-taxable income – (28.5) – Non-deductible expenses 14.4 5.2 – Non-deductible legal settlement 137.6 – – Group relief surrendered/(claimed) 19.4 (1.7) – Overseas tax charge/(credit) – 0.2 Income tax charge – 0.2 There is no deferred tax present on the balance sheet for either periods presented. #### 10 Dividends Please see Note 11 of the consolidated financial statements. #### 11 Investments Total £m Cost and net book value At 1 January 2022 4,372.1 Additions 473.5 At 31 December 2022 4,845.6 Cost and net book value At 1 January 2023 4,845.6 Additions 789.6 At 31 December 2023 5,635.2 Subsidiaries and other related entities are listed in Note 34 of the consolidated financial statements. Additions in the year predominantly relate to additional equity subscribed for in subsidiary companies. #### 12 Trade and other receivables 2023 £m 2022 £m Amounts due from Group companies 666.6 770.3 Other debtors 1.2 5.6 Prepayments 1.4 2.7 669.2 778.6 Amounts of £297.9m (2022: £633.3m) are not expected to be called upon within the next 12 months following the approval of these financial statements and have therefore been classified as non-current assets within the balance sheet. Other amounts owed by other Group undertakings are included under amounts falling due within one year as they are repayable on demand, unsecured, and accumulate interest in a range between 0% and 4% plus IBOR. The expected credit losses arising from receivables are not considered to be significant. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 221 Notes to the Company financial statements for the year ended 31 December 2023 ![]() #### 13 Trade and other payables 2023 £m 2022 £m Current Amounts due to Group companies - 1,131.0 Other payables 202.1 4.5 202.1 1,135.5 Non-current Amounts due to Group companies 1,977.8 651.3 Other payables 433.8 – 2,411.6 651.3 Amounts owed to certain Group undertakings are included under amounts falling due within one year as they are repayable on demand, unsecured, and accumulate interest in a range between 0% and 4% plus IBOR. Other payables include the HMRC settlement liability (see Note 20 of the consolidated financial statements). #### 14 Interest-bearing loans and borrowings The Company has prepaid costs of £7.0m (2022: £5.0m) in respect of committed bank facilities. The Company is part of the revolving credit facility. As at 31 December 2023 there were £515.0m (2022: £515.0m) of committed bank facilities of which £295.0m (2022: £nil) were drawn down by the Company and £5.2m (2022: £52.1m) of facilities which have been utilised for letters of credit. Fees incurred by the Company in the year relating to the undrawn facility were £2.3m (2022: £3.2m). #### 15 Financial risk management objectives and policies The financial risk management objectives and policies applied by the Company are in line with those of the Group as disclosed in Note 25 of the consolidated financial statements. #### 16 Called-up share capital Details of the share capital of the Company are given in Note 28 of the consolidated financial statements. #### 17 Contingent liabilities and guarantees Contingent liabilities Refer to Note 33 of the Group 2023 Annual Report. Guarantees The Company has entered into financial guarantee contracts to guarantee indebtedness held on the balance sheets of Group undertakings amounting to £3,038.8m (2022: £2,689.1m). The Company has also guaranteed derivative agreements of Group undertakings, of which those in a net liability at the reporting date total £119.0m (2022: £102.5m). The company has payables of £613.5m (2022: £651.3m) to the group subsidiary which is the principal external borrower and £1,001.0m (2022: £496.0m) to the subsidiary with a net liability on its derivatives. Consequently, no additional liability has been recognised in respect of the financial guarantee contracts noted above. The likelihood of the above items being called upon is considered remote. #### 18 Related party transactions The Company has taken advantage of the exemption under paragraph 8(k) of FRS 101 not to disclose transactions with fellow wholly- owned subsidiaries. See Note 34 of the consolidated financial statements for disclosure of remuneration of key management personnel. #### 19 Subsequent events For details of subsequent events affecting the Company, see Note 36 of the consolidated financial statements. 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023222 Notes to the Company financial statements for the year ended 31 December 2023 ![]() Defi nition of terms AAMS Automated accounts management systems Adjusted fully diluted EPS cents Fully diluted earnings per share based on adjusted PBT Adjusted PBT Profit before exceptional items, amortisation associated with acquisition, dividends from previously sold businesses AML Anti-Money-Laundering ARC™ Advanced Responsibility and Care™, the Group’s safer betting and gaming technology programme B2B Business-to-business B2C Business-to-consumer BI Business intelligence CAGR Compound annual growth rate CC Constant currency CGUs Cash-generating units CMS Customer marketing services Constant currency basis Each month in the prior period re-translated at the current period’s exchange rate Contribution Revenue less betting taxes, payment service provider fees, software royalties, affiliate commissions, revenue share and marketing costs Contribution margin Contribution as a percentage of NGR CRM Customer relationship management CS Customer services DE&I Diversity, Equality