UK bookmaker William Hill has reported a big fall in half-year profits after being hit by changes to betting taxes.
William Hill, one of the UK’s largest bookmakers, was affected by the government’s new taxes on gambling machines and online betting. Gambling and betting have the same meaning.
The bookmaker posted pre-tax profits of £78.7 million in the first six months of the year – about 35% lower than £121.8 million the previous year.
The company said that the changes on the taxation of fixed-odds betting terminals (from 20 percent to 25 percent) and higher taxes on online betting cost the company £44million.
William Hill – HY Financial Results
Source: William Hill PLC Half Yearly Report
William Hill chief executive, James Henderson, commented on the results:
“We have delivered a good operational performance in the past six months during a period of significant regulatory and taxation change for the industry.
“Whilst factors such as the Point of Consumption Tax and the increase in the Machine Games Duty rate have impacted our cost base as expected, we continue to progress our strategy and invest in our long-term growth drivers.”
Shares in William Hill dropped 6.47% on Friday, closing at 384.30.
William Hill announced acquisition of 29.4% of NeoGames
William Hill also announced that it bought a 29.4% stake in the US-focused online lottery software and service provider NeoGames.
The bookmaker’s 29.4% shareholding in NeoGames will give it some shareholder rights and allow the Group to nominate two representatives to the Board of NeoGames.
William Hill agreed to fund a $15 million working capital facility if necessary.
Referring to the bookmaker’s purchase of the stake in NeoGames, Mr Henderson said that the emergent online lottery market is “an exciting new opportunity in the gambling sector”, adding that the agreement with NeoGames gives William Hill “good optionality in a new market that is increasingly attractive to gambling customers.”