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Entain PLC
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Good day, and welcome to the Entain plc Third Quarter Trading Update 2021.At this time, I would like to turn the conference over to Jette Nygaard-Andersen. Please go ahead.
Good morning, everyone, and thank you for dialing in today. As always, I'm joined by our group CFO and Deputy CEO, Rob Wood; and our IR team.Before we get into the detail of the third quarter performance, I'd like to highlight that though there is a proposal from draftings in the market, today, we are not adding anything more to what we have previously announced. Therefore, we won't be taking any questions relating to that.Today's call is just about our trading performance. So turning to our announcement, I am very pleased to say that this has been another quarter where Entain has demonstrated the strength of our business and our custom offer. Our online business delivered its 23rd consecutive quarter of double-digit growth with NGR up 10% in the third quarter in constant currency.If we strip out Germany, as that continues to adjust to the new regulatory environment, online NGR was up 18% in constant currency. That is ahead of expectations. And while we've had help from margins our continued good performance is a credit to the hard work across all our people.Retail continues to recover. Volumes in the U.K. are a little over 90% of pre-COVID levels. In Europe, as reopenings were a little later, volumes are behind those in the U.K. Compared to Q3 last year, Retail delivered modest like-for-like NGR growth in the third quarter of 1% in constant currency.Overall, group NGR for the third quarter was up 6% in constant currency. Our business in the U.S. continues to grow from strength to strength, gaining share in both iGaming and sports-betting. In the markets in which we're live our market share is now 26% in the 3 months to August, which is up 2 percentage points from 24% in the second quarter.Just looking at the month of August in isolation, we can see that BetMGM is now #1 in the markets in which we operate. And so we can see that we are clearly starting to challenge for the #1 market position nationwide. We remain the preeminent iGaming operator across the U.S. with a 32% share.BetMGM has delivered another record performance with NGR in the third quarter expected to be over USD 200 million. This continued growth is driven by the Entain platform that encompasses our technology, digital marketing, capabilities, scale and flexibility.Our rapidly growing range of exclusive and branded games developed by our in-house studios that over 70% of our customers enjoy playing is also a competitive advantage that is helping to drive our growth. We are only 4 weeks into the new NFL season. So it is still early days. However, we've got off to a great start, and we are really pleased with our trading performance so far.Actives are strong. Bonusing has been high as expected but the early flurry has eased somewhat letting the real money players emerge. We are also really pleased with the cross-sell from football into our broader product offerings. As the NFL season kicked off, we launched our first national advertising campaign featuring Jamie Fox, which has helped to drive brand recognition across existing states where we operate as well as helping to build our brand in future markets as more states legalize.BetMGM has performed strongly when opening on day 1 of a new market launch. During the quarter, we went live on day 1 in 3 new states, all within a 9-day period, clearly demonstrating the flexibility and scalability of our platform. We are delighted to have added Arizona, South Dakota and Wyoming, taking us to 16 markets, and we remain on track to be live in 20 jurisdictions by the end of Q1 2022.Ahead of their launches, we were particularly excited by both Arizona and Wyoming due to our fantastic partnerships and market presence. Although it is early days since we went live, we are thrilled with both state's performance so far. Globally, we lead the industry on responsibility, not just in our approach to protecting customers but in how we are leveraging our technology to revolutionize player protection.We are making great progress with our Advanced Responsibility and Care program, or ARC. Trials are going well, and we are now rolling out real-time testing for our U.K. brands. ARC promises to unlock the pathway to predictive prevention rather than the reactive protection provided by much of the industry today. We continue to make progress across our sustainability charter during the third quarter with many further actions and initiatives.Examples include the Entain Foundation's renewed commitment to both the Pitching-In and SportsAid programs, whilst also partnering with the University of Technology in Berlin and Nexus Institute to encourage diversity in technology.In the U.S., the Entain Foundation is funding pioneering research with the University of Nevada in Las Vegas as well as launching a new app to support the American Gaming Association's responsible gaming initiative. We have also taken real action towards our carbon net zero target launching our big turnoff campaign internally, encouraging each and every employee to play their part in reducing our carbon emissions.Before I hand over to Rob to go through trading in a bit more detail, I'd like to briefly recap on the key messages from our Investor Day on 12th August when we outlined the fantastic opportunities ahead for Entain. Entain is a business that delivers secular growth. We have an incredible track record of both organic and nonorganic growth with a 3-year compound annual growth rate in online NGR of 14% at the end of Q3.Our addressable markets today have a scope to grow to over USD 160 billion, which will enable us to continue that growth and more than triple the size of our business, underpinning the secular growth of our business model. As we drive customer centricity and expand the experience for our customers to meet their changing needs of more content, more media and more social interaction, we increasingly leverage powerful flywheel effects, which broadens our customer funnel, improves loyalty and reduces acquisition costs.In addition to those flywheel benefits, we also leverage all aspects of our scale and the Entain platform, our industry-leading technology, our world-class talent and our focus on delivering a great experience for our customers. It is this platform that gives us competitive commercial advantages, which alongside leading market positions drive scale advantages, all of which enable us to continue to grow ahead of our markets. So our strategy is clear. Focus on our customers, grow in our existing markets, lead in the U.S., expand into new regulated markets and interactive entertainment and lean into these flywheel accelerators to drive significant value for shareholders.With that, I'll hand over to Rob.