and Inclusion DPA Deferred Prosecution Agreement the Group reached with the Crown Prosecution Service December 2023. DTR Disclosure and transparency rules EPS Earnings per share ESG Environmental, social and governance GGY Gross gaming revenue GHG Greenhouse gas GVC/GVC Holdings PLC The Group’s former name before becoming Entain plc in December 2021 H2GC H2 Gambling Capital – independent providers of betting and gaming market data and estimates IA Internal audit and risk management IAS International Accounting Standards IFRS International Financial Reporting Standards IOT Internet of things KPIs Key performance indicators KYC Know your customer – customer verification tools Ladbrokes Coral Ladbrokes Coral Group Plc LTIP Long-term incentive plan MIP Management incentive plan Net debt Cash and cash equivalents (including amounts recorded as assets in disposal groups classified asheld for sale), less customer liabilities less interest-bearing loans and borrowings Net Gaming Revenue (“NGR”) Revenue before deducting VAT NGR YTD Net Gaming Revenue in the year to date RET Research, education and treatment associated with responsible gambling Revenue Net Gaming Revenue less VAT (imposed by certain EU jurisdictions on either sports orgamingrevenue) RMG Real money gaming SASW Single Account Single Wallet functionality, enabling BetMGM customers with cross-state-access to their accounts. Sports Gross Win Margin Sports wagers less payouts Sports Gross Win Margin % Sports Gross Win Margin divided by Sports wagers Sports Net Gaming Revenue (“Sports NGR”) Sports Gross Win Margin less free bets and promotional bonuses Sports Wagers Gross bets placed by customers on sporting events TCFD Taskforce for Climate-related Financial Disclosures Underlying EBITDA Stated pre separately disclosed items 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023 223 Glossary Definition of terms ![]() #### Annual General Meeting The Company’s 2024 AGM will be held on Wednesday 24 April 2024 at 10:00am (BST) at etc. venues, 200 Aldersgate, London EC1A 4HD. Details of eachresolution to be considered at the meeting and voting instructions are in the Notice of Meeting which is available onthe Company’s website at www.entaingroup.com. Thevoting results of the 2024 AGM will be available on the Company’s website atwww.entaingroup.com shortly after the meeting. #### Communications Information about the Company, including financial results and details of the current share price, is available on the website, www.entaingroup.com. #### Shareholding contacts For any queries regarding your shareholding, please contact our Registrar, Link Asset Services. #### Share fraud warning Fraudsters use persuasive and high-pressure tactics to lure investors into scams. They may offer to sell shares that turn out to be worthless or non-existent, or to buy shares at an inflated price in return for an upfront payment. While high profits are promised, if you buyorsell shares in this way you will probably lose your money. Should you receive any unsolicited calls or documents to this effect, youare advised not to give out any personal details or to hand over any money without ensuring that the organisation is authorised bytheUK Financial Conduct Authority (“FCA”) and undertaking further research. If you are unsure or you think you have been targeted, you should report the organisation to the FCA. For further information, please visit the FCA’s website at www.fca.org.uk, email consumer.queries@fca.org.uk or call the FCA consumer helpline on 0800 111 6768 (freephone), 0300 500 8082 (from the UK) or +44 20 7066 1000 (if calling from outside the UK). 1 Overview 8 Strategic report 88 Governance 140 Financial statements Entain plc Annual Report 2023224 Shareholder Information ![]() CBP00 0190825 04183028 Paper: Claro silk Printed by Pureprint Group. This report has been printed on paper which is certified by the Forest Stewardship Council®. The paper is Elemental Chlorine Free (ECF) made at a mill with ISO 14001 environmental management system accreditation. This report was produced using the pureprint® environmental print technology, a guaranteed, low carbon, low waste, independently audited process that reduces the environmental impact of the printing process. Printed using vegetable oil based inks by a CarbonNeutral® printer certified to ISO 14001 environmental management system. Design and production by Radley Yeldar ry.com #### Company name Entain plc #### Company number 4685V #### Secretary and registeredoffice James Morris Entain plc 32 Athol Street Douglas Isle of Man IM1 1JB Telephone: +350 200 78700 www.entaingroup.com #### UK Corporate Office 25 Charterhouse Square London EC1M 6AE #### Registrar Link Market Services (Isle of Man) Limited PO Box 227 Peveril Buildings Peveril Square Douglas Isle of Man IM99 IRZ Trans fer Agent: Link Asset Services Central Square 29 Wellington Street Leeds LS1 4DL www.linkgroup.eu/get-in-touch/shareholders-in-uk-companies Telephone: 0371 664 0300 from the UK or +44 (0)371 664 0300 from outside the UK Email: shareholderenquiries@linkgroup.co.uk #### Auditors KPMG LLP EastWest Tollhouse Hill Nottingham NG1 5FS #### Legal advisors Freshfields Bruckhaus Deringer DQ Advocates #### Principal UK Bankers Barclays Bank PLC National Westminster Bank plc Future trading updates and financial calendar 17 April 2024 Q1 trading update 8 August 2024 Interim results Incorporated in the Isle of Man under number 4685V ![]() #### www.entaingroup.com