UK bookie warns on profit

William Hill expects its full-year operating profit to be near the lower end of analysts' expectations after a weak third quarter.

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London - British bookmaker William Hill said it expected its full-year operating profit to be near the lower end of analysts' expectations after a weak third quarter.

Shares in the company, which became the official betting partner of the Australian Open tennis event, fell as much as 5 percent in early trading on the London Stock Exchange on Friday.

Tighter regulation and tax pressures in Britain and continental Europe are taking chunks out of the profits of British bookmakers.

William Hill began the year as Britain's biggest bookmaker, but a series of summer mergers is pushing it down the pecking order and putting it under pressure to react.

Net revenue fell 9 percent in the 13 weeks to Sept. 29 and operating profit slumped 39 percent. The year-ago quarter benefited from strong betting on the month-long soccer World Cup tournament, the company said.

“Performance was weaker than our expectations across the board impacted by weaker gross win margin than we had anticipated,” Cenkos analyst Simon French wrote in a note.

The London-based company said its third quarter was hurt by 23 million pounds in additional gambling duties this year while its gross win margin was lower than expected in the quarter.

Analysts expect the company to report full-year operating profit in the range of 290.9 million pounds to 312.1 million pounds, according to company-compiled estimates.

William Hill shares were down 4.6 percent at 329.3 pence at 0705 GMT. As of Thursday's close, the stock was down 5 percent year-to-date.

REUTERS