William Hill Doubles Australian Profits

Nearly one year after its acquisition of Australian online betting provider tomwaterhouse, William Hill of Australia announced a near doubling of its operating profits. The interim report for the first six months of 2014 show record gains in wagering traffic, unique actives, and new accounts.

Successful diversification was observed in the 52% profit gained from increasingly popular digital channels; and 17% of total revenues earned from international markets for the globalizing entity.

World Cup Boost and Online Wagering

The World Cup yielded a record-breaking level of online wagering, up 211% from the previous tournament in 2010. The Online Sportsbook also continued to grow, boosted by mobile wagering to a 41% growth rate. Online gaming net revenue continued to grow, up 18%, mainly due to a strong and telling 146% growth figure for mobile gaming. 

Domestically, Australian operating profit nearly doubled, driven by wagering activity increases of 10%, unique actives of 21%, and new accounts of 14%. The US performance of William Hill was strong as well, with wagering activity showing gains of 22% and operating profit up 383%. This all added up to healthy interim dividend growth of 8%, but an overall drop in pretax profit. The overall drop is attributed losses the betting firm incurred from large payouts earlier in the year, a result of an unusually high number of favourites winning their matches.

As of Friday afternoon, this information reflected a 2.5% drop in shares to 343.90 pence.

Next Hurdle

The latest challenge for UK operators is to drive the business further outside the UK, due to tight controls within the UK on betting shops and increased duties imposed on high stakes gambling. This led to the closure by William Hill of 87 loss-making betting shops with 27 more by years end in response to a tax hike on fixed-odd betting machines. Despite the challenges, the company has expressed full confidence in"assuming normalised sporting results" by year's end.