William Hill is the UK’s leading bookmaker and one of the most recognised and trusted brands in the gambling industry, providing gaming and betting services across multiple channels.

Our business, performance and markets

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Overview

We have been listed on the London Stock Exchange (WMH.L) since 2002 and employ c16,000 people in nine territories: the UK, Gibraltar, Israel, Bulgaria, Spain, Italy, the Philippines, Australia and the US.

Our business is comprised of four businesses: the highly cash-generative Retail land-based operation in the UK; the rapidly growing Online betting and gaming business; William Hill Australia which offers digital betting in the Australian market; and William Hill US which operates sports books in Nevada and is the exclusive bookmaker to the Delaware state sports lottery.

William Hill’s core strategy is to invest in regulated markets where we can take a licence and operate profitably. Approximately 96% of the Group’s revenues are generated from these markets. As the legal picture continues to evolve, we have formed a risk-assessed legal view on each market from which we generate, or consider generating, revenues.

Retail operates 2,372 betting shops, representing 26% of UK’s licensed betting offices. It is our largest division, generating 56% of Group revenue in 2016 and employing around 12,500 people. Online is the leading provider of online betting and gaming to UK customers and is licensed to provide online betting and gaming in Italy and Spain. It generated 34% of Group net revenue in 2016. Digital has just become the biggest part of the UK market., growing at 14% CAGR between 2012 and 2015. William Hill Australia was created in 2013 through the acquisition of Sportingbet (including Centrebet) and tomwaterhouse.com. It contributed 7% of Group net revenue in 2016 and is only of the largest online betting companies in Australia. William Hill US was created in 2012 through the acquisition of three small sports book operators in Nevada. It operates 55% of the casino-based sports books in the state, which is one of only four in the US that are allowed to provide sports betting. 

Our strategy

We are focused on improving the customer experience by making it both fast and easy as well as enjoyable and personal to bet with William Hill. To do this, we are expanding our product range, increasing our marketing investment and using our technology for continuous improvement.

Grow UK market share

The UK remains our near-term priority. It is not only our largest market, it is also the world’s largest regulated online gambling market, four times bigger than Italy or Australia. Our brand, extensive high street footprint, product range, user experience and large-scale marketing investment remain powerful drivers in this market and we are confident we can further grow market share.

We have extensively reviewed our marketing effectiveness and have implemented a number of changes to digital marketing. With this in place, and with a clear pipeline of product innovations ahead, we are increasing our marketing investment in the UK by c20%.

Continued international revenue growth

We will continue to grow internationally, capitalising on good growth in digital markets and diversifying our sources of revenues.  We have built an innovative and highly competitive offering for customers. As regulations change and markets open up across the world, we are taking that offering into other regulated markets.

By diversifying our revenue streams, we reduce our exposure to fiscal, economic and regulatory change in any single market.

Transformation and technology projects

We have already successfully differentiated our customer experience through both betting and gaming innovations and the breadth and depth of our product range.

While many other operators continue to rely exclusively on third parties’ software and technology, we are increasingly building our own solutions and optimising how we use third parties to build a bespoke William Hill technology. This gives us the platform for further innovation and differentiation.

Enabling this strategy are two key projects: a transformation programme to increase efficiencies and deliver £40m of annualised savings to support our higher investment; and a three-year programme to deliver a global technology platform for the whole William Hill Group.

Indicators of strategic progress

Our strategy is to increase the diversification of the Group’s revenues by growing our digital and non-UK revenues. On page 10 we summarise the progress we made against four focus areas we outlined at the time of appointing Philip Bowcock as Interim CEO. We have also outlined our strategic priorities, targeted at growing our UK market share and our international revenues.

Since 2014, senior management’s longterm incentive plans have been linked to our diversification strategy, with 25% of awards assessed against mobile growth in Online and digital growth in Australia.

Between 2014 and 2016, the proportion of revenues from digital and international markets has remained relatively stable at 41% and 18%, respectively. This is because different divisions have experienced volatility at different times, effectively offsetting weakness in one part of the Group with growth in another. However, across the same period, we have seen mobile continue to increase as a percentage of Sportsbook and Gaming net revenues in Online, and digital has increased to 85% of Australia’s revenues. With greater stability now achieved in our Online and Australia divisions, we would expect to see our strategic measures progress positively in the coming years.

 

Regulation and our marketplace

Gambling takes many forms and varies from country to country. The industry is made up of government-run operations, licensed monopolies or open commercial markets. In some countries, there is an outright ban on gambling. The wide range of products available to consumers – including lotteries, sports betting, casino games, bingo and poker – are available in many different formats, from land-based clubs, pubs, casinos, betting shops and race tracks to online gambling.

Land-based activities remain the format of choice for most gambling customers across all the leading countries by gambling revenues. Online gambling first started in earnest in 1998 while mobile gambling has become more prominent in the last five years with the advent of smartphone and tablet technology.

In many countries, gambling regulations were originally designed with land-based operations in mind. With the advent of digital gambling overcoming physical borders, governments are moving to update their regulations to take account of online and mobile gambling.

This is creating opportunities for companies – such as William Hill – who have built a successful digital business. It is particularly an advantage for those who have become successful in the UK market as the competitive intensity in this liberalised market has driven high levels of innovation that are proving attractive in other markets. 

William Hill’s core strategy is to invest in regulated markets where we can take a licence and operate profitably. Approximately 96% of the Group’s revenues are generated from these markets. As the legal picture continues to evolve, we have formed a risk-assessed legal view on each market from which we generate, or consider generating, revenues.

An overview of our key markets can be found on pages 20-23 of our 2016 Annual Report & Accounts (5.9MB PDF).

Responsible gambling

Recently, the level of attention on our industry has increased substantially. This encompasses wide-ranging concerns, from the possible effects of the rapid growth in popularity of gaming machines over the last decade, to areas such as advertising, the effect of in-play betting on sports integrity, the industry’s support for the horse racing industry and localised concerns about the number of betting shops on the high street.

Leading operators have worked together and proactively – both as an industry and with the government, the regulator and various industry bodies – to address these concerns and to facilitate fact-based decision-making.

For more about our approach to responsible gambling and sustainability, visit our Responsibility section.

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