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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Good morning, everyone, and thanks for joining us today for 888's 2022 Full Year Results Presentation. I'm John Mendelson. I have served on the Board of 888 for 2.5 years and for the last two years as Non-Executive Chair. At the end of January, I became the Executive Chair taking on the responsibilities of the day-to-day leadership of the company, while the Board is running a process to appoint a permanent Chief Executive Officer. I will comment further on that process shortly.
Now slide two outlines the agenda for today's call. I will be providing an overview of key developments before handing over to our Chief Financial Officer and Chief Strategy Officer to take you through our financial and strategic progress in more detail. We will then take your questions.
Now slide four affirms our key priorities as a Board, recruiting and retaining an outstanding management team, a clear focus on driving ESG considerations to sustainability throughout the business and driving the execution of our plan articulated at our Capital Markets Day. Now we have a very strong operational management team in place and the Board priorities the appointment of a permanent Chief Executive Officer.
We have been pleased with the depth and caliber of the candidates that we're engaging with and are making good progress with our search. This is a business with the platform to become a top three global operator. We are committed to appointing a Chief Executive Officer that will lead the team to deliver the potential of this business. The focus of the Board is, therefore, making the right selection rather than just making a quick selection and we intend to make an announcement of the new Chief Executive Officer in the coming months.
The second priority is ESG and sustainability. Vaughan will provide a wider update on our progress during 2022. But I would like to address the critical area of player safety in light of recent announcements regarding the settlement with the United Kingdom Gambling Commission and our internal investigation in relation to the Middle East. On the 28th of March, the U.K. Gambling Commission amounts to GBP19 million settlement agreement with William Hill in relation to historic player safety failings.
The failings occurred before we own William Hill, so we could have had no bearing on the areas that were being investigated. The team had already taken significant remedial action, and we have further reinforced this following the acquisition. As a result, the business is now in a far stronger position from a compliance perspective. And with the improvement actions having already been taken, the announcement of the settlement has no further impact on our operations or revenue expectations in the U.K.
The settlement does not fall under any of the indemnity revisions we had with Caesars, so we will be paying the full amount. Having said that, the amount was in line with the range of expectations we had when we negotiated the GBP250 million reduction in consideration and it was fully provided for.
These historic failings are not acceptable to me or the Board and the entire group shares the commitment to improve compliance standards across the industry. We will continue to work collaboratively with the regulator and other stakeholders to achieve this. Finally, the Board's third priority is execution. We outlined clear plans to deliver shareholder value at our Capital Markets Day and in my capacity as Executive Chair and supported by the rest of the Board, we continue to work with our wider executive management team to deliver the potential of this business. These elements have my and the team's relentless attention and we remain on course with the plans we have outlined.
Turning to slide five. I would like to address the recent action that the Board took to suspend all VIP accounts in the Middle East as well as the swift actions we have taken to rectify the situation. We have invested significantly in our compliance team with the drive for higher standards headed by our new Chief Risk Officer, Harinder Gill, who joined the group last summer.
The compliance team has new personnel procedures and policies and our charge with the mission to drive higher standards across all areas of risk and safer gambling. And as a board and leadership team, we are fully committed to this. An internal team identified failures where our safer gambling policies were not being effectively applied. Further investigations identified similar accounts, which were later confirm to be a broader issue within a specific cohort of players namely our VIPs in the Middle East.
The Board once fully briefed took the prudent decision to suspend all of these accounts while the compliance team investigated the situation further. Whilst this was a very disappointing development, I am pleased with how the business responded and that we have been able to quickly remedy the failings. Furthermore, I am confident, highly confident, that our policies and procedures are robust. And this failure was isolated to a very specific cohort of players. We have found no further issues and we do not anticipate any further actions here. The only open item is the ongoing reactivation and reopen new accounts where our team are ensuring we are fully satisfied that all policies and procedures are being correctly and effectively implemented.
I'm pleased to say we have successfully started reopening accounts and revenues in the region are beginning to recover. As you would expect, when players are blocked, and we need to gather significant financial information. Some of these players have stopped playing with us or choose not to provide this information or don't do it in a timely fashion. While we are unlikely to recover all of the customers and revenue, we are on track to recover around 40% to 50% this year.
