Currency headwinds and a large impairment charge pushed gaming group Sportech (SPO) well into the red last year. Adjust for these and pre-tax profits would have risen 2.8 per cent to £14.4m. The big dent to the income statement was a £28.1m charge against goodwill in the football pools business.
The gaming group also had to contend with a judgment by the Tax Chamber of the Upper Tribunal, which forced Sportech to return a £95m rebate to the taxman. It related to a long-running VAT claim by HMRC on Sportech’s 'Spot the Ball' game, which had previously been thrown out by a lower court. The shares plummeted 24 per cent when the decision was overturned in September, though the company has been granted the right to a counter-appeal in November.
While the dispute rumbles on, Sportech is making good ground in the US - even if sterling's first-half strength smothered improvements within the US-focused racing and digital and venues divisions last year. The company continues to identify new opportunities for growth in the country, and recently entered the online gaming and in-stadia sports raffles market, the latter through the acquisition of Bump 50:50 for a performance-linked consideration of up to £5.5m.
Analysts at Investec predict normalised pre-tax profit of £13m this year, and earnings per share of 4.9p.
| SPORTECH (SPO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 66.5p | MARKET VALUE: | £136m | |
| TOUCH: | 66.3-66.8p | 12-MONTH HIGH: | 93p | LOW: 47p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 58p* | NET DEBT: | 54% | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 71 | -5.9 | -12.2 | nil |
| 2011 | 118 | 8.0 | -3.9 | nil |
| 2012 | 108 | 1.3 | 2.6 | nil |
| 2013 | 110 | 5.3 | 1.7 | nil |
| 2014 | 104 | -21.3 | -10.4 | nil |
| % change | -5 | -502 | -712 | - |
Ex-div: na Payment: na *Includes intangible assets of £167.1m, or 82p a share | ||||
