Hills deal suggests lottery focus

Hills deal suggests lottery focus

Friday, August 7, 2015 Totally Gaming
James Henderson describes lottery as "increasingly attractive"

William Hill has identified the lotteries sector as an area of growth and innovation after announcing the purchase of a 29.4 per cent stake in online specialist NeoGames.

The UK gaming operator – which has today posted a 35 per cent drop in half-year profits - will pay £16m (€22.8m/$24.8m) for its interest in the online lottery software and service provider, and has the option to buy the remaining stock after either three or five years.

Luxembourg company NeoGames was founded in 2005 as a scratchcard company, but has since developed a major online presence around the world.

“The emergent online lottery market is an exciting new opportunity in the gambling sector and NeoGames is a disruptive technology operator offering customers a great experience and lottery rights holders a compelling alternative to established retail lottery operators,” said James Henderson, chief executive of William Hill. “This agreement gives William Hill good optionality in a new market that is increasingly attractive to gambling customers.”

NeoGames’ partners include Michigan Lottery, Italy’s SISAL, Portugal’s Santa Casa and Eastern Europe-facing MSL.

Meanwhile, William Hill has seen a 35 per cent drop in pre-tax profit to £78.7m during the 26 weeks to June 30, with net revenue flat at £808.1m. The company recorded a £44m increase in its tax bill as a result of the UK’s point of consumption tax, plus a higher rate of duty on fixed-odds betting terminals.

“We have delivered a good operational performance in the past six months during a period of significant regulatory and taxation change for the industry,” Henderson said.

“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.”

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