Shares in FTSE 250 bookmaker William Hill (LON:WMH) climbed 5.90% to 113.05p (as of 12:15 BST) after it announced that its credit covenants had been suspended for 2020. The company’s cash burn has been restricted by cost controls and liquidity remains in excess of £700 million. Total net revenues for the period between 11th March and 28th April dropped by 57% with UK online sports betting not falling as far as expected due to movement into alternative products including emerging market football.
CEO Ulrik Bengtsson commented: “William Hill has overcome many challenges in its 86-year history, and I am exceptionally proud of the team and their response to the COVID-19 pandemic. We have worked hard to protect them, and in turn they have done the same for our customers.
“We reacted quickly to the cancellation of sports activities and the closure of our retail estate. We took immediate measures to save costs, reduce cash outflow and minimise non-essential expenditure by negotiating with our suppliers, cancelling pay rises and executive bonuses and suspending the dividend. We have preserved liquidity and amended the terms of our net debt covenant, leading to significant, balance sheet headroom. This will enable us to continue to invest for growth, most notably in the US, as plans there to roll out sports betting continue apace.
“Our ambition to build a digitally led, internationally diverse business of scale is proving beneficial during the disruption as our international online business has performed very strongly. We have accelerated product developments in the US in particular to ensure we are well positioned when sports activity reopens. Our product development teams elsewhere have also excelled themselves during this period of remote working, deploying a range of important new products, most notably a gaming front end to improve navigation and speed for the UK market.
“We remain focused on player safety employing ever more customer protection. We are taking care of our teams, securing as many employment opportunities as possible and we are ready to power up the business as soon as COVID-19 restrictions permit“.