Bookmaker William Hill took a hit in the early stages of the World Cup in Germany - but overall won £17.5 million from punters.

The firm said it benefited from the latter stages of the tournament when favourites Brazil and Argentina were knocked out along with England and a high proportion of matches ended in draws and penalty shoot-outs.

The World Cup takings helped William Hill increase overall winnings by 25 per cent to £478.3 million in the six months to June 27, while pre-tax profits lifted 23 per cent to £133.5 million.

The bookie, which has a large presence in the Midlands and more than 2,000 offices in the UK, said football betting also boosted the start of the second half as the tournament did not finish until July 9, with winnings up 13 per cent in the four weeks to July 25.

William Hill chief executive David Harding said: "The early group stages of the World Cup were very bad for us. Out of the first 24 matches, 20 were won by the favourites.

"It turned for us on the Italy-USA draw which came on a Saturday when a lot of people were watching.

"In the latter stages of the tournament there were a lot of draws and penalty shoot-outs which helped because the money is made on a match-by-match front."

The bookie also said it benefited from good horseracing results including the Grand National at Aintree in April which saw 11/1 shot Numbersixval-verde beat joint favourites Hedgehunter and Clan Royal into second and third.

"The Grand National definitely helped us although we lost out on some of the places on each-way money," said Mr Harding. "But by and large the National was good."

Mr Harding added that he was "comfortable" with consensus forecasts for the full year which indicate William Hill will make pre-tax profits of £234.5 million compared with £205 million last year.

Shares in William Hill lifted two per cent after the news, although analyst Matthew Gerard, of Investec Securities, said the results were "not particularly impressive".

He said the shares were being supported by an extended buy-back programme and a 19 per cent rise in the interim dividend.

William Hill chairman Charles Scott said the company was on course to deliver £20 million of cost savings this year following the £504 million acquisition of Stanley Leisure.

William Hill has also signed a deal with Spanish gaming group Codere to create a joint venture to become the leader in sports betting in Spain.

Mr Harding said the company would not be affected by the current clamp-down on sports and internet gambling in the United States because it has never taken sporting bets over the phone from America and stopped taking online bets in 2001.

William Hill estimates the introduction of the Amusement Machine Licence Duty (AMLD) will impact profits in the current year by £6 million.

The new tax takes effect from this month so will only affect less than half of this financial year, with 2007the first full year in which it will have an impact.

Finance director Simon Lane said: "There'll be about a £6 million hit on overall group profit this year. Next year, that will rise by a further £9 million taking the full year impact to £15 million."

In this year's budget, chancellor Gordon Brown decreed that the AMLD fee will increase from £250 a year on what is known as Section 16/21 machines to £1,965 and from £1,915 per year to 2,500 on Jackpot machines in casinos.

Shares closed upo 2.5 at 593.5.