William Hill is expanding its US business after the UK fixed-odds-betting terminal (FOBT) maximum bet reduction impacted its H1 results
An announcement regarding a major expansion in the US coincided with the release of the H1 results, reflecting the company’s new focus.
The company has entered into sports betting agreements with 11 casinos in Mississippi and an unnamed casino partner in West Virginia.
Net revenue for the operator increased 3% to £802.6m ($1.04bn), while existing operations adjusted operating profits were also up, albeit only slightly, as they rose 1% £130.8m.
However, adjusted operating profit declined 12% to £113.6m and profit before tax fell by 13% to £96.3m. In turn, this resulted in a sharp fall of 18% in dividend per share, from £11.1 in H1 2017 to £9.1 during the same period in 2018.
Philip Bowcock, CEO of William Hill, commented: “During the first half, our online business continued to deliver double-digit growth. In retail, we are beginning to put in place plans to mitigate the impact of the Triennial Review.
“In the US, we have moved quickly following the repeal of PASPA as we grow into newly regulating states. We will continue to invest in the US to ensure we are well placed to capture the substantial potential available to us.”
Exceptional charge and adjustments negatively impacted William Hill’s results as they totalled £915.9m, including £882.8m non-cash impairment to the retail division.
This was a result of the UK government’s decision to reduce the maximum stakes on FOBTs from £100 to £2, following the Triennial Review.
Proceeds from the disposal of William Hill’s Australian business and investments in supplier NYX softened the impact of the FOBT stake reduction as they raised £241.7m. The company also recorded 11% online revenue growth and continued strong growth in its existing US markets.
Bowcock added: “We have built on our existing business in Nevada which is number one and growing and in Delaware where we are risk manager for the entire state.
“We are now the early market leader in New Jersey where our mobile app will launch within weeks and we expect to be market leader in Mississippi with these eleven casino agreements. The team continue to engage in discussions that cover a further fourteen states and they are doing a tremendous job.”
William Hill US CEO Joe Asher commented: “We have had a great start in New Jersey and our team is working hard to launch our mobile product there, as well as getting ready to go live in Mississippi, West Virginia and elsewhere, subject to regulatory approval. There is a lot happening and we are very proud of our team.”