William Hill to lose 4,500 jobs over fixed-odds stake
BOOKIE William Hill plans to cut about a third of its betting shops and jobs in Britain after the UK government slashed the maximum stake permitted on fixed-odds terminals, dubbed the "crack cocaine" of gambling by their critics.
Regulators cut the maximum stake allowed to £2 (€2.23) in April after complaints that the machines, which had previously let gamblers bet up to 100 pounds every 20 seconds, were highly addictive and allowed players to rack up big losses.
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William Hill, which last year warned that about 900 shops could be shut, said on Thursday it had suffered a significant fall in revenues since the change and would close 700 of them. The company has not had any shops in the Republic of Ireland since 2011.
It said that the closures, which would put about 4,500 of its 12,500 British jobs at risk, were likely to begin before the end of the year.
The popularity of the fixed-odds terminals had helped to sustain a nationwide network of around 8,500 high street betting shops when more gamblers were using smart phones, tablets and computers to bet on sports such as soccer and horse racing - the traditional mainstays of the industry.
The closure of brick-and-mortar shops is likely to further accelerate that trend towards online gambling.
Job cuts and store closures among Britain's gambling firms come in the wake of the collapse of several retail chains, including Toys R Us UK and electronics retailer Maplin, in recent years.
William Hill's rival GVC has warned the stake limit would lead to the closure of up to a 1,000 shops and cut its 2019 core profit by about 135 million pounds ($170 million).
In May, owner Paddy Power owner Flutter Entertainment, forecast its revenue from fixed-odds machines would slump 43pc, but reported no substantial changes in footfall at its shops as a result of the change.
William Hill, which in March took a £882million non-cash write-down of its retail business, did not immediately respond to a request for details on its plan. It said it was consulting with its employees over the shop closures.
Meanwhile, British betting companies have been pushing into the United States after the U.S. Supreme Court overturned a federal ban on sports betting.
"High street betting shops are costly, and revenues are being lost to the online business, and funds are required to finance the expansion into the U.S. - an emerging market for gaming," CMC Markets analyst David Madden said.
William Hill, whose British retail business generated 56pc of its net revenue in 2018 and which accounts for about 90pc of its business, has invested in a digital launch in New Jersey and has started operations or expanded in six states in the U.S.