DAVY VIEW

Brazilian President Lula issued an executive order on September 25th that essentially closes the online sector in Brazil with immediate effect. The measure requires approval from Congress within 120 days to remain valid, so there appears to be scope for it to be annulled or amended. Entain has updated its guidance ranges as a result. This is another frustrating situation for the online industry. Brazil has had a bumpy start since regulation, and most operators’ revenues were down in H126 due to changes in regulation. As Brazil was still in investment mode, the profit impacts are relatively modest; however, it does potentially remove a region with attractive long-term growth prospects.