Sales for National Lottery games have fallen for the fourth year running, according to the operator Camelot.

It said there was a 3% decline in the past financial year to �4.83bn ($7.1bn; 7.6bn euros) from just over �4.98bn last year.

It is clear that the delays in awarding the second licence affected first half sales.

Michael Grade Camelot

Sales of instant scratchcards actually increased during the year but this was offset by the biggest drop in lottery ticket sales since the game was launched in 1994.

Sales for lottery tickets were down 4.1% for the year to �4.25bn.

Camelot's financial year runs during the 12 months to the end of March.

Licence worries

The big fall for tickets was largely due to a big 6.9% slump in the first six months of the financial year.

Camelot blamed this on the delay in the bidding process for the second licence to run the Lottery.

In the second half of the year, the decline in sales of the same tickets was just 1.2%.

"It is clear that the delays in awarding the second licence affected first half sales but a stronger second half performance has demonstrated Camelot has stemmed that decline," said Michael Grade, chairman of the Camelot Group.

New image

Scratchcard sales increased for the first time since their launch in 1995.

Results for the 12 months to the end of March show they rose by 5.9% to �579m.

During the year, the lottery gave �1.3bn to good causes.

Camelot has already said it will spend �72m over the next year marketing its new Lotto image in an attempt to halt the decline in the number of people playing the draw.

Controversy

It is introducing a new game, called Lotto Hotpicks, which aims to increase the chances of winning bigger prizes for matching fewer numbers.

Dianne Thompson wants to make Lotto fun

Players can win �40 by matching two numbers, �450 with three matches and �7,000 with four.

Mr Grade said he was confident that the business had a platform from which to grow sales over the second licence.

However, last week the chief execurtive of Camelot attracted controversy when she said that players of the lottery draw would be lucky to win �10.

It might not be you

Dianne Thompson said the public had a slim chance of winning as the odds of hitting the jackpot were one in 14 million.

In a newspaper interview she aknowledged that the original slogan of "It could be you" had given false hope to players and many had realised this.

"Eight years later, people have realised that though it could be you, it probably won't be," she said.

And she conceded that players "would be lucky to win a tenner".

Ms Thompson said the only way to halt declining sales in newly named Lotto was to make the game fun.

Camelot said Ms Thompson's comments had been taken out of context and were addressing the perception that �10 Lotto prizes were not worth winning.

The odds of winning �10 are one in 57, the company added.