1st Aug 2014 08:19
LONDON (Alliance News) - William Hill PLC said Friday that World Cup wagering drove operating profit higher in its second quarter, though this was not enough to boost its half-year results as the group recorded a drop in pretax profit.
The UK betting firm said pretax profit fell 26% in the 26 weeks to July 1, 2014 to GBP98.6 million from GBP133.7 million in the comparable period last year. Net revenue rose 7% to GBP805.2 million from GBP751.6 million in 2013, said the company.
Operating profit for the period declined 2% to GBP176.9 million from GBP181.4 million recorded last year. The company said this fall reflects the impact of "more customer-friendly results year on year, particularly in the first quarter. Positively, this performance reflects good profit growth in the second quarter, with underlying business progress more than offsetting the quarter's year-on-year sports betting margin declines."
William Hill also boosted its dividend for the half-year to 4.0 pence per share, up 8% on the 3.7 pence per share paid last year.
The recent football World Cup in Brazil provided the FTSE 250-listed company with a boost; William Hill reports a "record-breaking" performance for the tournament with online wagering up 211% on 2010 and said these results drove second quarter operating profit growth. However, the World Cup boost was not enough to lift the company's pretax profit for the half-year.
The company did not break out second quarter results.
The group's World Cup performance saw GBP172.5 million of wagering and GBP27.8 million of gross win at a margin of 16.1% from the World Cup results recorded in the first-half. Across the tournament as a whole, wagering from Retail, Online and Telephone was GBP208 million, up GBP93 million or 80% on the 2010 outcome. Gross win margin in these three channels was down 18.4% versus 27.9% but absolute gross win was up given the strong growth in wagering, said the company.
The adoption of mobile betting has continued at pace during the quarter, said William Hill, which said that 52% of operating profit came from Online and William Hill Australia in the period, and that international markets account for 17% of net revenue.
The bookmaker was relegated from the FTSE 100 at the last quarterly FTSE review in June, based on changing market capitalisation, and sees those FTSE 250-listed stocks that are the 90th biggest or larger in the main market move up, and FTSE 100 companies that are 111th biggest or smaller move down, keeping the indices balanced.
Newly-appointed Chief Executive James Henderson takes on the role from Ralph Topping with immediate effect Friday following his appointment at the bookmaker in July. He joins the company to drive the business both internationally and online, replacing veteran Topping who has been with William hill for more than four decades.
Henderson has been with the company for 29 years after starting out at the company as a trainee manager. He was previously William Hill's group director of operations, overseeing the UK retail business, online, and William Hill in Australia and the US.
Looking ahead the company said that it remains confident in its expectations for the full-year, "assuming normalised sporting results."
William Hill shares were trading 1.30% lower at 348.00 pence per share Friday morning.
By Alice Attwood; [email protected]; @AliceAtAlliance
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