GVC reduces number of betting shop closures after "game of poker" with rivals

GVC Holdings, the parent company of Ladbrokes and Coral, has said it now anticipates only closing 450 betting shops as a result of the government's crackdown on FOBTs – less than half the number originally estimated – following a "game of poker" with competitors.

The news came as the company released its financial results for 2019 and will be welcomed in racing as it will lessen the immediate impact to the sport from lost media rights payments.

Closures will now return to a "business as usual level" of two to three per cent per year, GVC said.

GVC had said it would have to close around 1,000 betting shops as a result of the government's decision to cut FOBT stakes to £2 from £100 which was implemented last April, although that estimate was subsequently reduced to 900 shops.

During 2019 245 shops were closed as a consequence of the government's Triennial Review, GVC said. A further 200 shops closed last month. William Hill closed 700 betting shops last autumn.

GVC said the performance of the group's retail business had been "very strong" and the company praised the "dedication and professionalism" of betting shop staff, with a one-off bonus of £2.5 million set to be shared "amongst our front-line colleagues in UK retail".

Alexander said: "It was going to be like a game of poker – who closes first. Some of our competitors closed proportionally a lot more shops a lot quicker.

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"We held our ground as a result and, as a result, we have closed significantly fewer shops than we had thought because others closed more. We have come out of the other end with a much stronger retail business than we had probably anticipated this time last year.

"We have got a UK retail business that generates over £100m in cash and can drive our online business with Ladbrokes and Coral through our omnichannel strategy."

Overall, GVC reported a three per cent increase in proforma net gaming revenue to £3.66bn.

Underlying group Ebitda (earnings before interest, taxation, depreciation and amortisation) fell by ten per cent to £678.3m but that was £50m ahead of consensus forecasts at the start of 2019.

GVC made a reported group loss after tax of £140.7m due to costs relating to the acquisition of Ladbrokes Coral and bwin and an impairment charge relating to the group's Australian online business.

Kenny Alexander: praised dedication and professionalism of betting shop staffCredit: Kathleen Sarg

Alexander said: "It was potentially a very challenging year but we have grown faster than all of our competitors in our key markets, we've beaten our numbers which people expected us to achieve at the start of the year by £50m and we upgraded our numbers three times during the year. So really we've managed to more than deliver on what we've said we'd do."

The gambling industry is facing up to the prospect of further tightening of regulation, with the government promising a review of the Gambling Act and politicians calling for a £2 maximum stake for online gaming.

Alexander said: "I don't think £2 stakes is the way to go, I think that will drive a lot of customers – and a lot of potentially vulnerable customers – on to the black market.

"There are going to be changes in the UK for certain, I can see further restrictions on advertising, I suspect there will be changes to the way we run our VIP programmes, but I am hoping that people recognise the industry has made quite significant strides tackling problem gambling and I think we are on the right path."

GVC shares were down 2.9 per cent on Thursday afternoon at 784.4p.

Kenny Alexander not just looking forward to Honeysuckle at Cheltenham

Honeysuckle is not the only fancied runner Kenny Alexander has as an owner at next week's Cheltenham Festival, with Minella Melody heading the market for the Daylesford Mares' Novices' Hurdle on Thursday at a general best price of 11-4.

Alexander may have three runners at the meeting with the Willie Mullins-trained Elfile possibly joining Honeysuckle in the Close Brothers Mares' Hurdle on Tuesday.

The Henry de Bromhead-trained Minella Melody is unbeaten over hurdles this season, winning a Grade 3 mares' event at Fairyhouse last time out.

Minella Melody (Rachael Blackmore) wins at Fairyhouse last timeCredit: Patrick McCann (racingpost.com/photos)

Alexander said: "I think I'll have three next week, Honeysuckle in the mares, I think we'll have Elfile in the mares and I think I'll have Minella Melody in the mares' novice.

"Minella Melody is unbeaten, she is favourite for the mares' novice. I think the price is quite short, it's probably more competitive than the market but she probably should be favourite. I'm not sure I would be getting stuck in at that price but maybe she will be bigger on the day.

"She's very good, she could probably do with being up in trip but if it's soft she's definitely got a chance."

Alexander said Elfile, the winner of three of her last four starts and who is also in the Coral Cup, should not be underrated.

He added: "Only Willie Mullins knows where she will run, she might not run at all, but she has probably gone under the radar. She could run a really big race. I can't see her winning but I could definitely see her in the first three."

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