Digital revenue rises but profit dips at Ladbrokes

26 February 2015

UK bookmaker Ladbrokes has reported a fall in year-on-year profit for 2014 after an increase in digital revenue was offset by wider costs in the business, resulting in the closure of 60 betting shops.

Digital revenue, comprising online and mobile, was up 22.9% in 2014, from £175 million (€239 million/$272 million) to £215.1 million.

Headline full-year revenue at the firm amounted to approximately £1.2 billion – a 3.8% rise on the £1.1 billion posted in the previous 12 months – while Ladbrokes also reported strong growth across its sportsbook business, with the amount staked in the overall division up 32%.

However, Ladbrokes was hit by various losses in the wider business.

Group operating profit tumbled 9.3% year-on-year from £138.3 million in the previous 12 months to £125.4 million in 2014.

Elsewhere, profit before tax dropped by 13.5% to £98 million while profit after tax also fell 13.4% to £93.1 million.

Total dividend per share remained level at 8.9p while Ladbrokes also confirmed it would be closing 60 of its betting shops, a move first reported by iGaming Business earlier this week.

Ladbrokes also announced that New York-based investment company has purchased a 4.7% stake in the company.

Despite the losses, chief executive Richard Glynn, who is due to step down from his position this year, was upbeat about the company’s potential growth over the next 12 months.

“Ladbrokes entered 2014 clear on what needed to be done to deliver a successful World Cup and to move from operational delivery in H1 to financial growth in H2,” Glynn said.

“We delivered against all our operational targets, enjoyed a successful World Cup and saw clear growth in key areas of the business. The changes put in place have made us competitive and our customers are responding.

“2015 will see new management but the focus on satisfying customer demands, improving the resilience of our retail estate, growing internationally and further improving our digital offer remains.

“Whilst recognising there are regulatory headwinds, Ladbrokes is confident in its plans for 2015.”

Related articles: Ladbrokes expected to announce further betting shop closures

Analysis: Looking for positives at Ladbrokes (paywall)