UK betting firm Ladbrokes plc has announced that their operating profits fell 60% in the first quarter because of unfavorable sports bets.
The company reported a one off drop in profits to £14.3 million in the first quarter, compared to £35.6 million during the same period last year. The results were due to the company's gross win margin falling below their 17% rate to 15.7%.
The challenges were also brought on by lower retail punter visits, resulting in the company closing 15 retail locations while also planning to close 60 additional sites this year.
Commenting on the results Ladbrokes CEO Jim Mullen said, “These results demonstrate the challenges we continue to face. We need to change the way we run the business, build scale - primarily in Digital - and respond faster to the customer and changes in the market place. I will complete my review of the wider business quickly and I will present some of the principal changes that I intend to make, in June, earlier than planned."
"Shareholders should expect me to focus on how we will build an effective competitive position, develop scale and resilience over the medium-term. We have laid solid operational foundations but there is still a lot to be done."
On the positive side of things Ladbrokes' Australian operations were higher, with wagers up 77.8%, active players up 137%, and net revenues up 132%. The company also announced that they reduced their net debt to £390.5 million, which is lower by £28.7 million.