Betting giant Gala Coral swung into the red in the first six months of the year, posting a loss of £49.8m despite a slight rise in revenues.
This compares to a profit of £103.4m during the same period last year. Last year's earnings were artificially inflated by an extra £158.5m generated from asset disposals.
The company was at pains to refer to the more rosy earnings before profit, tax and other considerations figure in its filings, which shows a rise in income of 16pc.
It also offered investors another figure that strips out the effects of regulation, suggesting a revised Ebitda rise of 43pc.
The company is currently awaiting regulatory approval for its merger with rival Ladbrokes.
Gala Coral blamed Cheltenham festival, which was "the worst for the industry since 2003", for the poor results.
Operating expenses jumped by 67pc to £318.8m, a rise the company attributed to salary increases and the cost of training staff to spot customers with a gambling problem and to learn new anti-money-laundering measures.
The Grand National, an improvement in football betting revenue, and increased winnings through slot machines provided a much-needed boost, while online revenues were also up 35pc. Total revenues rose 13pc to hit £606m.
Continued investment into the mobile app could generate strong future sales as gamblers increasingly opt for smartphones over high street bookies.
Ladbrokes share price slipped 0.89pc in early trading as investors reacted to the unexpected losses at Gala Coral. The Competition and Markets Authority (CMA) is currently reviewing the £2.3bn merger, which was first mooted in July last year.
It has been a challenging few months for the two companies. The betting giants could be required to offload 350 to 400 shops from their combined network of 4,000 high-street locations before the deal can be completed.
Last month, Ladbrokes became the latest company to fall foul of shareholders over executive pay, with 42pc voting against the bookmaker's remuneration report at its annual general meeting.
A spokesman for Gala Coral said that the company was "in good shape".
"We're on track with the CMA and the numbers for disposals were at the low end of analysts' expectations," he said. "We're in good shape and well positioned for the future and for this merger to go through as anticipated."
Along with William Hill and Betfred, the four largest national bookmakers control around 87pc of the market. Analysts expect the merger to complete in the fourth quarter of this year.