Phumelela results were released today.Photo Supplied Phumelela results were released today.Photo Supplied
Johannesburg - Strong growth in international operations, which accounted for 87 percent of group pretax profit, combined with a weaker rand helped tote operator Phumelela Gaming and Leisure to lift headline earnings a share by 26 percent to R1.1446 in the year to July.
Group net income rose by 8 percent to R1 billion with profit before tax from international operations rising by 56 percent to R97 million.
Pretax profit from local operations decreased by 59 percent to R14m. The final dividend was 60c a share.
Profit from the domestic market continued to fall, with the net income from local horse racing operations down by 5 percent to R55m, due partly to wet weather which caused the cancellation of several race meetings.
In contrast, fixed odds betting turnover rose by 13 percent. Horse racing bets accounted for 61 percent of volume with 22 percent on other sports and 17 percent on lucky numbers.
Expenses at Phumelela’s fixed odds bookmaking operations rose by 23 percent to R86m as it prepared to launch another 16 retail operations in the coming year.
Fixed odds profit before tax from local operations fell by 59 percent to R14m. Other local operations made a loss of R8m compared with a profit of R9m last year.
International income rose by 28 percent to R113m with revenues from France up by 282 percent, from Australia by 14 percent, from Singapore by 9 percent and from the UK by 16 percent.
The group’s share of profits from equity-accounted investees rose by 72 percent to R27m. This included R25.9m from the Isle of Man tote and R800 000 from Automatic Systems, a company listed on the Mauritius Stock Exchange and one of two licensed tote operators on the island.
Chief executive Rian du Plessis said the company was asking for more favourable tax treatment for the industry because of its higher level of employment than some other forms of gambling.
An independent survey had shown that horse racing was 22 percent more labour intensive than a casino, with many of the jobs provided in rural areas where more work opportunities were badly needed.
Shares in Phumelela leapt by 6.67 percent to close at R16 on the JSE yesterday. - Business Report