Phumelela CEO Riaan du Plessis
Phumelela Gaming and Leisure managed offset losses from its South African horse racing business with profits from its international online sports betting ventures.
The group’s overall interim revenue grew 4% to R819m and aftertax profit 5% to R68m in the six months to end-January from the year-earlier period. Phumelela maintained its interim dividend at 34c.
Its international arm grew revenue 37% to R174m — which would have been even better if not for the strong rand during the reporting period.
The rand averaged R17.54/£ during the six months to end-January versus R21.54/£ in the comparative period, a 19% gain. This resulted in a R2.5m foreign exchange loss, the company said in its results statement.
Pretax profit from its international division grew 7% to R39m.
The net loss from its traditional South African horse racing business widened to R22.74m from R6.87m in the matching period. Revenue declined 2% to R645m.
Part of the reason for the widening loss was an increase in prize money paid out.
“Local prize monies increased in line with the formula set out in the stakes agreement with the Racing Association,” Phumelela said.
Sun Met – a highlight (photo: Wayne Marks)
But despite these losses, SA’s largest turf owner and data supplier does not intend to stop betting on horses.
“Horse racing is at the heart of what Phumelela is and the foundation for our successful and expanding international operations,” CEO Riaan du Plessis said in the results statement.
“A highlight of horse racing in the period was the first-ever Sun Met at Kenilworth, sponsored by Sun International as the title sponsor and co-sponsored by GH Mumm. This prestigious race day carried record prize money with each race running an excellent field of horses,” Du Plessis said.
“Events such as the Sun Met underscores the fact that horse racing holds appeal both as on-course entertainment for the family and for those viewing and betting locally and, increasingly, overseas.”
Originally reported on www.businesslive.co.za
