Interim Results Announcement

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Interim Results Announcement

• September 2003

2
David Harding

• Chief Executive

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William Hill PLC Operating highlights 26 wks to
01/07/03

• EBIT up 27, profitable growth all channels
• Further product diversification
• FOBT rollout extended
• IT and estate development on track
• Deregulation

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EBIT up 27, profitable growth all channels
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Further product diversification
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FOBT rollout extended

• 2525 Terminals installed by end June
• Average weekly net profit/terminal over 350
• Anticipate c 3100 by year end
• Anticipate removing 4 500 AWPs
• Gaming Board case unlikely before Jan 04

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Retail Technology Programme on track
Retail Technology Programme
Rollout
Communications Infrastructure
Tender Central site integration
Pilot Rollout
Text system
EPOS
Design/software build Software
test/integrate
Soft/hardware tender Hardware
trials Pilots/UAT
Rollout
Training/Development
2003
2005
2004
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Estate development on track
Further 25 new licences in application
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Deregulation
......Government ......to......introduce
legislation......drafted such that betting
machines will be brought within relevant controls
for gaming machines ......Betting offices would
be able to install up to four gaming machines
with a maximum prize of 500 ......Does not
affect the display in LBOs of virtual
races......on which bets may be taken at the
counter
DCMS press release Jan 8
We will present a complete draft of the Gambling
Bill to Parliament in the Autumn, for
pre-legislative scrutiny by a joint committee of
both houses
DCMS press release August 7
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Tom Singer

• Group Finance Director

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Summary of Financial Results (pre exceptional
items)1H, 2003 v 1H, 2002
(1) Includes casino drop and AWP cash-in-box net
of VAT (2) Includes casino drop and AWP
cash-in-box inclusive of VAT
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Summary of Earnings and Dividends (pre
exceptional items)1H, 2003 v 1H, 2002
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Actual Earnings v Proforma (pre exceptional
items)1H, 2003 v 1H, 2002
Movement
1H, 2002 Unaudited Proforma m
1H, 2003 Actual m
80.1
101.9
Profit before interest and taxation (EBIT)
(17.7) (1)
(16.3)
Net interest payable
(17.5) (2)
(23.1)
Taxation
44.9
62.5
Profit after taxation
39 40
10.7 10.7
14.9 14.8
Earnings per share (pence) (3) - Basic - Diluted
(1) Assumes average net indebtedness of 525m
and an interest rate of 6.75 (2) Assumes an
effective tax rate of 28 (3) Assumes 418.4m and
422.7m shares in issue for basic and diluted EPS
calculations, respectively
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Analysis of Gross Win1H, 2003 v 1H, 2002
1H, 2003
1H, 2002
Movement
(1) Includes greyhound stadia, Course and Group
Promotions
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Taxes and Duties1H, 2003 v 1H, 2002
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Net Operating Expenses1H, 2003 v 1H, 2002
(1) Includes costs of horse racing pictures and
ISDN network (2) Primarily central support
functions, property costs and asset write offs
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Tight Control of Costs (pre exceptional
items)1H, 2003 v 1H, 2002
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Retail (1) Results1H, 2003 v 1H, 2002
Growth rate Gross win 18 Operating profit 30

• Continuing benefit of GPT regime/recycling
• Continuing strong growth in Numbers (eg virtual
  racing, FOBTs) and Football betting
• Average number of LBOs increased from 1538 to
  1580 due to acquisitions and new licences 54
  development actions
• Tight management of costs

(1) Includes traditional over the counter
business, AWPs and FOBTs
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Telephone Results1H, 2003 v 1H, 2002
Growth rate Gross win 3 Operating profit 14

• 170,000 active accounts
• (31 December 2002 164,000)
• Modest growth in gross win despite
  disappointing Cheltenham
  Festival and absence of international football
  championship
• Costs down 3 compared to comparable period due
  to closure of Athlone call centre in April 2002

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Interactive (1) Results1H, 2003 v 1H, 2002
Growth rate Gross win 32 Operating profit 42

• Sportsbook
• 137,000 active accounts
• (31 December 2002 130,000)
• Focus shifting to UK rather than
  international markets
• No international football championship

• Casino
• 58,000 (2) active accounts
• (31 December 2002 43,000)
• Successful launch of poker offering in January
  2003
• Full integration of Sportsbook and Casino
  planned for Autumn 2003

(1) Sportsbook and Casino (2) Total Casino and
Poker active accounts
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Cash Generation (pre exceptional items) 1H, 2003
v 1H, 2002
(1) Adjusted to eliminate accruals for
exceptional costs and tax relief thereon
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Revised Data for Forecasts

• Cost of debt 6
• Effective tax rates of 27 (FY 2003), 30 (FY
  2004)
• Projected investment in the business

(1) To finalise whether all items of
expenditure will be capitalised as opposed to
written off as incurred
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Current Trading

• Gross win up 23 in the nine weeks ended 2
  September 2003 due to
• Better horseracing results than in the
  comparative period
• Continuing roll out of FOBTs
• Continuing growth in Football and Numbers
  betting