BOOKMAKERS have been hit by a combination of unfavourable weather and unfavourable results in recent months but there are signs that things are returning to normal.
That was certainly the view of analyst James Hollins of Investec after Coral’s parent company announced their results for the year ended September 28 last week
Gala Coral said their Ebitda (earnings before interest, tax, depreciation and amortisation) before exceptionals was £20.7 million (nine per cent) behind last year.
The company blamed that primarily on difficult trading in the fourth quarter in their UK retail divisions, marked by warm weather which reduced footfall into shops and unfavourable sports results, mainly in football.
On the Coral side of the business the weather, combined with snow in the first half of the year, was estimated to have impacted Ebitda by £2.5m through fixture cancellations and reduced footfall.
However in trading for the first seven weeks of the new financial year, the group reported improvement across nearly all areas. While over-the-counter trading in Coral retail was reported down by three per cent, there was an improvement in margin of more than 19 per cent, while machines gross win was up seven per cent. Coral.co.uk actives were reported up 132 per cent, with stakes 158 per cent ahead.
Hollins, who reiterated Investec’s buy recommendation for William Hill on the back of the announcement, said the results “reflect a more positive sports margin performance for the industry after an horrendous run”.
He added: “The underlying sentiment is a small boost after a barren recent run of results for the bookmakers.”
Busy week for Grant
THE BETTING industry was keeping sports minister Helen Grant, whose remit also includes gambling, busy last week.
On Tuesday the Gambling (Licensing and Advertising) Bill passed its third reading in the Commons after MPs voted against an amendment that sought to extend the levy to offshore operators.
The amendment – new clause 11 – was proposed by shadow minister for sport Clive Efford and was voted on as the bill, which seeks to regulate gambling on a point-of-consumption basis, reached its report stage.
Grant reiterated her opposition to the amendment and also rejected a proposal to reserve the right to extend the levy at a later date.
She said: “We must look beyond extending a system that is agreed to be out of date, and there should be proper consultation before any measures are put in place.”
The amendment was not unexpectedly voted down by 271 votes to 213, a majority of 58.
The bill had its first reading in the House of Lords the following day and will have its second reading on December 17.
Meanwhile the government’s decision to maintain the status quo surrounding stakes and prizes on category B2 gaming machines – also known as fixed-odds betting terminals (FOBTs) – in betting shops is expected to be nodded through by MPs this week after it completed its final stage of parliamentary scrutiny last week.
The decision on FOBTs, as well as changes to other categories of machines, which followed the triennial review of stakes and prize limits, was approved by nine votes to seven following a meeting of the delegated legislation committee in the Commons this week.
However, during the committee’s debate Grant said she would not hesitate to act if she felt the industry had not made “real progress” on its code on social responsibility created by the Association of British Bookmakers.
She also said action on stakes and prizes would be taken if research due to be published in full by the Responsible Gambling Trust next autumn raised concerns.
While this was good news for the betting industry there might be concern over speculation that the government might execute a u-turn on FOBTs, following their recent reversal in policy on plain cigarette packaging.
Hills launch ‘centre of excellence’
THE DIGITAL sector is increasingly important to bookmakers, two of which announced developments in that sphere last week.
William Hill are moving into London’s “Silicon Roundabout” with the launch of what they describe as a “major new technological ‘centre of excellence'” in Shoreditch.
They have opened a 6,000 sq ft office on Scrutton Street at the heart of London’s hub for technology companies which will initially house 40 staff and complement William Hill’s international online operations in Leeds, London, Gibraltar, Tel Aviv, Sydney and Las Vegas.
William Hill Online managing director Andrew Lee said: “We see this as a hugely significant step in the history of William Hill and, indeed, our industry.”
Ladbrokes’ efforts to catch up with their rival continue with the news the bookmaker has announced a partnership with Chelsea Apps Factory to develop their mobile offer.
The deal will result in the Ladbrokes mobile sportsbook team join a Chelsea Apps Factory team with a remit of “improving the mobile product, analysing customer behaviour and embracing technological development”.
The partnership will complement Ladbrokes move to Playtech’s Mobenga mobile platform which is expected to be completed in the next few weeks. It also follows the launch of the Ladbrokes Exchange in November.
Ladbrokes Digital MD Jim Mullen said: “With our move to the Mobenga platform on track and imminent, we need to ensure our mobile offer stays relevant for the customer in a rapidly evolving market.”
Chelsea Apps Factory was founded in 2010 and the company has previously worked with Ladbrokes’ rival William Hill as well as the likes of Deloitte, Waitrose and Marks & Spencer.
What’s happening next week . . .
On Tuesday Betfair announce their interim results. Analyst Simon French of Panmure Gordon said the expectation was for a “robust performance with underlying ebitda (pre share based payments) of £50m (prior year £45.6m)”.
He added: “We await an update on the progress of the integrated sportsbook and any early anecdotal evidence from operating in New Jersey.”
source : www.racingpost.com
