Coral has backed CEO Andy Hornby after business secretary Vince Cable launched a bid to ban him from all directorships in the wake of MPs’ damning verdict on Hornby’s role in the “colossal failure” of HBOS in 2008.
The Parliamentary Commission on Banking Standards’ report, published on Friday, concluded that Hornby, his predecessor as CEO Sir James Crosby and former chairman Lord Stevenson were primarily to blame for a series of “toxic” misjudgements which led to HBOS collapsing with losses of £47bn in 2008, leading to its eventual rescue by Lloyds TSB and £20bn bailout by the taxpayer.
Business secretary Vince Cable is now looking into whether Hornby, Crosby and Stevenson can be banned from serving as company directors.
Coral spokesman Simon Clare however said in a statement that the company was “delighted” with the job Hornby was doing as CEO of its Coral bookmaking division, and that he had their “complete backing”.
Hornby joined Coral as CEO from Alliance Boots in July 2011, assuming responsibility for a retail estate of 1,750 shops and its accompanying interactive betting and gaming offerings. The company has invested heavily in marketing Coral.co.uk in 2013, £8.3m of costs wiping out gross profit of £5.3m from the division in the first quarter.
Gala Coral said this reflected the “bow-wave” of marketing investment needed to create the platform for subsequent growth.
The phasing of particular costs within the Coral retail estate and adverse weather conditions in January however impacted overall earnings for the Gala Coral group in Q1, snow and ice forcing the cancellation of 41 race meetings and reducing footfall at Gala Casinos and Gala Bingo halls. EBITDA dipped 6% to £73.6m, off a 1% improvement in gross profit to £276.3m.
Article written by Peter Holmes
