SBC News Voice of the Sports Betting Industry
Updating the market this morning, Ladbrokes Plc has issued its Q3 2015 (period 30 September) interim management statement forecasting a 57% drop in period Group EBIT earnings of £14.3 million.
Ladbrokes governance stated that its earnings performance had been impacted by higher taxation (POC and gaming machine duties) and increased marketing spend targeting UK football and recreational players.
The operators UK retail division has recorded a 1% downturn in net revenues. Ladbrokes noted that despite seeing strong start to the 2015/16 football season, the division had been impacted by weak horse racing results in September which weakened net revenue margins.
Positives in its Q3 statement, saw Ladbrokes digital division return to profits, with net revenues up 5.7%. The division sports betting product saw wagering up 34%, supported by a 5.6% increase in active players.
Ladbrokes further detailed improved results for its online gaming products which recorded net revenue gains of 11.5%.
Updating the market on its planned £2.3 billion merger with Gala Coral, Ladbrokes governance were positive of gaining regulatory approval by the Competition and Markets Authority to complete the deal.
Jim Mullen, Ladbrokes Chief Executive, commented on Q3 performance
“These numbers reflect the first 68 days of activity since we announced our organic plan to aggressively invest and grow our recreational and multi-channel customer base particularly across UK Retail, Ladbrokes.com and Ladbrokes Australia.
“It is early in our journey, but today’s results reflect positive initial progress and customer traction with continued increases in staking and actives across Digital and improved staking trends in UK Retail driven by football and racing. Operating profit as expected is down reflecting continued headwinds from higher taxation as well as our increased marketing spend to build our customer base.
“With sportsbetting at our core we see customers responding well to our products, our value and to our recently launched multi-channel offer. All these initiatives are part of the long term plan for Ladbrokes with our targets based around delivery on hard financials for 2017.
“The focus now is on building on this start. Our people are responding to this challenge and we are committed to taking whatever steps necessary to keep this focus. The proposed merger with Coral is on track and, after raising £1.35 billion bank debt to finance the merged group, we will shortly be issuing the shareholder circular. The CMA work is progressing but there is no material news that we can share on this today.”
Ladbrokes Q3 Performance Overview
