Ladbrokes Face £3m Hit If Leicester Win League

Ladbrokes (LSE: LAD.L - news) has revealed it will take a £3m financial hit should Leicester win the Premier League.

The bookmaker said the sum was in addition to funds that had already been collected through 'cash out' as fans sought to profit from bets placed at industry odds of around 5000/1 available at the start of the season.

It (Other OTC: ITGL - news) was revealed in March that one punter had already collected £72,000 on a £50 stake.

Ladbrokes issued details on its exposue as its latest results statement blamed the Cheltenham Festival for taking the gloss off its first quarter performance - the first update on its business since revealing an annual loss of £43.2m.

The company, which is planning a merger with Coral , said that results at the highlight of horse racing's jump season went against it and offers and pricing from other rivals "abandoned bookmaking principles".

Chief executive Jim Mullen described the festival as Ladbrokes' "worst in living memory".

"We have had an encouraging start to the year. Results throughout the first few weeks were largely in our favour and our customer metrics have continued to be strong".

But he added: "At Cheltenham we were reminded of the intense competition with offers and pricing at levels which, in our view, abandoned bookmaking principles.

"We competed hard but refused to pursue unsustainable strategies and our stance remains that we will compete where we know we can get the right returns from the right customers."

The major players in the betting industry have been battling to promote responsible gambling amid a furore over fixed-odds betting terminals within shops.

In racing, there was a flood of complaints from customers after Cheltenham that some digital bookmaker platforms were refusing to pay winnings and closing accounts for flouting their rules on promotions and bonuses - rules that punters claimed were not clear.

Ladbrokes said its festival performance had not dented the company's full-year guidance.