William Hill has posted $955.8 million in losses, but the operator is far from being down on its knees. What led to this development and is there a way back?
William Hill Announces $955.8m Losses
March began rather tepidly for William Hill with the UK-based operator posting $955.8 million in pre-tax loss in 2018. Though this is quite the sum, it’s justified by the latest changes in the legal context at home in the United Kingdom.
The operator is going to lose over $1 billion from the recent fixed-odds betting terminals (FOBTs) legislation which has effectively slashed the maximum allowable bet on such terminals to £2 down from £100.
If losses have seemed like a much unpleasant development, William Hill actually managed to post 2% year-over-year increase in revenue over the same period. Speaking on the recent developments, the company’s Chief Executive, Philip Bowcock, highlighted the problems the operator was facing:
Key regulatory decisions in the UK and US gave us much needed clarity to set a new five-year strategy and a goal to double profits by 2023.
Mr. Bowcock has been careful to explain the rather difficult context in which William Hill was operating. The company has agreed to a voluntary whistle-to-whistle ban, including further reduction of its FOBTs in Ireland.
The United States also proved a tough nut to crack, insofar as retail properties were concerned, but Mr. Bowcock explained that William Hill had been one of the first companies to make progress on the digital market in the country since SCOTUS repealed PASPA in May, 2018. He further added:
We have started delivering on our strategy with the expansion of our US business, being first out of the blocks in all states that have regulated sports betting, and with the acquisition of Mr Green, which will support the build-out of our international digital business.
He was correct to note the expansion of the operator in the Unite States where year-over-year revenue grew 38%. William Hill also reported great involvement with its mobile betting devices reporting 83% of the total handle.
Similarly, William Hill has been working on consolidating its footprint well across the United States, by expanding into newly-regulated markets, including New Jersey, Delaware, Rhode Island, Mississippi, Pennsylvania and West Virginia.
In light of this, William Hill has an advantage over DraftKings which has only now began to expand across the United States, having signed a fresh partnership with Caesars Entertainment. Despite the turbulences at home, William Hill has been performing well.
The regulatory changes have definitely occasioned some new challenges, but the company seems firmly resolved to overcome those and ensure better prospects for itself in the future. At the beginning of 2018, William Hill had to pay a stiff £6.2-million penalty to the UK’s regulator, the UKGC.
Since then, though, the company has been doing very well. The expansion of its US operations and the acquisition of Mr. Green have been well in line with the overall business strategy of the operator.