Sportech Plc is confident that its expanded product portfolio will help it through the uncertainty of COVID-19, following a year of vital transformations across the company.
Publishing its full-year 2019 results, the firm recorded a 2% group revenue increase to £65 million (FY2018: £63.5m) by optimising its cash-generating assets and operations.
Product upgrades saw Sportech confirm ‘service growth’ for its flagship international TOTE platform and North American Bump 50:50 in-stadia wagering systems.
Furthermore, 2019 saw the company expand its product portfolio by acquiring the digital lottery assets and tech resources of Lot.to.
Underlining ‘positive progress’ achieved across its core divisions, Sportech recorded group gross profits of £47 million (FY2018: £46m) as it declared a 2019 adjusted EBITDA of £7.5 million (FY2018: £6.5m).
Despite achieving improved top-line metrics, Sportech has widened 2019 corporate losses to £8.4 million (£2.6m), having accounted for a £5 million impairment attributed to its Stamford sports bar asset.
Richard McGuire, Chief Executive Officer of Sportech, said: “We continue to progress our strategic agenda focused on driving further development of our Group platforms following 2019 growth opportunity investments, whilst managing the inherent cost base. Despite the challenging retail environment and excluding some cost measures taken to reposition the Group, our performance in 2019 has been as expected.
“In particular, we have recorded positive progress with key performance metrics beyond, the typically focussed, EBITDA measure; namely cash generation from operational activities, capex reductions and delivery of a lower operational cost base going forward.”
In 2020, Sportech will continue to implement its Venue transformation programme, seeking to execute better cost management and with the improved use of its systems.
Short-term corporate directives, see Sportech governance cite extending sports wagering contracts across the state of Connecticut as a group-wide critical focus.
Mirroring industry counterparts, Sportech admitted that it was difficult to provide accurate guidance amid the uncertainty of COVID-19 impacts witnessed across the global sporting and racing calendar.
McGuire explained: “Understandably, the period of disruption is uncertain, but having strengthened our online capabilities during 2019 we are better positioned to deliver a broader service wherever possible.
“In this period of concern and uncertainty, we initiated a Sportech COVID-19 response task force and continue to work closely with our clients and our staff to ensure, as best we can, a combination of continuity where permissible and precautionary safety measures.
“Notwithstanding the uncertain short-term outlook, we remain focused on maintaining the Group’s financial strength with £11.0 million net cash and no debt as of the end of February 2020.”