Stanley Leisure Plc (LSE: SLY.L )


Dormant account
Dec 12, 2000
dUK's Stanley H1 profit drops, key casino better
By Mark Potter

LONDON, Jan 22 (Reuters) - UK gaming firm Stanley Leisure Plc posted a 13 percent drop in first-half profits on Thursday after a losing streak at its key Crockfords casino, but said its luck was changing and its betting shops growing well.

Finance Director Michael Riddy told Reuters said the firm's win margin at Crockfords in London's exclusive Mayfair district had picked up in recent weeks, but was still not back to normal.

He also said any continued shortfall from Crockfords should be made up by a strong performance from the firm's 640 betting shops, which are benefiting from moves to relax Britain's gaming laws, such as the introduction of virtual betting machines.

"I think you'll see analysts keeping their (full-year) forecasts broadly where they are," he said, noting the current profit consensus of 43.0 to 43.5 million pounds ($79 to 80 million).

At 1000 GMT, shares in Britain's biggest casino operator were one percent higher at 407 pence, after touching a 13-month high of 413p. The shares had lagged the UK leisure sector by about 30 percent over the previous year.

Stanley, which runs 41 casinos and is Britain's fourth biggest bookmaker, said profit before tax and goodwill fell 13 percent to 21.5 million pounds in the six months to October 26.

Analyst forecasts had ranged from 19.2-22.9 million.

Crockfords broke even after making a 10.6 million pound profit in the same period of 2002.

However, provincial casinos performed well and operating profits in the betting division jumped 44 percent, driven by the expansion of fixed-odds betting terminals which allow punters to bet on games such as virtual roulette.

The terminals, a big boost to bookmakers in recent years, have been criticised by some consumer groups as likely to fuel gambling addiction. But the UK government ruled in November that the machines could stay, up to a limit of four per shop.

Riddy said Stanley had an average of three-and-a-half machines per shop, including standard fruit machines.

"At the moment, we largely have two of each. You might see us switching a bit more to three-to-one next year," he said in a telephone interview.

Greg Feehely, an industry analyst at Altium Capital, planned to raise his profit forecast to 45-46 million pounds from 43.5 million for the year to April 2004. But he kept a "hold" investment rating on Stanley shares, noting their recent gains.

Riddy declined to comment on speculation Stanley might be a bid target for rival betting shop chains William Hill (LSE: WMH.L - news) or privately-owned Coral, or for a big U.S. gambling firm.

Chairman Leonard Steinberg, who founded the business in 1958 with two betting shops in Belfast, Northern Ireland, owns about 18 percent of Stanley Leisure.

Users who are viewing this thread