Hilton, the hotels and gaming giant, is to gamble on technological advance opening new betting frontiers after virtual greyhounds and internet poker helped it report a 72 per cent surge in interim profits.
David Michels, the Hilton chief executive, said that “ever more sophisticated” technology and proposed gaming deregulation would help to boost earnings at the comapany’s Ladbrokes arm after a 51 per cent surge to £153.7 million in the first six months of 2004.
“The renaissance in betting and gaming, driven by increased television sports coverage and innovative technology, will be fully exploited by Ladbrokes,” Mr Michels said.
Profits from internet betting operations were, at £12.1 million, in the half nearly double those in the first six months of 2003, with the number of active epoker players surging by 141 per cent to 33,000. In UK betting offices, virtual greyhound machines had helped boost earnings by 44 per cent to £119.6 million, with a poor Cheltenham Festival for favourites, and England’s failure to proceed far in Euro 2004, also boosting profitability.
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At Hilton’s hotels division, profits rose by 19.6 per cent to £67.1 million amid signs of revival in a sector hurt last year by Sars and the Iraq War.
“Hotels across most of our portfolio are now experiencing improvements in both business and leisure traffic,” Mr Michels said.
Profits in the core UK and Ireland unit rose by 23.8 per cent to £42.2 million as London hotels, in particular, enjoyed a recovery in demand.
However, with the hotels division not expected to enjoy a “full recovery” until next year, capital expenditure levels had been held back, prompting delays to plans to redevelop and reopen the Sydney Hilton.
The results beat City forecasts and were well received by analysts, with Deutsche Bank raising its forecast for Hilton’s full-year profits and Seymour Pierce keeping a “buy” rating on the company’s stock.
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Hilton shares stood 1p lower at 258.25p in afternoon trade after rising to 265p earlier.