Ladbrokes' profits down 34% as punters hit winning streak

An unusually high number of horse-race cancellations also affected the performance in the four months to 30 April, although Ladbrokes said more normal trading patterns had returned in recent weeks, helped by a favourable outcome in the Grand National at Aintree last month.

Chief executive Chris Bell said predicting activity levels in the current climate was difficult, but he remained confident in Ladbrokes' performance over the year.

In a trading statement, the bookmaker said its gross win – the amount left by losing punters – had declined by 4 per cent in its UK retail division.

Including the impact of free bets, over-the-counter gross win reduced by 11 per cent in the four-month period. However, this was offset by a 5 per cent improvement in the average weekly gross win per gaming machine.

Revenues from telephone betting fell 54 per cent, reflecting the impact of horse racing cancellations and poor results.

High-roller customers generated profits of 25 million for the company in the four-month period, down from 40m a year earlier, although it has generated a further 17m so far this month.

Shares slumped almost 9 per cent to close at 204.75p, with analysts saying the 34 per cent decline in the company's profit for the period had been worse than expected. The measure excludes the high-roller customers and is based on continuing operations. The group, which has more than 2,500 betting shops, posted operating profits of 243.8m in 2008, an increase of 0.9 per cent on a year earlier. The numbers for its high-roller business prompted Numis Securities to raise its full-year profits forecast by 9 per cent to 198.4m, although it warned there was a downside risk to estimates if current trading did not improve.

Investec Securities said the trading statement was disappointing in the context of more bullish updates from William Hill and Paddy Power.

Gross win for the group in the four-month period was flat, against Investec's expectations for growth of 4.7 per cent across the full year.

Analyst Matthew Gerard said: "Although margin volatility in over-the-counter retail is to be expected, the impact of poor sporting results in March has had a bigger impact than we expected, given William Hill and Paddy Power's recent guidance."

Ladbrokes is facing increased competition in the online business from William Hill, which has recently linked up with software provider Playtech to improve its offering.