Evoke Group’s financial results for FY2025 tell a split narrative: operational momentum building beneath headline losses that sparked analyst scrutiny during Thursday’s delayed results call. CEO Per Widerström faced tough questions about share price erosion and mounting debt, but pushed back with evidence of underlying improvement in the metrics he argues matter most.

The Loss in Context

Profit after tax collapsed 149% to a £541 million loss. That figure dominated early analyst reaction, unsurprisingly. Yet the loss largely reflects one-off items rather than operational deterioration. An £8 million Austrian gaming tax reclassification and fresh Italian licensing fees accounted for significant portions of the damage. Strip these away, and the picture sharpens considerably.

Revenue inched forward 2% year-on-year to £1.78 billion, which Regulus Partners characterised as effectively negative when inflation is factored in across Evoke’s core markets. That critique has weight, frankly. But EBITDA surged 43% to £301 million, the metric Widerström leaned on repeatedly during the call to demonstrate operational progress.

UK Headwinds, International Tailwinds

The UK and Ireland division showed cracks. Revenue declined 3%, dragged down by a 12% drop in betting revenue despite flat stakes. Gaming revenue managed 2% growth, insufficient to offset the betting weakness. The Remote Gaming Duty hike, which took effect in April, has yet to materially impact performance, according to CFO Sean Wilkins, who expressed confidence the online business would weather the tax without dramatic margin pressure.

Like peers Entain and Bally’s, Evoke is betting on consolidation benefits. Management expects smaller operators to absorb the RGD increase disproportionately, creating space for scaled players to expand market share. Whether that thesis holds will become clear soon enough.

International markets offered brighter news. Revenue climbed 9%, buoyed by record performances in Italy and Denmark, where Widerström confirmed Evoke is gaining ground. The contrast tells you something important: UK stagnation against international growth underscores just how strategically vital geographic diversification has become.

Retail Contraction and Deleveraging

Widerström confirmed a pruning of Evoke’s retail estate. The segment declined 1% over the year, but the CEO framed closures as essential to long-term profitability and cash generation rather than forced retreat. The company retains over 1,000 shops, which he characterised as providing strong customer experiences amid challenging macro conditions affecting retail betting.

On debt, things look less encouraging. Net cash swung to minus £34 million from a positive £9 million position in 2024, while net debt inched up to £1.86 billion from £1.79 billion. Wilkins acknowledged disappointment in cash flow performance, though attributed some weakness to timing effects. The deleveraging narrative Widerström cited appears premature until net debt trends move decisively lower.

Strategic Silence

Widerström declined to address questions about Evoke’s ongoing strategic review, which centres on takeover discussions with Bally’s Intralot. A £225 million deal is expected to conclude in May. Bally’s CEO Robeson Reeves has publicly highlighted Evoke’s UK online and international operations as transformation opportunities, signalling confidence in extracting synergies from a combined operation.

For now, investors are left with mixed signals. Operational improvements and international momentum on one hand; UK malaise and debt that stubbornly refuses to decline on the other. The strategic review may resolve the uncertainty, but this set of results alone offers limited reassurance on shareholder value creation.