William Hill Q1 online profits slide 6%
Profits impacted by "customer-friendly" results while operator records substantial 16% gaming revenue growth
UK operator William Hill has recorded a 6% year-on-year fall in online profits for Q1 2014 after “customer-friendly” sports results led to a lower than expected 7.1% gross win margin.
Online revenues for the three months ended 31 March increased 4% despite a 7% fall in sportsbook net revenue.
However, sportsbook wagers increased significantly in the quarter, up 39% compared to Q1 2013, with mobile now accounting for 45% of turnover.
The operator’s gross win margin was 2.9 percentage points lower compared to the 10% gross win margin in the comparative period in 2013 while mobile was 3.9 percentage points lower.
Retail profit also fell by 25%, hit by a 13% drop in OTC/sportsbook income however gaming machine revenue grew by 11%.
Net revenues from online gaming increased 16% year-on-year, boosted by triple-digit mobile growth which now accounts for 27% of online gaming.
Online casino revenues were up 22% YoY while bingo and poker revenues fell 5% and 15% respectively.
“Whilst outstanding gross win margin in Q1 2013 sets a very high bar, meaning we are facing tough comparative figures, two substantial loss making weeks in this quarter (weeks 2 and 12) “ with major wins for the football punters “ impacted profit progression despite good growth in wagering in both online and retail,” William Hill CEO Ralph Topping said.
The operator’s international business showed signs of encouragement with its US operations recording a 23% increase in amounts wagered and a 188% in operating profit following a favourable Super Bowl result.
Topping highlighted the company’s Australian business as an important avenue for growth in the future following a 11% year-on-year increase in sports betting amounts wagered and 3% growth in net revenue.
“We are also progressing successful diversification of the business both online and internationally, including delivering further good growth in Italy, Spain and the US,” Topping said.
“With most of the major components of the digital Australian platform now in place, we will be driving further improvements in that business’s performance as well,” he added.