|Internet gambling and football pools company Sportech is set to announce healthy profits for 2006.|
Sportech’s operating profits for the year to January 5th were predicted to come in at £18.4 million and the firm gave an optimistic trading update on its online gambling and football pool action.
Due to its European gambling base, the firm has not experienced the same problems with the UIGEA in the United States as other British gaming firms.
New management at the online businesses appears to be making a difference. Online bingo has added 5,500 customers in a year and online casino and poker have continued their recovery from the first half of 2006 and increased turnover and profitability, reversing an under-performing 18-month trend.
CEO Ian Penrose says these improvements are “part of a wide-ranging plan to get the basics right, dispose of unprofitable interests and build a strong backbone, with the new IT system on schedule. Sportech is now much more cash generative, netting around £680,000 of free cash flow per month during 2007, and this has helped reduce net debt 17 percent from this time last year to £90 million.”
Penrose is planning a big marketing push and analysts are speculating that this could lift pre-tax profits for the year to December 2007 to around £13.6 million.
Sportech shares jumped by almost a third following the news.