Entain (ENT.L), the owner of Ladbrokes and Sportingbet, has cut its online sales outlook following a sudden ban on online gambling in Brazil.
Brazilian President Luiz Inacio Lula da Silva signed an order on Friday that “prohibits all sports betting and online casinos,” catching the industry off guard.
The move comes as Brazilian authorities intensify efforts to address surging levels of gambling addiction sweeping across the country.
Entain said it was “disappointed” with the decision and criticised the government for acting without industry input before implementing the sweeping restriction.
The company stated the announcement was made “without consultation of industry stakeholders regarding its significant adverse consequences,” adding to frustration within the sector.
The FTSE 250 company said it would comply with the provisional ban, which must secure congressional approval within 120 days to become permanent law.
Entain downgraded its full-year online net gaming revenues growth outlook to between 4% and 6% as a direct result of the Brazilian ban.
The group now expects underlying earnings to land at the lower end of its guidance range, which sits between £910 million and £960 million.
Brazil had been expected to account for around 5% of Entain’s total online net gaming revenues this year, though its earnings contribution was forecast to be “modest” due to the “challenging and highly competitive operating environment” in the country.
The Brazil ban compounds an already difficult period for the London-listed gambling group, which has been navigating significant headwinds in its home market.
Earlier this year, Entain announced around 400 job cuts worldwide, citing increased gambling taxes in the UK and warning that further reductions could follow.
The group, which also owns Coral, launched a consultation that could eliminate a fifth of its 2,000-strong customer care workforce across 11 countries, including the UK.
Entain framed the potential redundancies as part of ongoing efforts to “address the impact of the UK’s increased gambling taxes,” though it did not specify how many UK roles are at risk.
The consultation process is set to conclude by November, at which point the full scale of domestic job losses is expected to become clearer.
