Ladbrokes in difficulty after slump in profits

Ladbrokes has long held its reputation as a bookmaker at the top of its game. This week, however, saw the world’s largest retail bookmaker announce that it was in serious difficulty after reporting a severe slump in pre-tax profits to a value of £191.3 million. Ladbrokes now faces a debt of £694.2 million following a challenging year fraught with setbacks.
Ladbrokes has attempted to explain its shortcomings and has noted the increased pressure imposed by what it calls ‘problem bettors’. In addition, it has suffered from the effects of the harsh regulation of the Gambling Commission. As it stands, the bet stands at just under seven million with maturity of bonds set to expire in 2012. It is expected that this will be delayed to 2017 in order to buy more time for the company. Other difficulties, meanwhile, have emerged in the form of competition. William Hill revealed 35 pct increases in its William Hill Online services. With over 2,000 William Hill betting shops, it’s no wonder that Ladbrokes is growing ever more anxious about its competitors.
Ladbrokes CEO, however, offered a more optimistic picture and said that it is crucial to look ahead rather than dwell on previous mistakes. “Last year was last year”, he said. "We've put a lot of actions into place and they are already having an effect". It remains to be seen how the company will recover in the months ahead. It is clear, however, that all members of the gaming industry will be monitoring Ladrokes very closely as an ever more aggressive environment threatens to topple some of the world’s most high profile businesses.