Issuing a trading update, the governance FTSE-listed bookmaker Ladbrokes-Coral has detailed that it is ‘on target’ to hit its full-year corporate targets and expectations following a positive H1 2017 opening driven by strong digital gains.
Updating investors, Ladbrokes Coral governance details that it expects Total Group net revenue to be 1% ahead of last year (cc -1%), with total group operating profit for H1 2017 to be within the range £153.3 – £158.3 million range, up 4-7% ahead of H1 2016.
Ladbrokes Coral detailed that group digital revenues were up ‘17% ahead of last year’. The bookmaker would note strong gains within its online sports betting division which is reported a +25% net-revenue increase despite competing against a tough H1 2016 comparative period (featuring UEFA Euro 2016).
Supporting the growth of online sports betting division, Ladbrokes Coral digital gaming assets are reported to be ‘11% ahead of last year’.
Despite its digital uplift, the combined Ladbrokes Coral UK Retail division is reported to be 6% behind 2016 net revenue figures. Company governance stated that its UK Retail division had been impacted by ‘planned structural improvements’ undertaken during the period to improve long-term ‘retail bottom line performance’.
Issuing a group strategy update, Ladbrokes Coral governance has now doubled its combined synergy target to circa £150 million in cost savings by 2019.
Commenting on the Ladbrokes Coral Trading update; Group CEO Jim Mullen stated
“Ladbrokes Coral posted a strong performance in H1 with results in line with our expectations and another significant upgrade to synergies, which at £150m will now be well over double the level initially announced.
Digital has performed well, with net revenue growth of 17% particularly pleasing against a backdrop of a significant period of platform integration and a competitive trading environment. In UK Retail, a key management focus has been on addressing some areas of ongoing inflationary pressure on the cost base and on improving gross win margins. Examples include the planned and considered commercial decisions taken on horse racing media costs and horse racing gross win margin. Whilst these have had a negative impact on stakes, they have been profit positive and helped mitigate some of the impact of underlying run rates. Furthermore, we are pleased to have resumed showing pictures from all UK racecourses following the agreement of a profit-share deal with The Racing Partnership reported last week.
On integration, we have successfully migrated our UK Digital brands to a single platform and completed the consolidation of our head office team. The further synergies identified re-emphasise the merits of the merger and the potential of the enlarged Group, with the additional savings delivered in 2017 offsetting the impact of current UK Retail run rates. We therefore remain in line with our expectations for the full year.”