The impact of this is fully reflected in our guidance. On the right-hand side of this slide, you can see our business mix following these changes in the Middle East. Based on our current run rate, overall regulated revenue is over 90% of the group, and within the small dot-com portion, we will class most markets as in process to regulation. No individual market within this bucket accounts for over 2% of revenue.
Turning to slide six to expand on our integration process. A successful integration is a key Board focus to create a higher margin, more efficient business and I'm pleased to update on significant progress made here. Our new operating model is in place, meaning that we have a more streamlined business that is focused on delivering high-quality and localized experiences to our customers.
We have centralized customer support functions with the existing William Hill Center of Excellence now serving customers across all brands. The new streamlined operating model has enabled us to increase our 2023 synergies, from GBP54 million to GBP111 million. And I'm pleased to confirm that we are well on target to deliver this. Our combined brand and marketing plan is supporting significant improvements on return on investment for marketing.
Our localized approach to customer engagement is also driving better decision-making. We are already seeing revenue benefits from our combination. This includes sharing the best betting and gaming content across our brands. And I'm pleased to say that we are also successfully recently launched Mr. Green in Germany on the 888 platform with a new local gaming license. Our technology plan based around growing our ability to scale and creating efficiencies is rolling out well. We will be migrating Mr. Green in Sweden until the 888 platform is planned in the coming months, which will be the first major milestone for the technology integration program as we aim to deliver our platform of the future over the next few years.
Now finally, slide seven shows the relative scale and potential of our business. Around GBP1.8 billion in revenue that is predominantly generated from regulated and tax markets and over GBP300 million in adjusted EBITDA. As you can see on the slide here, in terms of online revenues, we are now one of the largest operators globally.
As well as scale, this is a business with huge capabilities. We have world-class technology and products a portfolio of iconic brands and very strong teams across the business who have a proven track record of delivering excellent customer experiences. At our Capital Markets Day event in November, we outlined our evolved strategic road map based on three phases position, plan, potential. We have very clear priorities to deliver a leaner, higher-margin, more efficient business that will drive rapid deleveraging and unlock the strong potential of our business. We remain on course with our plans for this year and our targets for 2025.
And with that, I'm going to hand over to Yariv to walk us through the 2022 financial results.
Thanks, John. Good morning, everyone, and thank you for joining us today. Starting with slide nine, we show the main items in the bridge between 2021 actual to both the 2022 reported results in our financial statement and our pro forma results. In the appendix to this presentation, there are some more slides on the reported results, including details of the exceptional item being mainly the purchase price allocation amortization and transaction and integration costs.
On the left, you can see the revenue bridge starting from reported revenue in 2021 of GBP712 million. In July 2022, we completed the disposal of our Bingo business which contributed GBP 27 million to the decline in 2022 revenues. On an organic basis, 888 revenues dropped by GBP61 million, reflecting the regulatory and compliance headwinds that we have discussed extensively including the closure of the Netherlands and the impact of our proactive approach to safer gambling in the U.K.
The William Hill acquisition contributed GBP615 million to H2 revenue reflecting consolidation from the closing date on July 1st, 2022. After reflecting this transaction, our reported revenue for the full year were GBP1.24 billion. Our Bingo business contributed GBP20 million to revenue in the first half of 2022. After removing that and adding William Hill revenue of GBP630 million for the first half, pro forma revenue for the full year were GBP1.85 billion. On the right hand side, you can see the same build up from 2021 actual to 2022 reported and pro forma adjusted EBITDA. It is important to say that revenue of GBP1.85 billion and adjusted EBITDA of GBP311 million were in line with our guidance from the Investor Day.
In slide 10, we present the revenue and adjusted EBITDA by segment on a pro forma basis. We operate the business in two main segments. the U.K., which includes all of our U.K. and Ireland online businesses and our retail business and the international, which includes all our business outside the U.K. including the U.S.
For the U.K., pro forma revenue were flat in 2022, reflecting a full year recovery of retail, which was up 54%, offset by online revenue down 20%. The decline in online reflects some of the COVID unwind as customers went back to retail and other leisure activity, but mainly reflects the ongoing impact of our safer gambling measure including reducing stake limit for slot to GBP5 and GBP10 and implementing more affordability checks as soon as players have deposited GBP500.
