William Hill full-year online profits soar 20%

William Hill has reported a 20% year-on-year increase in digital profits for 2014 after strong double-digit revenue growth from the operator’s online sports betting and gaming arms.

According to financial results for the 52 weeks ended 31 December 2014, the firm recorded an online operating profit of £177.7m, up from £147.8m in 2013, while net revenue increased 18% year-on-year to £527.4m.

Online revenue growth was driven by both William Hill’s sportsbook and gaming divisions which reported year-on-year increases of 19% and 17% respectively, with the growth in sports betting revenues coming despite a weaker gross win margin of 7.6%.

Digital revenues including Australia now account for 40% of the group total, the company said.

The firm’s mobile arm was a key growth driver in the 12-month period and accounted for 56% of sportsbook revenues and 32% of gaming revenues which includes both proprietary and third-party mobile products.

Revenues derived from outside its core UK market made up 18% of the total, compared to 15% in 2013.

The company’s Australian arm, which accounted for 8% of group revenue, more than doubled its operating profit on a pro forma local currency basis, up 121% from AU$20.4m in 2013 to $45.1m.

Net revenue increased 11% to $223m and follows the decision to rebrand its entire Australian operations – made up of Tom Waterhouse, Centrebet and Sportingbet – to the William Hill brand which Henderson said would “enhance its competitiveness”.

Earlier this week the firm kicked off its move towards a unified brand in the Australian online wagering market after rebranding Sportingbet Australia under the William Hill moniker ahead of a new media campaign to start next month.

Meanwhile, William Hill said it expects to break-even in the Italian and Spanish online gambling markets by the end of this year after net revenues from the two markets grew 39% year-on-year and 64% year-on-year respectively.

Net revenues from the firm’s US arm were up 31% from £22.7m in 2013 to £29.7m, while operating profit increased from £4.9m to £9.7m which it said placed it in a strong position for any regulatory changes.

William Hill CEO James Henderson, who was appointed to the role last August, hailed the strength and performance of the company’s digital arm.

“2014 was a record year for William Hill, with good operating profit growth benefiting from the continued digital and international diversification of our revenue streams, and from a record-breaking World Cup performance,” he said.

“I am particularly pleased with the progress in our three strategic areas of focus: differentiation through technology; continued internationalisation; and maximising the omni-channel opportunity of retail and online,” Henderson added.

The chief exec also said trading for Q1 2015 up to and including 24 Febraury was in line with expectations despite experiencing some punter-friendly results.

William Hill’s share price at the time of writing stood at 390p on the London Stock Exchange.