1

22 February 2007

Sir Ian RobinsonChairman

2

Rosemary ThorneGroup Finance Director

3

Continuing operations

Operating profit(1)

Net finance costs (1)

Interest income on Hotels sale proceeds

Profit before tax(1)

Effective tax rate(1)

EBITDA(1)

EPS(1)

Year to 31 December

Summary of performance

(1) Before non-trading items

2006£m

268.1

(45.6)

24.0

246.5

17.8%

310.5

22.0p

2005£m

249.0

(16.9)

-

232.1

17.6%

286.2

12.0p

Variance B(W)%

7.7

(169.8)

-

6.2

8.5

N/A

4

UK Retail

Ireland & Belgium

eGaming

Telephone Betting

Vernons

Central Costs

Total

Year to 31 December

Betting and Gaming

2006£m

715.8

84.0

144.4

46.1

18.6

-

1,008.9

2005£m

683.6

71.0

123.1

21.0

19.3

-

918.0

2006£m

195.4

17.3

47.0

17.7

5.9

(15.2)

268.1

2005£m

207.8

11.7

41.4

(0.1)

5.8

(17.6)

249.0

VarianceB(W)%

(6.0%)

47.9%

13.5%

n/a

1.7%

13.6%

7.7%

Gross Win Operating Profit

VarianceB(W)%

4.7%

18.3%

17.3%

119.5%

(3.6)%

9.9%

5

OTC gross win

Machines gross win

Total gross win

Adjustments to gross win (1)

Net revenue

Gross profits tax

Staff costs

Property costs (2)

Content costs (3)

Other costs (inc. depn and FOBT tax) (4)

Operating profit

Year to 31 December

UK Retail – Results

(1) Fair value adjustments, VAT, associate income(2) Rent, rates and utilities

2006£m

510.5

205.3

715.8

(27.9)

687.9

(75.0)

(183.7)

(89.1)

(58.6)

(86.1)

195.4

2005£m

484.5

199.1

683.6

(2.0)

681.6

(96.9)

(171.4)

(78.2)

(53.4)

(73.9)

207.8

VarianceB(W)%

5.4

3.1

4.7

0.9

22.6

(7.2)

(13.9)

(9.7)

(16.5)

(6.0)(3) Pictures, data, levy, Sky(4) Depreciation = £34.7m (2005: £29.8m), FOBT tax = £5.6m (2005:£nil)

6

Like for like Total gross win growth

Like for like OTC gross win growth

Like for like machines gross win growth

OTC margin

Like for like total costs (1) increase

Like for like shop staff costs increase

Stake per slip (2)

Average number of FOBTs

Average weekly gross win per FOBT

Year to 31 December

UK Retail – KPIs

(1) Excludes VAT, Gross profits tax and FOBT tax

2006

0.8%

1.1%

0.1%

16.9%

4%

2.9%

£8.39

6,743

£538

2005

0.4%

(2.3)%

7.7%

16.1%

5%

7.3%

£8.47

6,403

£545

Variance B(W)%

(0.9)

5.3

(1.3)

(2) Slips exclude machines

7

Gross win

Fair value adjustments

Net revenue

Duty / Gross profits tax

Other costs

Operating profit

Shop numbers

Year to 31 December

Ireland2006£m

48.9

(0.4)

48.5

(5.1)

(29.1)

14.3

195

2005£m

34.3

(0.2)

34.1

(3.8)

(23.4)

6.9

148

VarianceB(W)%

42.6

(24.4)

107.2

31.8

8

Sportsbook

Poker

Casino

Games

Gross Win

Year to 31 December

eGaming – Gross win2006

£m

46.4

40.3

44.7

13.0

144.4

2005£m

33.0

41.4

39.1

9.6

123.1

VarianceB(W)%

40.6

(2.7)

14.3

35.4

17.3

9

Gross win

Fair value adjustments (1)

Net revenue

Gross profits tax

Levy

Staff costs

Software & geographical partners (2)

Marketing (inc. affiliates)

Banking and chargebacks

Other costs (inc. depn)

Operating profit

eGaming – Results2006£m

144.4

(10.3)

134.1

(6.9)

(2.1)

(11.0)

(29.0)

(17.3)

(7.8)

(13.0)

47.0

%age of net

revenue

5.1

1.6

8.2

21.6

12.9

5.8

9.7

35.0

VarianceB(W)%

17.3

15.4

13.5

2005£m

123.1

(6.9)

116.2

(5.8)

(1.5)

(10.2)

(26.9)

(14.2)

(5.3)

(10.9)

41.4

Year to 31 December%age of

net revenue

5.0

1.3

8.8

23.1

12.2

4.6

9.4

35.6(1) Adjustments for free bets, promotions and bonuses (2) Payments to third party software and platform providers and

geographical partners

10

Unique active players (000s) (1)

