By CHRIS STONE
HILTON hotels and betting group Ladbroke more than met City expectations in its first half as the resurgent company lifted profits 39% from #72.8m to #101.2m before tax and exceptional items on the back of better betting figures and buoyant hotels.
This was after #4.5m had been sliced off Hilton International because of the strength of sterling. On a like for like basis Hilton profits increased by 20% at constant exchange rates.
Group chief executive Peter George commented: ''These very good results underline the strength and potential of our business, which we will continue to expand and develop, both in the UK and internationally.''
Shareholders get their share of the bigger cake with the interim dividend hiked 8% from 2.4p to 2.6p on earnings per share up 44% to 6.54% before exceptionals.
Headline operating profits saw hotels rise from #70m to #76.2m and betting and gaming from #43.6m to #76.2m.
UK retail betting profits were up 43%, reflecting the benefit of the new products introduced during last year and also the acquisition in January of bookies chain A R Dennis.
Ladbroke reports that betting on the traditional sports of racing and greyhounds remained under pressure from the National Lottery, but turnover on the new numbers games of Lucky Choice and 49's helped to increase the overall number of betting transactions by 4.3% to #162.9m (1.6% excluding A R Dennis) and overall stake per slip by 1.4% to #5.01.
Gross margins from all activities increased by 2%, resulting in the significant profit rise.
Casinos reflected a full six months contribution from the Barracuda, acquired in April 1996, and improved trading at Maxims despite strong competition at the top end of the London market.
In August, the division was granted a new licence to operate a casino in the St Giles Hotel in London, the first new London casino for nine years.
Turnover at Vernons Pools continued to decline but profits were only slightly down due to ''rigorous'' cost management.
The Hilton International hotels operation saw hotel occupancy up 1% to 69.1%.
Ladbroke says the London market was particularly buoyant, with average room rates up 12.7%, while elsewhere in the UK good demand for meeting and conferences contributed to a much improved result.
Ladbroke shares firmed 1p to 261.5p against falling share markets generally.
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