William Hill had already flagged the impact of adverse sporting results on these results, so flat operating profits of £275m came as no real surprise. However, the company also booked more than £50m in impairment charges as the value of its steadily declining telephone betting business was written down, caused by punters switching to smartphones to place their bets.
That ongoing trend helped the performance of the bookmarker's online arm, run in a joint venture with Playtech, with net revenues growing by 28 per cent to £321m, and led to a 17 per cent rise in divisional operating profits to £107m. That was driven by the 75 per cent growth of in-play betting, with the amounts wagered in the sportsbook up by 51 per cent on the back of the popularity of football betting. The lack of a major sports tournament last summer resulted in tougher trading comparisons for the traditional retail betting estate, but net revenues held up well and were 1 per cent higher at £790m. In fact, it was only adverse sports results that lowered operating profits here by 4 per cent to £197m.
Investec forecasts adjusted EPS of 24.5p (24.2p in 2011).
WILLIAM HILL (WMH) | ||||
|---|---|---|---|---|
| ORD PRICE: | 232p | MARKET VALUE: | £1.63bn | |
| TOUCH: | 231-232p | 12-MONTH HIGH: | 248p | LOW: 174p |
| DIVIDEND YIELD: | 4.1% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 126p* | NET DEBT: | 46% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 934 | 209 | 31.6 | 16.5 |
| 2008 | 964 | 293 | 47.5 | 5.5 |
| 2009 | 998 | 121 | 9.5 | 7.5 |
| 2010 | 1.07 | 193 | 18.6 | 8.3 |
| 2011 | 1.14 | 187 | 16.5 | 9.6 |
| % change | +7 | -3 | -11 | +16 |
Ex-div: 2 May Payment: 8 Jun *Includes intangible assets of £1.4bn, or 199p a share | ||||