Real money sign-ups (000s) (2)

Cost per acquisition (3)

Adjusted cost per acquisition (4)

Year to 31 December

eGaming – KPIs2006

549

303

£91

£56

2005

435

247

£85

£62

VarianceB(W)%

26.2

22.7

(7.1)

9.7

(1) A player who contributed to rake and/or placed a wager during the period(2) A new player who has registered and deposited funds during the period(3) Total of all online and offline marketing spend and affiliate expenses divided by the aggregate real money sign-ups(4) Total of all online and offline marketing spend less any CRM spend divided by the total real money sign-ups

11

Gross win exc. High Rollers

Fair value adjustments

Net revenue exc. High Rollers

High Rollers’ net revenue

Net revenue

Gross profits tax

Levy

Staff costs

Direct operating costs

Other costs (inc. marketing and depn)

Operating profit

Telephone Betting – Results2006£m

33.9

(0.3)

33.6

12.2

45.8

(7.3)

(2.6)

(8.4)

(3.3)

(6.5)

17.7

%age of net

revenue

25.0

9.8

19.3

VarianceB(W)%

11.1

11.6

122.3

2005£m

30.5

(0.4)

30.1

(9.5)

20.6

(3.1)

(2.1)

(8.1)

(3.0)

(4.4)

(0.1)

Year to 31 December%age of

net revenue

26.9

10.0

14.6

(1) Direct operating costs include telephone, bandwidth and banking costs

12

No. of calls (000s) (1)

Agent cost per call

Gross win margin (exc. High Rollers)

Unique active players (000s) (2)

Average monthly active player days (000s)

Year to 31 December

Telephone Betting – KPIs

2006

7,832

59p

7.2%

124.4

209

2005

7,290

63p

7.3%

125.3

204

VarianceB(W)%

7.4

6.3

(0.7)

2.5

(1) Number of calls (excluding customer service calls)(2) A player who has placed a wager during the period

13

CapexUK Development (1)

FOBTs and EPOS

Xtra

Ireland

Other (including IT: £8.0m; 2005 - £3.1m)

Retail

eGaming / Telephone Betting

Total

AcquisitionsJack Brown

Other (UK: £2.1m, Ireland: £25.6m, Italy: £4.7m)

Year to 31 December

Analysis of 2006 capital expenditure2006

£m

38.8

15.7

6.3

3.7

17.8

82.3

5.1

87.4

-

32.4

119.8

2005£m

37.7

-

4.1

3.2

11.1

56.1

4.1

60.2

80.3

44.5

185.0(1) Development = new licences, relocations and refurbishments (inc. Jack Brown)

14

2006 gross win impacts

High Rollers

World Cup (1)

2007 incremental costs

FOBT tax (2)

Gambling Commission

Specific ItemsFY£m

(12)

(9)

(8)

(3)

H1£m

(13)

(5)

(7)

(1)

(1) Assumes 50% substitution(2) The incremental cost expected in 2007 over 2006

15

Cash generated by operationsInterest and taxPPE capital spend (1)

IntangiblesAcquired subsidiariesTotal capital spend (1)

Cash flow after interest, tax and capitalHotels disposal proceedsDividends paidProceeds from issue of shares, convertibles and optionsExchange and other movementsNet borrowings movementOpening net borrowingsClosing net borrowings

Net debt to EBITDA ratio for continuing operations

Year to 31 December

Cash Flow

(84.8)(9.0)

(26.0)

2006£m

264.7(53.5)

(119.8)91.4

3,241.4(4,208.4)

344.5(19.9)

(551.0)(397.9)(948.9)

3.1(1) Continuing operations only

16

Christopher BellChief Executive

17

Overview• Good World Cup

• Continued eGaming growth

• Successful year with Telephone High Rollers

18

Agenda• 2006 performance

• Strategic overview, including:

