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NO MORE STANDALONE POKER FOR LADBROKES
The managing director for online gambling operations at UK gambling group Ladbrokes, John O'Reilly, revealed this week that the company is to change its poker strategy from being a standalone Internet poker room powered by Microgaming, to being a full member of the Microgaming Poker Network, joining over 40 other tier one poker operations and enhancing player liquidity.
“Most of the poker rake is generated by the high stakes players and we have taken the decision to offer them US liquidity from those individual states where there is less of a legal risk," O'Reilly explained.
"We have evaluated the legal situation and are happy with our position, ” he added, further explaining that high stakes players have left many European sites in favour of higher liquidity US-facing competitors.
O'Reilly was commenting on the company's 2008 half yearly results, which saw the online gaming division of Ladbrokes achieve a 19.4 percent rise in net gaming revenues to GBP 86.6 million (H.1:2007 GBP 72.5 million).
Online poker NGR seems to have followed a developing trend in the industry, falling 6.4 percent to GBP14.7 million (2007 H.1: GBP15.7 million).
Elsewhere in the division, Internet sportsbook NGR climbed a creditable 18.5 percent to GBP32.1 million, and online casino NGR performed even better with a 19.8 percent growth. In-running revenues were particularly satisfying - up by 50 percent.
Divisional operating profits were flat year on year at GBP26.2 million, in line with Ladbrokes’ strategy announced back in February that it would focus on player acquisition during 2008, monetising same through to 2010.
“We intend to take advantage of our position in the market and invest heavily in player acquisition," O'Reilly reiterated. "Sign ups are up 30 percent on last year, and we have set a 20 percent growth target for NGR between now and 2010....we are bang in line with that.”
O'Reilly backed up his comments with impressive figures; Ladbrokes recruited some 237 000 new online gaming customers during the first half of the year, increasing the tempo of UK and European advertising. The key to success lay in retaining the players it had acquired, and this was a priority O'Reilly said.
Ladbrokes Group pre-tax profits for the six month period to the end of June fell to GBP 170 million from GBP192.7 million over the same period last year. Removing the volatile numbers from high rollers, gross win increased 13 percent to GBP 583.3 million, pre-tax operating profits fell 2 percent to GBP130 million and UK retail gross win increased 6.5 percent to GBP394.3 million.
Christopher Bell, the CEO for the wider Ladbrokes Group, said that performance had shown resilience despite the 'challenging' economic environment. Trading at the start of Q3 was looking up, with Group gross win for the period from 1 July to 5 of August rising by 11 percent overall," he revealed.
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