2 0 1 8 fj n a l r e s u l t s 53 weeks ended 1 January 2019 1 March 2019 1
D i s c l a i me r William Hill PLC Cautionary note regarding forward-looking statements This presentation has been prepared by William Hill PLC (“William Hill”). It includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "plans", "goal", "target", "aim", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. They appear in a number of places throughout this presentation and the information incorporated by reference into this presentation and may include statements regarding the intentions, beliefs or current expectations of the Directors, William Hill or the Group concerning, amongst other things: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects; (ii) business and management strategies, the expansion and growth of the Group’s business operations; and (iii) the effects of government regulation and industry changes on the business of William Hill, the Group. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future and may be beyond William Hill's ability to control or predict. Forward-looking statements are not guarantees of future performance. The Group's actual results of operations, financial condition, liquidity, and the development of the industry in which it operates may differ materially from the impression created by the forward-looking statements contained in this presentation and/or the information incorporated by reference into this presentation. Any forward-looking statements made by or on behalf of the William Hill Group speak only as of the date they are made and are based upon the knowledge and information available to the Directors on the date of this presentation, and are subject to risks relating to future events, other risks, uncertainties and assumptions relating to William Hill’s operations and growth strategy, and a number of factors that could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements. Undue reliance should not be placed on any forward-looking statements. Before making any investment decision in relation to William Hill you should specifically consider the factors identified in this document, in addition to the risk factors that may affect William Hill’s operations which are described under “Managing our risks” in the Company’s 2018 Annual Report. Subject to the requirements of the FCA, the London Stock Exchange, the Market Abuse Regulation (596/2014), the Listing Rules and the Disclosure and Transparency Rules (and/or any regulatory requirements) or applicable law, William Hill explicitly disclaims any obligation or undertaking publicly to release the result of any revisions to any forward-looking statements in this presentation. No statement in this document is intended as a profit forecast or profit estimate and no statement in this document should be interpreted to mean that the earnings per share of William Hill as altered by the presentation will necessarily match or exceed the historical or published earnings per share of William Hill. 2
F o c u s i n g o n t h e o p p o r t u n i t y BUILD A DIGITALLY LED, INTERNATIONALLY DIVERSE GAMBLING COMPANY D r i v i n g d i g i t a l g r o wt h G r o wi n g a b u s i n e s s o f i n s c a l e t h e UK a n d i n t h e US i n t e r n a t i o n a l l y D e l i v e r i n g o n o u r a mb i t i o n t h a t R e mo d e l l i n g R e t a i l n o b o d y i s h a r me d b y g a mb l i n g TO DOUBLE GROUP OPERATING PROFIT BETWEEN 2018 AND 2023 3
2 0 1 8 o p e r a t i o n a l h i g h l i g h t s Good underlying growth, actives +25% year-on-year, mass market focus • O n l i n e Acquisition of Mr Green: International Online hub, extended European • reach, increased diversification, multi-brand opportunity Robust performance in challenging trading conditions • R e t a i l Ready to implement changes in response to B2 staking limit • Sixth consecutive year of double-digit revenue growth in Nevada • US Only company live in seven regulated states, rapid progress on market • access, early launch of mobile Sale of Australia: increased management focus, stronger balance sheet • G r o u p Transformation programme is substantially complete • Nobody Harmed: whistle-to-whistle voluntary advertising ban • 4
F i n a n c i a l r e v i e w Ruth Prior, CFO 5
G r o u p i n c o me s t a t e me n t 53 weeks ended 53 weeks 53 weeks ended 52 weeks 1 Jan 2019 ended 1 Jan 2019 ended Exc. US 1 Jan 2019 Inc. US 26 Dec % change Good underlying growth Expansion US Expansion Expansion 2017 offset by enhanced £m £m £m £m customer due diligence in Ne t r e v e n u e 1 , 6 0 9 . 5 1 1 . 8 1 , 6 2 1 . 3 1 , 5 9 2 . 8 + 2 % Online. Resilient Retail in tough trading environment Cost of sales (388.1) (1.6) (389.7) (383.5) +2% G r o s s p r o fj t 1 , 2 2 1 . 4 1 0 . 2 1 , 2 3 1 . 6 1 , 2 0 9 . 3 + 2 % Net operating expenses (954.6) (998.0) (935.5) +7% (43.4) £17m reduction from Online customer due Ad j u s t e d o p e r a t i n g p r o fj t 2 6 6 . 8 ( 3 3 . 2 ) 2 3 3 . 6 2 7 3 . 8 - 1 5 % diligence, includes US Expansion losses of Exceptional items and adjustments1 (921.5) (921.5) (90.9) - £33.2m ( L o s s ) / p r o fj t b e f o r e i n t e r e s t ( 6 5 4 . 7 ) ( 3 3 . 2 ) ( 6 8 7 . 9 ) 1 8 2 . 9 a n d t a x £882.8m impairment of Retail, £31.2m for Net finance costs (34.0) (36.4) -7% transformation programme ( L o s s ) / p r o fj t b e f o r e t a x ( 7 2 1 . 9 ) 1 4 6 . 5 2017 includes Australia impairment charge Tax 5.8 (4.1) Full-year dividend in line with policy to pay out ( L o s s ) / p r o fj t f r o m c o n t i n u i n g c50% of adjusted earnings ( 7 1 6 . 1 ) 1 4 2 . 4 o p s excl. US expansion 3.8 (225.6) Profit/(loss) from discontinued ops 6 ( 7 1 2 . 3 ) ( 8 3 . 2 ) ( L o s s ) / p r o fj t f o r t h e p e r i o d Slide provides an overview of results with both adjusted and statutory measures. Following slides on divisional performance reflect adjusted results, since that is how performance is internally managed and reported Total exceptional items and adjustments of £922.1m disclosed in note 3 of the 2018 annual report includes £0.6m of finance costs 1. (Loss)/earnings per share and adjusted EPS figures are both calculated based on adjusted profit from continuing operations only 2. (83.6) 16.6 (Loss)/earnings per share (p) 2
O n l i n e KP I s – ma s s ma r k e t mo me n t u m UK International Ke y p e r f o r ma n c e 2018 2017 % 2018 2017 % i n d i c a t o r s 4 8 4 . 0 1 5 0 . 4 Net revenue (£’m) 475.0 +2% 141.9 +6% 7 1,914. 2 , 3 9 0 . 5 8 8 . 4 Unique actives (’000) +25 474.2 +24% 2 % 8 3 4 . 8 2 7 3 . 1 New accounts (’000) 760.3 +10 249.9 +9% % 2 0 2 2 5 6 Average revenue per user (£) 248 -19% 299 -14% Strong actives growth, particularly in gaming 1 3 3 1 3 3 Average cost per acquisition 136 -2% 142 -6% ARPU reflects targeting of mass market customers (£) Reduced CPA due to volume acquisition and increased marketing efficiency 7
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