Betting Business Bulletin 27th November 2017

Gambling industry warned to get its house in order

The gambling industry last week received a stern warning from regulators that it had to change its ways.

They were told the bar had been set too too low in treating customers fairly and that “change is now coming” by Gambling Commission chief executive Sarah Harrison, who also warned operators they were reaching a tipping point and that some of their number could find their future “increasingly in peril”.

The Competition and Markets Authority (CMA), which is in the midst of an investigation into terms and conditions in the remote gambling industry, also informed operators that certain practices would no longer be acceptable.

The warnings came at the Gambling Commission’s annual Raising Standards conference in Birmingham.

Harrison acknowledged operators had made progress in some areas but added: “The bar has been set too low by operators in relation to identifying customers at risk and treating them fairly.

“The [commission’s] strategy makes clear change is now coming. Fairness, transparency and harm-prevention are essential.

“Unreasonable behaviour and slow progress will not be accepted by us, by our partner organisations and certainly not by consumers.”

CMA project director George Lusty outlined six key concerns at the centre of their work so far, including lack of transparency and fairness around promotion and play restrictions, restrictions on withdrawals, the withdrawal of free bets and compulsory publicity and have told operators to stop some practices.

He added: “We were concerned a number of important terms placed significant restrictions on consumers’ own funds, afforded operators a wide degree of discretion and exposed consumers to disproportionate sanctions.”

Following up those comments, Gambling Commission executive director Sarah Gardner said: “We’ve been making it clear to the industry that they need to get their house in order on this. The CMA has now set out clearly its concerns so there is no excuse for operators not to act urgently in the interests of consumers. We plan to step up action in the new year to ensure that consumers are being treated fairly.”

Hills and Paddy Power Betfair linked to Aussie deal

Consolidation in the gambling industry is a global feature, something which was demonstrated again last week after it emerged that William Hill and Paddy Power Betfair had both had preliminary talks about a deal with Australian operator CrownBet.

Higher taxes and tougher regulation in Australia are driving deals, with local giants Tabcorp and Tatts Group in the midst of their own merger.

Hills issued a short statement confirming the talks on Friday which said: “Following media speculation William Hill confirms it is in very preliminary discussions with CrownBet, the 62 per cent-owned online wagering business of Crown Resorts, regarding a possible combination of William Hill Australia, a wholly-owned subsidiary of William Hill, and CrownBet.

“There is no certainty that these preliminary discussions will lead to any transaction.”

Crown Resorts is one of Australia’s largest casino and entertainment groups.

James Packer, son of media mogul Kerry Packer, is the major shareholder in the group.

Earlier in the week William Hill had described the Australian market as “challenging” as they released a trading update.

Chief executive Philip Bowcock said the firm have “delivered good financial and operational progress so far in the second half” of the year.

Although retail wagers were down slightly (by one per cent), revenue increased by three per cent. Online net revenue was up by six per cent year-on-year, with stakes up 13 per cent.

Bowcock said: “Our online business has performed particularly well, with UK wagering 14 per cent ahead of last year, in spite of the absence of a major football tournament, and an acceleration in gaming growth.

“Retail has benefited from a stronger gross win margin to deliver both sportsbook and gaming net revenue growth.”

He also updated on a series of cost-saving measures, saying: “We continue to make good progress on our transformation programme, which is on track to deliver £40 million of annualised savings by the end of this year. This is supporting reinvestment in our business.”

Analyst Gavin Kelleher of Dublin stockbroker Goodbody described it as a “solid update”.

He added: “Following a period of underperformance in online, the business appears to be performing closer to market growth rates. The retail performance remains ahead of its closest peer Ladbrokes Coral.”

Hearn crowned Betting Shop Manager of the Year

There was victory for the independent bookmaker sector last week when Ron Hearn of JenningsBet was named Racing Post/SIS Betting Shop Manager of the Year for 2017.

Hearn, the regional champion for Greater London, beat seven rivals to receive the prize from ITV racing presenter Ed Chamberlin at the Jumeirah Carlton Tower hotel in London.

The 57-year-old has been in the industry for 40 years, the last six with with JenningsBet. He started his career with William Hill a few days after leaving school in 1977.

Hearn said: “I was far too young to even take a settling test so they put me on the boards for a year and I was general dogsbody making the tea. I got through the first year, took the settling course when I was 18 and passed it first time.

“I remember my mum saying to me it will do to tide yourself over before you make up your mind what you want to do.

“I suppose I really have to stay in the game now – I was going to make my mind up after Christmas!”

Between William Hill and JenningsBet, Hearn worked for the bookmaker John Humphreys – managing a shop at Orpington as well as clerking at Crayford and Catford greyhound tracks – before moving on to Michael Tabor’s Arthur Prince chain of betting shops.

From there he joined Coomes in 1994, taking over two years later as manager of the shop by Charlton Athletic’s football ground The Valley, where he has stayed ever since.

JenningsBet took over Coomes in 2011 and Hearn said: “Our shops were run down – they came in and refurbished everything, built the shop up to what it is and I can say hand on heart we have had six good years.”

Hearn’s victory was the first for JenningsBet in the 30 years of the competition and the firm’s managing director Greg Knight was proud of the achievement.

He said: “Ron’s worked in that shop now for 21 years, he knows everybody locally. He is part of the community and I think that’s extremely important. I am just made up for him personally.”