Thanks, Jette, and good morning, everyone. As Jette has said, we're a business that continues to grow. We're growing in both our core business outside the U.S. and within the U.S. as well. Jette mentioned, BetMGM took over $200 million of revenue in Q3. That's over 5x more than the prior year.And our core online business delivered another quarter of double-digit growth in constant currency, bringing the count now to 23 consecutive quarters of double-digit growth. Now online growth was ahead of expectation at 10% in the quarter. But as you can see from the table, we benefited from a helping hand from sports margin.Our volume growth in Q3 -- so sports wages and gaming revenue, that was low single digits, so a touch ahead of expectation, but essentially in line. However, sports margin was up 1.3 percentage points due to strong match results in the quarter. Margin was 12.8%, so well ahead of our expected margin range of 11% to 12%. And the upside was purely results driven rather than anything structural.So Q3 upside versus our August guidance was a one-off, but it does compensate the temporary closure in the Netherlands, which is now going to impact Q4, and therefore, our full year guidance remains unchanged across all measures.Now aside from margin, there were really very few surprises with trading in Q3, but let me point out a few highlights. Firstly, actives growth and growth in FTDs both remained strong again in Q3 and well ahead of NGR growth in the quarter. We saw NGR growth in all our geographies, except Germany. And now that COVID impact is starting to wash out, it's pleasing to see that the 2-year online NGR growth in Q3 is up around 40% in constant currency.So online is clearly seeing permanent upside from the pandemic, particularly driven by accelerated channel shift from retail to online. Not surprisingly, Australia performed well in Q3, helped by retail closures during lockdowns and Brazil revenue nearly doubled in Q3, helped by a strong Copa America and reinforcing Sportingbet is the market leader in that territory.Even in the U.K., where growth was slower at single digits versus last year, on a 2-year basis, revenue was still up strongly and actives growth continues to be very encouraging in the U.K. as we deliver on our aim of broadening the appeal of our brands to recreational audiences.Growth in Italy remains strong online, particularly given shops are now back open, and we continue to see that omnichannel brands are outperforming the pure online operators. On the negative side, in Germany, our gaming revenues are stable, but they continue to be down very materially year-on-year due to the new regulatory regime and we look forward to more robust policing of the market in due course.We are at least approaching the anniversary of the tolerance policy now, and we remain excited by the long-term prospects for the German market. In fact, at the beginning of September, we announced a sponsorship agreement for Bwin with UEFA, which will help drive Bwin's presence in Germany as well as many other territories around the world.Just on retail briefly. And as Jette mentioned, volumes are within 10% of pre-COVID levels in the U.K., in particular, thanks to gaming machines. And whilst our European estates are further behind we remain on track to hit our target of getting to 10% down versus pre-COVID levels by the end of this year. And we estimate that, that 10% broadly equates to around 3 years of accelerated migration to online.So in summary from me, Q3 was another strong performance from the group. We're delighted to have delivered 1 last quarter of double-digit growth before we now inevitably hit pause on that run because in Q4, we'll be lapping the incredible 41% growth that we posted last year. And despite losing the Netherlands for Q4, we remain on track to hit our full year guidance from the interim, thanks in particular to that margin upside in Q3, and hence, our full year EBITDA guidance remains unchanged with a range of GBP 850 million to GBP 900 million.With that, I'd like to hand over the call for Q&A on our trading performance today.
