Regulatory challenges to see Entain take a £40m hit in UK and overseas

On an underlying basis, it saw earnings edge 1 per cent higher to £1.01bn last year.

Entain warned that earnings over the year ahead will be affected by around £40m due to regulatory changes in the UK and the Netherlands, and said it will provide a new profit forecast for the year in August.

Shares in the group tumbled 6 per cent on Thursday morning after the announcement.

It comes after a difficult recent time for Entain, whose former boss, Jette Nygaard-Andersen, stepped down suddenly in December just weeks after the legal settlement and sports results that went against the bookmaker.

Ms Nygaard-Andersen has been replaced by non-executive director Stella David on an interim basis until a permanent successor is appointed.

Entain has also been under pressure from activist investors.

In January, it revealed it had appointed activist investor Ricky Sandler – who has previously called for the group to sell off some or all of its stake in a major US joint venture – to its board.

Mr Sandler sits on its capital allocation committee as well as its people and governance committee.

The company said it will also work with his outfit, Eminence Capital, to find another director who can sit on Entain’s board.

Entain said in its full-year results that a safer gambling crackdown in the UK will affect betting in the short term, with limits on online slot games among new measures.

It said: “In the UK, we are delighted to see the long-awaited regulatory review draw closer to conclusion.

“We look forward to the implementation of stake caps on online slot games and a potential agreement on uniform safer gambling measures across the market.

“While we expect these changes to be a positive for Entain in the long run, we may see continued player disruption over the short term.”

Regulatory changes in the Netherlands are also set to weigh on the group as the country proposes tighter deposit limits from the second quarter.

Entain added that it is pressing ahead with plans to simplify the business and make annual savings of £70m by 2025.

Interim boss Ms David said: “2023 presented a number of challenges for the group, both industry-wide and Entain-specific.

“We have started the new financial year with a clear plan to accelerate our operational strategy, and are making pleasing progress across a range of initiatives to re-focus our market portfolio, prioritise organic growth, drive our share in the US, and expand our margins.”