Increased costs combined with the extra burden of betting taxes have seen Ladbrokes Plc post full-year 2015 (period ending 31 December 2015) group losses of £43 million, detailing a corporate decline from 2014’s profits of £37.7 million.
Outlining 2015 impacts, Ladbrokes governance detailed that the company had paid circa £50 million in taxes due to increased duties on machine gaming combined with UK POC charges.
Ladbrokes 2015 performance had been further impacted by £99 million of ‘exceptional costs’, relating to retail betting shop impairments (£53 million), merger cots transactions (£17.6 million) and betting shop closures (£19 million).
Despite posting its first corporate losses since 2005, Ladbrokes governance stated that 2016 expectations remained unchanged. The company will sustain its corporate strategy of investing heavily in platform and product development, whilst increasing marketing spend to drive up customer metrics.
Noting positives, Ladbrokes governance noted the growth of its online betting division (Ladbrokes.com) which had posted its strongest ever quarter in Q4 2015, detailing growth on all key metrics.
The company further detailed that its multi-channel strategy, was beginning to pay dividends to its group operations supplying over 35,000 customers by the end of 2015, of which the company noted had a greater value than its average customer base.
As expected Ladbrokes governance updated the market on its ongoing merger with Gala Coral. The company detailed no-change as Ladbrokes-Coral was on track with the company securing shareholder approval and awaiting its UK CMA phase 2 review.
Jim Mullen, Chief Executive of Ladbrokes , commented on 2015 corporate performance:
“I am pleased to be able to report a good start to the delivery of the strategy outlined in July. Although it remains early days there is positive progress to report. In UK Retail, self-service betting terminals are delivering growth, football is up and our Retail team are delivering strong Multi-channel growth. In Digital in Q4, increased marketing delivered more customers and more staking with Ladbrokes.com net revenue up over 25% and Australia, where the business goes from strength to strength, up over 75%(3) .
“The full year figures reflect the costs needed to undertake significant investment to deliver the strategy as well as facing circa £50 million of increased taxation.
“While it is pleasing to report that after two quarters we have made a good start, we are only at the beginning of the journey. Therefore, 2016 will see the same focus on winning more recreational customers, excellent operational delivery and a performance driven approach as the basis for delivering on our clear 2017 financial targets.”