Lads online profits slide ahead of UK sportsbook rollout
Long-awaited mobile platform set to be released in Q2 this year.
Ladbrokes has seen operating profit from its digital division fall by 39% to £31.8m as it awaits a full rollout of its new sportsbook site to UK customers this quarter, the London-listed operator has revealed in its preliminary results for the year ended 31 December 2012.
However online net revenues climbed by 9% year-on-year to £178.1m, buoyed by a 26.1% year-on-year improvement from the operator’s sportsbook, although poker revenues fell by 23.2%.
The period also saw Ladbrokes withdraw its online offering from three territories – Poland, Greece and Cyprus – meaning like-for-like “digital” revenues increased 10.3% compared to FY 2011, and the full-year figures represent something of a recovery after year-on-year digital NGR decline of 3.5% in FY 2011.
The results represent the first full-year numbers for the operator since the dismissal of former managing director of product Richard Ames in July, with Lads’ sportsbook platform – originally earmarked for release ahead of the 2012 European Football Championships – only now set for a full UK rollout.
Chief executive Richard Glynn said in a statement: “Although there remains much to do in order to complete our transformation of Digital, our progress to date gives us confidence.”
Part of the future progress will hinge on the integration and development of Betdaq, which was acquired by Ladbrokes last month for an initial 30m and which the company says “Will allow us to create a more comprehensive sports betting offer.
“Our immediate focus is on improving the existing Betdaq exchange, with development wholly provided by a dedicated technology provider,” the operator explained
The second quarter of this year will also see the unveiling of Ladbrokes’ mobile platform after the company admitted to “A delay” affecting both this and the sportsbook rollout in 2012.
Mobile revenues nevertheless increased by 93.6% year-on-year, with the new platform set to be accompanied by the launch of a new dedicated racing site, covering horse and greyhound racing, which contributes approximately 45% of mobile sportsbook net revenue.
Within the mobile channel sportsbook contributed 26.5% of net revenues, and the operator noted: “Our new mobile platform…has been developed in parallel with new API technology, which will enable us to develop and launch multiple new mobile apps from H1 onwards.”
Ladbrokes has also committed to continue expanding its in-play offering, with the channel contributing 60% of sportsbook amounts staked ahead of the addition of further sports and events this year.
Glynn said of the new sportsbook and mobile platform: “We expect these developments to drive growth in Digital revenues and earnings, particularly during the second half of the year.”
Analyst Simon French of Panmure Gordon issued a ‘Hold’ recommendation on Ladbrokes’ shares, noting that his firm “continu[es] to prefer William Hill” and saying: “We think 2013 will be a transitional year for the group as it seeks to rebuild profitability in its Digital division whilst trying to protect profit levels in its Retail divisions.”
Nick Batram, analyst with Peel Hunt, also issued a ‘Hold’ recommendation as he noted “Ladbrokes has delivered a good set of figures but it could have been so much better but for the well publicised issues in Digital.”
Meanwhile Christopher Rodrigues has stepped down as a non-executive director with Ladbrokes after opting not to seek re-election. Rodrigues, the chairman of tourism authority VisitBritain, had chaired Ladbrokes’ remuneration committee.