The UK’s major bookmakers have suffered a sharp drop in share price following the issuing of a trading update from land-based and online gaming operator Stanley Leisure.
Stanley, which operates several betting shops and land-based casinos, said it had reduced profit expectations for the six months ending 31 October 2004 following a string of “unfavourable” sporting results.
“Unfavourable sporting results within the Betting division have continued, and have affected both the domestic and international betting businesses,” a statement from Stanley said.
This was compounded by an estimated US$5.8m (£3m) loss to a high roller in one of its London casinos.
The firm said it estimated profits would now be in line with last year when the company generated profits of US$78.4m.
Investors reacted badly to the news and by close of trading on Wednesday Stanley was down -11.54%, and the knock-on effect was felt by other listed companies in the sector.
Sportingbet, the largest pure egaming firm on the London Stock Exchange, saw its share price fall by nearly 4%, despite having limited exposure to the UK betting market.
And William Hill and Ladbrokes, the UK’s two biggest bookmakers, also suffered a share price slide as a result of the news with William Hill’s share price falling by almost 7%.
But despite investors’ fears, William Hill said it expected continued growth in the fixed-odds betting terminal (FOBT) sector to soften the blow from the run of bad results.
In contrast Stanley said growth in its FOBT business had been “insufficient to offset the reduction in contribution from the core betting operation”
source : egaming review magazine
