LADBROKES, the betting chain, emerged as the rescuer of its parent, the Hilton Group, after another disastrous performance from the group’s hotel division.

Hilton’s hotels, which includes the self-branded chain and Scandic, reported a 42.6 per cent fall in first-half profits to £56.1 million. This follows a 52 per cent drop for the same period between 2001 and 2002. The profit fall was blamed on the war in Iraq, the Sars outbreak and an economic downturn that hit European room reservations hard.

David Michels, Hilton chief executive, was unable to give investors hope of an imminent recovery: “Given the uncertainty in the market, caution is probably called for. It has never been more difficult to forecast the hotel business. Customers are making up their minds later and later, and war, famine and terrorism just muddy the picture even further.”

Group profit was down 15 per cent to £110.5 million. The dividend was held at 3.4p.

The figures were saved by the betting division’s strong performance. Gambling profits rose 33 per cent to £101.8 million, although the company is concerned that a judicial review of its fixed-odds betting terminals could outlaw the fastest-growing part of this business.

The terminals, which offer virtual roulette and dog racing games, provided 80 per cent of the growth in revenues at the 2,000 Ladbroke shops.