William Hill suffered a 15 percent drop in operating profits in 2018 and announced it will close about 900 betting shops in the UK.
William Hill officials said the move was part of a strategic realignment focusing on international growth and digital transformation. But the move also come ahead of the UK implementing a drop in the maximum bet allowed of fixed odds betting terminals to £2 from £100 in the spring.
Despite the operating profit drop, William Hill said in its full-year trading statement that despite setbacks, the bookmaker’s digital division and US operations have delivered “excellent growth.”
The group’s Chief Executive Philip Bowcock, however, said new directives would be made to “remodel William Hill’s retail proposition.” Bowcock said 2018 was a pivotal year for the company and for the bookmaking industry.
“We now have greater clarity around the key challenges and opportunities for our business,” he said. “In 2019 we will remodel our retail offer while building a digitally led international business underpinned by a sustainable approach as part of our Nobody Harmed ambition.
The shop closures also come after William Hill’s approval for a €270 million acquisition of Stockholm-listed MRG Group, which includes online brand Mr. Green.
“With rapid expansion underway in the US, building on profitable foundations, and the acquisition of Mr Green nearing completion, we look forward to making further progress this year,” Bowcock said speaking to investors.
The shop closures are expected to begin within a few weeks, reports said. William Hill has 2,300 stores in the UK. The closures could affect about 4,500 jobs.
In a similar story, GVC also announced it is planning cuts to its Ladbrokes and Coral retail shops.
GVC, Britain’s biggest bookmaker reported 21 percent growth in online gaming revenue and announced that Ladbrokes and Coral shops will become a “relatively small part” of operations.
“UK retail is in terminal decline,” Kenny Alexander, CEO of GVC Holdings told the Daily Telegraph. “We’re growing market share in all our major territories. We’re shooting the lights out at the moment. It’s all about digital. And thankfully our digital business is going gangbusters.”
The group said the stake cut on FOBTS will likely lead to 1,000 Ladbrokes and Coral shops closing.
“There is no point in sugar-coating it, some jobs will go,” Alexander said. Profits from UK retail are “going to be a relatively small part” of the wider company in the future, he said.
GVC Holdings also announced a series of changes to its senior management team, with Tom Ritzema, Nick Batram and Paul Tymms all taking on new roles.
Ritzema, who has more than 18 years of experience in bookmaking and trading, moves into the position of group trading director. He replaces Jim Humberstone, who recently opted to leave GVC.
Batram becomes group director of corporate strategy and development, where, reporting directly to CEO Kenneth Alexander, he will focus on both M&A activity and the group’s broader strategic direction, the company said in a press release.
Meanwhile, Tymms takes on Batram’s previous role, where he will report directly to Rob Wood, who is to become chief financial officer in March.
