Evoke withdraws medium-term targets after Budget tax changes

(Sharecast News) - Evoke withdrew its medium-term financial targets on Wednesday in response to the gambling tax rises announced in the Budget, which it expects to increase duty costs by about £125m to £135m on annualised basis once fully implemented. In the Budget earlier, Chancellor Reeves said that from April 2026, there will be an increase in remote gaming duty from 21% to 40% and the abolition of bingo duty from its current 10% rate.

Reeves also said that from April 2027, a new rate of general betting duty for remote betting will be introduced at 25%. This will exclude self-service betting terminals, spread betting, pool bets, and horseracing.

In addition, the government announced a freeze in casino gaming duty bands in 2026-27, with the usual retail price index uprating thereafter.

In a statement after the close of markets, Evoke said that prior to any mitigating actions, changes in tax rates would increase duty costs by up to about £135m on an annualised basis once fully implemented from April 2027, with approximately £80m of the pre-mitigation impact arising in FY26 given the timeframe for implementation.

Evoke - formerly 888 Holdings - expects to be able to mitigate about 50% of the impact from higher duties over the medium-term through supplier savings, reduced marketing, retail store closures, operating cost savings, and potential changes to the customer proposition.

"As one of the leading and largest operators in the UK market, the Group is better positioned than many to navigate this increase and, over time, potentially stands to benefit from further consolidation of market share with the likely exit of smaller operators due to the rising costs," it said.

However, the group withdrew its medium-term financial targets "as it evaluates its future investment plans as a result of these significant duty changes".

Chief executive Per Widerström said: "The decision today by the UK government to substantially raise taxes is highly damaging for the economy and consumers. As an industry, we have consistently warned of the significant impact on jobs, investment in the UK, and player protection that these changes would have, yet sadly the Government has chosen not to listen. These proposals are ill-thought-through, counterproductive, and highly damaging. It is clear these changes will significantly harm businesses, employees, and customers.

"We will begin immediately on executing our mitigation plans, which involve a significant reduction in investment into the UK, and, very regrettably, the likely need for thousands of jobs to be cut up and down the country. As a result of the actions now required, these tax changes will reduce the overall level of tax the regulated industry pays in the UK, and more importantly it will have a significant negative impact on player protection as these changes will incentivise activity moving to the illegal and dangerous black-market."