Yahoo Finance Ladbrokes keeps Covid furlough payments despite online betting surge
Ladbrokes’ owner, Entain, claimed millions of pounds in furlough cash while reaping the benefits of a surge in online betting, the Guardian can disclose.
Rival bookmaker William Hill paid back taxpayer support, citing growth in online revenue among the reasons why it did not need the money.
Related: UK betting companies report profits in 2020 as US market opens up
HM Revenue & Customs (HMRC) disclosures analysed by the Guardian show that Entain claimed between £12.5m and £30m in December and January.
It received the money to pay 14,000 staff who were furloughed at about 3,000 of its high street shops, which were forced to close as a result of coronavirus restrictions.
Its full-year accounts, published last month, showed that the financial impact of the closures was offset by a £500m increase in online revenue during 2020. Entain finished the year with revenues unchanged at £3.6bn, recording a profit of £113.8m.
Its share price ended 2020 up more than 40%, as investors welcomed promising signs for online gambling and the company made strong gains in the fast-growing, newly regulated US market.
The company also spent money on lobbying efforts while claiming furlough support.
In January 2021, a month for which Entain received between £10m and £25m of taxpayers’ funds to pay staff, the company hired CT Group – the political consultancy run by former Boris Johnson and Theresa May adviser Lynton Crosby.
CT Group helped Entain set up a consumer group called Players Panel, which it said represented the voices of ordinary gamblers. The group publishes comments from Entain customers who say they are concerned at the prospect of draconian regulation arising from an ongoing review of gambling laws that could crimp industry profits.
While Entain kept its furlough support, William Hill made the decision in August last year to pay it back, thanks to a “strong recovery” as live sports resumed and its shops were allowed to open again.
“In light of this positive trading environment, the board feel it is appropriate to repay the furlough funds received, amounting to £24.5m, and we will not be claiming the job retention bonus.”
High street bookmakers have had to close again since then due to the national lockdown but the Guardian understands that William Hill has not reversed its decision and has continued to pay staff 100% of wages.
A number of other companies that have performed well financially during the pandemic have also returned furlough support. They include Ikea, Serco and the housebuilders Redrow, Barratt and Taylor Wimpey.
In a statement, Entain said: “The furlough scheme has been a sensible and highly welcome policy intervention that helped us, as one of the country’s largest retailers, to maintain the livelihoods of more than 14,000 retail colleagues on full pay.
“Whilst the virus is still with us and the outlook, although improving, is still far from certain, the board will continue to keep the situation under review.”
Entain is not the only major gambling company to claim furlough despite a significant online presence.
Done Brothers (Cash Betting), part of the billionaire Done brothers’ Betfred empire, claimed between £6m and £12.5m over December and January. A spokesperson for the company did not return requests for comment.
“These companies have made vast profits over the past year, taken directly from punters losses, and now they are taking from the taxpayer too,” said the Labour MP Carolyn Harris, who chairs a cross-party group of MPs advocating regulatory reform of gambling.
HMRC started disclosing furlough claims earlier this year after the government changed the law in an effort towards transparency designed to prevent fraud.
Only claims for December 2020 and January 2021 have been published so far, with the next set of disclosures due in early May.
The Guardian has previously revealed that billionaire tax exiles, the British National party, Saudi royals and oil-rich Gulf states were among the claimants.
