Ladbrokes Plc, the owner of more than 2300 UK and Irish betting shops announced that it will be moving its online sports-betting unit to Gibraltar by the year end in order to save about £7 million in tax and levy annually. Online bookmakers based offshore pay about 1.5% in tax, compared with the 15% for UK operators. "It gets to the point of 'last man standing,' it really gets to be untenable," Chief Executive Officer Richard Bell told reporters. "We made it quite clear we wanted to stay in the UK." The move comes as the company reported a 21% drop in first half profit as horse-racing and soccer results favoured customers. The company's internet gambling operations were hurt in the first half by intensified competition for poker, Ladbrokes said in a statement today. Results were also crimped by horse racing cancellations and customer wins at shops early in the year.

Net income for the 6 month period ending 30th June dropped to £74.7 million from £94 million the previous year. While on the internet side revenues showed only a modest decline of 2.3% to £84.6 million the operational profit declined 21% as a result of the factors above. Bingo revenues were up 29.8% from £4.7 million last year to £6.1 million for the same 6 month period this year.

Ladbrokes shares gained 3.5p to 170.1p in London trading giving the market company a market value of around £1.03 billion. Bell added that while the company had experienced difficult times that they were still aiming to meet analysts' full-year profit estimates. Ladbrokes said that they would cut the first-half dividend fomr 5.1p to 3.5p and disclosed plans to sell off parts of the business. These include the Italian Betting Shops reportedly to be worth around £50 million and The Paddington Casino in London.