Betting technology and retail gaming operator Sportech has announced its interim results for the six months ended June 30 2021, with lottery showing strong H1 growth versus 2020, but down by 9% on the comparable period in 2019.
According to the firm, continued COVID challenges impacted sales for several months in 2021. However sales have recovered in recent months against 2019 comparisons. Revenues increased 75.1% versus H1 2020 and reported EBITDA was £0.8m (H1 2020: £0.1m). This corresponded to 9% lower revenues than the H1 2019 period. However, in recent months revenues have returned to comparable 2019 levels.
Updating investors, Sportech stated: “The team advanced digital lottery capabilities further and post the period engaged in discussions which may lead to a potential sale of a terrestrial lottery contract. The core focus for the lottery team remains pursuing licensing opportunities drawing on the Sportech brand, legacy and digital expertise to deliver an enhanced consumer experience.”
Post the period end, the group announced discussions had commenced relating to a potential sale of a terrestrial lottery contract and will update the market in due course.
Looking at the group’s performance in the round, overall revenue came in at £13.4m versus £7.9m year-on-year. It continued to operate all business lines through most of the period before announcing the completion of the disposals of the Global Tote business to BetMakers Technology; the sale of Bump 50:50 to Canadian Banknote and the sale of a freehold property in New Haven, Connecticut in June 2021.
Those disposals, it noted, supported a resulting stronger balance sheet, with shareholder equity increasing by £23.3m to £48.5m (31 December 2020: £25.2m), including an impressive cash position excluding customer cash of £48.6m at the end of the period (31 December 2020: £16.8m, which included £6.12m deposit on a corporate sale and cash in disposal entities, and excluded customer cash balances).
CEO Richard McGuire commented: “The first half of 2021 marked a notably successful period of restructuring as Sportech completed business disposals, secured the move to the AIM market and built further on the online revenue gains from 2020.
“In recent weeks we also secured shareholder support for a proposed capital reduction and a significant capital return to shareholders and were delighted to announce a 10-year business relationship with the Connecticut Lottery Corporation to support their sports betting initiative.
“Shareholder funds during H1 almost doubled to £48.5m, we have no debt and significant cash to deliver on our shareholder and investment commitments.”