Lad­brokes re­tail slow­down stead­ies as TV race dis­pute is re­solved

The Daily Telegraph - Business - - Business - By Bradley Ger­rard and Jack Tor­rance

Co­ral has stemmed the slow­down suf­fered at its re­tail busi­ness since the start of the year af­ter the res­o­lu­tion of an in­dus­try spat meant it could show key horse races in its bet­ting shops again.

Man­age­ment had been in a dis­pute over me­dia rights with The Rac­ing Part­ner­ship, which cov­ers 15 cour­ses owned by Arena Rac­ing Com­pany, the UK’s largest race­course op­er­a­tor, and seven in­de­pen­dent tracks. The Lad­brokes re­tail es­tate had been suf­fer­ing from the lack of pic­tures from the 22 race­courses af­ter it re­fused to pay for rights to show the races. While this meant Lad­brokes saved money, it be­gan to have a detri­men­tal im­pact on rev­enues in its store es­tate.

In 2017 un­til Oct 29, the amount staked over the counter at its shops has dropped 8pc on the prior year but in its trad­ing up­date yes­ter­day, the drop for the four months to the same date was only down 5pc, show­ing a slow­down in the de­cline. Chief ex­ec­u­tive Jim Mul- len reck­oned about 80pc of the cus­tomers it had lost due to not hav­ing The Rac­ing Part­ner­ship’s pic­tures had re­turned.

Mr Mullen also said that be­fore the merger of Lad­brokes and Co­ral, the for­mer had been giv­ing up some of its mar­gin as part of a mar­ket­ing in­vest­ment to re­tain cus­tomers but that this had now ceased, mean­ing its re­tail es­tate was per­form­ing more prof­itably.

Its on­line busi­ness con­tin­ued apace though, with net rev­enue up 12pc for the four months to Oct 29 even though there was not a ma­jor foot­ball tour­na­ment in the pe­riod com­pared to last year. Within its dig­i­tal arm, though, Lad­ stut­tered with net rev­enue 9pc be­hind the same pe­riod in 2016. Mr Mullen said a ma­jor rea­son for this was the merg­ing of the Lad­brokes and Co­ral sites on to one tech­nol­ogy plat­form, which meant the site was not re­leas­ing the num­ber of new games it usu­ally would to en­tice cus­tomers.

But Mr Mullen said such a drop off had been pre­dicted and re­it­er­ated that the merger of Lad­brokes and Co­ral would now see an­nual cost sav­ings of £150m a year by 2019 – dou­ble the ini­tial es­ti­mate. Else­where, the group’s Australian and Ital­ian busi­nesses per­formed well with sports stakes up 41pc and 35pc re­spec­tively.

The tri­en­nial re­view was re­leased last month, with pro­pos­als to cut the max­i­mum stake wa­gered on fixed odds ma­chines to as low as £2, from £100 at present. The re­port is in the mid­dle of a 12-week con­sul­ta­tion pe­riod.

“We have ex­isted with the un­cer­tainty caused by the re­view since we were cre­ated and hope that the con­sul­ta­tion her­alds a pos­i­tive step,” Mr Mullen said. Lad­brokes Co­ral shares closed down 2.4pc at 133.6p.

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