Coronavirus – The Online Bookies That Have Been Hit Hard

While we were all sipping champagne and toasting to the new decade just a few months ago, no one would have predicted that this sort of pandemic was about to take place. The coronavirus has devastated families, stock markets, and global economies within a matter of weeks, and who knows how much longer this could go on?

On top of this, international sporting events have come to a grinding halt, which has brought the betting industry to its knees. Simply put, with no sporting events taking place, there is no revenue being generated through online sports betting. This has already caused major financial problems for some of the leading betting brands in the world, and industry worth $450 billion. With William Hills shares falling 26% mid-March the raise has started to find alternative markets for punters to bet on until the major sports even can reopen. The question is if eSports and virtual sports events can fill the gap and secure the shares of the major sports betting operators. Let’s take a look at some of the main players in the sports betting stock exchange;

GVC

GVC is a major company that owns huge brands like Coral and Ladbrokes, and they have already been hit enormously hard by the Coronavirus this year. With horse racing now being a casualty of the coronavirus too, GVC and other betting companies estimate a loss in revenue of almost £25 million per month, at least until the sports get back in action.

The GVC share price has already dropped by more than 40%, which is an extremely worrying sign indeed for such a prestigious company. This really is an unprecedented drop for any betting company in recent history, and until the sports betting world gets back on its feet, we really don’t know how GVC can survive this without some form of a government bailout.

William Hill

William Hill (WIMHY) is another sports betting giant that has had to swallow a rather difficult pill in light of the coronavirus impact. Much like GVC, William Hill predicts a monthly loss in revenue of up to £30 million , which is just huge. The only saving grace that companies like William Hill could fall back on right now is the £330 billion in reserves that are available for businesses that are going under due to coronavirus.

Given that William Hill is one of the major bookies in the horse betting niche, they will no doubt be impacted even more because of the suspension of horse racing both nationally and globally. Things certainly aren’t looking any better right now for sports betting either, with the announcement of the Olympics being postponed, Euro 2020 being postponed, and major Grand Slam events in tennis facing cancellations.

William Hill has already announced that they won’t be paying their dividend to investors over the coming months, and we have to say, we don’t think that they will be the only ones!

Flutter Entertainment

Flutter entertainment is the parent company of the popular betting brands, Paddy Power and Betfair. Just like William Hill and GVC, Paddy Power/Betfair generates an awful lot of revenue through horse racing betting. As a matter of fact, Flutter entertainment announced that they estimate that they will lose over £100 million in revenue this year as a direct result of the coronavirus. This has caused Betfair to be creative trying to find alternative betting options. For the Australian betting market , Betfair introduced betting on house prices as an alternative during the midst of the corona crisis. It will hardly compensate for the revenue lost on regular sports betting but perhaps a way to keep afloat as the industry recovers from the COVID emergency.

Flutter Entertainment shares have decreased by over 20% in a matter of weeks, although it has somewhat rebounded recently due to the government stepping in to assist in multiple countries. We still don’t know for sure when sports across the globe will return to normal, as it all depends on the spread of the pandemic and how effectively individual nations are able to control the virus.

We sincerely hope that the markets and indeed the world can recover soon enough, but a £100 million loss in revenue is significant for any company. Whether Flutter Entertainment and the other bookies in this list have enough reserves to last this pandemic remains to be seen, especially given that Flutter Entertainment stated that sports betting contributes a sizable amount to their bottom line at the end of each year.

Global Industry Impact

Stock markets all over the globe have been in free fall in recent weeks, with huge companies in different industries screaming for help. Whether it’s the travel industry, construction industry, or sports industries – they’ve all suffered heavily at the hands of the coronavirus.

There are some staggering statistics out there already for how this pandemic has destroyed the sports betting industry. Take East Africa as a prime example – companies there claim to have lost up to 99% in sales, which is simply unheard of.

Then when you consider the contribution that fans make for keeping various sports going, the loss in ticket sales will already be in the millions. The Champions League has been postponed, major tennis tournaments including the French Open have been postponed, and now all major horse racing has also become a victim.

When will this end? We simply do not know yet but sports events are slowly being rescheduled and as more countries get out of lockdown during the summer, sports will return, and so will sports betting.

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