William Hill embarks on transitional journey posting group losses of £63m

Philip Bowcock – William Hill

Publishing its interim 2019 results (26-week period ending 2 July), FTSE250 William Hill Plc details solid progress on the firm’s five-year business transformation strategy (announced November 2018) focusing on the three core areas of digital expansion, US market growth and retail realignment.

Updating investors, William Hill stated that H1 2019 trading reflected the ‘different challenges and opportunities’ that the group is trying to address during a period of strategic transition.

Philip Bowcock, CEO of William Hill, commented: “We are making good progress against the five-year strategy we outlined last year, delivering strong revenue growth in the US and other international markets and positioning William Hill well for future growth.”

The FTSE betting group records a 1% increase in group revenues to £811 million (H12018: £802m) impacted by the UK’s £2 stake limit on FOBTs machines and costs attached to the firm’s acquisition of Mr Green (transaction closed February 2019).

The trading period saw William Hill book exceptional items and adjustment costs totalling £114 million, of which the bookmaker attributes £97 million to retail ‘mitigation measures’, which include the proposed closure of 700 betting shops.

In addition, the betting group reports a further capital expenditure of £60 million on technology investments supporting its US market growth strategy.

Bowcock added: “We continue to expand rapidly in the US, both in Nevada and in the new states, with over $1bn wagered with us in the first half. We are now live in eight states and will expand into at least two more states in H2.”

Detailing digital oversight, William Hill announced that its enlarged online business has overcome its period of enhanced customer due diligence measures ‘with year-on-year impacts set to come to an end’.

“Online International revenues have grown strongly, up 66 per cent, with the acquisition of Mr Green,” said Bowcock. “We are becoming more diversified with non-UK markets now contributing a third of online’s revenues, up from just 24 per cent last year. In the UK, performance has improved through the half, up seven per cent in Q2, as we manage the tax and regulatory impacts.”

Closing a busy period of high activity and costs, William Hill declared ‘adjusted’ group operating profits of £76 million, down 33% on H1 2018’s £113 million.

The firm added: “We continue to make important progress in collaborating with other major operators on a package of measures to enhance safer gambling and address public concerns about gambling.

“The second of these, following the voluntary whistle-to-whistle ban on advertising, was a commitment to increase our funding for research, education and treatment and was formally announced by the Secretary of State for the Department of Communications, Culture, Media and Sport (DCMS) in the House of Commons on 2 July.

“This was also welcomed by Tom Watson as Shadow Secretary of State and the Gambling Commission. We do not see this as the end of our responsibilities and we continue to work with the industry to develop additional measures to protect our customers, in line with our ambition that nobody is harmed by gambling.”

William Hill – Interim H1 2019 – Performance Overview

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