ONE MORE THING:It might not have a physical presence in Ireland any longer but London-listed bookmaker William Hill is looking like one of the better bets in its sector just now.
During the week, it announced 20 per cent growth in operating profits to £330 million, partly driven by 27 per cent growth in its online business, which is available to Irish punters.
The group sold the last of its Irish betting shops to local rival Boylesports in late 2011 at a time when it was struggling with the recession both here and in Britain. Back then, it was very much seen as the laggard in its sector, having failed to get to grips with the opportunities offered by online betting.
Under the leadership of chief executive Ralph Topping, it has turned this situation around considerably and is poised to close a long-awaited deal with Sportingbet in Australia, where it will be going head-to-head with none other than our own Paddy Power, the market leader in online betting down under.
Exiting some markets
It’s not all been plain sailing though, thanks to the confused nature of regulation in this area in Europe. The bookie is going to have to pull out of some markets, notably Germany.
Stockbroker Davy will be hoping that this does not break William Hill’s gallop this year. Just before Christmas, Barry Dixon, Davy’s head of research, picked it as one of a number of stocks to follow this year.
His rationale was simple. It had dealt with the online issue, was poised to do a number of value-adding deals, and was trading at a price-earnings multiple of around 11 times, compared to 23 for Clonskeagh-based Paddy Power.
This week’s good news has narrowed that gap somewhat. Yesterday, it was trading at 385.9 pence or around 13 times earnings. That’s still a chunky discount to Paddy Power and Betfair, whose multiples are in the low 20s.
