British bookmaker William Hill has embarked on a rights issue, scrapped its dividend and renegotiated its banking facilities as it looks to reduce debt and remove uncertainty over refinancing.
William Hill, which is vying with Ladbrokes to be Britain's biggest bookmaker and has 2,300 betting shops in the UK and in Ireland, reported full-year pretax profit ahead of expectations and strong current trading.
William Hill said today it plans to raise £350m from a 1-for-1 rights issue priced at a deeply discounted 105 pence per share, 57% below Thursday's closing price of 246.75.
The company will not pay a final 2008 dividend, but it said it expects to pay an interim dividend in 2009. It said axing the final dividend will save it £55m.
It has also imposed a pay freeze on its 15,000 employees and management as it looks to cut costs.
Today William Hill reported underlying pretax profit for the 52 weeks to December 30 of £216.1m, ahead of market expectations.
Net revenue was up 3% to £963.7m, with retail gross win - total bets minus payouts - rising by 4% to £838m.
Bookmakers are widely regarded as being less vulnerable than other retailers to deteriorating economic conditions given the habitual nature of gamblers and because it is a 'low ticket' industry, with an average bet of less than £10.
