April 23 - The South African gaming group Phumelela Gaming and
Leisure rolled out its financial report for the six months from August 1st, 2011
until January, 2012.
The leading horse racing and tote betting company reported diluted
headline earnings of 44.49 per share, from 42.77 in the previous period.
Highlights of Phumelela's financial report include:
Total income for Phumelela increased to R452 million - up 2%.
If one excludes the group's Isle of Man totaliser operation,
total income actually increased 5%.
Net betting income decreased to R323 million - a drop of 3%.
The main reason for this drop in betting income was the fact that the Isle
of Man operation was equity accounted in the six month period.
Local operations saw their net betting income climb 1%.
Operations profit for Phumelela dropped to R43 million - 21%.
Profit before income tax grew 100% from Phulemela's
international operations. This was mainly due to income derived from the
export of South African racing media rights and the growth in the number of
international punters wagering on South African races.
A weakening Rand also saw an increase in international
Profit before income from local South African operations
dropped a whopping 49%, mainly to an increase in operating costs.
Income from fixed odds betting, limited payout machines, bingo
and tote betting on soccer and rugby offset the big losses felt from the
group's local horse racing operations.
Phumelela Betting Group Looks Ahead
Despite some worrying numbers highlighted in the six month
Phumelela first half earnings report, the group said that it was looking
ahead and expected its international operations to continue to be in good
Phumelela also expected its local turnovers on South African
sports (excluding horse racing) to continue to do well.
Management has promised to give its full attention to the poor
revenues in local Tote betting operations.
The statement indicated that the group has sanctioned the South
African government on a number of opportunities to address the problem of the
lack of a level playing field between the contributions made by Tote and
bookmaker betting in the South African gambling industry.
Should the government adopt recommendations made by a
sub-committee that changes are made to South African gambling legislation, this
could positively impact Phumelela's financial earnings, although these changes
would not be felt before year's end.
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