Retail realities bite William Hill’s 2019 performance

FTSE250 William Hill Plc has this morning published its full-year 2019 results, recording a 2% decline in group revenues to £1.58 billion (FY2019: £1.6bn). 

The bookmaker branded 2019 as a ‘transformative year’, in which it has restructured its three core trading divisions for online, retail and the US.

Continued retail adjustments related to shop closures and redundancies saw William Hill book exceptional charges of £134 million, as the betting group continued to soak up costs related to the UK government’s £2 FOBTs stake reduction.

Absorption of a number of anticipated restructuring costs led to a 37% decline in 2019 operating profits to £147 million, while group performance was maintained ahead of management expectations.  

Updating investors, Group CEO Ulrik Bengtsson commented: “2019 was a year of transition during which we executed on our ambition to diversify internationally with the acquisition of Mr Green and the continued strong growth of our US business. The Group delivered a strong operating performance, ahead of our expectations and against a challenging regulatory backdrop.”

Closing its full-year 2019 accounts, William Hill governance declared group statutory losses before tax of £38 million, compared to FY2018’s £720 million loss – the year in which the FTSE bookmaker began its group-wide transformation programme, resulting in the closure of 700 UK betting shops. 

Detailing 2019 highlights, William Hill maintained confidence in its online performance with ‘three consecutive quarters of growth’ which was further supported by Mr Green assets performing ‘in line with expectations’, achieving cost synergies of £4 million in its first year of full integration. 

Despite navigating continued shocks related to the FOBTs stake reduction, William Hill said that retail sportsbook wagering saw a 6% increase in average weekly staking across its self-service betting terminals.

The FTSE betting group enters 2020 maintaining a cash flow of £183 million, as corporate net-debt is expanded to £535 million to reflect its group restructuring costs, US expansions and acquisition of Mr Green.   

“We move into 2020 in a stronger position,” Bengtsson added. “Almost a quarter of revenue is now generated outside the UK compared to 15% in 2018. We made positive progress with our digital platform, launching our purpose-built platform in the US and product developments in the Online business in 2019. 

“We will invest in our proprietary technology as we continue to improve the competitiveness of our customer offering. We have also made great progress embedding a culture of safer gambling across the Group.” 

He concluded: “This is an exciting time to be William Hill’s CEO. Our industry is evolving and this brings great opportunities, underlining the importance of our efforts to re-position the business. We look forward to building on these foundations with a renewed focus on customer, team and execution.”

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