TIDMWMH
RNS Number : 8987W
William Hill PLC
20 November 2017
WILLIAM HILL PLC TRADING STATEMENT
20 November 2017
Continued momentum in 2017 for William Hill
William Hill PLC (LSE: WMH) (William Hill or the Group)
announces a trading update for the unaudited 17 weeks and 43 weeks
to 24 October 2017 (H2 to date and year to date (YTD)).
Comparatives relate to the equivalent weeks in 2016.
-- Online net revenue up 6% with wagering up 13% despite rolling
over EURO 2016 and gaming net revenue up 14%
-- Retail net revenue up 3% with growth in both Sportsbook and gaming
-- Australia delivering improved gross win margin, softening a 5% wagering decline
-- US continues to deliver strong net revenue growth, up 30% in local currency
-- On track to deliver previously announced GBP40m of annualised
cost efficiencies by end of 2017, for reinvestment
-- Performance remains in line with market expectations assuming normalised margins
In GBP terms H2 to date (28 Jun Year to date (to
to 24 Oct 2017) 24 Oct 2017)
---------------------------------------
Amounts Net Gross Change Amounts Net Gross Change
wagered revenue win wagered revenue win
margin margin
--------- ---------
-0.8 -0.5
Online +13% +6% 7.6% ppts +12% +5% 7.2% ppts
+0.5 -0.8
Retail -1% +3% 17.6% ppts +1% +0% 17.5% ppts
+0.6 -1.1
Australia -5% -2% 10.8% ppts +26% +11% 8.9% ppts
-0.3 0.0
US +33% +28% 8.0% ppts +31% +31% 6.7% ppts
--------- --------- -------- ------- --------- --------- -------- -------
Group +4% +3%
--------------- --------- --------- -------- ------- --------- --------- -------- -------
Philip Bowcock, CEO, commented:
"We have delivered good financial and operational progress so
far in the second half. Our Online business has performed
particularly well, with UK wagering 14% ahead of last year, in
spite of the absence of a major football tournament, and an
acceleration in gaming growth. Retail has benefited from a stronger
gross win margin to deliver both Sportsbook and gaming net revenue
growth. Internationally, our US business continues to deliver
strong double-digit net revenue growth and Australia's gross win
margin has normalised relative to H1.
"We continue to make good progress on our transformation
programme, which is on track to deliver GBP40m of annualised
savings by the end of this year. This is supporting reinvestment in
our business, including marketing increases in this second half to
promote Online's reinvigorated product and customer experience.
"The Triennial Review has now moved into the second consultation
stage and we look forward to receiving much needed clarity. We will
contribute both directly and via the industry trade associations,
emphasising the need for evidence-based decision making. Betting
shops have a unique and positive role to play in supporting problem
gamblers who typically, use five or six gambling products.
"Separately, we look forward to the US Supreme Court's hearing
on PASPA on 4 December and its decision next year. As the largest
operator of sports books in Nevada and with our 80-plus year
heritage in the UK, we are actively engaged in helping sports
bodies, regulators and other interested parties to understand the
benefits of having a licensed and well-regulated US betting
industry.
"Overall, I am encouraged by the huge amount of progress the
William Hill team has made this year in improving our customer
proposition and delivering on our strategy. We remain on track to
deliver on market expectations for 2017."
Strategic priorities
We have made further good progress against our three medium-term
strategic priorities.
Grow UK market share
In the UK, we launched Bet Boost as a personalised enhanced odds
offering and in-play for #YourOdds, implemented our programmatic
marketing systems ahead of the new football season and released a
series of gaming apps for Android. For Retail and our omni-channel
programme, we replaced the 800 BGT cabinets with our proprietary
self-service betting terminal and we are on track to have at least
one per shop by the year-end. This supports upcoming initiatives,
including the launch of in-play horseracing and a 'single wallet'
so Online customers can access their account in our shops.
Grow international revenues
Internationally, William Hill US continues to perform very
strongly, with double-digit growth in amounts wagered and net
revenue. During the period, we launched #MyOdds as a localised
version of #YourOdds and benefited from strong interest in the
Mayweather-McGregor bout in Las Vegas. In Australia, we are
starting to manage the credit betting transition ahead of the ban
becoming effective in February 2018. As a result, turnover has been
impacted. However, gross win margin has normalised compared with
the H1 performance and profit in H2 to date is ahead of the same
period last year.
Deliver key projects: technology and transformation
We are making very good progress on our transformation
programme, which is both enabling the revenue growth we are seeing
and delivering in excess of GBP40m of annualised savings (including
GBP25m of in-year savings for 2017) by the end of this year, which
is being reinvested to support growth. The exceptional cost of this
programme is likely to be c1.5-2 times the annualised savings over
2017 and 2018. In technology, we have soft-launched our new Trading
Automated Platform, further enhancing our market-leading trading
capability by accelerating the time to implement changes and
expanding automation across pre-match and in-play.
Operating review
The following narrative relates to H2 to date.
(a) Online
Online net revenue was up 6%, with Sportsbook net revenue 1%
lower and gaming net revenue up 14%. Sportsbook amounts wagered was
up 13%, with 14% growth in the UK, continuing the improving trends
seen since H2 2016. Gross win margin was in line with expectations
at 7.6% but 0.8% below the prior year which had benefited from good
football results. Free bets were higher at 0.8% of amounts wagered.
