Gaming duties hit William Hill's earnings

Additional gambling duties imposed by HM Government were a sore point for William Hill's earnings in the 52 weeks to 29 December, though the company was confident it could grow out of the rut.

The FTSE 250 bookmaker and gambling firm saw net revenue decline 1% to £1.59bn, though group operating profit at £291.4m was up 2% before additional UK gambling duties of £87m.

Including those extra duties, operating profit was down 22%. William Hill's profit after tax was down 8% to £189.9m.

Basic adjusted earnings per share were down 8% to 24.7p, while basic earnings per share were down 8% to 21.6p.

William Hill's board announced a dividend per share of 12.5p, up 2.5% on last year's 12.2p.

"In the last 12 months we have made substantial operational progress against our three strategic priorities of omni-channel, technology and international," said CEO James Henderson.

"In technology terms, online now has a platform that allows us to deliver rapid and frequent innovations to customers, further differentiating our offering. We are also now preparing to roll out our proprietary self-service betting terminal in Retail. This is an important part of our omni-channel strategy and enables us to bring the best of Online to our shops," he added.

Henderson said the company was particularly pleased that William Hill Australia is now benefitting from reshaping and investment in the business.

The company now had one of the highest rated betting apps in Australia and during the William Hill-sponsored Australian Open it acquired an 1,000 customers per day, and saw a 680% increase in tennis in-play turnover.

"We have made further good progress on measures to encourage responsible gambling, including using algorithms to identify potentially harmful behaviour and helping to develop a national, cross-operator self-exclusion scheme," Henderson explained.

"As one of the largest scale businesses in gambling, the board is confident in the outlook for the year ahead and believes the Group is well placed to deliver on its growth strategy.

James Henderson said the board had reviewed its priorities for capital alongside a strengthening balance sheet and continued good cash generation.

"Together, these underpin our decision to announce a share buyback alongside our ongoing investment to grow the business. In addition, the board has increased the dividend payout ratio to around 50% of adjusted earnings, reflecting our focus on delivering value for shareholders," he concluded.