SIS sees fall in profits
Betting services supplier Sports Information Services (SIS) saw a reduction in profits during the most recent financial year, ending 31 March 2019, due to the challenges in the retail betting market and an increase in expenditure and investment.
The content and production services provider for the betting industry saw continuing group revenue growth of 41% to £222.5m (€261.2m/$292.6m) during the year.
The reporting period included the first full financial year of SIS offering Racecourse Media Group’s (RMG) content into British and Irish licensed betting offices. SIS Retail also broadcast races through its partnerships with Horse Racing Ireland (HRI), Association of Irish Racecourses (AIR), Chelmsford City Racecourse (CCR), and the SIS British Greyhound Service.
Additionally, other International content has increased with additions of US, South American, South Korea and Melbourne Racing content into the services.
January 2019 saw a change in the international rights and sales arrangements with RMG and SIS commencing new partnership arrangements to exploit UK and Irish Horseracing rights and Greyhound rights both internationally and online. This followed the closure of GBI Racing Limited, a Joint Venture between Racing UK Ltd and Attheraces Holdings Limited which previously exploited UK horseracing rights.
The group said its SIS Digital business has continued to grow with increased streaming volumes on existing content as well as new products launched to the digital market. The portfolio of products includes both Watch and Bet as well as Bet and Watch streaming, internet protocol TV delivery and pricing services.
Total operating expenses increased by 27% to £234.0m, of which £217.2m was on continuing operations. It said that during the period it made a significant investment in its capabilities to deliver bespoke services to both retail and online bookmakers in the UK and globally. That increase was among the contributing factors towards a 11% drop in group EBITDA on continuing operations before individually significant items to £5.3m.
Profit before taxation was down significantly by 83% to just £732,000, with the after tax figure of £185,000 down 93%.
SIS said total comprehensive income for the year was up 24% to £4.6m.
SIS said in its filing: “The group has seen a reduction in operating profit before individually significant items from £8.4m to £7.4m, this can be separated into two elements, firstly the change in media rights year on year, prior to new media rights agreements commencing in April 2018, as well as increased non-trading costs associated with restructuring the business.
“Operating profit after individually significant items has decreased to £2.2m. The reduction is largely due to increased litigation fees incurred in the year.”
The group noted that more than 95% of its revenue comes from the UK and Ireland. It is hoping to increase its global business, and in November appointed Angel Calderon as digital sales manager in Spain and Latin America.