Robert Chvátal, CEO of Allwyn, has endorsed Phil Walker as the new head of the company’s UK operations, despite facing criticism from some politicians regarding Walker’s previous role at William Hill. During a post-Q2 earnings call, Chvátal expressed confidence in Walker's ability to steer the company into its next chapter following the successful completion of a significant overhaul in both retail and digital sectors.
"Phil Walker is well positioned to lead us through this phase," Chvátal stated, acknowledging Walker's familiarity with the UK market and the digital sphere. He stressed the importance of this transition for Allwyn’s future in bidding for lottery tenders, indicating it presents invaluable experience that could yield non-financial benefits as well.
Last week, Allwyn UK announced the departure of Andria Vidler, with Walker stepping in as interim CEO while a permanent replacement is sought. However, concerns have been raised by MPs Dawn Butler and Sir Iain Duncan Smith, who recently reached out to the Gambling Commission. They voiced their unease about Walker’s appointment, referencing a sanction from 2024 due to serious anti-money laundering (AML) and counter-terrorism financing failures at William Hill, where Walker was formally warned after it was identified that he had not taken adequate measures to ensure compliance with licensing conditions.
In its Q2 report, Allwyn provided mixed updates about its UK operations. Although net revenue increased by a modest 2% to €236 million ($274.8 million), profitability saw a significant boost, with adjusted EBITDA rising dramatically from €6 million to €23 million following the completion of their technology transformation for the National Lottery. Chvátal mentioned that while projections for the UK revenue in Allwyn’s FY 26 may not meet earlier expectations, he remains optimistic about the market's future.
He also pointed out the intensifying competition from prize draws, remarking on the establishment of a strong foundation through their tech transformation, which positions them well for future growth. As a result, Allwyn has started innovating on their existing Lotto offerings and introduced a new game called Powerball. He acknowledged the UK market's evolution and the emergence of lottery-like propositions that are less regulated, underscoring the need for Allwyn to intensify its efforts.
In terms of international performance, Allwyn holds a 36.75% stake in the betting brand Betano, which reported a remarkable 26% rise in revenue during Q2 when adjusted for constant currency. Ken Morton, CFO of Allwyn, noted that Betano is currently the top player in the Brazilian market, where many competitors have faced declines. He commented on the brand's leading status, emphasizing its growth trajectory and solid positioning in Brazil and other international markets.
Chvátal also discussed the benefits of being a leader in the market, stating that Betano’s established presence has enabled it to better adapt to challenging circumstances. "Being a market leader helps reaffirm your position and weather headwinds more effectively," he remarked. Morton anticipates that Betano will convert EBITDA to net income at a comparable or slightly improved rate in the upcoming quarters after a softer second quarter.
