Date: May 01, 2020
Supreme Ventures Limited (SVL), for the three months period, reported a 9% increase in Total Gaming Revenue from $9.30 billion in 2019 to $10.13 billion in 2020.
Revenues from the company’s segments were as follows:
Revenue from Non fixed odd wagering games, horse racing and pin codes- $5.72 billion (2019: $5.42 billion), a 5% increase.
Income from fixed odd wagering games, net of prizes- $4.41 billion (2019: $3.88 billion), a 14% increase.
Direct expenses recorded an increase to close the period under review at $7.83 billion when compared to $7.40 billion for the same period in 2019. As such, gross profit for the period improved 21% to $2.30 billion (2019: $1.90 billion). Management noted the increase was, “attributable to the higher net sales for Lotteries, PIN codes and Sports Betting.”
Selling, general and administrative expenses grew by 37% for the period to $1.30 billion (2019: $948.45 million), while SVL booked other income of $64.29 million relative to other expenses of $10.20 million in the prior comparable period. Management noted, “the increase in the Group’s operating expenses of $350 million can be attributed to inclusion of PostToPost Betting, which was not a subsidiary of the Group in Q1 2019 and the activities associated with our planned acquisitions and expenses that support the increased revenues. We continue to exercise due care in the management of the operating expenses.”
Consequently, operating profit for the period increased 13% to $1.06 billion relative to $943.25 million reported in same period last year.
Finance costs increased 73% for the period to total $54.04 million (2019: $31.40 million). As such, Profit before taxation amounted to $1.01 billion, up from $911.95 million recorded in the previous comparable period.
Taxation for the year fell by 7% to close at $272.02 million when compared to $290.96 million incurred in 2019. As such, net profit after tax for the three months period amounted to $736.79 million, a 19% increase from the $620.98 million recorded for the prior corresponding period.
Net profit attributable to shareholders amounted to $738.37 million (2019: $620.98 million).
Earnings per share totaled $0.28 for the period under review (2019: $0.24). The twelve months trailing earnings per share amounted $0.97. The number of shares used in our calculations 2,637,254,926 units. Notably, SVL’s stock price closed the trading period on April 30, 2020 at a price of $14.99.
In addition, SVL stated that, “the Group’s operation has been negatively impacted by COVID-19 during the first quarter and will also experience challenges in the upcoming quarter as a result of closures affecting the horse racing operations, gaming lounges and places of entertainment. The Group looks forward to the continuation of improvements and the launch of key initiatives through our retail channel, the continued build out of our business in Guyana and the improvement in the horse racing product through technological and new product initiatives. Our Lotter portfolio continues to be a primary focus while improving and strengthening our internal infrastructure and capabilities.”
Balance Sheet at a glance:
As at March 2020, Supreme Ventures Limited total assets base amounted to $10.22 billion relative to $7.06 billion a year earlier, a 45% increase. The increase was due mainly to increases in ‘Property, Plant and Equipment’ and ‘Deposit on Investment’ which closed at $1.86 billion (2019: $1.50 billion) and $1.42 billion (2019: nil), respectively. In addition, ‘Cash and Cash Equivalents’ and ‘Goodwill and Intangible assets’ contributed to the increase closing at $3.58 billion (2019: $2.55 billion) and $1.08 billion (2019: $290.18 million), respectively.
Shareholders’ equity amounted to $3.91 billion (2019: $3.46 billion), resulting in a book value per share of $1.48 (2019: $1.31).
Analyst Certification -The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.
Company Disclosure -The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.