SVL reports 48% increase in three months net profits

Date: April 30, 2018

Supreme Ventures Limited (SVL), for the Three Months March 31, 2018 reported a 14% increase in Revenues to total $15.29 billion, up from $13.39 billion in 2017 representing the best results for the first quarter in the history of Group’s operation.

Revenues from the company’s segments were as follows:
Lottery – $10.98 billion (2017: $10.44 billion)
Sports Betting – $248.07 million (2017:$156.72 million)
Horseracing – $1.57 billion (2017:$328.09 million)
Gaming & Hospitality – $80.67 million (2017: $114.13 million)
Pin codes – $2.39 billion (2017: $2.35 billion)
Unallocated – $5.78 million (2017:$3.69 million)

Direct Expenses increased by 12%, amounted to $13.57 billion (2016: $12.17 billion).

As a result, Gross Profits increased by 40% from $1.22 billion for the first quarter of 2017 to $1.71 billion in 2018. “This increase was attributed to higher sales for Cash Pot, Pick 4, Money Time, Super Lotto, Horse Racing and Sports Betting.”

Operating Expenses rose by 34% for the period to $903.05 million relative to $673.54 million in 2017. The Company noted the increase was mainly influenced by, “three months of Caymanas Park (SVREL) operations in 2018, compared against only one month in 2017. The Group’s operating expense ratio (operating expenses as a percentage of revenue) remained relatively flat at 5.4%, which is reflective of improved operating efficiencies.”

As such, Profit from Operations grew year over year to total $809.96 million in contrast to the $548.52 million recorded last year, a 48% improvement.

Interest Income declined by 7% to $16.97 million (2017: $18.31 million). This amount reduced due to the, “early settlement of a major receivable, lower interest rates on deposits held with financial institutions, consistent with general trend of interest rates.”

Finance Costs grew by 76% to $15.49 million (2017: $8.78 million) comprising of interest charges relating to the funding of the acquisition and development of the Caymanas Park operations, which include a finance lease arrangement. A Net Foreign Exchange Loss of $1.02 million was recorded for the period relative to $1.43 million in the first quarter of 2017.

Profit before Taxation from continuing Operations amounted to $810.42 million in 2018, moving from $556.62 million in 2017.

After deducting $192.01 million in taxes (2017: $140.71 million), Net Profit amounted to $618.41 million, a 48% increase on the $415.34 million recorded in the first three months of 2017. SVL noted, “the after tax gain on the sale of SVL’s May Pen Regional Office contributed to $33 million to the net profits for the quarter.

Earnings per share totaled $0.234 (2017: $0.158) while the twelve month trailing EPS amounted to $0.53. The number of shares used in our calculations 2,637,254,926 units.

“The Group will continue to maintain the positive momentum in the first quarter through the implementation of key strategic initiatives for the remainder of the year and by closely monitoring the performance of the Horse Racing segment in order to reverse the Group’s product offerings and customer experience.”

Balance Sheet at a glance:

As at March 31, 2018, Supreme Ventures Limited had Total Assets totaling $5.74 billion relative to $6.20 billion a year prior. SVL stated, “reductions are due to the sale of May Pen property, partial settlement of a Sagicor loan, as well as payment of taxes and dividends.” The increase in Total Assets was largely due to a decrease in long-term receivables which to $29.50 million compared to $516.92 million in 2017. ‘Cash and Cash Equivalent’ tempered the overall decline in assets with a 13% or $264.77 million increase to $2.25 billion.

Shareholders Equity amounted to $3.21 billion (2017:$ 3.98 billion) with a book value per share of $1.22 (2016: $1.51).


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