John Leach, chief executive of the leisure company that owns the 1,650- strong William Hill bookmaking chain, said 96 per cent of regular punters were spending between £3 and £10 a week on lottery tickets.
Ladbroke, the biggest in the industry, recently said the effect from the lottery had been minimal, but a spokesman said yesterday more details may be given at this month's annual meeting. Extensive research is also being conducted by the Betting Office Licensees Association, the trade body, and a full report is due to be published by the autumn.
The full effect is not yet possible to quantify, due mainly to the high incidence of lost race days in January and February, but betting shops are coming under further pressure from the recent launch of instant scratch cards, and the pending introduction of mid-week lottery draws.
"Common sense says the lottery has to affect us. It can't by-pass us entirely," said Mr Leach. He also yesterday announced Brent Walker's results for 1994, showing a considerable improvement in overall trading with profits before interest charges of £45.6m comparing with losses of £107.3m in the previous year. The pre-tax loss was £142.7m, against £319.1m, after interest charges. However, the picture is clouded by the complex interest repayment scheme put in place by the restructuring.
Less than £50m cash interest payments are due each year, with the rest gradually being rolled over until December 1997, when the position will be reviewed by lenders.
William Hill's performance was "exceptionally good" despite turnover remaining flat. However, a trend of lower turnover has been experienced in the current year due to the lottery, lost race days, and luck being on the side of the bookie which means that fewer winnings are re-bet.
Betting turnover, of which more than 80 per cent comes from horse racing, rose from £1.54bn to £1.58bn and operating profits climbed from £47.5m to £57.5m.
The growth came from higher credit betting, betting on the World Cup, and the continued deregulation of gaming laws by the Government - allowing betting shops to open after 6.30pm to take advantage of evening racing in the summer.
Pubmaster, the company's 1,700-chain of pubs, returned profits of £13.3m, up from £11.3m. Income is derived mainly from rents, with more than 1,500 of the pubs operated under tenancy agreements.
Other businesses made £1.5m, up from £1.2m.