William Hill’s mixed trading update, new Sci-Games lawsuit

TAGs: nyx gaming group, Scientific Games, William Hill

william-hill-trading-updateUK-listed bookmaker William Hill saw its online sports betting revenue fall in its H2-to-date trading update, despite online wagering turnover rising double-digits.

In a trading update covering the 17 weeks ending October 24, Hills said group revenue was up 28% from the same period last year, based on a strong performance by online gaming, continued strong growth in its US market operations, and excitement surrounding the Mayweather v. McGregor boxing match.

Overall online revenue was up 6%, driven entirely by online gaming revenue, which rose 14% while sportsbook fell 1%. Despite the poor comparison with last year’s Euro 2016 football tourney, sportsbook handle improved 13% year-on-year. But free bet offers and operating costs rose due to the need to market the hell out of Hill’s sports offering.

Hills CEO Philip Bowcock said the online division had performed “particularly well” and noted that UK market wagering had improved 14% year-on-year despite the lack of a major sports tournament.

The William Hill Australia online sports betting site reported declines in both wagering (-5%) and revenue (-2%) and Bowcock credited an improved win margin with limiting the revenue decline.

Bowcock said Australia’s tightened regulatory environment – credit betting ban taking effect Feb. 2018, national point of consumption tax a possibility – meant that Hills would “continue to manage spend carefully” while further diversifying its product range.

The William Hill US sports betting business continues to post double-digit gains, with betting handle up one-third and net revenue rising 28%. Bowcock said Hills, “the largest operator of sports books in Nevada,” was eagerly awaiting the US Supreme Court’s hearing on New Jersey’s efforts to overturn the federal sports betting prohibition.

Hills’ UK retail operations reported revenue up 3% despite OTC sports handle falling 1%. Sports revenue gained 2% thanks to improved win margins and gaming revenue improved 4%.

Hills said it’s on track to have at least one proprietary self-service betting terminal (SSBT) in each of its UK betting shops by year’s end, having replaced 800 BGT cabinets. The new gear is expected to boost Hills’ omni-channel capacity, including the upcoming launch of in-play horseracing and a ‘single wallet’ for omni-channel punters.

Analysts were on the fence regarding Hills’ update, with some expressing trepidation at the scale of the decline in Australian wagering. Analysts also noted that Hills has yet to face whatever curbs the UK government has in store for the fixed-odds betting terminals in high street betting shops.

Meanwhile, US gaming technology provider Scientific Games Corporation has filed a lawsuit against a Hills subsidiary in a Nevada District Court. The lawsuit follows a similar suit filed by NYX Gaming Group, who Sci-Games is looking to acquire but Hills has threatened to block the acquisition unless it receives certain assurances.

NYX owns sportsbook technology provider OpenBet, which powers Hills’ sports betting platform. Hills helped provide the money NYX used to acquire OpenBet, making Hills a significant NYX shareholder. With the US sports betting market poised to liberalize, Hills is worried that it could find itself marginalized by NYX’s new betting-keen owners.

The Sci-Games lawsuit accuses Hills of using “extortion and coercion” to scupper the NYX acquisition, with an ultimate aim to “undermine competition in the gaming industry.”

NYX shareholders were supposed to vote on the proposed Sci-Games acquisition on December 7, but this has since been pushed back to December 20 as the parties seek to resolve their legal squabbles ahead of time.


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