– International progress

– Casino ambitions

• Current trading

19

UK Retail Gross Win Margin %

2006 2006

FY

2005

FY

2004

FY

04 - 06

3 Yr Av.

Q4 Q3 Q2 Q1

Horses 14.6 13.3 15.7 14.5 14.6 13.9 14.2 14.2

Football 25.0 32.2 19.1 19.0 22.9 23.4 18.7 21.7

OTC 17.5 16.4 17.3 16.4 16.9 16.1 16.2 16.4

Horse overround

per runner 1.71 1.61 1.50 1.51 1.58 1.55 1.60 1.58

%1st/2nd favs 54.6 50.1 50.4 52.0 51.7 49.0 50.9 50.6

20

Retail EstateNumber of shops ’06 ’07

pipeline

Acquisitions 44 9

New licences 27 33

Relocations 91 42

Extensions 25 11

Refurbishments 67 17

Total 254 112

21

Shops• New Dual screen FOBT estate

• EPOS renewal completed by April

• Winter evening opening from September

• £500 Jackpot machines from September

• Self service terminals being tested

• Largest retail estate in Ireland

• No negative impact from Scottish smoking ban

22

eGaming• Continued organic growth

• Poker competitive but improvement in Q4

• Good year for Casino and Games

• Strong Sportsbook growth

• Growing global market enabled by broadband

• Turnaround for Telephone Betting

23

Strategy• Targeted shop investment

• Online expansion

• International expansion

• New UK Casino operation

24

International• Italy

– 3 shops at year end (now 4 shops)– 58 sports and 33 horseracing

licences– 51 in shop/café-bar kiosks– eGaming and Telephone Betting

licences– JV with Pianeta Scommesse – 200 outlets in the next 3 years

25

International• Spain

– Madrid first to regulate fixed odds betting

– Virtually a green field for fixed odds betting

– Large existing lottery, bingo, casino and slots market

– JV with market leading Cirsa Slot

26

International• Asia

– Vietnam• First time regulation of sports betting

expected in Q2

– China• Happy Pool single match betting shops• Shops in three provinces• JV with Asia Gaming Technologies

• Scandinavia– Acquisition of Sponsio

27

Casinos• Paddington Casino and Sports Bar

• Targeting to operate a number of the 17 new casinos

• Will bid for Manchester

28

Summary• Strong, highly motivated company

• World class brand, people and technology

• Continually evolving the Ladbrokes business

• Maintain future sustainability and grow earnings

29

Current Trading• Trading satisfactory to date

• Good football results

• More race cancellations than 2006

• eGaming performing strongly

• Telephone Betting in line with our expectations

• International plans on track, positive contribution in 2008

30

Q&As

31

Appendix

32

eGaming – Net revenue2006£m

2005£m

Variance% B(W)

Sportsbook 45.5 32.4 40.4

Poker 35.0 39.2 (10.7)

Casino 41.0 35.2 16.5

Games 12.6 9.4 34.0

Net revenue 134.1 116.2 15.4

Year to 31 December

33

eGaming – KPIs

2006 2005Variance% B(W)

Year to 31 December Sportsbook Gross win margin 6.4% 6.8% Unique active players (000s) 398 305 30.5 Average monthly active player days (000s) 610 451 35.3 Yield per unique active player (£) (1) 114 106 7.5

Poker Unique active players (000s) 154 128 20.3 Average monthly active player days (000s) 461 411 12.2 Yield per unique active player (£) (1) 227 306 (25.8)

Casino Unique active players (000s) 90 77 16.9 Average monthly active player days (000s) 72 64 12.5 Yield per unique active player (£) (1) 454 455 (0.2)

Games Unique active players (000s) 126 78 61.5 Average monthly active player days (000s) 99 54 83.3 Yield per unique active player (£) (1) 100 120 (16.7)

(1) Net revenue per unique active player for the period

34

Belgium

Gross win 35.1 36.7 (4.4)

Duty / Gross profits tax (13.3) (13.4)

Other costs (18.8) (18.5) (1.6)

Operating profit 3.0 4.8 (37.5)

Shop numbers 286 301 (5.0)

Year to 31 December2006 2005 Variance £m £m B(W)%

35

Gross win / Net revenue 18.6 19.3 (3.6)

Duty / Gross profits tax (2.6) (2.8)

Other costs (10.1) (10.7) 5.6

Operating profit 5.9 5.8 1.7

Customer recruitment (000’s):

New customers 53 71 (25.4)

Reactivated customers 65 68 (4.4)

Vernons2006£m

2005£m

VarianceB(W)%

Year to 31 December

36

Taxation£m

Normal tax charge:

Tax charge at 17.8% on continuing operations profit before tax and non-trading items*

Tax charge on discontinued operations profit before tax and non-trading items

Tax charge for Total Group

Non-trading tax charge:

Tax charge on non-trading items:

Total tax charge

*Include prior year settlement with HMRC credit

43.9

3.8

47.7

4.9

52.6

37

Disposal of Hotels£m

Cash proceeds(1)

Assets disposed

Cost of disposal

Foreign exchange

Profit on disposal

Profit on disposal of non- current assets

3,241

(2,766)

(95)

4

384

28

412£m

3,298 as announced on 23 February 2006

(57) debt and working capital adjustment

3,241

(1)

38

2006 operating profit impacts

High Rollers

World Cup (1)

2007 incremental costs

FOBT tax (2)

Gambling Commission

Specific Items – effect on operating profit FY

£m

(10)

(7)

(8)

(3)

H1£m

(11)

(4)

(7)

(1)

(1) Assumes 50% substitution(2) The incremental cost expected in 2007 over 2006