For our international business, revenue were down 9%, reflecting strong performance in our core and growth markets, offset by a bigger decline in our optimized market where we exited some market, including the Netherland. Excluding the Netherlands, revenues were down 4%. Adjusted EBITDA was GBP311 million on a pro forma basis, in line with consensus and representing an adjusted EBITDA margin of 17%.
Turning to slide 11. We made good progress on our three core priorities that we laid out at our Investor Day. Our first focus is execution of synergies. We delivered GBP25 million of cash synergies in 2022 and the good progress that was made with integration enabled us to increase our 2023 target from GBP54 million to GBP111 million. Our second priority is improving our adjusted EBITDA margin. As we have been executing on our integration plan and delivering improved ROI from our marketing spend, we have confidence in our plan to deliver an adjusted EBITDA margin above 20% in the full year 2023.
And our third priority is deleveraging. We ended the year with a net debt of GBP1.73 billion. This represents a leverage ratio of 5.6 times on a pro forma basis, which drops to a little over four times after reflecting the full synergies. We continue to target below 3.5 times in 2025, and we will continue to be disciplined with capital allocation to prioritize debt reduction in the next couple of years. Our disciplined approach to capital allocation includes reviewing opportunities to generate cash from a lower return or non-core assets. For example, we are selling some freehold properties and we have a 19.5% stake in SAS, which is undertaking a strategic review.
Turning to slide 12. I would like to provide a summary of our debt structure. At the end of 2022, we completed another part of our debt syndication and we now have a strong and long-term debt structure in place with no significant maturity before 2027. We also undertook further hedging at the end of last year, such that 70% of our debt is now interest fixed for the next three years. We have also better matched our debt to our cash flow with about half of the debt in euros, 43% in pounds and only 7% in U.S. dollars. You can find more detailed breakdown of the debt structure by instrument in the appendix of this presentation.
This long-term and largely fixed debt structure give us a better visibility about our future cash requirements and our expected cash interest cost of GBP165 million to GBP170 million for 2023, is consistent with our prior guidance. It is also important to say that our debt is fairly flexible from a rate, perspective, so as we execute our plans and deleverage, we will have future opportunities to optimize the cost of the debt.
Turning to slide 13. I would like to provide some details about our Q1 performance and some commentary on our outlook for 2023. For Q1 2023, revenue were GBP446 million compared to GBP469 million on a pro forma basis in 2022. The decline of approximately 5% is broadly in line with what we expect for the full year. We are pleased with the continued engagement we see from customers with active up about 6% year-on-year, but we continue to see lower spend per player.
The decline in the U.K. revenue reflect a drop of 9% in online, caused by the ongoing impact of our safer gambling measurer together with our focus on profitability that led us to remove loss-making or low-return revenues. While we are seeing lower online revenue as we continue to remix the business and drive a low spending recreational base, I'm pleased to say that we are seeing and expect to see in the full year 2023 higher profit from the U.K. online segment and strong performance from the retail business.
In our international markets, revenue were down approximately 11%, which reflects strong growth in some of our core and growth market, offset by disruption in some of our dot-com markets like the Middle East, where we expect GBP25 million to GBP30 million revenue headwind. In terms of the outlook, we expect 2023 revenue to be lower than 2022 by a low to mid-single-digit percentage largely as we outlined at our Investor Day and as we saw in the Q1 performance.
On the profitability, I can say that we continue to track towards an adjusted EBITDA margin of above 20% for the full year. It's worth noting that EBITDA performance will be more H2 weighted, given the timing of synergy realization. For further technical guidance matter, see more details in the appendix. Most of it is largely consistent with what we gave at our Capital Market Day.
Finally, on slide 14, I just wanted to reiterate the 2025 financial targets introduced at the Capital Markets Day last year. As we have discussed already, we are very focused on delivering a leaner, higher-margin, more efficient business that will unlock the strong potential of our business and drive rapid deleveraging.
Supported by our clear focus on our core growth and pipeline markets, we remain confident in our 2025 ambitious of over GBP2 billion of revenue, at least 23% adjusted EBITDA margin, leverage of below 3.5 times and over 35p of adjusted EPS. I would like to mention again that additional financial information can be found in the appendix.
