Bookmaker William Hill (WMH) expects to deliver £234m in adjusted operating profit for 2018, bang in the middle of the £225m to £245m guidance most recently given.
Yet investors are understandably miffed given that this means overall profits will be 15% lower compared to 2017. Shares in William Hill are down nearly 3% in early trade at 171.15p, close to nine-year lows having virtually halved over the past year.
That the past 12 months has been hellish for the bookmaking industry is not new news. The UK government is becoming increasingly proactive in its attempt to address what it sees as vulnerable gamblers, a massive headache for William Hill given that it still generates four-fifths of its income in the UK.
In November the gambling company warned that the regulatory crackdown, and higher taxes, would squeeze online profits by £20m in 2018, and an extra £25m this year.
So it comes as no surprise that the company is now banking on US expansion, and more online gaming, to drive growth.
William Hill is investing in rapid expansion in US states that have legalised sports betting with operations now live in seven - Pennslyvania, New Jersey, West Virginia, Rhode Island, Delaware, Nevada and Mississippi.
Online US sportsbetting figures in New Jersey. Source: Peel Hunt
WHAT COULD REVITALISE TRADING?
Shore Capital analyst Greg Johnson estimates sales in the US hit $92m in the second half of last year, in line with company forecasts.
A key question for investors is to what extent the US sports betting opportunity and William Hill's £242m takeover of European peer Mr Green (which completed today) will help revitalise trading, particularly online.
‘Key to its hopes of returning to a sustainable growth path are its efforts to expand in the US, where the rules are generally being loosed, rather than tightened as they are in the UK,’ comments AJ Bell investment director Russ Mould.
Investors should keep their eye on progress in the US as there has been speculation that online gambling could be made illegal over state borders.
As the US government is still partially shutdown, news of a crackdown emerged from unofficial sources and has, so far, remained unconfirmed.