The coronavirus pandemic has had a pronounced negative effect on the retail betting industry in the United Kingdom, causing a shift toward the online segment. The London-based bookmaker William Hill is one of the companies that have suffered a severe blow revenue-wise since the pandemic started.
The company reported its annual revenue from the retail sector has plummeted by 51%, dropping to £1.1 billion. The operator suffered over £29 million in adjusted losses from its retail arm alone. The company currently operates more than 1,400 retail bookmaking shops in the United Kingdom after shutting down 119 shops during the first lockdown in 2020.
William Hill had traditionally relied on the UK market for a significant portion of its revenues. According to company representatives, the operator has registered a more negligible increase across the online segment compared to its rival Entain.
The company relies on the online segment for 61% of its overall profits. William Hill’s remote betting revenues increased by 9% to reach £803 million, with adjusted operating profit growth of 3% to £122 million. This has enabled the company to at least partially offset the losses incurred after the closure of some of its bookmaking shops and commercial casinos.
By contrast, its rival Entain, who owns major brands like Ladbrokes Coral, confirmed its betting sites had witnessed significant growth following the closure of some of its retail locations. The company expects to transition to the online segment as a means of dealing with the permanent decrease in demand for landbased betting shops.
Entertain’s retail arm suffered a revenue decline of 40% to £857 million last year. This is a dramatic decrease from an underlying operating profit of £172.3 million in the previous year to a £19 million loss in 2020. By means of comparison, Entain’s online segment posted 28% revenue growth to £2.7 billion. Its underlying operating profit increased by nearly two-thirds, reaching £679 million as a result of bettors transitioning to online gambling during the lockdown.
Both Companies Push Aggressively for Further US Expansion
Both William Hill and Entain have resorted to aggressive pushing for a slice of the US market share after the country embraced sports wagering and online gambling back in 2018. The number of states the two companies operate in sharply increased in 2020.
According to William Hill, the company saw its revenue from the US market jump by nearly a third, reaching £167 million and operating profits of £12 million. Entain confirmed its joint enterprise with the US gambling giant MGM Resorts generated $178 million in revenue (£127.5 million) last year. These results are way ahead of the company’s expectations of $160 million.
The market share of BetMGM, Entain’s joint project with MGM Resorts, grew by 18%. However, Entain invested significantly in further expansion on the US market which caused the group to lose around $60 million. The company expects its investments into further market expansion will increase considerably in 2021.
- Author
Daniel Williams
