Bookmaker William Hill has unveiled plans to return £453m to investors at the same time as it announced plans to expand its betting shops empire.
Bad luck for punters spells good fortune for the gaming industry
William Hill announced a 21% rise in pre-tax profits to £205.3m, towards the bottom end of market forecasts.
It said it chose to return the cash as the softening of government plans to deregulate gaming made it unlikely that it would be able to invest in casinos.
Instead, it is looking to expand its betting shops empire.
The Gambling Bill, which outlines the deregulation of the gaming industry, was originally expected to open the doors to large numbers of Las Vegas-style "supercasinos" in the UK.
However, the government has since limited growth to eight of these casinos, amid fears of an explosion in gambling addiction.
"Consequently the board is not inclined to commit significant capital to potential acquisitions outside of its core bookmaking and gaming business at the current time," said chairman Charles Scott.
Given that there are now less opportunities for expansion in the UK casino industry, chief executive David Harding said: "Our first priority would be to buy more betting shops. I think we could buy another 600."
Cash flows back
The company said its balance sheet had been further strengthened by securing new bank facilities of £1.2bn.
It plans to return the £453m to shareholders via a 'B share' scheme, under which shareholders will exchange their share for a 'B share', which they can then exchange either for cash or a dividend payment.
This brings the total amount returned to shareholders since its flotation in June 2002 to £752m.
As well as increasing the return of cash to investors, it plans to increase the total dividend by 32% to 16.5p.
Brokerage Seymour Pierce welcomed the return of cash to investors but said it also demonstrates that William Hill has few growth areas to invest in.
The company said its performance had been hit by unfavourable horseracing and football results.
However, the growth in the number of fixed-odds betting machines in its shops has helped to stabilise income, with each terminal making £370 a week on average during the year.
William Hill operates 1,600 betting shops and also offers telephone and internet gambling.
Its shares have outperformed the benchmark FTSE 100 index by about 10% over the last year.