Entain sets aside A$100m for potential AUSTRAC penalty
1. Entain sets A$100m AUSTRAC provision
During the earnings call, Entain CEO Stella David addressed investor concerns upfront about the ongoing legal issues with AUSTRAC, Australia’s financial crime watchdog.
The company has booked a A$100m provision in its accounts related to a possible penalty, but David emphasised that this figure is purely accounting-driven and does not represent a confirmed penalty amount.
“There is no certainty that the quantum reflects what might be a potential penalty. We are currently in early stage mediation, and there is no further update until those discussions have concluded,” David said.
In December last year, the Australian government’s financial crime watchdog took the company to Federal Court, alleging “serious non-compliance with Australia’s money laundering laws.”
2. Entain builds tech platform with white label potential
Entain’s CTO Satty Bhens detailed how a recent reorganisation of the firm’s product and tech teams has accelerated innovation and sharpened market focus, including the creation of locally based squads dedicated to specific markets.
This new structure enables faster product improvements, with over 1,000 code updates deployed in July alone, powered by a modernised, API-first platform and AI-driven automation.
Crucially, Bhens highlighted that Entain’s modular platform is designed for flexibility and scalability, built on four independent pillars — gaming, sports betting, marketing, and player accounts — that can evolve separately without dependencies.
This architecture supports white labelling and even cloning, meaning Entain could license its technology to third parties or run parts of the business independently if desired.
While CEO David clarified that Entain currently has no plans to actively pursue white labelling, she said the company is deliberately building “better optionalities for the future” so it can quickly adapt and seize strategic opportunities when the time is right.
3. Entain cautious but confident on UK tax risks
Both David and Entain CFO Rob Wood also shared clear perspectives on the company’s approach to UK tax risk.
David emphasised Entain’s status as a top 20 UK taxpayer, saying: “We should be proud of the success that this company generates, not only here in the UK, but in many other markets.”
She urged caution around media speculation on potential tax hikes, warning of the risk of pushing players to the unregulated black market.
David also highlighted the importance of protecting high street jobs: “We have 14,000 people in the UK. We’ve got a very large presence on the high street. Protecting the high street is also very important.”
She pointed to the recent experience in the Netherlands as a cautionary tale, saying: “When the tax rate went up significantly in January 2025… it hasn’t worked. I think people should look at the maths and be very careful about where we go forward.”
“I also think it’s reassuring that that despite everything that you read, the Treasury do understand the concept of the black market,” Wood added.
“We continue to encourage government and the Gambling Commission to really focus on the black market… That would be our advice on how to proceed.”
4. Regulatory pressures still weigh on Netherlands online revenues
Entain reported significant regulatory headwinds in both the Netherlands and Belgium, with online net gaming revenue (NGR) down sharply.
Belgium’s NGR fell 12% on a constant currency basis, while the Netherlands saw a steeper 29% decline.
David described the Dutch market as “very challenging” due to heightened regulation and tax increases impacting performance.
However, she noted that results have actually been “ahead of where we thought we would be” and expressed optimism that the market will “normalise itself out quite quickly” as the company begins to lap some of the most negative impacts.
https://next.io/news/features/entain-sets-aside-100m-potential-austrac-penalty/