According to GVC, the impact of the new FOBTs regulations hasn’t been as bad as they originally expected on British operator Ladbrokes.
UK.- The UK government decided to slash the cap on fixed odds betting terminals and operators feared a major crisis. However, GVC Holdings, the parent company of Ladbrokes, explained that things have gone better than expected.
The company revealed that the impact on its core earnings will be €149 million, instead of €171 million.
“This actually follows on what William Hill said regarding the same subject. William Hill didn’t adjust their guidance in the same way but the tone of the results was certainly positive around the impact of the FOBT changes,” Hargreaves Lansdown analyst George Salmon said.
The previous forecast
The reduction of maximum stakes at fixed odds betting terminals (FOBTs) from €116.5 to €2.3 was enforced in April. The decision may have a hugely negative impact on the industry, causing not only a loss of profit but of jobs as well.
As GVC told media outlet The Sun, Ladbrokes will close up to 1,000 shops, putting 5,000 jobs at risk. They currently operate 3,475 stores but will lose out on cash from regulation changes, which will force them to reduce.
“As announced during a recent trading update we expect up to 1,000 shops to become loss-making,” they said. “Closures at this level would place up to 5,000 jobs at risk over the next 18 to 24 months,” the company added.