Ladbrokes owner sees profits increase regardless of gambling crackdown

9 October 2019

GVC, the company that owns Ladbrokes, says it expects its profits to be larger than anticipated in spite of the government's clampdown on gambling.

The firm still expects to close 900 shops over 2 years due to the fact that of the optimum stake on fixed-odds betting terminals (FOBTs) being cut to ₤ 2.

But while making use of FOBTs has actually fallen, in the third quarter more bets were being positioned in-store.

The group, which likewise owns Coral, stated online wagering is likewise up by 12%.

In a third quarter trading update, it updated its profits assistance for the complete year to between ₤ 670-₤ 680m, from ₤ 650-₤ 670m.

Kenneth Alexander, GVC's president, said: "I am happy that the group's financial performance has actually allowed us to update our full-year earnings before interest and tax expectations again.

"Online momentum stays strong across all major territories, with net video gaming earnings up 12% in the quarter regardless of the prior duration including part of the World Cup."

In August, the business announced strategies to shut 900 shops - putting up to 5,000 jobs at risk - due to the fact that of the yohaig code cut in FOBTs maximum stakes from ₤ 100.

There were 3,500 Ladbrokes and Coral stores at the start of the yohaig code year, and some 198 have actually currently shut, with the rest scheduled for closure by April 2021.

Rival William Hill has stated it will close 700 stores as an outcome of the regulatory clampdown. While GVC said profits in the stores is down 18%, it still ahead of expectations.

GVC indicated that consumers were discovering other ways to bet, as while profits from devices - consisting of FOBTs - were down 36% in the quarter, there was 7% rise in betting in stores.

But the greatest growth was in online gambling, boosted by a 16% increase in online sport wagering incomes. GVC shares were up nearly 4% in early trading.