Phumelela Gaming continues to diversify
Chief executive Rian du Plessis said on Friday that the firm remained committed to stretching its options to boost its margins and that the transactions concluded had pointed the firm in the right direction.
“The acquisitions are very exciting for the company. We are looking forward to seeing their contributions in our future earnings as they are not included in these half-year results, because they were acquired outside the period of reporting,” said Du Plessis.
Last month, the company made numerous transactions that included the acquisition of a 50 percent stake in Supabets Holdings for R437 million.
Supabets is one of the leading and fastest growing sports betting and gaming groups in Africa, with a specific focus in the high-growth fixed-odds sports-betting market.
The transaction was settled through a combination of a rights offer, shares issued to the seller and cash. The group also acquired 51 percent stake in Afribet, saying it would provide it with a fixed-odds retail presence in the Eastern Cape.
The company also increased its shareholding in online betting portal Interbet from 26 percent to 50 percent. Phumelela said it hoped the acquisitions would bear fruit.
On Friday, the company reported half-year results that were negatively impacted by a challenging consumer environment, with tote-betting down 7 percent to R1.7 billion in South Africa.
Read also: Economy weighs on horse betting - Phumelela
But the international operations made up for the disappointment experienced in the local operations.
Du Plessis said the international units put in an exceptional performance despite a stronger rand, with pre-tax income up 18 percent to R91.3 million, an increase of 38 percent on a constant currency basis.
“Our international operations did not only provide a foreign currency hedge, but also diversified income across multiple regions,” he said.
The units comprise the export of live televisual South African horse racing, the import of live televisual international horse racing and parimutuel betting through PGI on the Isle of Man.
Group earnings per share increased 4 percent to 90.78 cents, with headline earnings per share up 3 percent to 90.19c per share and headline earnings per share in constant currency increasing 26 percent to 109.80c a share.
The group said a highlight during the year was the successful inaugural Sun Met at Kenilworth sponsored by Sun International and co-sponsored by GH Mumm, which was further evidence of the continued appeal of horse racing as on-course entertainment.
Phumelela shares traded flat on the JSE at R21 on Friday.