[Operator Instructions] We will take our first question today from Ed Young of Morgan Stanley.
I've got 3, please, 2 on the U.S. and 1 on trading. Your comments around August are obviously very exciting and encouraging, competing for the #1 position in terms of market share that month.Flutters guided for U.S. revenues of between $1.8 billion and $2 billion this year and BetMGM's targets for $1 billion next year. If you're already in the same ballpark on market share, doesn't that imply that the JV is going to beat that target for TRD maybe not quite this year given the build you've said you've got for Q3, but pretty close. That seems encouraging on way you're analyzing.The second just on Arizona. You said the early indications that are encouraging given it's kind of an interesting sort of clean state, if you like, it would be interesting to just any further color you could give on that. And then the final one, just about clearly, margins came in, it sounds like very strongly in September. Just wondering if you could give us a bit of a look forward to Q4.You said in the past, you're absolutely not going to continue this 23 streak into Q4 given the comps. But given you're doing what you said 40% to your rate in Q3, you did 40-ish-percent in Q4 last year. but you are annualizing Germany. Is it possible you'll do positive growth in Q4? Or is it sort of undoubtedly going to be down year-on-year just to how to think about the Q4 growth rate.
Thanks. So let me take the 2 first on the U.S., and I'll hand you over to Rob for trading. So well, you nailed it, we're extremely pleased, of course, with the BetMGM performance, both when we look at the last 3 months to August, and of course, looking at the August flash data is certainly very pleasing.So that's really great to see. When it comes to the NGR and the NGR forecast, I mean, H1, we did USD 357 million and then Q3, just over USD 200 million. It's too early for us to start looking at a new forecast. So we stick to the guidance we've given on 2022 of over $1 billion in NGR.Now when it comes to Arizona. So we launched online sports-betting on day 1, 9th September, and we even had the opportunity to start preregister in the week before. So in time for NFL and we are very excited about that states. We have really encouraging early results, to Las Vegas sporting culture partnerships that we've done with the Cardinals and river hotel casinos and then a good and live present.And as you know, no historic DFS present there. So that really sets us up well and it has started well, both when it comes to bet count and number of FTDs and actives have really been fantastic. We also held our corner when it comes to bonusing and sign-up offers at these markets.So we continue to be really excited about Arizona, but it's also Wyoming as new states, which we also launched on day 1. So there's a number of new states where we see standout performance. But that's a little bit of early color of -- for Arizona. Rob, over to you on margins and trading?
So yes, firstly, we've said previously that now that we've had some structural benefits to our trading margin, I think we're now on an underlying basis in a range of 11% to 12%. If you look back at 2019, it was just over 11%. So I think we're now sort of 11% to 12% perhaps nearing 12%. Q3 was 12.8%, so clearly ahead of where we expected to be.Some really clear reasons for that. We started the quarter really well with the Euro's final. That was a 30% match for us. And then whilst the domestic football season had a bad opening weekend, September football margins were very good, particularly in the U.K. and Italy and racing was good throughout in Australia actually.So good onetime benefit in Q3. As we look ahead to Q4, I'd suggest we're back into that underlying range of 11% to 12%. So then to your question, is there any possibility of growth in Q4, I mean the answer is it would be a very tough. So our guidance was around 10% down in Q4 that we gave in the summer.And now we've lost the Netherlands. So that 10% becomes more like 13%. So even if Q3 had a little bit of volume upside, we're still looking at double-digit down. Remember, it's not just the lockdown benefit in Q4 that drove the 41% growth that we saw in Q4 last year. We also had a record margin at 13.6% in that quarter. So very tough on a year-on-year basis, but the 2-year CAGR will still look strong for Q4. And I think we're comfortable that we can deliver the guidance that we've suggested.It's also worth noting that if you take the run rates that we're seeing right now, on an NGR per day basis and then extrapolate that through Q4, you still get to those declined as per the guidance. So whether you look on a 2-year basis or you look on a run rate basis, we will be hitting pause on the run of consecutive quarter of double-digit growth next quarter.
