BUSINESS

Sportech H1 revenue dips as online operations slump 40%

TAGs: Sportech

sportech-revenue-declineUK-based pools betting operator Sportech’s revenue fell in H1 2015 due to a dramatic tumble in its online operations.

On a constant currency basis, overall revenue fell 6.1% to £51m in the six months ending June 30, while earnings fell 10.6% to £11m and adjusted profit before tax fell 17% to £5.4m. Statutory profit rose nearly 900%, but this was due to the May sale of its share of the New Jersey-facing SNG Interactive joint venture to partner NYX Gaming Group.

The Racing and Digital division saw revenue slip £300k to £17.2m. The Tote services side reported revenue up £500k to £16m, while Digital revenue fell 40% to £1.2m and digital profit slipped two-thirds to just £200k following the loss of “two significant customers,” including the Colonial Downs track in Virginia, which ceased racing operations in April, as well as an unidentified “high value affiliate player.”

Revenue from the US-facing Venues division was flat at £17m despite a £1m decline at its 15 Winners race-betting venues in Connecticut, which the company blamed on the severe winter on the US northeast. But weather doesn’t exist online, and the Connecticut-facing MyWinners.com race-betting operation saw betting handle improve 59% to £4.1m.

The football pools business saw revenue decline £1.9m to £17.2m. Core subscription revenue was flat at £14m while collectors and overseas revenue fell one-third to £2.8m and wallet-based sales on skill pools and instant win games fell by more than half to £400k due to the loss of certain VIP players.

Sportech CEO Ian Penrose briefly addressed the recent takeover bid by Canada’s Contagious Gaming, saying the industry was undergoing “a period of considerable consolidation, and we continue to explore all options to deliver strategic value for our shareholders.”

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