There are some encouraging developments at pool betting operator and technology supplier Sportech (SPO), although the rewards aren't showing up in the numbers just yet. Despite a mere 3 per cent dip in revenues (on a constant currency basis and excluding the cessation of part of the football pools business) operating and pre-tax profits took a far greater hit thanks to the exceptional £8.1m disposal gain booked in the prior period. Further sales are also on the cards, with chief executive Ian Penrose confirming approaches had been made for the football pools division, although none have met valuation expectations yet.
Elsewhere, the racing and digital division lost a sizeable betting contract in California last year and closed its German operation, but a new Singapore base has replenished the segment following several contract wins to provide betting technology at Asia-based racetracks, with more deals pending. It also processes all Tote bets on live UK racing through Betfred via a 10-year contract.
Venues turnover fell by 3 per cent on a constant currency basis too, but there are positive developments here as well, including plans to develop 10 new Striders sports bars in California.
Analysts at Investec expect pre-tax profits of £14.2m for the year to December 2016 leading to EPS of 5.8p compared to £12.4m and 4.6p in 2015.
| SPORTECH (SPO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 70p | MARKET VALUE: | £144m | |
| TOUCH: | 70-72p | 12-MONTH HIGH: | 82p | LOW: 50p |
| DIVIDEND YIELD: | nil | PE RATIO: | 32 | |
| NET ASSET VALUE: | 64p* | NET CASH: | £36m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 51.0 | 7.9 | 2.0 | nil |
| 2016 | 48.7 | 2.7 | 0.9 | nil |
| % change | -5 | -66 | -55 | - |
Ex-div: na Payment: na *Includes intangible assets of £166m, or 81p a share | ||||
