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Big drop in revenues as company struggles to achieve profitability

SSL Venture Capital continues to lose money, chalking up another period of losses for the six months ended December 31, 2020.

The investment company recorded an operating loss of $35.62 million in the half-year period versus a loss of $69.34 million reported in 2019. Operating loss for the second quarter closed at $14.18 million relative to $48.08 million reported for the same quarter of 2019.

Finance costs for the period fell 41 per cent to close at $4.12 million compared to $7.01 million reported in 2019. After a  tax credit of $4.81 million, SSL Venture Capital reported a net loss of $34.93 million versus a loss of $50.90 million reported in 2019.

Net loss for the quarter amounted to $15.19 million, down from the $33.78 million recorded in 2019. Shareholders losses for the period amounted to $30.63 million compared to a net loss attributable to shareholders of $40.14 million in 2019.

For the quarter, net loss attributable to shareholders was $13.32 million coming from $26.64 million reported in 2019. As a result the loss per share (LPS) for the period amounted to $0.08 versus a LPS of 0.10 the prior year.

LPS for the quarter amounted to $0.03 (2019: LPS $0.07). As a result of the poor performance the company executed a strategic review of the distribution segment and the severe impact on the business brought on by the pandemic.

Bar Central ceases operations

Following its strategic review, the board and majority shareholder of SSLVC have decided to shutter the operations of Bar Central effective December 31, 2020. It is anticipated that the process for winding up the company will be completed as soon as possible.

The company advised that “shareholders will be updated as the process unfolds. It is our intention to ensure that our shareholders be made whole on their investments”.

“… the lingering effects of the COVID-19 pandemic, continue to severely impact performance especially on the bar and entertainment sectors, major revenue earners for the group …”

SSL Venture Capital

For the six months period revenues of $19.32 million were reported versus $95.30 million in the prior year’s corresponding period. For the quarter, SSL Venture Capital reported $1.07 million in revenue coming from the $44.28 million posted in 2019.

The company’s management explains that, “the lingering effects of the COVID-19 pandemic, continue to severely impact performance especially on the bar and entertainment sectors, major revenue earners for the group with losses before taxes coming in at $39.7 million for the December quarter compared with $76.3 million for the same period in 2019. Most of the losses recorded relate to the distribution segment, the main casualty of the pandemic.”

Cost of sales dwindling

Cost of sales amounted to $19.12 million (2019: $85.29 million), thus resulting in gross profit of $199,288 relative to $10.01 million booked last year. Gross profit for the quarter amounted to $19,656 versus gross loss of $6.31 million booked for the second quarter ended December 31, 2019.

Other operating income closed at $115,524 (2019: $351,650) for the six months period ended December 31, 2020. In addition, administrative expenses were $35.93 million compared to the $79.70 million documented in the previous year corresponding period.

According to the management, “the Group has been able to realise savings from rigorous cost management initiatives and efficiency improvements.” As at December 31, 2020, total assets amounted to $113.80 million down 51% from the $230.99 million booked in 2019.

This decrease was mainly due to decreases in ‘Goodwill’ and ‘Property & Equipment’ which closed at nil (2019: $112.01 million) and $9.89 million ($18.71 million), respectively. Shareholders’ deficit closed at $237.99 million relative to shareholders’ deficit $108.57 million recorded in the prior year’s corresponding period.

This resulted in a shareholders’ deficit per share of $0.59 (2019 shareholders’ deficit per share: $0.27)