I will now hand over to Vaughn to run through the strategic highlights.
Thank you, Yariv, and good morning, everyone. Turning to slide 16. This is a reminder of our strategic pyramid. This sets the guardrails for how we manage the business and prioritize our actions.
Our goal is very clear, rapidly reduce leverage and drive high EPS growth. We will do this through clear priorities of integration and market focus. The business has been quickly changed from one that is competing at low scale in a huge range of markets to one that is laser-focused on maintaining and building really strong and sustainable positions in three core markets and five growth markets.
In these markets, we plan to grow market share by investing in our competitive advantages, namely product and content leadership, world-class brands and customer excellence. And all of this is underpinned by sustainability and our critical foundations, which are our focus on players and player safety, on people and culture and our commitment to the planet and environment around us. Yariv has already touched on the integration and deleveraging priorities. So over the next few slides, I'll discuss some of the progress we have made across the other areas of market focus, competitive advantages and sustainability.
Turning to slide 17 and a few highlights from our core markets in 2022. These represent about 70% of our online revenues. In the U.K., while revenues were lower, this reflected the impact of our proactive safer gambling measures with reductions in maximum stakes for slots and further increases in the proportion of players that have deposit limits in place.
While overall revenues are lower, it is really encouraging to see that we are growing our share of active customers and really driving a positive remixing of the business towards a lower spending recreational base. Turning to Italy in the middle. We were pleased to see strong market share gains in casino for 888 during the year with a really strong recovery in the second half of 2022 as trading trends normalized following the disruption from COVID. In Spain, on the right hand side, you can see a similar trend with really strong improvement in trading in the second half of the year.
Turning to slide 18 to look at how we focus on our other market archetypes. It was a busy year for our growth markets with all 888 products launching under a new license in Ontario and local licensed sports launches in Germany, Virginia and Michigan during the year. This was followed early this year with the debut launch of SI Casino in Michigan. And in Q1 2023, we also received our German gaming license and went live with the Mr. Green brand over the fully licensed 888 platform.
These growth markets represent about 10% of our online revenues today, but we see really strong growth potential and are building long-term sustainable market-leading positions in these jurisdictions. We launched SI Casino in February this year. And while it is early days, we have been delighted with the customer reaction here and this has further reinforced our confidence in our U.S. strategy to focus on gaming states where the combination of our world-class products and content platform and the strength of the SI brand gives us huge competitive advantages.
In our optimized markets, we focus more on cash flow and profitability and growth using our global services to provide incremental returns and you can see that this group has reduced as a percentage of the total mix over the year as we focus on our core and growth markets.
However, importantly, contribution margin has increased by three percentage points from H1 to H2 as we rolled out our market-focused plans. This group is a diversified mix of both locally regulated markets like Sweden, Romania and Portugal and countries that we service on our multi-jurisdictional licenses or dot-com licenses like Canada and the Middle East. As John said earlier, no country within this group represents more than 2% of our revenues.
We've been really pleased with our pipeline markets with our Africa JV launching its first four locally regulated markets in the second half of 2022 and we've seen really strong progress in those markets with over 0.5 million customers having enjoyed our products already. We're looking forward to further launches here soon.
Turning to slide 19. I'm going to talk about our key enablers and how we drive growth in our target markets. Our key enablers are our three competitive advantages, products and content leadership, world-class brands and customer excellence. On this slide, you can see some great examples of our product and content leadership. This is all about using our tech expertise to build great customer experiences, things like our Bet Builder product, build your odds, which was significantly enhanced during the year with leg tracking, live status and cash out, and this massively improves the customer experience.
We launched a new daily free play game that is branded with Millionaire Genie, one of our leading in-house games, and this provides a reason for customers to keep coming back to us, along with continued improvements in our AI personalization within gaming. On 888sport, users can now choose what the app looks like with light or dark mode, and we rolled out a much improved football page with live games as part of a tap layer that makes building accumulators much quicker and simpler.
This is what recreational customers want, and we saw a 20% uplift in the number of players, including in-play legs as part of their accumulators following this redesign. This shows that we continue to develop exciting new product features for all our brands and products alongside all of the work that we're doing on integration.
