Shareholder revolt takes shine off solid update from William Hill
An "unprecedented" spell of bookmaker-friendly results has boosted William Hill according to their latest trading statement, but there was a sting in the tail as shareholders rebelled against chief executive Philip Bowcock's pay.
There was also a warning from chairman Roger Devlin at Tuesday's annual meeting about the possible effects of the government's review of gambling and details of a package of measures the bookmaker supported to tackle problem gambling.
Shareholder groups had advised investors to vote against the company's remuneration report over a nine per cent increase in Bowcock's basic pay to £600,000.
In the end 30.71 per cent of ballots were cast against the report.
The company said in a statement: "The board is pleased that the majority of resolutions received overwhelming support from shareholders, but notes the significant vote against the remuneration report this year of 30.71 per cent.
"The board has noted the concerns of shareholders, and while on balance we remain of the view that the CEO remuneration is justified in the context of the key events and ongoing industry challenges we commit to engage fully with shareholders and advisory bodies in advance of any key remuneration decisions in the future."
Earlier Hills had announced a three per cent increase in revenues for the first 17 weeks of the year, with a strong performance online and in the United States helping to offset weakness in retail, where business was hit by punters having fewer winnings to recycle and also 15 per cent of UK and Irish horseracing fixtures being cancelled.
Online net revenue was up 12 per cent during the period thanks to "very strong" football and horseracing results in the early part of 2018, but net revenue in the firm's estate of betting shops was down four per cent.
In his speech to the annual meeting Devlin said the industry "should have handled this critical issue better" but claimed that should the government cut maximum stakes to £2 from £100 that 4,000 shops and 20,000 jobs would be lost.
He added: "William Hill would support a package of measures allied to a proportionate stake cut. This would include a statutory levy to fund education, research and treatment of problem gambling, a ban on gambling advertising around football before the 9pm watershed, and earlier closure of shops in the evenings."
In the trading statement Bowcock said Hills had made a "positive start" to 2018.
He added: "Continued momentum in online and strong growth in the US have driven a good performance during the period. In the UK an unprecedented run of bookmaker-friendly sporting results led to unusual wagering and gaming trends, which we expect to normalise over time. The sale of our Australia business has further strengthened our balance sheet.
"While we await the outcome of the UK Triennial Review and the Supreme Court's decision on US sports betting legislation, we remain focused on continuing to deliver a great customer experience, particularly ahead of this summer's World Cup."
Goodbody Stockbrokers' analyst Gavin Kelleher said it was a "solid update" from Hills given the poor weather and high level of horseracing cancellations.
Hills' share price ended the day up 1.7p at 280.60p.
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