Bookmaker William Hill says it’s withstanding the UK government’s assault on retail gambling while pinning its hopes that the online casino segment will be spared a similar fate.
On Thursday, Hills issued a trading statement on its H2 2019 performance through October 29, during which the company’s net revenue rose a mere 1% from the same period last year. Ulrik Bengtsson (pictured), the former Betsson boss who was named Hills CEO in September, said the company “remain[s] on track to meet our full year expectations.”
Hills retail revenue was off 23% following the April reduction in maximum stakes on fixed-odds betting terminals from £100 to just £2. The change pushed retail gaming revenue down 45% while OTC betting turnover fell 1%, but Hills says gaming trends are “improving incrementally as customer behavior adjusts” to the new restrictions.
Hills closed around 700 UK betting shops during the period, based on what Bengtsson called a “do it once and do it right” strategy, otherwise known as ripping off a band-aid. These “disciplined and necessary actions have provided certainty for our employees,” at least, for the ones that weren’t made redundant.
The picture was much brighter online, as net revenue rose 26%. The gains were entirely driven by the casino vertical, which shot up 51% while betting managed only a 1% rise as turnover fell 7%. However, absent the impact of Hills’ acquisition of MRG (formerly Mr Green), overall online revenue would have been up only 1%.
UK-facing online operations grew 4% during the period and now account for two-thirds of overall online activity, so Hills better hope there’s no FOBT-style online slots stake cut in its future. And Sweden’s restrictive new regulated online market, Hills’ forced exit from Switzerland and payment-blocking in other markets pushed overall international online revenue down 4% year-on-year.
The William Hill US division reported revenue rising 60% as more states legalize wagering. Hills’ original Nevada betting operations saw revenue rise 27% while operations outside Nevada tripled. The second half to date has seen launches in Indiana and Iowa, bringing the number of states in which Hills is active to 10, allowing the company to claim a 26% share of the US betting market.
Hills’ Nevada operations got a serious boost on Wednesday via the acquisition of CG Technology’s Las Vegas sportsbook assets. Hills is still playing mum on how much it paid, although Bengtsson said Thursday that the price was “not material at this point.”