Regulatory pressure is looming for 888 Holdings, the parent company of internationally renowned brands William Hill, 888, Mr. Green, and SI Sportsbook, according to multiple reports.
The news comes following a series of court cases in Austria, where it was found that the company had been operating illegally.
Judges ruled that all companies except the state-backed gambling organization Casinos Austria were in breach of the law, and would therefore be liable for any money that players had lost since 2016.
In Austria, the state-backed gambling company holds a monopoly - and it has done for several years now. The market is therefore limited by the country’s assertion that any companies other than Casinos Austria are illegal.
It has been reported that 888 Holdings expects costly legal action to follow, as players begin to claim refunds on any losses they have incurred. The company’s most recent annual report notes that a total of £116 million has been set aside to cover such claims from players in Austria and Germany.
A testing time for a gambling giant
Compliance problems and sudden changes in leadership have meant real uncertainty for 888 Holdings over the past 18 months, and this news will only add to the pressure it is under.
The company’s fourth-quarter 2023 earnings report caused a stir for all the wrong reasons. The UK-based brand announced revenue of $541.6 million, a 7% year-over-year drop, despite the 5% increase the company saw in the preceding quarter.
At the time, it was reported that a cost-savings program was behind the revenue reduction.
Looking at overall figures for last year, 888 Holdings saw an 8% fall from $2.35 billion in 2022 to $2.2 billion in 2023. Executives said more than $100 million of revenue was lost as a result of a “proactive mix shift away from dot-com markets.”
Shortly afterwards, at the end of January 2023, CEO Itai Pazner was removed as a direct result of failings in AML and KYC processes for customers in the Middle East. VIP accounts were suspended following reports that they could have violated money laundering policies.
What’s next for 888 Holdings?
The latest news will do little to quell fears amongst shareholders. But this is a legal battle that’s far from over.
“The group only operates where it has a justifiable legal basis to do so. Based on the extensive advice and opinion received, we are absolutely confident in our legal and regulatory position," a spokesperson for 888 said. "We remain completely confident in our position under EU law to offer these services to our players from Austria, alongside many other competitors.”
888 Holdings is now looking ahead under the new leadership of CEO Per Widerström, who took the helm in October last year, and has promised a new focus for the company.
One of the key changes being brought in by Widerström is a name change, and a new image. The company will soon change its name to Evoke, with Widerström stating that this will better demonstrate the company’s “mission to make life more interesting by delighting players with world-class betting and gaming experiences.”
Debt has plagued 888 Holdings ever since it acquired William Hill’s international operations back in 2021, and this, too, will be a priority for Widerström.
New financial targets reportedly include increasing revenues 5%-9% per year in the medium-term, and significantly reducing the company’s leverage by 2026.
We can expect a number of cost-saving measures from 888 Holdings as it becomes Evoke, along with a renewed focus on the company’s core markets, such as the UK, Italy, Spain and Denmark.