The integration is the really exciting part that would enable us to launch all of these features across all of the brands. You can see some of the potential benefits on the right here with Section 8 games, including the latest Captain 8 franchise that has a unique daily jackpot feature and the vast library of content that we can offer once Mr. Green and William Hill are on the platform.
Over on slide 20, you can see some examples of our world-class brands. William Hill stands out for a love of football, the most recognized name in Horse Racing and being famous for trust, relevance and value. 888 is a slick entertaining experience with a great range of content and excellent recommendations with an experience that has made to play. Mr. Green is a polished brand and experience with a differentiated position as a market leader in the crowded casino market.
And Sports Illustrated is an American icon, famous for its high production values and consistent quality. These brands enable us to compete hard in our chosen markets using the strength of our brands and our marketing expertise to drive more efficient marketing spend. And you can see on the chart with our marketing ratio in H2 being three percentage points lower than in the first half of the year.
Turning to slide 21 and a few words on customer excellence. This underpins our whole philosophy, understanding our customers, understanding what they want, what they don't like and how we can engage them and create great experiences. Delivering for our customers could be resetting your password, depositing and betting, tracking your bets or changing your player safety limits, understanding the flow of all of these journeys, testing different options with our customers through [indiscernible] and AB testing and making them as seamless as possible.
We call this concept brilliant basics, and we've made huge improvements over the last 12 months. One of the best ways to track this is through player base and customer NPS. With increases here showing that our customers are coming back to us more as we are really getting it right and delivering what they want. We also monitor contacts, and we don't really want players contacting us. This usually means that they have a problem or an issue.
So the continued reduction in contacts per active, you can see here, is really encouraging, and we're getting it right in the first place. This is also more effective from a business perspective as it reduces our costs. However, when customers do need to contact us, we want to provide excellent service and our customer satisfaction scores are a great proof point here that we are getting it right. The William Hill Center of Excellence that has driven these strong results is now looking after all of our customers across all brands, one of the big benefits of our integration.
Turning to slide 22. I'm pleased to provide an update on our ESG and sustainability progress. Our whole approach to business and our strategy is built on a foundation of sustainability. This means making the right decisions to deliver long-term value for our stakeholders. Our sustainability plan is built on our three pillars of players, people and planet. The players we have continued to build on our ambition to create a safer gambling environment. This impacts our revenues in the short term as we intervene more and stop players from spending more, but it is the right thing to do to build a sustainable and trusted long-term business.
For our people, we are committed to building a strong culture where our colleagues can grow their careers and thrive. And for the planet, we were delighted to see a 44% reduction in carbon emissions during the year and the retail estate reached net zero emissions. I'd now like to hand back to Jon to conclude the session.
Thank you, Vaughan. Turning to slide 24 to conclude with our continued progress against our position, plan, potential road map. During the second half and into this year, we are focused on the execution of our plan by integrating the business, delivering the synergies and creating a streamlined business fit for higher margins and a platform for future growth.
We have made excellent progress against our plans in a short period, and this gives us clear confidence that we are very well positioned to deliver our 2025 financial targets that will unlock and create shareholder value.
I look forward to updating you in the coming months with the appointment of a permanent Chief Executive Officer as we continue to deliver the potential of this outstanding business.
With that, I'd like to hand over to the moderator for questions.
[Operator Instructions] I see there are currently no questions on the phone. With this, I will hand over to Jack for any web questions.
Thank you to those online. We've had a significant number of questions from the webcast. starting with those from Jemma Permalloo from JPMorgan. Just to confirm, there was no fine imposed by the regulators in relation to the Middle East accounts investigation. Are you able to provide a bit more of an update on this?
Certainly. Yes, we've been in a very close discussion with the regulator because it was an issue, of course, that we self-reported -- we -- and that we have addressed with great speed. That has not been the case at this stage and that we believe that there will be no fine. The regulator has worked very closely with us to make sure that the work that we're doing has dealt with the problem effectively. And we continue to deal with them over every aspect of what we're doing in the Middle East and across our Gibraltar licenses.
