Phumelela announce acquisition strategy/ results

Phumelela Gaming & Leisure posted a 15% jump in headline earnings per share, supported by strong offshore results, currency gains and the growth of betting volumes.

The horse racing administrator and licensed totalisator operator and bookmaker recorded that profit before tax rose 17% to R130m. Profit before tax from international operations increased by 47%.

"We are very pleased to report headlines earnings per share up by 15%," CEO Rian du Plessis told Fin24 in a video interview.

Headline earnings per share increased by 15% to 132 cents for the year ended July 31 2014 from 114.5 cents in 2013.

Earnings per share increased by 29% to 146 cents from 113.6 cents previously.

The group declared a dividend of 60 cents. This brings the total dividend for the year up to 80 cents said Du Plessis.

"We did not increase the dividend this year because we are increasing our cover. We will look at increasing our dividend going forward".

Watch: Phumelela headline earnings tick up



Income from local operations increased by 7% to R967m.

South African horseracing and tote betting continued to be loss-making, but tote betting on sports other than horseracing was up 34%.

“Tote betting on sports other than horse racing increased by 34% and now exceeds tote betting on international horseracing,” said CEO Rian du Plessis.

The group is quite positive about the year ahead, with expansions on the horison.

"We will be growing our international business. A weak rand happens to also be good for us."

"Locally, we are looking to extend our retail footprint - organically in the first place and then to augment that with acquisitions," du Plessis said.

A loss from SA horseracing and TOTE BETTING, off an income of R967 million(How much of this is Horseracing?).......that must be mind boggling to anybody who has run their own business or being a participant at an exco level of operations!!!

Hard to understand how you can't cut a suit according to that cloth!
Would love to see expenses broken down between variables ,semi variables and non variables.

Well done Phumelela on a really good performance.

It supports what we have been saying in this forum on many occasions which is that diversified operations are doing well and that these efforts are to be applauded in light of the subsidies that it is offering the struggling core racing product.

I have just come back from an industry conference in Paris and it was obvious that most betting operators, tote and online, are in agreement about the urgent need to reverse the declining racing customer trend.

It makes sense that growing the customer base is the only solution that will guarantee racing a future and that growth without an increase in the customer base is never going to be sustainable.

Racing has huge inherent advantages that should be tapped into, especially when there is access to product 365 days a year, not to mention the benefits of skill if the learning curve could be tackled successfully.

It would be very interesting to get a number on our local racing customer base and to track changes in future.

Come on Phumelela, lets tackle racing with real commitment and return it to its former glory.

correct me if im wrong, seems Phumelela are capitalizing on products run by other organizations and failing on what they are entrusted with which is local racing,,,

maybe the tote and bookmaking should be their core business and the administration of horseracing should be put in the hands of a new body

I think you got something there Mr H
They've lost the plot

Surely they can't be criticised here

If racing is a loss leader, their other income is propping the industry up

mister a wrote: correct me if im wrong, seems Phumelela are capitalizing on products run by other organizations and failing on what they are entrusted with which is local racing,,,

maybe the tote and bookmaking should be their core business and the administration of horseracing should be put in the hands of a new body

It is clear that there is enough money gambled countrywide,but the focus does not appear to be on local racing.
It is hard to understand how racing can be best served in the hands of an organization that has other priorities(Their soccer betting has the same benefits to them , as the open bet to bookmakers)
That is maybe why ,you will see a great deal made out of every big soccer win ,but big pick6 wins ................not a word.

Bob Brogan wrote: Surely they can't be criticised here

If racing is a loss leader, their other income is propping the industry up

Only while there are assets to strip...............how long do public companies retain loss leaders, once there is nothing to gain!!!

You have to laugh at the incongruity of the article headline and the graph of the share price movement just to the right of it.

at least they have the decency to have a photo of a world class racetrack not some greyhound track :lol:

pirates wrote: at least they have the decency to have a photo of a world class racetrack not some greyhound track :lol:

1.) Correction, Pirates : I believe the picture is of Clairwood; which has just closed. There must be irony in that!

2.) They better pray the rand does not strengthen.

3.) I will be surprised if they haven't 'restructured' ( ie dumped the management of local racing) within the next decade. I believe they will do so as soon as racing has declined further beyond the increasingly negligible (and troublesome) activity it remains for them.

4.) Interested to see that my decison to 'turn up' ANY form of betting which earned revenue for the operator actually seems to have had a small effect. The figures now seem to confirm that they DID manage to chase a good number of us away. for that I can only thank them.