UK Retail
We became the first high street bookmaker to launch a loyalty card programme which now has over 300,000 regular users.
Richard J Ames
Managing Director,
UK and Ireland Retail
Industry fact file
There are now approximately 8,800 betting shops in Great Britain, versus 10,200 in 1990. There have been significant legislative changes over the years which have enabled bookmakers to improve the quality of their customer offering in the shops and the environment in which they deliver it.
The most notable changes have been the introduction of television coverage, summer evening opening, Sunday openings and the introduction of machines. The implementation of the 2005 Gambling Act, in September 2007, represented another step change in the UK regulatory environment, and allowed for the introduction of winter evening opening, advertising on television and £1 stake: £500 jackpot machine games (B3 content).
Although the number of adults regularly betting in shops has not changed materially, the introduction of the national lottery has contributed to changing social attitudes towards gambling.
Number of regular GB bettors* (m)
*Excludes Northern Ireland.
Source: TNS Omnibus 2008
Ladbrokes' performance
UK Retail gross win increased by 4.7% over the period to £773.9 million, with the amounts staked increasing by 9.4%.
OTC gross win for the year fell 0.6% to £487.8 million (down 2.3% after free bets) with a lower margin of 16.9% (2007: 17.1%). The product mix for the business has changed during the year, with growth in the amounts staked on horses and football more than offset by declines in greyhounds and virtual racing. This, combined with the lower margin, resulted in the gross win decline.
Machine gross win grew 15.2% during the year to £286.1 million, benefiting from the completion of the rollout of our dual screen machines in March 2007, additional evening hours in the first three months of the period and the addition of new B3 content. This content now accounts for in excess of 15% of machine gross win and has resulted in margin enhancement of 0.3 percentage points. Average gross win per gaming machine per week was up 16.6% to £682.
Total costs rose 4.8% in the period to £467.3 million (2007: £445.9 million). Of this increase, 2.1% was associated with extended evening opening and 2.2% for Turf TV, both of which were one-off step changes in costs. As regards to other costs we have benefited from voluntary single opening, a new staff scheduling system, 61 unprofitable shop closures and further reducing Sky coverage in our estate to just 400 shops. Costs are, and will remain, a key focal area for the business.
We have implemented a number of further initiatives to improve the Ladbrokes' market positioning during 2008. The most notable is the introduction of our OddsOn! loyalty card scheme. Launched in June and rolled out across our entire estate, it offers odds enhancements, win bonuses and free bets for various levels of points awarded on OTC spend. Our emphasis thus far has been on getting the card into circulation and we are pleased to report that more than 300,000 cards are being regularly used with over 445,000 free bets and bonuses, worth £8.6 million, enjoyed by customers through points redemption. With the enhanced level of customer data now available to us we can begin to provide appropriate offers and promotions to specific customer groupings during 2009.
At 31 December 2008 we had 2,091 shops and 52 on-site outlets in Great Britain. During 2008,19 new licences were opened, 61 shops were closed, 46 shops were relocated, seven shops were extended and 68 were refurbished.
| Year ended 31 December 2008 £m |
Year ended 31 December 2007 £m |
Year on year change % |
|
|---|---|---|---|
| Amounts staked | 12,203.1 | 11,151.7 | 9.4 |
| Gross win | 773.9 | 739.3 | 4.7 |
| - OTC gross win | 487.8 | 490.9 | (0.6) |
| - Machine gross win | 286.1 | 248.4 | 15.2 |
| Net revenue | 723.1 | 701.8 | 3.0 |
| Profit from operations* | 187.9 | 187.8 | 0.1 |
*Before non-trading items.
Ladbrokes PLC 2009