William Hill Distances Itself From Bid Rumours

William Hill, Britain's second-biggest bookmaker, yesterday played down the prospects of a significant acquisition and pledged to continue returning cash to shareholders.

The company has in recent weeks been linked to possible bids for Rank Group, the casino and Bingo club operator, and Empire Online, the online poker operator that has just sold its Empire Poker unit to PartyGaming.

David Harding, the chief executive of William Hill, said: "We'll evaluate opportunities as and when they come along, but anything has got to be value enhancing. There is an unbelievable amount of speculation flying around gaming stocks at the moment. It's speculation. I can categorically say we're not in talks with anyone right now."

Mr Harding said that the group would continue to buy back shares in line with its promise in September to return between £200 million and £300 million over 18 months. Since then, it has bought back shares worth £78.3 million and analysts expect it to spend another £200 million over the current financial year.

Mr Harding pointed out that, since its flotation in June 2002, the company had returned about £450 million through share buybacks, equivalent to about half its original market capitalisation.

In the year to December 27, William Hill reported a 5 per cent increase in profits before tax, exceptionals and finance charges to £246 million, from turnover that rose 29.7 per cent to £10.75 billion.

Adjusted earnings per share before exceptionals fell from 36.5p to 36.2p and the final dividend of 12.2p makes a total of 18.3p, up 11 per cent.

In common with other bookmakers, William Hill's retail and telephone betting businesses were hurt by a string of winning favourites, although this was offset by an 18.4 per cent jump in internet profits and an improved performance from fixed-odds betting terminals in its shops.

Mr Harding said that he expected the integration of Stanley Leisure's 624 betting shops, acquired last summer for £507 million, to yield annual synergies of more than £20 million in the medium term, against an original estimate of £13 million.

Some £2.5 million of the extra synergies will come from a revamp of the combined management structure, resulting in about 50 job losses.