Ladbrokes profits dip after a poor Cheltenham

(Source: Reuters)

Ladbrokes, the gaming company, has released results for the first quarter (results). Group operating profit fell by £13m to £37.4m. The firm put this down to an increase in costs and machine taxation in UK retail. Revenues from Cheltenham were also softer than anticipated, falling by £6m.

we now expect group operating profit for the year to be at the bottom of the existing market range

Machine gross win increased by 3.2 per cent for the quarter, as gross win per shop per week of £3,569 rose by 0.3 per cent while digital net revenue declined by 0.7 per cent.

Richard Glynn, chief executive, commented:

The trading environment and economic conditions since the start of the year have remained challenging, which when combined with a number of specific one off factors in the latter part of the period, have driven a softer first quarter than expected.

After a slow start, the performance of machines in recent weeks shows encouraging signs of responding to planned initiatives. In OTC a significant increase in lost racing and a poor Cheltenham materially impacted performance during the quarter. However we maintained a strong margin performance throughout and will continue to implement trading developments during 2013, allied to the ongoing evolution of our value offer to compete aggressively but sensibly for customers.