Gaming saw growth across both core and non-core markets. Cost of
sales were 16% higher with the addition of the horseracing levy and
Point of Consumption tax on gaming free bets. Operating costs were
8% higher, driven by the previously announced increase in marketing
investment in H2.
(b) Retail
Retail net revenue was up 3%, with Sportsbook net revenue up 2%
and gaming net revenue up 4%. Sportsbook amounts wagered was down
1% as we rolled over EURO 2016. Gross win margin was 0.5 percentage
points higher and in line with expectations at 17.6%. Costs of
sales increased in line with revenue and operating expenses were 2%
higher, in line with expectations.
(c) William Hill Australia
Amounts wagered was 5% lower (local currency -8%). The gross win
margin returned to a more normal level at 10.8%, 0.6 percentage
points higher than last year, and net revenue was down 2% (local
currency down 5%).
The Australian market remains challenging. With the credit
betting ban now passed by the Australian Government and the
potential for a Point of Consumption Tax to be adopted by other
states, we continue to manage spend carefully while extending and
diversifying our product range.
(d) William Hill US
Our US business continues to perform strongly. Amounts wagered
was up 33% (local currency +35%) and net revenue was up 28% (local
currency up 30%) with gross win margin 0.3 percentage points lower
at 8.0%.
OAM: Additional Regulation Information
William Hill LEI: 213800MDW41W5UZQIX82
Enquiries
William Philip Bowcock, CEO
Hill PLC
Ruth Prior, CFO
Lyndsay Wright, Director Tel: +44 (0)
of Strategy, Brand and 20 8918 3614
IR
Ciaran O'Brien, Group Communications Tel: +44 (0)
Director 20 8918 3607
Brunswick Andrew Porter / Oliver Tel: +44 (0)
Hughes / Chris Buscombe 20 7404 5959
Analyst conference call
Philip Bowcock, CEO, and Ruth Prior, CFO, will host a conference
call for analysts at 8.30 a.m. GMT today. Dial-in details for the
call are:
Telephone: +44 20 3059 8125
Password: William Hill
An archive of the call will be available until 27 November 2017.
Dial-in details for the archive call are:
Telephone: +44 121 260 4861
Passcode: 7339394
An audio webcast of the call will be available at
www.williamhillplc.com
About William Hill PLC
William Hill, The Home of Betting, is one of the world's leading
betting and gaming companies, employing around 16,000 people.
Founded in 1934, it is the one of the UK's largest bookmakers with
around 2,350 licensed betting offices that provide betting
opportunities on a wide range of sporting and non-sporting events,
gaming on machines and numbers-based products including lotteries.
The Group's Online business (www.williamhill.com) is one of the
world's leading online betting and gaming businesses, providing
customers with the opportunity to access William Hill's products
online, through their smartphone or tablet, by telephone and by
text services. William Hill US was established in June 2012 and
provides land-based and mobile sports betting services in Nevada,
and is the exclusive risk manager for the State of Delaware's
sports lottery. William Hill Australia is one of the largest online
betting businesses in Australia after the Group acquired
Sportingbet and tomwaterhouse.com in 2013. It offers sports betting
products online, by telephone and via mobile devices. William Hill
PLC is listed on the London Stock Exchange. The Group generates
revenues of cGBP1.6bn a year.
Cautionary note regarding forward-looking statements
This announcement includes statements that are, or may be deemed
to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates",
"anticipates", "expects", "intends", "plans", "goal", "target",
"aim", "may", "will", "would", "could" or "should" or, in each
case, their negative or other variations or comparable terminology.
These forward-looking statements include all matters that are not
historical facts. They may appear in a number of places throughout
this announcement and the information incorporated by reference
into this announcement and include statements regarding the
intentions, beliefs or current expectations of the directors,
William Hill or the Group concerning, amongst other things, the
results of operations, financial condition, liquidity, prospects,
growth, strategies and dividend policy of William Hill and the
industry in which it operates. By their nature, forward-looking
statements involve risks and uncertainties because they relate to
events and depend on circumstances that may or may not occur in the
future and may be beyond William Hill's ability to control or
predict. Forward-looking statements are not guarantees of future
performance. The Group's actual results of operations, financial
condition, liquidity, dividend policy and the development of the
industry in which it operates may differ materially from the
impression created by the forward-looking statements contained in
this announcement and/or the information incorporated by reference
into this announcement. In addition, even if the results of
operations, financial condition, liquidity and dividend policy of
the Group and the development of the industry in which it operates,
are consistent with the forward-looking statements contained in
this announcement and/or the information incorporated by reference
into this announcement, those results or developments may not be
indicative of results or developments in subsequent periods. Other
than in accordance with its legal or regulatory obligations
(including under the Market Abuse Regulation (596/2014), the
Listing Rules, the Disclosure Guidance and Transparency Rules and
the Prospectus Rules), William Hill does not undertake any
obligation to update or revise publicly any forward-looking
statement, whether as a result of new information, future events or
otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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