Ladbrokes owner GVC bets on US growth

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GVC, the holding firm of Ladbrokes, is hopeful of a massive growth in the USA, following its third straight annual loss in the UK and circumstances of general gloom.

The company acquired bookmaker Ladbrokes Coral last year for £4bn. Now it reports a pre-tax loss of £18.9m. The loss last year was £22.6m.

The reasons for the loss are mainly £434.2m in one-off costs, which include write downs of the value of Ladbrokes’ UK shops and back taxes in Greece.

GVC reiterated its expectation that the rule change on April 1, when the maximum stake on fixed-odds betting terminals will be slashed from £100 to £2, would force it to close about 1,000 shops, with roughly 5,000 job losses.

British gambling companies are increasingly seeking to duck domestic headwinds by building their businesses in the US market, which has opened up piecemeal since a ruling permitted individual states to legalise sports betting.

Ladbrokes rival William Hill, which already has operations in all seven US states where sports betting has been legalised, last week said it aimed to expand its US presence as it too revealed an annual loss.

Kenny Alexander, GVC chief executive, said the importance of the UK retail business was declining as customers moved online, and that he expected GVC to return to profitability in the next 12 months.

GVC said the US market was a “very significant opportunity” and that it expected the majority of states to be regulated within three to five years.

“We’ll be aggressive when new markets open up there,” said Mr Alexander, adding that it would not be a “drain on our financial firepower.”