Ladbrokes Releases Third Quarter 2012 Financial Results

UK based land and online gaming giant Ladbrokes plc has released its third quarter 2012 financial results, highlighting a strong performance for the company's retail and digital operations.

Key financial indicators for the period ending September 30th were:

• Net revenue for the group was up 3.9%, with operating profit marginally up at £49.2 million (2011: £49 million)

• UK Retail net revenue increased by 5.4%, and OTC was ahead 0.6% in the period. OTC gross win margin was up at 16.9% (Q3,2011: 16%)

• Machine net revenue for the period was up 11.5%. The average gross win per terminal week across the estate was £937, with the year to date average now at £943. The average number of machines per shop is now 3.87

• Operating costs in UK Retail for the full year are expected to be up 6% overall. During the period Ladbrokes opened 16 new shops, acquired 12, closed 12, and refurbished 19. Management expects to have opened/acquired around 80 shops over the course of the year

• Digital net revenue grew 6.1% with 21.8% growth in sportsbook net revenue, along with stronger margin and continued growth in active punters

• Online casino and games showed a slight improvement of 1.1%; bingo declined 6.1%; and poker plunged by 25.7%

• Mobile revenues continued to deliver strongly, with 40% of all digital sports book customers now betting via mobile devices

• Bet in Play operations contributed 66% of sportsbook stakes (Q3,2011: 50%) with events now expected to exceed Ladbrokes' plan of 60,000 in 2012

• Telephone net revenue slipped 5.9% in the period, although staking was marginally up year-on-year

• High roller action showed a dramatic improvement, generating an operating profit of £6.9 million (Q3,2011: loss of £700,000)

Commenting on his company's performance, Ladbrokes CEO Richard Glynn said: "Consistent growth of both machine and OTC net revenue, as well as a robust control of costs reinforces the resilience and strong cash generation of our UK Retail business. Despite having fully annualised last year's launch of the Global Draw terminals, we remain confident that our focus on player and machine yields, as well as an increase in machine density, will generate further growth."

"We are now delivering against a clear programme to complete the rollout of the digital sportsbook and migration of customers by the end of Q1,2013, whereupon we will focus increasingly on enhanced CRM. Enhancements in trading are leading to early signs of an improvement in the quality of turnover, with further developments in pricing and liability management still to come."

"Though the economic outlook remains uncertain, we remain confident in our delivery and are in line with the Board's expectations for 2012."

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