Entain, the owner of prominent gambling brands including Ladbrokes, Coral, and Foxy Bingo, is set to be removed from the FTSE 100 index. This move comes as the company grapples with significantly higher gambling taxes imposed by the UK government.
Shares in Entain have experienced a substantial decline, falling 40% over the past year. This performance is largely attributed to recent fiscal measures introduced by Chancellor Rachel Reeves. In her latest Budget, taxes on remote gaming, which encompasses online casinos and slots, were increased from 21% to 40%. Additionally, the levy on online sports betting has been raised from 15% to 25%.
Entain has stated that these tax increases are projected to cost the company approximately £150 million in the current year and an additional £100 million in 2027. In response to the challenging financial landscape, the company has already closed 70 of its shops and has urged the government to reconsider further tax escalations to prevent additional closures.
Entain's departure from the FTSE 100 will see it replaced by budget airline easyJet and North Sea oil and gas operator Ithaca Energy. EasyJet's inclusion follows a £5.7 billion deal, while Ithaca Energy has benefited from elevated oil and gas prices.
Separately, housebuilder Persimmon is also being removed from the FTSE 100. The company has been impacted by a subdued housing market, influenced by rising mortgage rates and a general dip in consumer confidence, factors exacerbated by the ongoing conflict in the Middle East. Troubled luxury car manufacturer Aston Martin has also been relegated, exiting the FTSE 250 index.
The quarterly adjustments to the FTSE indices are scheduled to take effect on September 21.