Thank you. A follow-up from Jemma. The white paper is now very imminent with latest headlines suggesting no change from what we are already seeing or we know. Do you think this will be less of a significant event or do you expect further impact on your numbers?
We believe that much of the impacts of the white paper are that's baked into our figures, but we'll wait to see what the full details are of all of it. But we don't think this will be a significant departure from our numbers. But certainly the additional steps that we've taken to make sure that we have an effective response on safer gambling, really put us in a position where we believe that it's largely factored in.
Thank you. We have a question from Ivor Jones from Peel Hunt. It appears 888 was cash neutral in Q1 '23. What do you expect for cash for the full year?
Yes. So we are not providing the specific forecast for the cash generation. But what we mentioned in the Capital Market Day and also as part of the result that we are announcing today. We are expecting the deleverage this year to come mainly from expansion of the EBITDA and not necessarily from cash generation, considering that we have quite a lot of spend on the CTA and some exceptional during the integration process. From '24 and on that deleverage will come from both expansion of the EBITDA and from the cash generation that will enable us to repay some of the debt.
Thank you. We have a number of questions from James Wheatcroft at Jefferies, the first of which is what is driving the strong momentum in retail.
Thank you for that question. I'll ask Vaughan to go through our retail performance.
Sure. Thanks, John, and thanks, James. I think what we're seeing across the High Street is really the benefits of the hard work that the team did over the last few years to rightsize the estate and really focus on the best locations and the best shops. And then as the teams have really rolled out the great products and experiences on both the sports side and the gaming side, we're really starting to see the benefits of that coming through.
So you're probably familiar with the Epic Odds promotions that we've been advertising on TV and you will have seen with the Grand National coming tomorrow. And those are advertised in-store and promoted in-store by our teams there to really highlight the value that we provide and the great prices and great offers that you can get on those special promotions.
And on the gaming side, we've had some good new games come through on the cabinets. And we're just in the early stages of rolling out and testing new cabinets that we really think can drive a step up in terms of our gaming penetration. And if you look across the High Street business, we have a significantly higher market share of sports than we do in gaming, and we see really significant upside potential on the gaming side as that product and that hardware experience leapfrogs the peers and we become the best in the market in terms of that gaming experience.
So overall the High Street is robust. We're seeing really good customer engagement and I think our teams in the stores are doing a great job of just entertaining those customers.
Thanks, Vaughan. I mean I do want to reinforce the point that Vaughan made about our colleagues in the stores. They've been doing an outstanding job and showing outstanding service to our customers, and I've been deeply, deeply impressed with how well they've been performing and what a good job they're doing.
Thank you. A follow-up question from James at Jefferies. Can you comment on the EBITDA drag from the U.S. in FY'22? And how is that expected to shape up in FY'23?
Yes. So the negative EBITDA in 2022 in the U.S. was GBP12 million, and this is quite similar to the level that we saw in 2021, and we are expecting similar level also in 2023. When we are referring now to the U.S. business, this is including the B2C and the B2B businesses that we have in this market.
Thank you. And the final question from James, can you tell us a bit about how the process is going in the Netherlands in achieving a license?
Yes. Thank you very much for that question. Vaughan?
Yes. Thanks, James. So look we're in the licensing process. I think as we discussed at the Capital Markets Day, it's not one of our key priority markets for this year. We do see it as an interesting market sort of mid and long-term. There's a large sizable market there. There's quite high appetite for playing amongst players, there's high disposable income.
And we do have good sort of competitive advantages and opportunities there, particularly with the strength of the 888 brand in the casino market. So we are reviewing options as to when and how we will launch into that market. But there's nothing that we would sort of pinpoint right now in terms of time lines. It's more a medium and long-term opportunity for us rather than one for 2023.
Thank you. We have a follow-up question from Ivor Jones at Peel Hunt, which regulator did 888 report to in the Middle East.
So, thank you, the question of who do we report to -- the -- our operation to those customers was under the Gibraltar license. And so in relation to that, it's held under the Gibraltar license but we continue to discuss with all regulators across our range of regulatory issues all the matters that become present. And I think that we've done a very good job across all our regulated licenses across all our businesses in dealing with that. But the specific point on the Middle East was that the Gibraltar license issue.
