Bookies Set to be Bashed as Coronavirus Wipes Out Sporting Schedules

CoronovirusThere is, of course, a very real human element to the coronavirus pandemic, with thousands expected to lose their lives worldwide due to the illness. It would be rather trite to forget about the real tragedy here.

For many of us, we may get a dose of COVID-19 ourselves or we may be asked to self-isolate from our workplace – annoying yes, but a mere drop in the ocean in the wider context.

If the viral epidemic drags on for months, rather than weeks, there will be a significant – if not unprecedented – impact upon the UK economy, with businesses forced out of action if their main revenue streams are wiped out as a side-effect of coronavirus.

One such industry that is likely to take a battering is the sports betting sector, what with the sporting schedule worldwide being dismantled as mass gatherings become temporarily halted.

Early estimates suggest coronavirus will cost bookmakers billions, rather than small change, and at a time when the industry is already getting a walloping from harsher regulation, there will inevitably be more shop closures and redundancies.

It seems that the only ones benefitting from the coronavirus outbreak are loo roll manufacturers and dried pasta suppliers….

Billions Lost Overnight

You may not follow such things, but the global stock market is in absolute freefall at the moment.

NASDAQ, the major stock exchange in North America, and the UK equivalent that is the FTSE Index, have both see whopping losses across the board, with major firms like Disney and Amazon seeing as much as $50 per share lost almost overnight.

Nasdaq and FTSE 100 Crash During Coronovisur Outbreak - March 2020

And the value of crude oil stocks has fallen to their lowest since the Gulf War in 1991.

So it will come as no surprise to learn that many UK bookmakers have taken a bashing as far as their share price is concerned, with losses experienced above the current market rate, with the FTSE down around 10% or so. In total, so far more than £2 billion has been wiped off the value of the UK bookmaking sector.

Flutter Entertainment, who own Paddy Power and Betfair amongst other things, saw their share price fall a huge 15.6% – not surprising given that roughly £1.5 million of its annual empire comes from sports betting.

William Hill’s shares were trading near an all-time low price at the weekend, which equals a real-time loss of 24%.

Clearly, a lack of major sporting action going on will have significant impact upon these firms’ second quarter takings.

Football, one of their major cash cows, has been all but wiped out, with Champions League and Europa League games cancelled, the top divisions across Europe wiped out and the very real possibility that Euro 2020 will be postponed for as long as a year.

The ATP tennis tour has been suspended for the next six weeks, the PGA Tour golf for a month at least and the NBA indefinitely after the Utah Jazz player Rudy Gobert tested positive for COVID-19.

What Happens to Futures and Ante Post Bets?

It’s a good question really – can a bookmaker pay out on a market that has not been completed?

There was an interesting example at the PLAYERS Championship golf, where all but three players had completed their first round prior to the tournament being cancelled.

Even though that trio couldn’t affect the top of the leaderboard, some bookies still refused to settle on First Round Leader bets, with all wagers voided and stakes returned.

There are specific rules about the completion of ‘action’, and in the USA – where ‘futures’ betting on the NBA in particular is a big money business – a number of firms have already been forced to react given that their season could roll on for months yet due to the suspension.

The same is true for March Madness, the popular college basketball event that the NCAA has also had to postpone indefinitely.

Often, how the bookies react to the settlement of such ante post bets is usually outlined in their terms and conditions, and the standard position is that they won’t settle until a result is announced as ‘official’ by the sport’s governing body – e.g. they won’t pay out on Liverpool to win the Premier League until the brand’s officials confirm that the season is over (or, of course, when all teams have played their 38 games).

William Hill have already sent out a tweet that concerns the settlement of NBA futures, writing that all bets remain ‘in action’ until a winner is officially announced – be it at the natural conclusion of the season, or when the NBA declares they are bringing the campaign to a premature close.

This rule typically applies to all sports, so watch this space ahead of what is likely to be a rocky few months ahead.