William Hill warn of challenges to come after year of transition

William Hill is now in a "good position" according to chief executive Ulrik Bengtsson following a "transitional" year in which the bookmaker closed more than 700 betting shops, but he warned there were more challenges to come.

Losses before tax narrowed to £37.6 million from £722m in 2018 and, while adjusted operating profit fell 37 per cent to £147m, that was ahead of management expectations following the implementation of the £2 stake limit on FOBTs which led to Hills closing 713 betting shops last year. Group net revenue fell two per cent to £1.58 billion.

Hills said they maintained online market share in the UK, with three consecutive quarters of growth, while the company also completed the acquisition of Scandinavian operator Mr Green.

In the United States, where Hills take one in every four sports bets placed, net revenue increased 38 per cent and the company expect to break even there this year.

"We feel we're in a good position," Bengtsson said. "We've made good progress on our online business, which has had three quarters of growth in the back end of the year.

"The underlying international business has performed well, although we have some regulatory challenges in some countries, and our US business is going from strength to strength. We have 24 per cent national market share and we added $1 billion of wagers in the US in 2019, which is a staggering number.

"However, we realise there are more challenges ahead and more work to be done."

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Among those challenges is the government's promised review of the Gambling Act as well as the continued focus on tighter regulation.

William Hill said the ban on betting with credit cards due to come into force in April would lower adjusted operating profit by £5m to £10m, while they have also put £3m aside for a Gambling Commission penalty which is set to be announced imminently in relation to compliance failings at Mr Green before their acquisition.

Bengtsson said the industry had always faced regulatory challenges but that an "enormous amount of progress" had been made in recent years in tackling problem gambling.

He was among a number of industry leaders who faced a House of Lords select committee recently and Bengtsson added: "My overwhelming feeling coming out of the Lords was there is a real interest in having a sensible and evidence-based conversation about a review of the Gambling Act and we would support that."

Ulrik Bengtsson: 'We feel we're in a good position'

Gambling's relationship with sport through advertising and sponsorship remains another controversial topic and, despite the industry having introduced a whistle-to-whistle ban on TV advertising, there are calls for an outright ban.

Racing has an exemption from that ban, with William Hill sponsoring ITV's coverage, and Bengtsson said he knew of no plans for that to change.

"It does have an exemption for the time being," he said. "I haven't come across any conversations where that might change. I don't think there are such conversations right now.

"It's also important to mention that for William Hill racing is such an integral part of our business and always has been, so we're very proud of that [ITV] sponsorship."

Bengtsson said there were no plans for further large-scale betting shop closures, with their estate now numbering 1,533 shops following the sale of 35 shops to BoyleSports.

Adjusted operating profit in retail fell 45 per cent to £83.2m but that was better than their original expectations of £50-70m.

"The fact the results are better is due to the execution of that project," Bengtsson said, adding: "We're the nation's number one gambling brand in terms of awareness, and retail plays a big part of that."

With the stock market continuing to reflect fears over the coronavirus outbreak, William Hill shares were down 1.8 per cent at 173.45p on Wednesday afternoon.

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