William Hill: 2020 Earnings Impacted by Closures, Sport Disruptions
UK-based global gaming group William Hill released its final 52 week ended December 29, 2020 earnings report posting a 16% slump in net revenues year-over-year.
Growth in Online Gaming
The final 2020 earnings report showed no surprises from the trading statement featuring unaudited results William Hill released in January, in which the gaming company outlined the adverse effect on the business from the temporary closures on its betting shops.
Net revenue for the 52 weeks in 2020 was £1.324 billion, 16% down compared to the revenue for the 52 weeks ended December 31, 2019, £1.582 billion, mainly due to closures and restrictions to retail and casinos and the disruption of live sporting events.
While retail took a significant blow to finish the year with net revenues down 51%, the total figure was partially offset by growth in online gaming, 9%, as William Hill finished the challenging year with strong momentum across digital.
Global Diversification
William Hill outlined strategic focus on Customer, Team and Execution paid dividends in terms of improved competitiveness in a year in which global diversification increased its share. The company noted that, compared to the previous year in which 24% of the group’s revenue originated outside of the home country, UK, in 2020 that percentage jumped to 36%.
“We began the year well and finished the year even stronger, highlighting the traction generated by our strategic focus on Customer, Team, Execution.”
Ulrik Bengtsson, CEO, William Hill
International operations contributed to a growth in net revenue of 16% and expansion into new territories, while platform and product launches for its UK online business generated record net revenue of £503.2 million for the year.
“We are delighted with our International Online performance, where our investment in our product and technology is producing clear benefits, particularly in light of the regulatory headwinds in Germany and temporary restrictions elsewhere.”
Ulrik Bengtsson, CEO, William Hill
Strengthening US Position
Across US jurisdictions, William Hill achieved significant expansion by utilizing partnerships, and maintained a strong market position, besides generating revenue growth of 32%.
“The US traded well into the year-end, concluding the year with 19% market share and delivering a profitable return. Our partnerships have ensured that brand awareness has risen, our product offering has expanded, and our end-to-end proprietary tech is facilitating rapid new state openings.”
Ulrik Bengtsson, CEO, William Hill
The windfall of £208.3 million from VAT in the UK benefited statutory profit before tax reading of £51 million and managed to more than offset non-cash impairment of £125.7 million from retail and costs associated with the £2.9 billion all-cash offer from Caesars Entertainment, £70.4 million.
The sports betting and gaming group took action to strengthen its balance sheet by raising capital and preserving liquidity. Placing of equity contributed to the overall balance position with £218.6 million of net proceeds.
As a result of shareholder dividend suspension and employee bonus cancellation, as well as disciplined cost management and debt covenant waivers, William Hill achieved a net debt to EBITDA ratio of 68 to 1.
With 4 years experience as an analyst, Julie—or ‘Jewels’, as we aptly refer to her in the office—is nothing short of a marvel-worthy in her attention to the forex and cryptocurrency space as she quickly became the first pick to co-pilot education to the masses with Mike.
