fter reaching a settlement with HMRC, Ladbrokes said that the cash receipt of us$ 122.8 million covers substantially all outstanding items in respect of tax years through to December 31st 2007.
Ladbrokes said the settlement would result in the recognition in the company’s 2010 Income Statement within the tax charge of a us$ 402.4 million tax credit in relation to prior years.
Of this credit, us$ 331.7 million relates to current tax and us$ 70.6 million relates to the recognition of a deferred tax asset. As a result the finance charge in 2010 will be reduced by approximately us$ 30.7 million to reflect the interest consequences of the settlement.
Ladbrokes said that its guidance for the effective accounting tax rate over the medium term remains unchanged at 19%, and anticipates that the cash tax rate over the same period will fall to about 15% to reflect the utilisation of tax losses.
In related news this morning, former Chief Executive Christopher Bell has been appointed interim CEO of video games retailer Game Group after Lisa Morgan stepped down from her role as CEO following a significant drop in profits in 2009. Bell has served on Game’s Board since 2003 and was recently replaced as Ladbrokes CEO by Sporting Index’s Richard Glynn.
Shares in Ladbrokes plc have gained 3.49% in London this morning following the announcement.