Ladbrokes Coral Group plc (lon:lcl)
Ladbrokes and Coral Uninspiring But May Be Profitable!


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Title: Ladbrokes and Coral Uninspiring But May Be Profitable!
Company: LCL - Ladbrokes Coral Group plc
Share Price Then: 0p
Author: Ian Smith
Date: Tue 04 Jul 2017
Comments: Ladbrokes and Coral merged on the 1st Nov 2016 citing the normal reasons that businesses merge with competitors but nothing surprising.

It is almost as if both management teams couldn't work out what else to do so lets merge as it will keep everybody busy.

The combined business now has the largest number of shops which is important as there is a big portion of the customer base that will never be on line gamblers.

Worryingly I find both Ladbrokes and Corals websites very difficult to use, there is so much on the screen that I find it difficult to actually find the "make the bet button". However I am not a user of on line gambling sites so they may be clearer to real users.

Also worrying is the video dispute with The Racing Partnership as horse racing is a traditonal part of the betting shop. Whilst each individual horse race better contributes only a small profit, collectively this is a consistent, profitable and predictable income stream.

However neither of these seem to have damaged or encouraged growth with 2017 first quarter revenue up by 5%.

Rightly most people are expecting a cut in the maximum stakes when playing fixed odd machines (roulette etc) soon. I was staggered to find that you can go into a high street betting shop and play computer screens staking up to £100 on the spin of a simulated roulette wheel.

A bit like tobacco companies that used to claim that smoking is harmless, the betting industry is saying that shops will have to close if these high stakes machines are brought under control.

Any business that can only be profitable by exploiting its customers needs to re-consider its business model, there are very few people in high street bettting shops who can afford to bet with even £20 stakes where the game lasts only a few seconds.

Instead be imaginative, when did you last see a betting shop that women would want to go in to? What about luxurious members only areas in the shop?
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