The City bet against the UK’s biggest bookmaker Ladbrokes today as the heatwave and dwindling growth from the games machines in its betting shops hit the shares.
Chief executive Richard Glynn, who joined three years ago with the carrot of a £12 million bonus if he can get the shares above 297p, was further away from the mark as the stock fell 4%, or 7.6p, to 200p.
Pre-tax profits for the first six months of the year halved to £55.1 million and July’s heatwave has hammered the bookie in a rough start to the second half, sending customer visits to its betting shops down by up to 15%. Drier weather reduced the number of horseracing runners, meaning a higher percentage of winning favourites.
Ladbrokes said a poor Cheltenham was offset by a strong Royal Ascot and Grand National result. A £600,000 profit on Wigan’s shock FA Cup final win “was more than given back” when Andy Murray broke Britain’s 77-year Wimbledon hoodoo last month. “We’ve had some pretty shocking margins. Sport is volatile. You have to take the ups with the downs,” Glynn said.
Ladbrokes has more than 8900 machines in its shops. But after rapid growth in recent years, revenue growth has been much slower than expected this year, a trend exacerbated by the heatwave as gross win per shop fell 9.2%. The firm said it is “no longer planning on like-for-like growth” this year.
Digital net revenues rose 2.8% to £90.8 million.
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