- Full-year earnings to be near bottom of range of estimates
- U.K. bookmaker's shares fall the most in more than two months
Britain’s biggest bookmaker William Hill Plc said profit for the year will be near the lowest analyst estimate after customers from the U.K. to Australia got lucky.
Outcomes of horse races and American football games favored gamblers during the period, while a 23 million-pound ($35 million) increase in U.K. duties also weighed on the company’s performance, William Hill said in a statement Friday. The shares fell as much as 7.9 percent, the most in two months.
“We always expected a tough quarter, but clearly it’s been a lot tougher than anticipated,” said Nick Batram, an analyst at Peel Hunt in London, cutting his recommendation on the stock to hold from buy. “The extent of the miss is surprising.”
It’s been a difficult year for Britain’s big betting-shop owners, who are seeking to fend off online competition while grappling with changes in tax laws and increased regulation. Ladbrokes Plc yesterday reported a 57 percent drop in third-quarter earnings as it plowed more money into marketing to build its brand. William Hill’s operating profit in the period fell 39 percent, hurt by a 91 percent plunge in Australia.
William Hill shares were down 7.5 percent at 319.6 pence as of 11:45 a.m. in London, extending their decline for the year to 12 percent.
Full-year operating profit will be “around the bottom” of analyst estimates, which range from 291 million pounds to 312 million pounds, the bookmaker said.
William Hill was caught out by customers’ lucky streaks in many parts of the world. In Australia, the bookmaker had its worst horse-racing day of the year on Oct. 2 when all nine favorites won at an event in Sydney. Racing results also hurt the company’s online unit, which now accounts for 35 percent of revenue, while too many favorites won NFL football games in September.