Betting machines boost Ladbrokes

A surge in revenues from gaming machines today helped betting firm Ladbrokes offset the impact of the UK's August riots and unfavourable horse racing results.

A surge in revenues from gaming machines today helped betting firm Ladbrokes offset the impact of the UK's August riots and unfavourable horse racing results.

The bookmaker, which this week ended takeover talks with online rival Sportingbet, shut over 200 betting shops during August’s unrest, which reduced the amount taken in bets over the counter by 3.5%.

Horse racing results also went against it in August and caused an 8.3% slide in net revenues in the three months to September 30, although revenues overall rose by 2.5% as growth in machines income more than compensated.

Winnings from its gaming machines rose by 20.4% to an average per week of £866 (€989), up from £821 (€938) in the first half.

Profits across the group were 2.7% lower at £49.7m (€56.8m) as comparisons were impacted by last year’s World Cup, which gave a £5.3m (€6m) boost a year ago.

Online, Ladbrokes said sports bets were up by 6.4% but due to poor results in August and a very strong quarter for football a year ago net revenues fell by 6%.

A big marketing push started by Ladbrokes in August has increased the number of new online customers by nearly 40%.

The acquisition of Sportingbet would have boosted the online business, but the deal fell through amid concerns over Sportingbet’s Turkish operation.

Ladbrokes also failed to conclude a deal with another online gambling group, 888, earlier in the year after the two sides could not agree on a price.

On Monday, chief executive Richard Glynn denied that the Sportingbet deal collapse heaped more pressure on the firm. “This is not a failure. The biggest failure would be doing a deal that did not deliver shareholder value.” he said.

Ivor Jones, an analyst at broker Numis, said today’s statement was in line with consensus estimates but added he was becoming more cautious in his stance because of the tough outlook for 2012 and the failure to complete any major acquisitions.

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