In an interview with the Irish Independent this week Ladbrokes Ireland director Jackie Murphy explored the likely consequences of the Irish government’s doubling of its tax rate on betting, suggesting that the gambling giant is likely to shutter its horse racing on-course bookmaking activity in Ireland as unviable, and possibly discontinue racing sponsorships at locations when it closes the on-course betting shops.
Murphy said it was possible that the tax hike would slow the company’s investment in retail High Street betting shops, and claimed that it’s unlikely that any other operator will take over the on-course betting points once Ladbrokes’ contracts expire, unless they want to operate them on a loss-making basis.
“I would be surprised if anyone else goes into them,” she said. “No one would be doing it to make money.”
The newspaper reports that Ladbrokes operates betting shops at eight racecourses: Galway, Limerick, Killarney, Punchestown, Listowel, Navan, Gowran Park and Clonmel.
Murphy said that existing contracts on some of those on-course betting shops expire later this year or early next year, while Punchestown runs until 2020. She said that Ladbrokes pays either a fixed rent or profit share to operate the outlets, and the contracts are held with the individual racecourses.
She acknowledged that smaller racecourses may come under pressure as a result of the decision to cease race sponsorship at courses where it has betting shops, but explained that viability varied widely – a race day at Killarney might see its on-site betting shop take Euro 6,000 in bets, but the figure could be as high as Euro 60,000 at Punchestown, depending on the event.
Ladbrokes may seek to retain the contract at Punchestown given that its profile is higher and it receives TV coverage, but that even its presence there will have to be reviewed, she said.
Ladbrokes operates 141 of its own outlets in Ireland, having closed more than 50 in 2015 following an examinership process (see previous report).