‘Disappointing’ results from Ladbrokes

Ladbrokes chief executive Richard Glynn has labelled his firm’s annual results for 2013 as ‘disappointing’ but maintains that the bookmaker has made ‘real operational progress’ during the year. The figures were never going to be good after a series of profit warnings during the period, but the company has posted a 32.9% drop in group operating profit to £138.3m with turnover up slightly to £1.12bn. All of the firm’s divisions saw a drop in profit – the biggest being the 74.2% plummet of the Digital business to £8.2m and profit after tax was slashed by 65% to £67.0m.

Glynn commented: “As we have made clear, H1 is about delivery and H2 is about growth. Our immediate focus is on the completion of our remaining platform, product and capability upgrades, notably single wallet and CRM, which will begin to deliver tangible benefits from the World Cup onwards.

“The early evidence from our changes to the desktop sportsbook and to our mobile offer are encouraging, giving us confidence that where our product upgrades and improved capabilities converge behind our brand, we have a powerful proposition. We look forward to competing even harder through the course of this year.”

Among the measures that Glynn wants to introduce this year are:

• Digital – complete product migration, introduce single wallet and apply CRM expertise to drive performance in H2 and beyond
• Machines – roll out of new Clarity gaming machines ahead of the World Cup to deliver benefits in H2
• Retail – optimise retail estate to improve quality of earnings with 40 to 50 shop closures
• Group – completion of the remaining platform, product and capability upgrades means H1 2014 Group operating profit is targeted to be ahead of H2 2013 but down on the comparative period with further growth anticipated through H2 2014

The signs for a good year are not there though. Already Ladbrokes has cited sporting results largely favouring customers, particularly in football and horseracing, and from 1 January to 18 February 2014, group net revenue was down around £11m on the prior year.