William Hill has warned that regulatory and tax changes will result in a significant hit to the operator’s revenues, as it looks to capitalise on the nascent US sports betting market.
Announcing an overall revenue rise of four per cent for the year, CEO Philip Bowcock forecast that operating profit for 2018 will be between £225m and £245m.
That is a long way down on 2017’s £291.3m. The forecast arrives amid adverse regulatory and tax changes in the UK that are set to impact up to the end of 2019 – including the bump in remote gaming duty to 21 per cent – with the gross effect of reducing profit in 2018 by £20m, with a further £25m hit the following year.
Bowcock is, though, looking towards the US market with plenty of optimism, with existing businesses seeing net revenue grow six per cent year-on-year, with sportsbook up 17 per cent.
“I’m pleased to report that we’ve built on our market leading position in Nevada to make rapid progress in other states as they legalise sports betting, and are the only company to be taking sports bets in the first five states to have regulated,” he said.
“Our goal is to be in every state. Supported by the extensive experience of our US Existing business in Nevada, we’re building a network of market access agreements, including our strategic partnership with Eldorado, expanding our relationship with Golden Entertainment and exclusively partnering with IGT for sports lottery opportunities. We’ve opened 18 new sports books and launched our initial mobile offering in New Jersey.
“We’re also progressing a new technology solution to go live in 2019, incorporating the newest elements of the Group’s existing platform and a bespoke Player Account Management system from NeoGames, whose solution is more feature-rich than any sports betting platform currently live in the US.
“We are continuing to experience a period of significant change for our industry and have already made important changes over the last two years to transform our digital business, broaden the management team and enhance our financial flexibility ahead of key regulatory changes.”
William Hill recently announced the acquisition of Swedish operator Mr Green for £242m.
