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Warning Hits Web Gambling Shares

September 25, 2006

Share prices across much of the internet gambling sector dropped following a warning from Leisure & Gaming.

The company said that a string of unfavourable results in American Football's NFL had hit margins.

Its first half pretax profit fell by 8% to £3.5m and it warned that it would not meet expectations for the year.

"Anecdotally, I can confirm that our competitors are feeling the same pinch," said Chief Executive Alistair Assheton.

He added that the problem was a typical headache for bookmakers of favourites winning repeatedly.

L&G's own shares fell , along with those of rivals such as Sportingbet.

Mr Assheton insisted: "Volumes are higher than ever. The punters are certainly coming in."

But he cautioned: "While I remain confident in the prospects for the group, the board is taking a prudent view that we may not meet external expectations in this financial year."

He said that the group's main internal problem was with its Nine.com division, which currently costs too much to run and is not retaining enough customers.

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