Ladbrokes: offshore move sees egaming profit soar 40%
Ladbrokes' sportsbook move offshore is credited with a 41% year-on-year rise in operating profit from its egaming division in the first four months of 2010, a company trading update revealed this morning.
LADBROKES’ sportsbook move offshore is credited with a 41% year-on-year (YoY) rise in operating profit from its egaming division in the first four months of 2010, a company trading update revealed this morning.
The move to Gibraltar in November 2009 was combined with further cost efficiencies across the retail estate and a VAT rebate from the UK tax body to boost group operating profit by 3%, the UK operator said, but declined to reveal a figure for this.
Ladbrokes new chief executive, Richard Glynn, said: “The economic environment remains challenging and the strength of UK consumer confidence post the election is difficult to gauge. However group profitability year to date has been broadly in line with expectations.”
However the boosted operating profit is despite revenue from the egaming division having fallen 2%, however, with strength in online sportsbook and bingo offset by weakness in poker and casino.
Online sportsbook turnover grew 13% and net revenue by 4%, driven by a 9% growth in in-play and a 15% in pre-match turnover. Bingo turned in 5% net revenue growth, with flat net revenue from games.
On the negative side, casino net revenue fell 6% due to lower revenues from high staking players and the free bet promotions run during the period. Poker net revenue also fell 10% from the prior period due to industry-wide liquidity issues in Europe resulting from the presence of US-facing sites.
Group net revenue fell 6%, hit by an 11% decline in over the counter retail revenues.