Robert Chvátal, the CEO of Allwyn, has expressed strong support for Phil Walker, the company's new CEO for the UK division, describing him as the "right leader" despite criticisms from some politicians regarding Walker's previous tenure at William Hill. During Allwyn's earnings call on Thursday, which followed the company's Q2 financial results, Chvátal stated that Walker is ideally suited to guide the business into its next phase after completing a significant retail and digital transformation.
Chvátal emphasized Walker's familiarity with the UK market and the digital landscape, asserting, "We believe he is the right leader for the next phase after we successfully do both the retail and digital cutover, one of the biggest in the industry." He acknowledged the challenges ahead but highlighted the potential non-financial benefits for Allwyn in navigating such transitions successfully, particularly when it comes to future lottery tenders.
The announcement of Walker's appointment came shortly after Allwyn UK revealed the departure of Andria Vidler. Walker is set to assume the role temporarily until a permanent successor is appointed.
Recently, MPs Dawn Butler and Sir Iain Duncan Smith expressed their concerns regarding Walker's hiring by writing to the Gambling Commission. Their letter referenced a sanction issued by the Commission due to "widespread and alarming" failures in anti-money laundering and counter-terrorism financing practices during Walker’s time at William Hill in 2024. Walker received a formal warning in May of that year, as investigators found he had not ensured compliance among several William Hill businesses with their licensing requirements.
In reporting its Q2 results, Allwyn presented mixed outcomes from its UK operations. The company noted a slight increase in net revenue of 2%, reaching €236 million ($274.8 million), while profitability improved significantly following the completion of its National Lottery technology transformation, with adjusted EBITDA soaring from €6 million to €23 million.
Chvátal commented that although he expects UK revenue for the fiscal year 2026 to fall below initial projections, Allwyn remains optimistic about restoring growth. He pointed out rising competition from alternative prize draws, indicating, "This technology transformation has established solid foundations for future growth. We have begun innovating both the existing Lotto business and a new game called Powerball."
He acknowledged the necessity to ramp up efforts against the growing number of less regulated lottery-like propositions in the UK market.
Allwyn also reported a strong performance from Betano, a global betting brand in which it holds a 36.75% stake. Betano achieved a 26% increase in revenue on a constant currency basis during Q2, positioning itself as the leader in Brazil, amidst declines reported by several competitors.
CFO Ken Morton noted that Betano's growth underscores its robust standing in a substantial market. He stated, "Betano’s positioning in that market has continued to go from strength to strength," further highlighting the diversified nature of the business.
Chvátal reflected on the advantages of market leadership, stating, "Being a market leader allows you to weather challenging conditions better. That’s exactly what happened to Betano. It was beneficial that they were there relatively early in the market."
Looking ahead, Morton predicts that Betano will convert EBITDA into net income at a rate similar to, or slightly higher than, previous quarters after a less than normal Q2 performance.
