888 has stated proactive enhanced player safety measures in the UK online vertical, and the closure of the Netherlands, as drivers to its drop in year-on-year online revenue.
Announcing a post-close trading update for the 12 months, ending December 31, a combined revenue from the retail and online space totalled £1.85bn, a three per cent drop from 2021, which 888 states is in-line with guidance.
Looking into its online sector, this vertical contributed £1.3bn in revenue for 2022 (2021: £1.57bn), a 15 per cent decrease from last year. This drop, according to 888, was primarily down to the strengthening of player safety measures in the UK regulated market.
Moreover, the firm pointed to the closure of the Netherlands, with revenues outside these territories down four per cent, which it states reflects a “strong comparative period and refined market focus”.
Fourth quarter figures also displayed a decrease in YoY online revenue (five per cent) for 888, though the company stated it was “stable” despite the drop.
Despite the firm’s online shortcomings, 2022 was a successful period, revenue wise, for the company, partly in part to its acquisition of William Hill in July of this year. Retail revenues for the full year were up 54 per cent to £519m. The spike in this revenue reflects a full year of trading in 2022 with figures inflated due to the partial closures during the first half of 2021.
Reflecting on its performance from 2019 figures, the average revenue per shop was up seven per cent.
888’s retail performance in the fourth quarter was also boosted by the first winter World Cup, as the company reported revenues of £131m, up five per cent to the prior year and six per cent from Q3.
The World Cup also aided William Hill with its acquisition of new customers and engagement of existing customers across both online and retail, with online player days up 22 per cent from the 2021 Euros.
Itai Pazner, CEO of 888, explained: “During the fourth quarter of 2022 our teams continued to make rapid progress in integrating these two highly complementary businesses, and have started the process to migrate Mr Green to our proprietary global tech stack, as we execute against our strategic roadmap that we outlined at our recent capital markets day.
“Revenues during the fourth quarter saw continued strong trading in retail, and a robust performance online. As previously discussed, we continue to see pressure on our UK online revenues from regulatory change including the ongoing impact of the enhanced player safety measures, but I am confident we are building a sustainable leading business for the future.
“As we look forward, we remain focused primarily on successful integration, execution and de-leveraging in order to unlock the potential from our enlarged business.
Alongside the group’s FY22 results, 888 also confirmed that Yariv Dafna, Chief Financial Officer and Executive Director, will step down from his role following the publication. Stated to be a “mutually agreement”, Dafna will leave his position on March 31 this year will a search to identify his successor underway.
“The board and I would like to thank Yariv for the contribution he has made to 888 including playing a crucial role in the completion of our transformational combination with William Hill and leading the recent successful financing of 888’s external debt,” Pazner added. “On behalf of everyone at 888, I wish him the very best in his future endeavours.”