$1.2 billion is the number for losses at the Gaming and Hospitality segment at Supreme Ventures Limited Revenues in three years. Losses worsened from $252 million in 2012 when it jumped to $553 million last year but was down to $376 million up to September this year from $440 million in 2013.
There were no noticeable improvements in the losses in the September quarter. The substantial losses amounting to 47 percent of profit in the lottery segment in 2013 and 31 percent in 2014, with no noticeable reduction in the losses, forced management hands to take action. The losses in this segment coupled with losses in sport betting, contributed significantly in negating the profits from the lottery segment.
On December 1, (SVL) advised that they will close operations at the Odyssey Gaming Lounge at Market Place in Kingston and Castle Gaming Lounge VLT operations, in Portmore on December 1. SVL advised that the Lottery and Sports Betting Unit at the facility in Portmore will remain open for normal business operations and that it will focus all its energies on the flagship gaming lounge – Acropolis Barbican, with enhancements to its offerings in these locations.
The company further advised, that it will focus its energies on the continued development, of what it says is its profitable Acropolis Gaming Lounge. Over the next two to three months SVL will be expand the gaming floor, along with greater focus on improving the customer experience through wider game options, increased payouts and improved food & beverage offerings. The consolidation will result in a re-allocation of staff and other resources to meet the expanded needs at Acropolis Barbican. However, approximately 20 positions will be made redundant, after a reallocation of staff resources to meet the new needs at Acropolis Barbican. Will those changes be enough to eliminate the more than $500 million loss in the segment is left to be seen? The move should reduce the losses going into 2015 with less rent and staff cost.
The company also has to deal with the Sports betting losses which worsened even as revenues climbed from $177 million in 2013 to $418 million in 2014. The sharp growth in sports betting is attributable to betting on world cup football games. The segment lost $87 million in 2013 and $148 million in 2014 so far.
Trackbacks
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[…] the stock to resume trading. As a result of the cancellation of the trade, the closing price for Supreme Ventures officially ended at a 52 weeks’ high of $2.95. The changes meant that JSE index ended at 85,647.64 […]
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[…] by posting a 5 cents gain. Grace Kennedy traded 3,850 shares at $65 for new 52 weeks’ highs and Supreme Ventures with 20,435 traded as high as $2.95, a new intraday 52 weeks’ high but ended down, at the close at […]
[…] Supreme Ventures cut losses in the hospitality segment by a massive $103 million but the segment still lost $47 million leaving more work to be done to remove the losses and put it into a profitable position. The company was not so lucky in the sports betting with increased losses of $12 million or 37.1 percent to $45 million. The change in these areas coupled with growth in new games helped pushed net profit after tax to $405 million for the three-month period, 20 percent increase, compared to $338 million for the comparative three-month period of 2014. Earnings per stock unit for the quarter amounted to 15.36 cents, compared to 12.82 cents for the corresponding period in 2014. IC Insider had earlier forecasted profits for 2015 to be in the order of 45 cents per share and have now increased it to 60 cents per share, based on the latest numbers. The strong profit growth came from a 15 percent growth in total revenues of $11.8 billion or a $1.5 billion increase, over the corresponding period in 2014 and flat expenses during the quarter. “The Sports Betting segment results show an increase in, which was primarily attributable to higher than designed prize pay-out at 75 percent. The prize liability for the corresponding period in 2014 was 61.29 percent. The Gaming and hospitality segment results show a reduction in losses due to the net effect of the closure of Acropolis Montego Bay, Odyssey and The Castle gaming lounges”, management stated in a release of the quarterly report. For the December quarter last year, gaming losses amounted to $85 million compared to an average of $126 million in the previous three quarters and sports betting contributed $46 million in losses for the final 2014 quarter. Without the losses in these two areas profit would have been much larger. At the end of March the company had cash funds of $1.8 billion and should see an annual build-up of around $400 million, even with the increased dividend payments. Equity capital stands at $3.7 billion down from $4 billion in December 2014 and borrowed funds are at only $42 million, leaving the company in a healthy financial position. The company upped its dividend payment based on these results by 55 percent. […]