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Ladbrokes shares fell nearly 10 per cent Thursday amidst news the UK’s second largest bookmaker’s operating profit would come nowhere near that of last year’s numbers.
Forecasts now call for between £10million to £14million this year compared with market forecasts of £27.5million.
Fingers are being pointed at Ladbrokes chief executive Richard Glynn, who assumed his position as Chief Executive last year.
Glynn said: “Our digital earnings have been disappointing, reflecting a lack of competitiveness in sportsbook, lower margins than planned and a greater disruptive impact than expected from the transition necessary to grow digital for the long term.
“There is only one person accountable and that is me. I am big enough to accept that as chief executive I will be judged on results.”
Ladbrokes outsourced its online development to gaming software firm Playtech, which had previously partnered with Ladbrokes rival William Hill.
A little due diligence on Ladbrokes part could have gone a long way.
In October 2011, Playtech’s Affiliates United employees locked Hill’s online COO Jim Mullen out of its Tel Aviv office while dozens of employees walked off the job. That began the slow and agonize breakup of the William Hill-Playtech relationship.
Ladbrokes chairman Peter Erskine remained optimistic: “The board believes that the (current) strategy is the right one and that the actions taken to date, along with those planned for the coming months, will drive the long-term success of the business.
“We remain fully confident in this management team to deliver them.”
Outside analysts, however, have begun to shun the company.
Canaccord Genuity analyst Simon Davies said the “deeply disappointing update puts considerable pressure on Richard Glynn”.
Shares fell 14¼p to 173¾p.
- Aaron Goldstein, Gambling911.com
