Taxes are one of life's only two certainties if the oft-quoted Benjamin Franklin is to be believed and their rising prominence within gambling companies' results is as much of a sure thing these days. This was substantiated by the latest numbers from 32Red (TTR), which look less impressive without understanding the impact of the point of consumption tax (POCT). Underlying cash profits rose by three-quarters to £11.2m - helped in part by the July 2015 acquisition of Roxy Palace - but with the tax included they grew only 7 per cent.
Reported figures were also hit by restructuring costs related to the Roxy purchase, and a near-£100,000 payment to the Gibraltar Betting and Gaming Association (GBGA) for the trade body's fight against POCT currently rumbling through the European Court of Justice.
It's thought around 80 per cent of 32 Red's revenues now come from regulated markets and, encouragingly, the core business saw net gaming revenues rise by more than a third. Mobile turnover was also nearly three-quarters higher than in 2014.
House broker Numis expects pre-tax profits of £10.5m in 2016 leading to EPS of 11.3p, up from £5.9m and 7p in 2015.
| 32RED (TTR) | ||||
|---|---|---|---|---|
| ORD PRICE: | 162p | MARKET VALUE: | £136m | |
| TOUCH: | 158p-166p | 12-MONTH HIGH: | 186p | LOW: 49p |
| DIVIDEND YIELD: | 1.7% | PE RATIO: | 132 | |
| NET ASSET VALUE: | 14p* | NET CASH: | £10m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 25.0 | 2.16 | 2.9 | 1.2 |
| 2012 | 32.1 | 2.04 | 2.8 | 1.4 |
| 2013 | 25.4 | 2.29 | 3.1 | 1.8 |
| 2014 | 32.1 | 3.41 | 4.5 | 2.4 |
| 2015 | 48.7 | 1.07 | 1.2 | 2.8 |
| % change | +52 | -69 | -73 | +17 |
Ex-div: 16 Mar Payment: 15 Apr *Includes intangible assets of £8.8m or 10.5p a share **2015 dividend excludes special 3p-per-share dividend | ||||
