William Hill full-year profit down 37% as operator diversifies outside of UK
Profit comes in ahead of expectations at £147m despite £2 stake limit and £13m Remote Gaming Duty hit
William Hill today reported a 2% decrease in full-year revenue to £1.58bn as profit fell by 37%, albeit ahead of management expectations.
Adjusted operating profit for the period reached £147m, down from £234m in 2018, due to the implementation of a £2 maximum stake limit on FOBTs in the UK.
The £2 stakes, which could well be replicated for online, led to 713 shop closures and an exceptional charge of £134.1m, leading to a statutory loss before tax of £37.6m.
The operator’s UK Online business stabilised following investment in product and service and a “relentless customer focus”, having grown in line with the market for three consecutive quarters.
The UK Online arm also had to absorb an increase in Remote Gaming Duty during the reporting period, which hit profitability by £13m.
Online net revenue reached £738m for the period, £481m of which came from the UK market, while 35% of online revenue now comes from outside the UK, compared to 24% in 2018.
International online net revenue fell by 3% however and was negatively impacted by regulatory headwinds and a legacy product, despite the firm’s £242m acquisition of Mr Green.
Hills described the US as its “biggest opportunity” and is continuing to invest in North America, where net revenue rose by 38% as the operator gained nationwide market share of 24%.
William Hill US currently provides 8% of group revenues.
William Hill CEO Ulrik Bengtsson
William Hill chief executive Ulrik Bengtsson said: “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.
“We move into 2020 in a stronger position. 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.
“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 reposition the business.
“The business responded with conviction to the regulatory challenges and is once again ready to focus on the future.
“We look forward to building on these foundations with a renewed focus on customer, team and execution,” he added.