William Hill set for online lottery expansion
William Hill have been expanding into the lotteries market by taking a stake in NeoGames, however, they had to be a little bit disappointed when they found out the UK Point of Consumption tax increased duty on gaming machines hit the group's profits.
The bookmaker posted net revenue of £808.1 million (€1.1 billion/$1.3 billion) in the first half, approx. £ 3 million more than in the corresponding period in the previous year. Basic earnings per share dropped 30% to 7.9 pence, but the bookmaker was able to pay out a dividend per share of 4.1 pence, up slightly from 4.0 pence last year.
Speaking about the results, chief executive James Henderson admitted William Hill had been impacted by the UK’s new Point of Consumption tax and a hike in machine games duty during the period, but said it was still able to make “excellent” progress with key strategic priorities.
“We have delivered a good operational performance in the past six months during a period of significant regulatory and taxation change for the industry,” Henderson said.
“We are making excellent progress across our three strategic priorities, particularly in technology where Project Trafalgar will give us the ability to bring our customers a faster and more stable online service, a much improved mobile experience and an enhanced in-play product range on mobile devices.
Henderson also noted William Hill is likely to receive a significant boost from its decision to expand into the lotteries market, a move that will be supported by its acquisition of a stake in NeoGames.
The bookmaker’s current stake in the company will grant it certain shareholder rights as well as being able to nominate two representatives to the NeoGames board of directors. William Hill has also agreed to fund some $15 million in working capital 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,” Henderson said.
“This agreement gives William Hill good optionality in a new market that is increasingly attractive to gambling customers.”
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