The UK’s largest bookmaker William Hill grew its online business 33% in the first quarter of this year, it revealed in an interim management statement this morning.
A run of positive sports results – less so for William Hill’s punters – helped the betting business deliver sportsbook net revenue 58% higher than for the equivalent period last year, supported by a 31% rise in stakes and higher-than-expected gross win margin of 8.8%.
The 33% increase in net revenue from its online joint venture with software provider Playtech helped deliver a 12% rise in group net revenue and a 19% rise in operating profit, as digital performance bolstered a more sluggish but still robust return from its shops division, where net revenue was up 5%.
Chief executive Ralph Topping (pictured above) put the online uplift down to the company’s increased investment in marketing and technology, revealing that turnover from the sportsbook had for the first time reached £50m in just one week, and mobile turnover almost £11m, with wagering from the latter channel up more than 370% year-on-year.
According to the company this morning, new punters have accounted 30% of the 190,000 downloads of its free mobile sportsbook app from the Apple app store in the 13 weeks to 27 March, “giving us access to thousands of new customers who have never bet with William Hill before,” said Topping.
Hill’s was the main bumper sponsor during this year’s Cheltenham Festival coverage on Channel 4, and is also the betting partner of the FA Cup through a deal with the Football Association.
Revenue from gaming – including casino, bingo and poker – was up by 19%. Revenue from casino games increased 26%, which included a 37% improvement in the Casino provided by its joint venture partner Playtech, compared to 16% for Hill’s Vegas Casino, which includes games from a range of providers. Bingo also performed well, rising 7%, but poker fared less so, dipping 8% in the period.
The bookmaker, which employs around 15,000 people, mostly in the UK where it had approximately 2,370 shops, also criticised the UK government’s plans to tax online gambling based on location of gambler rather than company and a 15% gross proft tax from 1 December 2014, saying its view remained that “there is no demonstrable need for the proposed POC regulation based on consumer protection, which is the Government’s justification and that rigorous enforcement would be required to avoid market distortion”.
A Deloitte-authored report commissioned by William Hill and released in January concluded that setting the new tax at 15% GPT would drive smaller operators out of business and increase the size of the unlicensed offshore market. In common with Ladbrokes and Betfair, Hill’s moved its online division to Gibraltar in 2009 in order to increase the competitiveness of its online division compared to those targeting the UK from lower tax base in other EEA Member States, Gibraltar and the UK government’s “white list” of approved jurisdictions.
The bookmaker also confirmed that the new machine games duty of 20% levied on gross profit from 1 February 2013, also unveiled in March’s Budget, would have cost the company an additional c£13m had it been in place last year.
