“A 16% increase in the net revenue,” reported Britain’s biggest bookmaker – William Hill. Now that William Hill celebrates its 80th anniversary this year, much of the success that this traditional firm has experienced is a direct result of its transformation over the past five years. From Britain’s traditional chain of high street betting shops, William Hill have diversified its focus to it’s online gambling operations, and have extended their reach to new and emerging markets, some of which have proved extremely lucrative, judging by the latest financial results released to the market. In fact the Australian gambling market has attributed a considerable amount to William Hill’s success this year with revenue for the 52 weeks to December 31 rising 16pc to £1.5bn. It’s clear that the obsession ‘down under’ with Aussie pokies and other forms of gambling, should in theory continue to contribute handsomely to William Hill’s success in this market, particularly as their brand gains more recognition amongst their Australian audience.
William Hill achieved this success despite the introduction of a new tax on gaming machines last year. The annual sales posted by William Hill were £1.3 billion, but its pre-tax profit fell to 7 percent i.e. £277.7 million. This was because of significant one off costs associated with incorporating the newly acquired Sportingbet business into the William Hill empire. Once these exceptions are put aside, William Hill reported an operating profit up 1 percent which is £330.6 million. Net revenue from online business jumped 10 percent to £446.3 million and 8 percent increase to £907 million from its high street shops. The numbers continue to show the process of growth in William Hill’s strength.
The sports book side of the business continued its strong performance with revenues up to 29 percent. William Hill also successfully attained the remaining 29 percent stake of William Hill Online from Playtech and made important investments in this regard. One of the major boosters of William Hill is now mobile gaming. William Hill reported a 166 percent growth in mobile gaming net revenue. RalphTopping, William Hill’s outspoken but highly respected CEO said: “Our focused transformation of the group over the last five years means William Hill is now one of the world’s leading multi-channel betting and gaming businesses, with revenues diversified through the rapid growth of online and through careful expansion into selected international markets.” With the business now firmly established within the Australian sector, the future looks bright for William Hill, particularly if they can grab a share of the lucrative Aussie pokies market, where popular games from Aristocrat and IGT have continued to boost the financial performance of a number of William Hill’s rivals.
Another significant investment of William Hill in online market share is the launch of websites williamhill.it and Williamhill.es for Italy and Spain respectively. Moreover, William Hill launched mobile gaming in Italy and effectively incorporated the Miapuesta brand in Spain. William Hill strengthened its position in Australia by completely procuring Sportingbet and Tomwaterhouse.com. The expansion of revenue in online business and Australia paid back in the form of 48 percent of operating profit. Also, there has been an increase of 15 percent of net revenue from international markets. Ivor Jones, analyst at Numis, said he believed William Hill “overpaid” for its acquisitions last year. But he added: “It now has control of its online destiny and market leadership in Australia. These are the foundations on which a thriving international online business can be built. We believe the current share price does not reflect the scale of the opportunity.”
William Hill’s annual results have been compared with its rival Ladbrokes which shows 66 percent decline in a whole year’s pre-profits to £67.6million. Ladbrokes has been struggling to improve its online business to compete with rivals such as Bet365 and William Hill.
Apart from these successes, William Hill’s business is expanding namely from gaming machine estate (3% increase) and also over the counter betting which remained strong throughout the year, rising by 2 percent. All of the areas of the business mentioned have brought good profits to William Hill. Overall, the year 2013 proved to be very good for this biggest bookmaker.