Thank you. We have a question from Daniel Walther at MS. When considering lease payments, CapEx and significant capitalized R&D, I see approximately GBP41 million unlevered cash flow while you have GBP160 million to GBP170 million of interest payments per annum. How do you expect to significantly grow cash flow to service your debt?
Yes. So I will repeat the message from the previous question. So our message was all the time that from a cash flow point of view, this year is going to be fairly flat. So we will use the cash flow that we generate from the business to pay for the CapEx, for the cost to achieve the synergies, and of course, to pay the interest. So the deleverage in 2023 will come from expansion of the EBITDA, which we are expecting to be significant this year from '24 there are -- we will deleverage both from generating cash and a further expansion of the EBITDA.
Thank you. Sticking with the theme of Finance, Tim Kempster at Thinking Machine has asked, can you provide any color on any existing covenants in your debt in particular, any EBITDA multiple covenants?
So we have a very light covenant on our debt. It's actually kicked in only when we are using the RCF, which until now, it's not in use. And even that it's very, very light and we are not expecting to be even close to that level of use during this year.
Thank you. We have a number of questions from Francesco Barbato at JPM. Can you please provide some more details on the proactive measures you've taken in the U.K?
And that I assume is in relation to regulation. So what I would say at the moment is, overall, in terms of regulatory compliance and we've -- I think we've added a slide as well some details on this, so that you've got a much clearer picture about what we've done. I think it's important that we emphasize.
But what we've done is we've rebuilt the entire team, and we've built processes, we've enhanced the whole risk approach, but we have done a number of measures about protecting customers from rapid losses on reducing 30 day net deposit limits, on implementing third-party vulnerability checks and other hard stops pending assessments of safer gambling and anti-money laundering stuff. We've done more to introduce protection of customers in retail and reduce the spending triggers there.
We've also looked at additional training for our retail colleagues which they've done extremely well on adopting. And we've got a more coordinated approach to monitoring of those things, and we've enhanced our AML processes. We've expanded the customer due diligence team we've increased further hard stops.
We've strengthened the AML training and policies, and we were improved arrangements in governance and in the regulatory assurance function. So we've got a pretty comprehensive range of things that we've done to make sure that in the U.K. and indeed across the business in all jurisdictions, we're doing as much as we can to ensure that we've got the highest possible standards and the safest possible experience for our customers.
And so I do feel that we've got to the position where a lot of the overhang that we had from those sorts of issues has now been lifted, and that we've got an effective team and a full suite of measures which have been implemented.
Thank you. Coming back to the topic of the Netherlands. A question from Patrick Soede at Nassau Corporate Credit. Is the reentry into the Netherlands baked into the GBP2 billion FY'25 revenue forecast?
Vaughan?
Nothing material from the Netherlands in terms of that guidance, no. So we do see significant opportunity there and upside potential there, but yes, that's not part of the current guidance.
Thank you. And the final question comes from Robert Simmons at EGR. Are you able to shed some light on your U.S. plans this coming year?
Well, I think we've been pretty clear about what our U.S. strategy has been and what we were planning to do, we've really emphasized that we've found a brand in order to be able to market to a very distinct customer to have a very good, strong niche position in a very large market that we're focusing on using that brand of Sports Illustrated to go to this slightly older customer and one who has a longer lifetime value and that we're really going to try and focus on markets where we have an iGaming advantage as well.
So those really are the plans that we've outlined for some time, and it's now a question of implementing it, ensuring that we can deliver that effectively. The initial signs from our launch in Michigan are encouraging, and we really hope to be able to update at a later time on how well this is fully progressing, but we're comfortable and confident with the plans that we now have.
Thank you. It looks like we still have one more question to cover. That question is from Davide Chiesa from CQS. Is your fully RCF undrawn as of the end of Q1 '23?
Yes.
Thank you. As it appears there are no final questions, I would like to hand back for any additional or closing remarks.
Now I'd just like to thank you all for being here today and for your questions and for your engagement. As always, we remain completely open and available to you for any further questions and any further discussion. But I think we've made encouraging and steadfast sort of progress in what we're doing, and we look forward to updating you further in due course with what -- with how we're doing on our plans. But just thank you very much for your attention today.