We will take our next question from Gavin Kelleher of Goodbody.
Just a few from me. Just on the U.S. Jette, you mentioned bonusing has come down more recently to more reasonable levels. Could you just give us a bit of color was bonusing more aggressive at the start of the NFL than you would have expected and now it's kind of in line? That's my first question.My second question is on U.K. actives. Just where you think you're getting your actives from? Is it from online actives? Or is it a bit of retail migration in there? And where are they coming from U.K. actives? And then just finally on Holland, can you just give us some color on how you think the licensing process may play out for you over the next, let's say, 6 to 12 months?
Sure. And good morning, Gavin to you. Yes, that's right. I said in the beginning that the initial flurry around bonusing for NFL seems to have leveled off a bit. And I think when we look at the first -- at the first weeks of NFL, there were some pretty hefty bonusing and promotions in the market.So when we look across August, for example, fees were there with a risk free of USD 5,000 and our other competitors also had some pretty aggressive bonusing and promotion. But we are seeing it coming down a bit and remain confident that the promotional environment will normalize over time. And as we always say on these calls, that really the ones with the best products will be winners.But yes, so the initial somewhat aggressive bonusing, we see that coming down a bit. Rob, hand over to you for U.K. actives and the Netherlands.
Sure, absolutely. And if I could just add 1 more thought on bonusing in the U.S. is, of course, when you're at the start of the NFL season, there's a massive amount of acquisition bonusing. And therefore, as the season progresses, that ratio changes towards retention bonusing and therefore, as a percent of GGR, it comes down. So that's sort of another reason why we're down from the peak right at the beginning of September.Onto U.K., where are the actives coming from? So yes, retail. And obviously, we have an advantage by virtue of having the brand recognition and indeed, customers on thousands of high streets up and down the country. There's also an element of -- you had from the at our Capital Markets Day over the summer that we're doing more and more to reposition our brands towards the massive market.So a real sort of focused on recreational customers and driving volumes there, and that's paying dividends with the actives growth that we're seeing. Onto the Netherlands. So we expect to apply for our license later this year. We expect to get licensed hopefully, middle of next year. And we'll have to wait and see what the timing is. We don't know precisely yet, and we'll have to wait and see what other operators get licensed in the timing of that before we can have a real feel for how 2022 may play out. But I think the key message is we will be applying for our license by the end of this year and hope to be licensed by middle of next year.
Our next question will come from Joe Thomas of HSBC.
Three questions from me as well, if that's okay. Firstly, in the Q3 net revenue numbers, I'm just wondering if you could give us a bit more granularity, specifically, what's the contribution from M&A in there? I guess there is something in there. Secondly, you've sort of touched on this as well. But the reopening of retail, is that what is driving the slowdown in the performance of the online gaming segment? Or is it something else in there?And then finally, just a broader question on the U.S. I'm just wondering if there's any color you can give us on how your VIP split, however, you might want to segment that or define it looks for BetMGM versus perhaps the U.S. as a whole?
Yes, Joe. Let me start by the last one. No, we don't give any splits on the different segments here. I think what I can overall say and what is important from our side as we are really a long term -- have a long-term focusing on the business is, of course, the lifetime value over time and the average spend level.And as you might recall, when we get -- when we made the long-term prediction on where we saw the TAM going, we also had some assumptions in there in spent per adults, whether it was for online sports or iGaming. And the numbers that we are seeing now in our business basically support those trends that we have in our TAM assumptions.So lifetime value look good, and that's really the most important when we look to build a sustainable business going forward. Rob, I'll hand over to you for Q3 revenues and what's in there from M&A and also reopening of retail and potential online impact, please?
