Sporting results hit performance
Wagering trends in the nine weeks to 27 December remained in line with those seen earlier in the year. However, customer friendly football and racing results meant that gross win margins were below expectations. The shares are down 2.6% early on 9 January.
Full year operating profit for 2016 was around £260m, at the bottom end of the group's £260-£280m range guidance range.
Interim CEO, Philip Bowcock, commented;
"Improvements we saw in wagering in Online and Australia in the second half have continued in recent weeks. However, all four divisions saw customer-friendly results at the back end of the year, which translated into profits being c£20m below our prior expectations."
Full year results will be released on the 24th February.
2016 was certainly an eventful year for William Hill. Unfortunately, two bids and one CEO later the group doesn't look much further forward than it did in January 2016.
Last year was supposed to see William Hill's online business regain its mojo, following a number of operational challenges in FY15. Instead the group warned of lower profits from the division, barely a month after issuing full year results.
We can forgive the group an unfavourable run of sporting results, which are clearly outside its control, but the warning was more a result of an acceleration in the number of time-outs and automatic self-exclusions in its online business. Basically 'problem gamblers' being locked out of their accounts.
Like all bookies, William Hill is trying to recruit more "recreational" clients. Punters who don't take it seriously enough to really know what they are playing at, and can therefore be relied upon to bet money at poor odds, in return for a bit of a thrill.
With the distracting merger talk of last year now behind it, the group seems to be knuckling down to the job of sorting out the core business. Recent updates suggest the number of bets placed online and in Australia is improving, both areas that have underperformed in recent years.
For all the drama of last year the improvement is still small. Hopefully, the renewed focus and improving trends will start to deliver some results.
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