William Hill operating profits down GBP 30 million in latest full year report

In a trading update Monday, online and land gambling group William Hill plc reported that its FY 2016 operating profit was down GBP 30 million year-on-year following unfavourable results in football and horse racing.

The company said its full-year operating profit for 2016 would be around GBP 260 million, at the bottom end of its guided GBP 260 million to GBP 280 million range, marking a decline of over GBP 30 million from the GBP 291.4 million operating profit posted in 2015.

The update notes the failed multi-billion-pound merger negotiation with Canadian online poker giant Amaya in October (see previous reports).

The company issued a profit warning in March this year, less than a week after the end of the Cheltenham Festival, the centrepiece of the horseracing calendar. In November, it said it expected operating profit to be at the higher end of its guidance range, said gross win margins were below expectations.

Whilst imparting some bad news, the trading statement Monday, reeported that underlying trends “remain encouraging” but said gross win margins for the end of the year were below expectations as football and horseracing results went against bookmakers.

“Importantly, the improvements we saw in wagering online and Australia in the second half have continued in recent weeks,” said Philip Bowcock, interim CEO. “However, all four divisions saw customer-friendly results at the back end of the year, which translated into profits being GBP 20 million below our prior expectations.

“With key underlying trends continuing to be positive, the recent run of sporting results have not changed our confidence in a better performance in 2017.”

The company will announce its full final results for 2016 on February 24.