Sure. So contribution from M&A in Q3 is actually there are 5 points. So we guided towards 4 points of online NGR growth benefits, but in Q3 actuals there are 5. So that's hopefully the answer to that question.In terms of online gaming, impact of retail reopening, I think the first thing you need to do is look at 2-year growth to sort of take out the noise from last year. And if you look at over a 2-year basis, our growth is very good.CAGR is around 17%, and that growth is pretty equal between sports and gaming. So we're not seeing a particularly different pattern between the 2. But reason why you see a difference when you look year-on-year, is more around what happened last year. So I think the answer is Q2 last year, you remember we had a big uplift in gaming as sports -- live sport was postponed and then we hung on to a lot of that upside through Q3 and into Q4 in gaming.So therefore, the comps when you look year-on-year are just tougher in gaming. On an underlying basis, I don't think there's a particular difference between the 2. Does that help, Joe?
Yes, that's great.
[Operator Instructions] Our next question will come from Kiranjot Grewal of Bank of America.
Three questions from me. Firstly, on Germany, could you just update us on your expectations? Do you expect many of the states will start to switch on online casino anytime soon? Secondly, on European retail, that's continuing to lag the U.K. retail piece. Is there any particular reason for this? And then just lastly, you mentioned a strong performance in Australia. Could you offer some more color around this? Is it driven by something in particular for Entain or is it broader strength you're seeing in the market?
And good morning to you too. I'll hand you over to Rob for all 3 of them: Germany, EU retail and also Australia trading.
Okay. Let me have a go at those. So Germany, what we're hearing from the ground is that perhaps states that represent around half the country, the half of the population are looking at legislating some form of online gaming. So that's sort of our target if you like.Fair to say, though, within that, some of those lenders may allocate the license to state monopolies, for instance. So I wouldn't suggest that half of the population will ultimately be available to us, but that's sort of the size of the prize.On retail, yes, true to say that the European estates are lagging the U.K. at the moment. So there's a couple of reasons for that. One is that if I look at the U.K. the gaming part of the business is outperforming the sports part of the business, and we don't have gaming machines in European retail. So that's part of it, the mix.Another part is that if you look in European retail, there are still COVID restrictions impacting our trading. For instance, in Italy, they have a green part where you have to prove vaccination. And as I understand it, only around 70% of people have those. So clearly, that's impacting footfall. I think in the Republic of Ireland, they still have the rule of 6.So there are some sort of structural COVID-related reasons why European retail is behind as well as opening later as well. But we -- having reviewed it very recently with the MDs those businesses, we're still confident of the target of getting to within 10% of pre-COVID by year-end. and paying particular attention to what happens to COVID restrictions.So I think that's the answer to that question. In Australia, yet a really good growth in Q3. Clearly, lockdowns are a driver of that, we saw that last time around. And Australia now sort of easing out of lockdown. So I'm sure there will be some lessening of growth. Clearly, therefore, retail migration is a key part of that as well as not having so many ways of spending discretionary income.Is it market growth? Yes, I think it is, albeit our market shares are increasing, particularly as Tabcorp is underperforming in the online environment at the moment. So a very good market share growth and market growth, I think, is the answer in Australia at the moment.
We will take our next question from James Rowland Clark of Barclays.
I've got 3 questions, please. The first is on U.K. regulation. Would you mind perhaps updating us as to your expectations on the white paper, given the change of personnel at DCMS? And any early discussions you've had with them and you also have a sense of where the new Chair and new Head feel or what they feel about the industry at the moment?Secondly, on the outlook, I think consensus has in $1.07 billion for 2022 EBITDA. Are you comfortable with this level just given the headwind that potentially Dutch licensing represents for next year? And then finally, on U.K. Retail, do you have any sense as to the level of capacity exits from the market post COVID.
