William Hill reports rising online revenues as turnaround continues
The firm’s online business saw net revenue rise 6% over the 17 weeks to October 24.
Betting giant William Hill has celebrated growing revenues from its digital business and assured investors that its turnaround programme is still on track.
Net revenue from the firm’s online business grew 6% over the 17 weeks to October 24, with the amounts wagered rising 13% for the period.
That is compared to its UK retail stores which reported half of that revenue growth at just 3%, while wagers fell 1%.
Chief executive Philip Bowcock said the results highlight “good financial and operational progress” so far in the second half of the financial year.
“Our online business has performed particularly well, with UK wagering 14% ahead of last year, in spite of the absence of a major football tournament, and an acceleration in gaming growth.”
International performance was mixed, with Australian revenue and wagers falling 2% and 5%, respectively, while its US business delivered a 28% rise in revenues and a 33% jump in wagers.
William Hill shares were down 1.1p at 277.1p in morning trading.
Mr Bowcock assured that the company was set to make further investments in its digital business as part of its turnaround plan.
He said: “We continue to make good progress on our transformation programme, which is on track to deliver £40 million of annualised savings by the end of this year.
“This is supporting reinvestment in our business, including marketing increases in this second half to promote online’s reinvigorated product and customer experience.”
The update follows in Ladbrokes Coral’s footsteps last week, with the rival also reporting strong growth from the digital business which helped offset a drop in takings at its own retail stores.
But the betting industry is preparing itself for a further squeeze in light of increased regulation in the UK, with the Government last month revealing plans to cut the maximum stake on fixed-odds betting terminals from £100 to between £50 and £2.
It was part of a package of measures resulting from the Government’s gambling review, with the high-stake, high-speed electronic casino games said to be dangerously addictive, allowing players to wager up to £100 every 20 seconds.
Mr Bowcock said that the company was looking forward to “receiving much-needed clarity” over the Government’s review, which is currently out for consultation.
“We will contribute both directly and via the industry trade associations, emphasising the need for evidence-based decision making.
“Betting shops have a unique and positive role to play in supporting problem gamblers who typically use five or six gambling products,” the chief executive said.
George Salmon, an equity analyst at Hargreaves Lansdown, said that while William Hill’s digital growth in recent months was “particularly impressive”, there remain “several daunting regulatory fences ahead” including Australia’s ban on extending lines of credit to punters set to come into force in February.
But the “most pressing challenge” for William Hill will be the UK’s clampdown on fixed-odds betting terminals, which would hit company profits.
Mr Salmon said: “The Government consultation is still ongoing, but it’s as much of a sure thing as anything in gambling that the new limit on stakes will be well below the current £100 cap.
“Slashing the maximum to just £2 is still among the favourites, and with machines responsible for millions in revenues each year, this would seriously impact the group’s bottom line.”