November 1, 2019

Supreme Ventures Limited (SVL), for the nine months ended September 30, 2019, reported a 16% increase in ‘Total Gaming Revenue’ from $24.25 billion in 2018 to $28.06 billion in 2019. For the quarter, ‘Total Gaming Revenue’ closed at $9.45 billion (2018: $8.13 billion). “Lotteries, PINs, Sports Betting and Horseracing recorded double digit increases whereas VLTs showed a marginal decline when compared to Q3, 2018,” SVL noted. The company also noted, “ this sustained revenue growth has been a result of several drivers: our strong performance from our lottery portfolio which continues to perform above target due to strategic expansion of our retailer distribution network, ongoing player engagement and growth across our mobile channel, improvement in our horseracing, gaming lounge and sports betting segments”.

Revenues from the Company’s segments were as follows:

• • Revenue from ‘Non fixed odd wagering games, horse racing and pin codes’ amounted to $16.70 billion (2018: $14.44 billion), a 16% increase.
  • Income from fixed odd wagering games, net of prizes totaled $11.36 billion (2018: $9.81 billion), a 16% rise.

Direct expenses recorded an increase to close the period at $22.31 billion when compared to $19.44 billion for the same period in 2018. As such, gross profit for the period improved 20% to $5.75 billion (2018: $4.81 billion). For the quarter, gross profit closed at $1.87 billion (2018: $1.60 billion).

Operating expenses grew 10% for the period to $3.11 billion (2018: $2.83 billion), while recording ‘Other losses’ of $52.27 million relative to ‘Other income’ of $127.22 million for the prior period in 2018. For the quarter, operating expenses amounted to $1.10 billion versus $967.94 million booked in the previous comparable quarter. The Company highlighted that, “the increase in the Group’s operating expenses of $132.38 million include Post to Post Betting expenses of $93.8 million and can be attributed to the activities associated with various initiatives to boost revenue as wells as we continue to exercise due care in the management of the operating expenses.”

Consequently, operating profit for the period increase 23% to $2.59 billion relative to $2.11 billion reported in 2018. While, for the quarter, operating profit closed at $748.23 million (2018: $672.24 million).

Finance costs rose to $81.86 million (2018: $57.46 million). As such, profit before taxation amounted to $2.50 billion, up from $2.05 billion in 2018. For the quarter, profit before taxation totaled $706.04 million (2018: $651.91 million).

Taxation for the period rose 40% to close at $742.22 million compared to $532.04 million in 2018, thus resulting in net profit of $1.76  billion, a 16% increase from the $1.52 billion recorded in the prior comparable period. For the quarter, net profit closed at $526.53 million (2018: $468.87 million).

Earnings per share totaled $0.67 versus $0.58 in the previous period in 2018, while EPS for the quarter amounted to $0.20 (2018: $0.18). The twelve months trailing earnings per share amounted $0.89.  The number of shares used in our calculations 2,637,254,926 units. Notably, SVL’s stock price closed the trading period on November 1, 2019 at a price of $25.09

SVL noted that, “The results include the performance of the recently acquired operations of Post to Post Betting Limited of $28.07 million, with profits allocated to non-controlling interest of $13.76 million.”

Balance Sheet at a glance:

As at September 30, 2019, Supreme Ventures Limited had assets totaling $8.30 billion relative to $6.14 billion a year earlier. The increase was due mainly to a 16% and 257% increase in ‘Cash and Cash Equivalents’ and ‘Goodwill’ which closed at $3.04 billion (2018: $2.61 billion) and $1.06 billion (2018: $296.85 million), respectively.

Shareholders Equity amounted to $3.46 billion (2018: $2.93 billion) with a book value per share of $1.31 (2018: $1.11)

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