Sportech brought in revenue of £20.0m ($27.5m/€23.4m) and made a £12.8m loss, after selling both its Global Tote business and the Bump 50:50 lottery brand in 2020.
The business’ revenue was down 40.6% when compared to the same segments in 2019.
Sportech chief executive Richard McGuire said it was an extremely difficult year for the business because of the impact of the novel coronavirus (Covid-19) pandemic, but noted that it performed better than its March expectations.
“Covid-19 created unprecedented challenging conditions for our businesses and the industries we serve,” McGuire said. We continue to take the necessary actions to safeguard the Group and to progress our strategic agenda.
“In line with this, the Group took steps to generate tangible investor returns by exiting certain businesses and assets, advancing the sale of the racing and digital division’s Global Tote business to BetMakers, the sale of the Bump 50:50 raffle business to Canadian Bank Note, and the disposal of a freehold property in Connecticut.
“Despite the challenging global environment, our performance in 2020 was better than initially forecast in March 2020, with Sportech delivering on key 2020 performance metrics, namely cash generation from operational activities, effective capex management, and delivery of a more efficient lower operational cost base going forward, resulting in only a modest cash outflow since the outbreak of COVID-19.”
As it sold the Global Tote business during the year, wagering at venues made up most of the continuing Sportech business’ revenue, down 36.0%.
Food and beverage sales at those venues brought in an additional £1.5m, down 66.5%.
The business made £2.9m from its lottery business, down 43.3% year-on-year.
Sportech paid £9.4m in costs of sales, for gross profit of £10.5m, down 42.6%.
After marketing and distribution costs of £319,000, down 62.0%, Sportech was left with £10.2m, 41.7% less than in 2019.
The business then paid a further £12.3m in operating costs and £261,000 in investments for an adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) loss of £2.3m.
Following share options, depreciation, amortisation and impairment, Sportech’s operatingloss was £10.0m.
It incurred a further £557,000 in finance costs for a £10.6m pre-tax loss. After a £297,000 tax benefit, Sportech’s overall loss from continuing operations was £10.3m, 41.7% less than the same segments lost in 2019.
In addition, the operator’s Global Tote business, which was sold to BetMakers, and its Bump 50:50 business, which was sold to Canadian Banknote, made a combined £2.6m loss after recording revenue of £25.7m.
When these segments are accounted for, Sportech made a final loss of £12.8m, which was 11.7% less than 2019’s loss.
McGuire added that the business was currently engaging with the Governor of Connecticut, Ned Lamont, following statements “that appear to deny Sportech equal rights to a Connecticut State Sports Betting licence” as the state looks to expand its sports betting offering.
Lamont has confirmed his intention to launch betting and igaming in his State of the State address in January, but current plans involve the state’s two tribal operators: the Mashantucket Pequot Tribe and the Mohegan Tribe.
