Date: July 31, 2019
Supreme Ventures Limited (SVL), for the six months ended June 30, 2019, reported a 15% increase in ‘Total Gaming Revenue’ from $16.12 billion in 2018 to $18.62 billion in 2019. For the quarter, ‘Total Gaming Revenue’ closed at $9.31 billion (2018: $8.06 billion). “Lotteries, PINs, Sports Betting and Horseracing recorded double digit increases whereas VLTs showed a marginal decline when compared to Q2, 2018,” SVL noted.
Revenues from the Company’s segments were as follows:
Revenue from ‘Non fixed odd wagering games, horse racing and pin codes’ amounted to $10.90 billion (2018: $9.60 billion), a 14% increase.
Income from fixed odd wagering games, net of prizes totaled $7.72 billion (2018: $6.52 billion), an 18% rise.
Cost of sales recorded an increase to close the period at $14.74 billion when compared to $12.91 billion for the same period in 2018. As such, gross profit for the period improved 21% to $3.88 billion (2018: $3.21 billion). For the quarter, gross profit closed at $1.97 billion (2018: $1.55 billion). SVL noted that, “this was attributed to the higher net sales of Cash Pot, Pick 4, Money Time, Super Lotto, PIN codes, horseracing and sports betting.”
Operating expenses grew 8% for the period to $2.01 billion (2018: $1.86 billion), while recording ‘Other losses’ of $16.03 million relative to ‘Other income’ of $91.51 million for the prior period in 2018. For the quarter, operating expenses amounted to $1.06 billion versus $954.18 million booked in the previous comparable quarter. The Company highlighted that, “the increase is attributed to the activities associated with the launch of Mobile Gaming in March 2019. This expenditure is expected to have a positive return overtime in the form of sales from new segments on the platform.”
Consequently, operating profit for the period increase 28% to $1.85 billion relative to $1.44 billion reported in 2018. While, for the quarter, operating profit closed at $907.77 million (2018: $613.47 million).
Finance costs fell to $43.06 million (2018: $44.02 million). As such, profit before taxation amounted to $1.81 billion, up from $1.40 billion in 2018. For the quarter, profit before taxation totaled $896.01 million (2018: $589.41 million).
Taxation for the period rose 61% to close at $562.70 million compared to $349 million in 2018, thus resulting in net profit of $1.25 billion, a 19% increase from the $1.05 billion recorded in the prior comparable period. For the quarter, net profit closed at $624.28 million (2018: $432.42 million).
Earnings per share totaled $0.47 versus $0.40 in the previous period in 2018, while EPS for the quarter amounted to $0.24 (2018: $0.16). The twelve months trailing earnings per share amounted $0.87. The number of shares used in our calculations 2,637,254,926 units. Notably, SVL’s stock price closed the trading period on July 31, 2019 at a price of $30.
SVL noted that, “The Guyana operation’s product suite is currently being built out, and the business is expected to show positive returns by the end of 2019. Our current focus is investing in the right product set in Guyana, with effective retail distribution which we can build on.”
In addition, Management mentioned that, “the Group looks forward to the second half of the year as we maintain the positive momentum created in the first half. Through initiatives such as our acquisition of Post to Post betting, the continuation of improvement of the JustBet product through execution of various initiatives, driving various promotions and initiatives through our retail channel, the continued drive to grow our mobile channels through increased registration across our gaming segments, and the preparation to enter the online gaming landscape, the continued build out of our business in Guyana and the improvement to the horseracing product through technological and new product initiatives. Our Lottery portfolio continues to be a primary focus and improving and strengthening our internal infrastructure and capabilities.”
Balance Sheet at a glance:
As at June 30, 2019, Supreme Ventures Limited had assets totaling $7.78 billion relative to $5.99 billion a year earlier. The increase was due mainly to a 23% and 30% increase in ‘Property, Plant and Equipment’ and ‘Trade and other Receivables’ which closed at $1.51 billion (2018: $1.23 billion) and $1.22 billion (2018: $937.77 million), respectively.
Shareholders Equity amounted to $3.53 billion (2018: $2.85 billion) with a book value per share of $1.34 (2018: $1.08).
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