Phumelela Gaming and Leisure

Phumelela Gaming and Leisure on Friday reported a 20% decline in diluted headline earnings per share for the year ended June 2009 from 116.89c to 93.67c. This was despite total revenue increasing by 3% to R804.3-mn (2008: R782.6-mn) with the increase derived mainly from international operations which was up 19%. The group said that totalisator betting income contracted in the 2nd half of the year impacted by the negative economic climate and concomitant decline in consumer spending patterns. Despite the tough trading conditions revenue from local operations ended marginally up on the previous year at R693.6-mn (2008: R689.7-mn). Other operating income that includes, inter alia, bookmakers levies, stable rentals, local and international broadcasting levies/fees and a R27.8-mn profit on disposal of the Bloemfontein racecourse in the previous year decreased by 8% to R221.5-mn (2008: R239.8-mn). Excluding the profit on sale of Bloemfontein racecourse, other operating income increased by 5%. Total operating expenses and overheads increased by 7% to R679-mn (2008: R634.7-mn). Excluding stakes operating costs increased by 6%. Earnings before interest, taxation, depreciation and amortisation excluding the profit on sale of Bloemfontein racecourse in the previous year decreased by 8% to R120-mn (2008: R130.9-mn). Headline earnings decreased by 21% to R70.9-mn (2008: R89.4-mn) and HEPS decreased by 20% to 93.67c per share (2008: 117.20c per share). The group declared a final dividend of 43c per share which, together with an interim dividend of 25c, brings to 68c the total dividend per share for the year - which is unchanged from last year. Phumelela said that trading conditions both locally and internationally are expected to remain challenging in the short to medium term. "Continued emphasis will be on cost containment, growing local revenues through the use of technology and the introduction of new bet types and expanding our international customer base," the group added.