William Hill Revenue Plummets 57% Over COVID-19

  • Loss figure covers all William Hill group operations between March 11 and April 28
  • Revenue for the first ten weeks of 2020 was also down 5% year-on-year
  • Earnings will fall by £12-15m for each extra month that the betting stores are closed
  • Monthly cash outflow is down to £15m following extensive cost-saving measures
  • Group plans to start reopening UK retail betting stores in the second half of the year
William Hill betting shop sign
William Hill plc saw its total group revenue drop by 57% following the outbreak of COVID-19. [Image: Shutterstock.com]

A significant revenue drop

William Hill plc’s total group revenue during the coronavirus pandemic fell by 57% from March 11 to April 28. According to a trading statement released on Friday, revenue for the initial ten weeks of 2020 was 5% lower than for the same period in 2019.

operator was able to reduce monthly cash outflow to about £15m ($18.3m)

The leading betting and gambling operator was able to reduce monthly cash outflow to about £15m ($18.3m) through measures such as cuts in marketing spend and staff costs. The group of companies also availed of the business rates relief offered as part of government support measures. It also obtained a covenant waiver through its various banking arrangements.

Reopening retail betting locations in stages

One positive note for William Hill plc was that online sports betting revenue did not fall by as much as expected following the cancellation of most global sporting events. It observed that many customers transitioned to alternative betting markets, such as obscure football games and table tennis.

Retail betting locations in the US and UK remain shut for the most part. A number of major sporting organizations are readying to return to action in the near future, which will boost online sports betting operations.

William Hill estimates that earnings will fall by between £12m ($14.6m) and £15m ($18.3m) for each extra month that its retail stores remain closed. These figures are also based on the assumption that government support will continue to be offered for its furloughed workers.

earnings will fall by between £12m ($14.6m) and £15m ($18.3m) for each extra month that its retail stores remain closed

The operator will not be providing any estimates on future performance amid ongoing uncertainty. However, it is planning a staged reopening of its UK retail stores in the latter half of the year. William Hill will also closely monitor all developments in the US, where it recently opened drive-thru sports betting services in Nevada.

Overcoming current and future challenges

Group CEO Ulrik Bengtsson spoke about the various challenges William Hill has overcome during its 86-year history. He felt “exceptionally proud of the team and their response to the COVID-19 pandemic” as sports events were canceled and its retail stores had to shut down.

He added that the group took measures to minimize costs, such as renegotiating with suppliers, cancelling executive bonuses and pay rises, and suspending its dividend to shareholders. As a result, company liquidity has been maintained.

Bengtsson also said that, thanks to the net debt covenant, William Hill has sufficient strength in its balance sheet. It will continue looking at growth opportunities to invest in, particularly in the expanding US sports betting market.

However, the chief executive did not shy away from saying that it will be a tough recovery for William Hill plc following the ending of the lockdown.