Ladbroke Sunday U-turn
Independent on Sunday, 1 Canada Square, Canary Wharf, London E14, Telephone 0171 293 2000.Fax: 0171 293 2096. Email: email@example.com
Sunday 27 August 1995
A small number of shops will open today "in commercially competitive locations". One site is Chinatown in London's Soho: when all three Ladbroke shops there shut two weeks ago, punters reported "an unbearable crush" in the rival Coral shop.
Ladbroke still has not announced what it will do about Sunday racing dates after today, but the move to scrap the experiment early is seen as an admission that it cannot leave the market to its competitors. Loyal customers who visit a rival on a Sunday might decide to take their business there all week long.
Ladbroke was one of the main advocates of Sunday racing before it was introduced earlier this year, but turned cool on the concept when the public, confused by an intermittent calendar, gave their high street shops a wide berth on the Sabbath.
Its decision to return to the field, though on a smaller scale, comes as the battered company prepares to reveal disappointing interim results on Thursday. As well as the Sunday betting fiasco, it has faced unprecedented pressure from the National Lottery.
Profit forecasts for the gaming division, which includes 1,900 betting shops and the Vernon's football pools operation, have been scaled back by pounds 10m-15m ahead of the figures for the six months to June. Brokers NatWest now expect a 3 per cent decline to just under pounds 48m.
Ladbroke's hotels side, which operates all the Hiltons outside the US, has fared better, however, and after paying an interest bill of almost pounds 50m, group half-year profits should come in at pounds 60m against pounds 51.3m in the corresponding period last year.
Last month Ladbroke axed 200 jobs in the face of unexpectedly stiff competition from the Lottery. Vernons has cut 95 of its 500 staff and seen sales fall by more than 15 per cent sinceits launch last November.
Although spending on "instant-win" scratchcards has declined from a peak of pounds 44.4m in the last week of May to around pounds 25m in August, weekly on-line tickets remain very popular, with sales averagingpounds 65m.
A recent report from the Henley Centre, an independent forecasting institute, predicted that the lottery would cause an 8 per cent drop in betting turnover this year and industry profits could fall by 30 per cent, with the loss of 6,500 jobs.
Ladbroke received another blow last week when Camelot, the National Lottery organiser, announced that weekly tickets and scratchcards are to be sold in 70 pubs and clubs in a pilot scheme beginning in the next fortnight. The betting industry is upset because other forms of gambling on licensed premises are banned by law.
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