Ladbrokes shares up despite profits hit

<p>Profits have taken a sharp fall at Ladbrokes.</p>

Ladbrokes stocks are up this morning (February 25th) despite a sharp drop in profits at the company revealed in its latest financial results.

The firm announced that its pre-tax profits for 2013 were recorded at £67.6 million, which was down 66 per cent on 2012. Ladbrokes said this was due to £51.6 million in exceptional costs, a total that was driven largely by a software upgrade.

Chief executive Richard Glyn admitted that the bookmaker's latest results were "disappointing", but insisted that the company had made "real operational progress" in the last 12 months.

As part of its plans to improve its financial position in 2014, Ladbrokes announced it is planning to close between 40 and 50 of its stores this year.

Ladbrokes is aiming to complete its software upgrade – the result of a deal with Playtech – in time for the Fifa World Cup, which is taking place in Brazil this summer.

The company is one of the largest UK bookmakers but has come under fire for its use of fixed odds betting machines, which allow users to gamble large sums in a short period.

Mr Glyn said Ladbrokes took the issue of responsible gambling "very seriously" and added: "Problem gamblers, contrary to popular myth, are not good for business."

Although shares in Ladbrokes initially rose by three per cent on the news, by 13:32 GMT they had lost ground and were up just 0.53 per cent for the day.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.