So let me take the first one. I think the 2 last one was in your bucket, Rob. But yes, I'll start off with the first one, and then we'll get to the 2 other questions.And your first question was around U.K. regulatory and the white paper. So I think that the main update since we spoke last is probably that the white paper has been delayed and given the reshuffle at DCMS It could be even later. So I think what I said on the last call that we had that it was delayed into autumn 2021. And it now looks like that it could even be delayed further and potentially into Q1 2022.I mean our discussion so far has been that they are referring to the publication timing to be in due course and that kind of supports that are probably a delay coming from there, which basically means that any impact on legislation will be into 2022 (sic) [ 2021 ] and probably some time into 2022. And we remained, as I said a couple of times, cautiously optimistic around the approach being taken, as I understand the work has been ongoing for some time and is quite advanced.And we keep getting the same feedback that DCMS will take a holistic approach to the gambling reform and make sure that they deliver a coherent package. And we continue to have discussions and we have many discussions around our technology. We get good feedback around ARC. So we will continue to work also with the new ministers and keep them updated on the findings from the right trials that we are having in the U.K. I think that's the update I can give on the white paper. Rob, can I hand over to you? I mean, the third question was around U.K. retail. Did you take a note on the second one?
Yes. The second one was around EBITDA expectations for 2022. So it's too early for us to be guiding on 2022, James. I think I can say that I was happy with where consensus was prior to the Netherlands announcement. So now we do need to understand what impact the Netherlands may have on next year.And as I mentioned earlier on in this call, it's too early to say because we do need to see what time of year will get licensed, which competitors will get licensed and when they get licensed to really understand what our sort of rebuild strategy will look like and therefore, where we can exit the year at. So I think to answer your question, we were happy prior to Netherlands, and we'll be guiding more fully on 2022 in March.And then the last question, I think, was around capacity exits in retail post COVID. I think the things you appreciate with retail is there's always a bit of a lag because very often, whilst the profit -- whilst the shop might have tipped to being marginally unprofitable, you still have the lease, and therefore, it can be more beneficial to stay open in the small lease -- small loss rather than close and pick up the cost of the lease.So not a huge amount of activity, I would suggest yet, but that's not necessarily a surprise. And we haven't seen any sort of any of the large independents or any of the major operators take any significant moves that the material moves really followed the implementation of the Triennial Review in 2019. But that's a watching brief. And undoubtedly, there will be continued retail closures over the next couple of years in the U.K.
We will take our next question from [ Joe Staff ] of .
I had 2 questions, please. First one was I wanted to see if you could share any commentary maybe on user growth that you saw in BetMGM in the third quarter and/or September in particular. And then the second question I wanted to ask, maybe is just me being in the States, to clarify, maybe the U.K. takeover rules, is the deadline of March -- I'm sorry, October 19, is that a decision that you have at Entain to be able to move that or not?
Thanks. Good morning, Joe. And I think you're up early. So thank you for dialing in. So listen, as I said in my introduction, we're really not going to talk about the DraftKings' proposal, and I don't really have anything to add to the announcements that we sent out on 21st of September following the leak.So as we flagged, we, the board and our advisers, we are now carefully considering the proposal. And that includes a number of matters, including structure and value and then we'll come back to the market as and when appropriate. So sorry for not being more informative on that. As I'm sure you can appreciate.And then when it comes to your questions around actives and user growth. Well, it is very early days, but you've heard me speak about Arizona, which we are very excited about. Arizona was the state with the highest actives in September. And overall, our actives are 5x compared to last year. And September also so rigid high for iGaming. So very, very encouraging numbers coming from BetMGM when it comes to actives and user growth.
It appears there are no further questions at this time. I would like to hand the conference back to Jette Nygaard-Andersen. Apologies. We have just had a late joiner to the queue, Simon Davies from Deutsche Bank.
Apologies. I thought I was wide into the process. But a couple from me, please. First, many congratulations on 23 consecutive quarters of growth. Unfortunately, 24th quarter looks like an insurmountable hurdle. But do you think you can return to double-digit growth in the first quarter next year. Obviously, by that stage, you will have lapped the impact of tightening in Germany, which should make the comps a bit easier.Secondly, you talked about the ramp-up in the level of marketing spend around the new NFL season. Has that been greater than you had anticipated? And if you had to respond more than you would have expected in terms of marketing and bonusing spend?
