Heineken and Ladbrokes count costs of lockdown
Betting firm Ladbrokes has reported a 90% year-on-year drop in revenue for its European retail division for the first half of the year. Picture: Nick Ansell/PA Wire
Brewers and bookies continue to show the impact of the Covid-19 disruption; with Dutch beer giant Heineken and UK betting firm Ladbrokes each showing reduced revenues for the first half of the year due to the pandemic.
Heineken’s first-half net revenue fell 16.4% as the impact of coronavirus-related lockdowns intensified in the second quarter.
The Dutch beer maker’s unscheduled downbeat results sent its shares down by more than 5% before the stock pared back some of its losses.
“After a low point in April, volume started to gradually recover into June as lockdowns were lifted around the world and customers restored depleted inventories,” Heineken said, adding that beer volumes were most affected in the Americas, Africa, the Middle East and Eastern Europe.
The company’s January-June preliminary operating profit and net profit plummeted by 52.5% and 75.8% respectively, it said.
Heineken’s Danish rival Carlsberg said last week it had seen a smaller than forecast drop in first-half operating profit as its key Chinese market rebounded strongly during the second quarter.
Meanwhile, betting firm Ladbrokes has reported a 90% year-on-year drop in revenue for its European retail division for the first half of the year.
The European unit strips out its core UK arm and mainly covers its 141 shops in the Republic, but also its operations in Italy and Belgium.
Ladbrokes shops only recently reopened after four months closed amid a virtual total blackout of live sport.
On a group-wide basis, GVC - which owns Ladbrokes-Coral and online gaming brands such as PartyPoker, Party Casino and Foxy Bingo - saw first-half revenues fall 22% year-on-year.
GVC also announced the departure of long-time CEO Kenny Alexander, who transformed the company into one of the world’s biggest gambling businesses during 13 years at the helm.
The group's shares fell nearly 4%.
Another consumer giant, Johnson & Johnson said its second-quarter profits tumbled 35%.
However, the healthcare giant has raised full-year profit forecasts and said it is aiming to begin in September a late-stage study of its Covid-19 experimental vaccine, as researchers work at break-neck speed to develop a shot to combat the fast-spreading pathogen.
J&J expects to start human trials of its vaccine this month, but it lags other companies that also are developing coronavirus vaccines, with Moderna expected to begin a late-stage study on July 27.
