Net profit cut in half during the September quarter

Jamaica-based regional gambling and entertainment group, Supreme Ventures Limited (SVL) is now feeling the pinch from the adverse effects of the COVID-19 driven multi-day lockdowns, early evening curfews and social distancing protocols in Jamaica that took place during the just ended September quarter.

The Group’s unaudited financial statements for the quarter showed that net profits declined by $310.5 million or 49.9 per cent when compared to 2020, ending the period at $312.3 million. During the quarter under review, SVL operations were largely impacted by several external factors including severe Government imposed restrictions and increased lock down days to contain the devastating spread of the Delta variant of COVID-19.

However, the company says “it is grateful to have performed creditably under these challenging conditions. Total gaming income of $10.1 billion represents a decline of $264 million or 2.5 per cent when compared to the corresponding period in 2020, driven largely by sizeable payouts for Cash Pot.”

Direct expenses for the reporting quarter was contained at $7.9 billion, which was $203 million or 2.5 per cent, lower than the same period in the prior year.

More money paid out in prizes despite challenges

According to SVL, “despite the difficult business environment, total prizes paid for the quarter amounted to $14.7 billion, representing an increase of 5.1 per cent compared to the same period in 2020, as we continue to put more money back into the hands of the consumer, and help to drive the overall economy. Total contributions to Government coffers, including the consolidated fund amounted to $1.9 billion for the quarter (similar to 2020), despite restricted operations for over 15 days”.

Earnings per share for the quarter is 11.80 cents (2020: 22.60 cents). The dividends proposed of 11 cents will be paid on November 18, 2021. SVL advised shareholders that its aggressive product and channel diversification strategy implemented over the last three years has been able to somewhat reduce the overall exposure of specific channels and segments to the risks associated with the ongoing uncertain COVID environment.

The company is emphasising that, “at a time when all business were impacted negatively by the no-movement days and curfews, during the months of August and September, we continue to enhance our customer experience and key stakeholder relationships, utilising tactics that expand and grow the business in addition to maintaining firm cost control measures. Our customers have affirmed their confidence in our products and services, as showcased by a steady increase in transactions across our various product categories, and consistent, robust revenue growth in the face of legal and illegal competitive forces. “

Improved market condition expected

SVL anticipates improved market conditions as the vaccination numbers continue to rise both in Jamaica and overseas, and the guidelines implemented by the government enable the country to better cope with changes to the pandemic’s protocols. The Group notes that it has been playing its part to contribute to the vaccination efforts, through its Vax and Win promotion and vaccination blitz at Caymanas Park.

SVL’s assets totalled $15.2 billion, representing a decrease of $395.4 million or 2.5 per cent when compared to the assets as at December 31, 2020. The net reduction is mainly impacted by the payment of dividends and estimated statutory taxes paid in the first quarter of this year.

These reductions were offset by the acquisition of 51 per cent of the shares of McKayla Financial Services Limited, 10 per cent shareholding in Main Event Entertainment Group and the additional 29 per cent share ownership in Post-to-Post Betting Limited, as well as deposits placed for key development projects.