Proposed regulations from U.K. Gaming regulators—including betting limits at video poker terminals and slot machines—will hurt British bookmaker’s bottom line, a report by Fitch Ratings warns.
According to an opinion paper by Fitch, gaming regulators are preparing new regulations for gaming machines, including setting a £2 wager limit. The current limit is £50.
Lawmakers are also considering rules that would reduce the pace of play at video betting terminals. The proposed rules appear to be in response to criticism of betting machines in the British media and by problem gambling advocates.
Fitch estimates, bookmakers like William Hill and Ladbrokes Coral would see significant reductions in revenue as the machines account for about half of the profits realized by both companies.
“Ladbrokes Coral and William Hill are the most exposed major gaming companies, because of their large portfolios of licensed betting offices,” the opinion said. “In our downside scenario we assume that Ladbrokes Coral would lose about 35 percent of gaming machine revenues, leading to FFO-adjusted net leverage remaining above our 4.0x sensitivity guidance for a downgrade for two years.”
