William Hill, the second-largest bookmaker in the UK, have swung to an annual loss after slashing its Australian assets’ value, but it it still keeps its eyes on future investments in America. The British bookmaker is aimed to take advantage of the expected removal of the sports betting ban in case that the US Supreme Court rules in favour of New Jersey in the state’s sports betting case.
Currently, the Supreme Court of the US is considering whether to thoroughly remove the sports betting ban imposed by the Professional and Amateur Sports Protection Act of 1992 (PASPA). Under PASPA, sports betting is currently allowed only in four US states, including Montana, Nevada, Delaware and Oregon.
Although the plans of further expansion once the US sports betting market is finally opened, the gambling operator reported a 2017 pre-tax loss estimated to £74.6 million. In comparison, it reported a £181.3-million pre-tax profit in 2016. The loss is considered to be mainly due to a charge of £238-million charge which the bookmaker paid to reduce the value of its Australian arm.
Still, the company also reported that its net revenues for the full year 2017 rose by 7% thanks to its growing market share in the UK in both online and land-based divisions. The revenues generated by the US division of William Hill increased by 29%.
As far as its finances on an underlying basis are concerned, or in other words when the problems in the Australian division and other one-off taxes are excluded, William Hill explained that its finances were doing well. Its underlying pre-tax profit increased by 19% and reached £255 million.
William Hill Aussie Division Sale and UKGC Fine
The possible sale of William Hill’s Aussie division was announced in mid-January, after the country’s authorities chose to impose a gambling crackdown. Local regulators banned credit-funded betting, and as mentioned above, taxation in some states also increased. The bookmaker also announced that it took an impairment charge of £238 million on its Australian business in order to reflect the reduced value of the assets.
One of main reasons for the bookmaker’s decision to sell its struggling business in Australia is the regulatory regime in the country, with local authorities making gambling regulation stricter, while taxation has increased in some states. Currently, the UK gambling operator is carrying out a strategic review of its Australian assets which is expected to be finalised by the middle of 2018.
Apart from that, only a few days ago the British bookmaker suffered a massive blow by the UK Gambling Commission (UKGC), which imposed it a massive £6.2-million fine for violating social responsibility and anti-money laundering laws. According to the gambling regulatory body, the company did not do enough to make sure that it complied with the afore-mentioned measures, which resulted in 10 customers making deposits linked to criminal activities.
- Author
Olivia Cole
