Business World

Sunday 26 March 2017

William Hill forecasts profit progress

Heavy snowfall and freezing temperatures last month failed to stop gamblers placing their bets as William Hill today posted robust sales growth in its shops.

The company, which has more than 2,350 outlets in the UK and Ireland, said retail turnover grew by 4pc in December and 8pc in the fourth quarter despite the adverse weather - which led to 47pc of scheduled UK horseracing meetings being cancelled and just one weekend of reduced football.

But the bookmaker said group revenues growth in the three months to December 28 was driven by online gambling and use of gaming machines in its shops.

William Hill said it expects full-year earnings to come in at the top end of expectations - with pre-exceptional underlying earnings of around £275m (€326m), up from £258.6m (€307m) the previous year.

Shares in William Hill surged more than 12pc after the update, which forecast net revenues growth of 7pc for the group in the year to December 28.

William Hill online saw net revenues growth of 24pc year-on-year, the bookmaker said, driven by strong sports betting, as well as online gaming such as casino and bingo.

The company has also expanded its mobile offering, with betting applications available through its website.

The group added that turnover for in-play betting - placing bets as an event or match is in progress - more than doubled over the year, spurred on by television adverts promoting the service.

Ralph Topping, chief executive of William Hill, said: "Overall, I'd class 2010 as a strong performance.

"We're at the top end of market expectations on operating profit, we've transformed our trading operation, we've become a market leader in in-play football as we promised, we're focusing on mobile over the next two years, and we've still got the best football and gaming offerings on the high street."

William Hill revealed plans last July to transfer its telephone business to Gibraltar in a move that impacted on its contribution to the Horseracing Betting Levy, which UK-based bookies have to pay in order to take bets on British races.

Looking ahead, Ivor Jones, analyst at brokers Numis, said: "William Hill is in good shape for a tough year with new gaming machines in the betting shops and an upgraded sportsbook offering online.

"But these strengths have to offset the challenges of increased VAT on machines, increased unemployment and reduced disposable income for the core retail customer base and rising costs.

"We believe that profits, and hence the share price, will make little progress this year."

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