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William Hill Earnings Report

4/29/10 - The internet operations of UK gambling group William Hill plc have once again provided a boost to group revenues against a backdrop of a 4 percent decline in land-based betting shop net revenues.
 
The gambling group published Q1 2010 key performance indicators, showing group net revenue up a scant 1 percent and EBIT up by 3 percent - due largely to a welcome surge in the bookmaker’s e-gaming division. 
 
Online activities were again an important driver of growth, with net revenue up by 25 percent compared to the first quarter of 2009.  William Hill Online – a joint venture with Playtech plc - increased new accounts by a creditable 31 percent and lifted operating profit by 51 percent.
 
This first quarter delivered a particularly strong performance in online sports betting, with the group’s Orbis-powered sports book platform and in-running betting product contributing to sports’ net revenue growth of 79 percent, due to both higher volumes and an expanded margin of 8.1 percent, up from 6.6 percent in Q1 2009. 
 
Online casino and bingo grew 11 percent and 53 percent respectively, although the bookmaker struggled in a tough and competitive online poker environment which saw net revenue fall 11 percent. 
 
Online EBIT was GBP 23.3 million. 
 
Commenting on the Q1 performance, chief executive Ralph Topping said: “I am satisfied with our performance this early in the year, with an improvement shown in overall retail turnover levels and good growth from William Hill Online in revenues, operating profit and new accounts.  

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“We have much to look forward to this summer with interest in the World Cup expected to be greater than ever. Kick-off times in South Africa are favourable for our UK and European customer base and we have experienced sustained growth in football betting since the last tournament. 
 
“We continue to maintain a watchful eye on costs and are making significant investment in growing our international online business. I am confident that we are on track to achieve our objectives for this year.”
 
William Hill’s retail [land] operations fared less well with net revenues down by 4 percent. Gaming machines turnover rose 9 percent, but the OTC gross win percentage fell sharply compared with last year. Gross win fell by 11 percent with operating profit down 13 percent.
 



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