MORE DETAIL EMERGES ON LADDIES-CORAL MERGER
24th July, 2015 at 16:40:44
UK marketing focus will be on boosting online gambling activities.
In addition to announcing the Gala Coral
merger today, Ladbrokes
has outlined its intentions going forward, the results of its recent strategic review and a half-year trading update.
The review outlines plans for a three year program in which the company's share of the UK online gambling market will be aggressively expanded, marketing efforts increased, the UK football activity boosted, and multi-channel enterprise growth achieved.
The plan is to ensure that at least 20% of the merged business will flow from digital activity. The company intends to increase the digital division's contribution to group revenue to 30% by 2017, up from 18.6% in 2014. It calls for growth in active users from 960,000 last year to over 1.3 million, and a doubling in net revenue from Australian operations.
Ladbrokes CEO Jim Mullen said in a statement:
"Today I am announcing an aggressive three-year investment programme to build our UK Retail, Digital and Australian recreational customer base. I also intend to restore our passion and pride of being at the heart of sportsbetting in our culture and all that we do.
"Current trading shows how results have continued to favour our customers but the underlying customer metrics, on which we have built our strategy, provide strong support for this plan."
The merger deal does not include Gala
Bingo, which remains on the "for sale" block, but both group brands will be used in operations.
Ladbrokes will issue new shares to Gala Coral
shareholders representing 48.25% of the enlarged group, with Ladbrokes shareholders to own the other 51.75 percent.
John Kelly, currently senior independent non-executive director at Ladbrokes, will become non-executive chairman of the combined business.
Gala Coral will bring £865 million in net debt to the merged company.
Ladbrokes H1-2015 trading update highlighted:
* Overall group net revenue up 1.3% to £585.4 million (excluding high roller activity;
* Digital revenue up 6.9% to £112.2 million, but despite this the division reported a loss of £11.5 million, well down from the £ 3 million profit recorded in the same period in 2014;
* UK retail revenue up 3.2% to £410.5 million;
* UK retail operating profit down 1.2% to £ 56.9 million;
* European retail revenue up 1.7% percent to £60 million;
* Core telephone betting operations 53.4% down at £ 2.7 million;
* Group operating profit down 32% to £38.9 million, due to UK p.o.c. and machine game taxes and poor sportsbook margins;
Related News Tags: Uk, Coral, Gala, Ladbrokes