Ladbrokes H1 digital revenues rise 41%

Ladbrokes this morning posted a 41% rise in digital revenues for the first six months of the year, with numbers boosted by an increase marketing investment and a favourable run of sporting results.

Total revenues for period ended 30 June were £158.1m, an improvement on the £112.2m posted during the same period last year, albeit with the added bonus of this summer’s European Championships.

However, the digital division continued to post a loss with operating profit in the red to the tune of £9.6m, although this was a 17% improvement on the £11.5m operating deficit recorded in H1 2015.

Sportsbook revenues through Ladbrokes.com were up 69% to £58.3m. The firm said the improved numbers reflected a focus on three core areas of the digital business: mobile, bet in-play and football.

Mobile contributed 78% of all stakes while bet-in-play and football saw staking growth of 51% and 44% respectively. Sportsbook margin was 7.5% in Q2, up 1.2pp year-on-year but down slightly on Q1’s 7.9%.

Despite favourable sporting results, overall sportsbook staking continued to rise with Ladbrokes.com seeing wagering growth of 30% – when factoring out high HVC activity in the corresponding period last year.

The brand’s gaming division also continued its recent upward trajectory with revenues up 27% to £54.9m, the vertical’s seventh consecutive quarter of growth.

Meanwhile, Ladbrokes’ Australian division posted a 42% increase in half-year revenues to £35.5m. The firm said its “differentiated approach” in the market was behind its surge with 80% of its clients taking advantage of its daily Odds Boost product.

Although he remained cautious, Ladbrokes chief executive Jim Mullen said today’s results showed the firm was on the right path with even greater opportunities ahead following the approval of its merger with Gala Coral, which is expected to complete at the end of Q3.

“These strong numbers show customers are responding positively to the new strategy at a time when the sporting gods have generally been on our side and we’ve enjoyed some helpful bookmaker friendly results,” Mullen said.

“History would strongly dictate that such a run of results in our favour would see customer staking suffer, but encouragingly these numbers firmly buck that trend and combine strong staking and a good margin.

“However, 130 years of experience in sports betting has shown us that we will endure a run of customer friendly results and margins will normalise.

“With the merger on the horizon we recognise there is a lot of hard work still to come, but this is an exciting time for Ladbrokes and we approach the opportunities ahead with a strong sense of confidence,” he added.

Ladbrokes’ share price was up 4p to 142.4p after early morning trading.