Profits at Ladbrokes in Ireland doubled

Tax-free betting and expansion doubled profits at bookmaker Ladbrokes' Irish operation to €21 million last year.

London-listed Ladbrokes said yesterday that 2006 operating profits from its Irish business increased 107 per cent on the previous year to €21.3 million.

The company did not fully break out its 2005 Irish results last year, and instead combined them with its retail betting operation in Belgium. The pair had operating profits of more than €16 million in 2004.

Gross win - the difference between the total amount staked by customers and that handed back in the form of winnings - was €73 million last year.

That was a 43 per cent increase on 2005. As a general rule, gross win amounts to between 11 per cent and 15 per cent of betting turnover. The figure is calculated before operating costs.

The company said that the growth in its Irish business was "due to a 32 per cent increase in shop numbers and the first full year of tax-free betting in all Ladbrokes shops".

Ladbrokes says it has the biggest chain of bookies in Ireland, with 195 shops around the island. During the year it bought the Duffy family-owned North West Betting business in Derry. This added 16 shops to its estate. It began 2006 with 148 outlets.

The chain is one of a number hoping to introduce casino-style gaming machines, fixed-odds betting terminals (FOBTs), to its shops in the Republic.

Irish law does not allow betting shops to operate gaming machines, but lawyers have told the Irish Bookmakers' Association (IBA) that this does not apply to FOBT.

However, Minister for Justice Michael McDowell said the machines were illegal and warned that they would be seized. A group appointed by him is due to report on legalising and regulating casinos.

The IBA is waiting to hear its findings. A Ladbrokes spokesman said yesterday that the company would not introduce FOBTs until "there was clarity around the law". Ladbrokes' average weekly gross win from its FOBTs in the UK was €800 million in 2006.

Ladbrokes plc yesterday reported operating profit of £268 sterling (€400 million) on the back of gross win that topped £1 billion.