Entain, the London-listed owner of Ladbrokes, Coral and BetMGM, said on Wednesday it had begun a consultation process that could eliminate 400 jobs, or one in five of its 2,000 customer care roles.
Chief executive Stella David said the proposed changes were intended to keep the business competitive and financially resilient. She said the decision had not been made lightly and that supporting affected colleagues was the immediate priority.
The cuts follow first-half results reported weeks earlier, in which underlying operating profit reached £479 million for the six months to the end of June. That figure was 2% below the same period a year earlier but ahead of investor expectations.
Entain attributed the reductions in part to higher UK taxes, as the sector braces for a possible increase to machine games duty in the budget. The chancellor is reportedly considering raising the levy in his first budget on 28 October, in a way that could target betting shops and adult gaming centres.
Doubling the standard rate of machine games duty from 20% to 40% would add about £100 million to the cost of running Entain’s UK retail business, David wrote to Andy Burnham last week. She claimed such a move could result in 1,470 betting shop closures and 15,900 job losses across the UK.
Research by the Social Market Foundation estimated that doubling the duty could increase the tax take from £2-a-spin category B slot machines by between £275 million and £458 million, on top of the £600 million they currently pay.
Entain, headquartered in London, employs more than 28,000 people worldwide and began as GVC Holdings in 2004. Its brands include BetCity, Eurobet, Foxy Bingo, Gala and PartyCasino.
Shares in the company are down about 36% in the year to date and fell 1% in early trading on Wednesday. Entain is due to be demoted to the mid-cap FTSE 250 index from 21 September.