Good. Thank you, and good morning to you also, Simon. And yes, let me just -- I'll take the U.S. question and then hand you over to Rob. But I'll just start by saying about our Q3 results.I mean, we are, as you can understand, really pleased with them. And for me, it's really a testament of the strength of our platform. And we see this strong result as success with out of testament on a sustainable and consistent diversified growth platform that we have. So very pleased with that. And in a second, I'll hand you over to Rob to talk about what we then think about Q1 in 2022.Now when it comes to the NFL season, I think it's -- as every time there's sports kick off, we also saw it in March madness. We have increased bonusing and promotion. And we are -- we remain flexible. We put the spend where it makes no sense. One thing I would maybe stress is that this was the first time that we started doing national advertising. So that has been a first for us.And we've said that we were not going to do that until we had a reach that basically made that a good way forward for us. So we started that have great success with our Jamie Fox campaign. So I think, overall, we're quite happy with what we are seeing and the bonusing has leveled off. And in that sense, I think it was more or less as expected when you go into the first NFL season after the market has really come off with so many states now being online and for our 16 states that we are live in. Rob, over to you on the last question on 2022, Q1.
So can we achieve double-digit growth in Q1 next year? I think it's going to be very difficult. We have lapped Germany, that is true, and we've now lost Netherlands. But I think the key point though is analyzing against lockdowns in Q1 in the prior year.You've heard me talk previously about analysis suggests that we keep something like 1/3 of the upside that we get during lockdowns, but clearly, that means 2/3 does not stay with us because it goes back to retail or in other forms of discretionary spend. So when you're lapping lockdowns, I think, to expect double-digit growth on top of that, it's just not going to happen.The other thing to think about is, when I look at the NGR per actives -- sorry, NGR per day that we achieved in the quarter that we're about to lap in Q4 last year, it was very similar in Q1. So in other words, the very tough comp that we're about to face in Q4, and it's the same sort of numbers that we're going up against in Q1. So I think it will be something of a stretch timing.
Stretch is good.
Okay. And as always, if you look at 2-year growth, you'll see that we would still expect really quite strong numbers on a 2-year basis. It's just we're going to have this period where we're annualizing its lockeddowns, and we need to look for that.
We will take our next question from Michael Mitchell of Davy.
Just 1 left from my side, if I could. And just if I can ask you to provide a bit more color on the U.K. online market post lockdown. I appreciate you've touched on it through the last 45 minutes. But first of all, I mean, have activity levels now settled, particularly with retail back to within 10% pre-COVID level. So do we have a settled picture of what the U.K. online market looks like now post lockdown? And if so, Rob, I wonder if you could just kind of help us a little bit more with your comments about the 2-year growth rate being up strongly. I mean kind of what is the rough pace of growth in the U.K. on the market on a 2-year basis that we should be thinking about over the coming period of time.
Rob, I think I'll let you ask that one -- let you answer that one.
Okay. So 2-year growth rate. So firstly, the quarter just gone. We did around 35% 2-year growth in real currency and it is near 40% in constant currency. If I look at the U.K. in isolation, it's more like 25%. So clearly, a little lower, but nonetheless, 25% growth in the U.K. in a market that was ordinarily expected to do sort of high single digits is a strong performance for us.I think as we look forward, our real focus in the U.K. is expanding our appeal to more recreational audiences. And our hope is that all the terrific growth that we've seen in actives and FTDs during this -- during the last 12 months or so, will therefore play through into continued NGR growth in 2022 as well. Obviously, we need to wait and see what, if any, impact comes out of the Gambling Act review.But the -- we would still maintain that the prospects of growth in the U.K. are strong, not just for the market, but certainly for outperforming the market as well, not least because we have the retail estate, which continues despite COVID, despite everything that's happened to continue to drive traffic to our online platforms. So I think the prognosis for the U.K. continues to be strong.
There are no further questions at this time. I will now turn the conference back to Jette Nygaard-Andersen for any additional or closing remarks.
Thank you, and thank you all for dialing in and listening in today. Intent continues to go from strength to strength. We have a fantastic industry-leading platform that continues to drive growth, both in our core business and in the U.S. through BetMGM, as you've heard this morning, but it also provides a very strong base to drive further growth as we deliver on the strategic agenda that we set out on the 12th of August.I also hope that you can join us for our ESG and sustainability events on tenth of November. And in the meantime, if you have any other questions, do get in touch with David and the IR team. Thank you, and goodbye.