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Evoke shares sank as much as 10 per cent on Tuesday after the owner of William Hill and 888 said full-year profits would fall short of previous guidance.
In a trading update on Tuesday, the gambling group said revenues for the three months to December 31 were about £464mn, down 3 per cent on the same period in 2024.
That decline, which the company blamed on more favourable sporting results in the same period in 2024, meant full-year revenues would be £1.78bn — below analyst expectations of £1.84bn.
Adjusted profits before tax, interest and other charges are now expected to be between £355mn and £360mn — about 14 per cent higher year on year but lower than an earlier forecast of more than £362mn.
Evoke was hit hard by the steep tax rises on online betting announced in November’s Budget. It did not provide forward-looking financial guidance while it carries out a strategic review announced last month, which could include a potential sale of the group or some business units.
Chief executive Per Widerström said on Tuesday that the company had “moved quickly and decisively” to cut costs, including closing some stores. He said Evoke would update shareholders on its updated strategic plan in due course.
Shares jumped last week following reports that casino chain Bally’s and British bookmaker Betfred were weighing deals for Evoke’s retail estate.
Broker Peel Hunt downgraded Evoke shares from “buy” to “under review” on Tuesday, as analyst Ivor Jones warned that the company needed “material change”.
Shares were trading at about 25p on Tuesday, valuing Evoke at just £132mn.
The stock has tumbled since the chancellor’s plans to raise taxes on the UK gambling sector were first reported in August last year and is down more than 90 per cent over the past five years.
In a profit warning released on the evening of the Budget, Evoke said that, without any mitigation measures, higher taxes would increase its costs by between £125mn and £135mn from 2027.
The company, which makes two-thirds of its revenues in the UK, was hit harder than its larger and more geographically diversified peers such as Flutter and Entain. Investors concluded that those companies could more easily absorb the new taxes and ultimately increase their market share.
Evoke was already struggling ahead of the Budget and reported a pre-tax loss of £168.8mn for 2024.
