Major UK-headquartered gambling operator Ladbrokes plc reported its financial results for the six-months ended June 30, 2016. The company highlighted strong customer metrics across all key divisions. The figures posted exceeded initial expectations and were mainly attributed to good staking and favorable sports results over the period in review.
Overall revenue for the half-year ended June 30 totaled £661.8 million, up 13.1% year-on-year. UK Retail was Ladbroke’s best performing division in terms of revenue generated. The company’s UK land-based operations generated a total of £436.6 million during the first half of the year, up 6.4% year-on-year.
The operator’s Digital business was the one to post the biggest growth over the period in review. Revenue from online gambling totaled £158.1 million, reflecting an increase of 40.9% from the figure reported for the same six months of the previous year.
European Retail revenue amounted to £64.4 million in the first half, up 7.3% year-on-year. Core Telephone Betting did not change from the previous year. Revenue from the division amounted to £2.7 million.
During the first half of the year, group operating profit also exceeded management’s expectations. Ladbrokes reported a 34.4% year-over-year increase to £52.3 million. The rise was mainly driven by favorable sports results and the company’s growth strategy, initiated by CEO Jim Mullen last year.
Operating profit from UK Retail totaled £63.5 million in the six months ended June 30, up 11.6%. Digital operating loss dropped 16.5% year-on-year during the period in review from £11.5 million to £9.6 million. European Retail generated a total of £8.9 million, up 43.5% as compared to the figure posted for the same six months of the previous year. Core Telephone Betting saw operating loss fall 60% to £0.8 million.
Group profit before tax amounted to £39.8 million, up 61.1% year-on-year. Profit after tax for the period in review stood at £34.8 million, reflecting a 57.2% rise over the previous year.
Commenting on the numbers reported, Ladbrokes CEO Jim Mullen said that they indicate that gambling customers are responding to the company’s new growth strategy in a positive manner. The executive also noted that favorable sports results also helped the gambling operator improve considerably its key metrics during this year’s first half.
Mr. Mullen confirmed that despite the fact that results were firmly in the company’s favor, customer staking did not suffer. On the contrary, Ladbrokes enjoyed strong staking and a good margin in the reported period.
Growth in the number of recreational and multi-channel customers, expanded football business, and strong increase in Australia have been noted as performance highlights for the first half of the year by the executive.
Last month, Ladbrokes received a provisional approval of its £2.3-billion merger with fellow operator Gala Coral. The two companies will have to sell a combined of 400 betting shops in order to be able to complete their consolidation.
