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Pollard Banknote breaks revenue record in 2021

| By Marese O'Hagan
Lottery solutions provider Pollard Banknote has reported record revenue of CAD$459m (£272.4m/€324.6m/USD$358.6m) in its full year 2021 results, but net income declined.
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This revenue total was a rise of 10.8% from 2020, when revenue was at $414.1m overall.

Costs of sales came to $367.9m, up 13.8% year-on-year. This left gross profit at $91.1m for the year, rising slightly by 0.1% compared to 2020.

Administrative expenses grew by 17.1% to $47.2m, while selling expenses rose by 19.8% to $17.5m.

Equity measurement income resulted in a loss of $12.3m, up by $10.7m from 2020.

Other income grew $17.3m to $5.2m, bringing the total income from operations to $33.5m, a fall of 33% year-on-year.

Following interest expenses of $5m and foreign exchange expenses of $1.4m, the total pre-tax income was $27.1m – 41.2% less than the pre-tax income in 2020.

Income taxes came to $7.4m, a fall of 42.1%, bringing the total net income to $19.7m. This was a decrease of 40.8% year-on-year.

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) total came to $84m. Lotteries and charitable gaming made up $64.3m of this, a fall of 13.4%, while egaming systems made up the remaining $19.7m – up by 207.8%.

“2021 was a very successful year for Pollard Banknote on a number of critical fronts,” said John Pollardco-chief executive officer of Pollard Banknote. “In light of the extreme challenges over the last two years with Covid-19, we could not be prouder of our employees.

“All of our main business lines continue to see exceptional demand from our customers and we expect that to continue throughout 2022.”

The company also reported record revenue for its fourth quarter, with $116.5m. This was up 12.3% year-on-year.

Cost of sales hit $95.8m, a rise of 12.7%, leaving the total gross profit at $20.7m.

This was a decrease of $2.3m.

Administrative expenses for the quarter came to $11.9m, up by 14.4%. Selling expenses also grew, by $1.2m. Equity investment income came to a loss of $3.2m, and other income increased by $6m to $2.3m.

After considering this, income from operations was $4.7m, a significant decrease of 66.6% year-on-year.

After other expenses at $1.5m, pre-tax income was $3.2m, down 80.4%.

Income taxes came to $2m, bringing the overall net income for the quarter to $5.2m, a year-on-year fall of 57.3%.

“Our fourth quarter results reflected a number of the themes impacting our 2021 full year results,” noted Doug Pollard, co-chief executive officer of Pollard Banknote.

“With record fourth quarter revenue of $116.5 million, up 12.3%, driven by higher charitable gaming and egaming sales, demand for our charitable products and solutions remain extremely high.”

Adjusted EBITDA for the quarter came to $18.7m. Lotteries and charitable gaming made up $12.3m of this, down 32.4%, while egaming contributed $6.4m – up by 204.7%.

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