7th Aug 2015 06:19
LONDON (Alliance News) - William Hill PLC Friday reported a drop in profit in the first half of 2015 as it was hit by tax hikes and a tough comparative period, and said it has bought a stake in online lottery company NeoGames.
The FTSE 250-listed bookmaker reported a 35% drop in pretax profit in the 26 weeks ended June 30 to GBP78.7 million from GBP121.8 million in the first half of the prior year. Revenue, however, grew to GBP808.1 million from GBP805.2 million.
William Hill said that its cost base was hit by the increase in machine games duty and the point of consumption tax, which in turn hit its profit. The half-year also faced a tough comparative which included the 2014 FIFA World Cup, the company added.
William Hill will pay an interim dividend of 4.1 pence, a 3% rise on the 4.0p it paid the year before.
"Looking ahead, the board is confident that the group remains well positioned to gain share in key markets, notwithstanding the impact of increased taxes and regulation. In UK Retail, we anticipate some further impact from the £50 journey during the second half. We are making good operational progress in building a leading business in Australia, repositioning William Hill Australia in the key recreational segment in that market," Chief Executive James Henderson said in a statement.
Separately, William Hill said that it has bought a 29.4% stake in online lottery software and services provider NeoGames for a total cash consideration of GBP16 million, and said it has an option to acquire the remaining 70.6% after three or five years.
NeoGames made total lottery sales of USD60 billion in 2014, William Hill said, adding that it has agreed to fund a USD15 million working capital facility if required.
"The emergent online lottery market is an exciting new opportunity in the gambling sector and NeoGames is a disruptive technology operator offering customers a great experience and lottery rights holders a compelling alternative to established retail lottery operators. This agreement gives William Hill good optionality in a new market that is increasingly attractive to gambling customers," Henderson said.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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