DGAP-News: Tipp24 SE: foundation laid in FY 2012 for expansion of international business (english)
Mar 28, 2013 12:19 PM
Tipp24 SE: foundation laid in FY 2012 for expansion of international
business
DGAP-News: Tipp24 SE / Key word(s): Final Results
Tipp24 SE: foundation laid in FY 2012 for expansion of international
business
28.03.2013 / 11:19
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Press release
Fiscal year 2012
- Revenue and EBIT 2012 largely on target
- Best result in company's history
- Relocation of company's registered office to UK
(Hamburg, 28 March 2013) Tipp24 SE largely reached its targets in fiscal
year 2012. Generated mostly abroad, consolidated revenue grew by 2.5% to
EUR 142.7 (prior year: 139.3) million. Earnings before interest and taxes
(EBIT) improved by 8.8% to EUR 56.5 (51.9) million, thus raising the EBIT
margin by 2.3 %-points to 39.6% (37.3). Earnings per share rose to EUR 4.99
(4.80). At year-end, there were liquid funds of around EUR 132 (129)
million.
Revenue and earnings influenced by special items
The spin-off of former subsidiary Lotto24 AG had a strong impact on the
company's financial figures: the disclosure of hidden reserves resulting
from the possibility to broker lotteries online in Germany raised EBIT by
EUR 18.2 million, after netting with related consultancy expenses and
deconsolidation effects.
Comparability with the previous year was affected by two other relevant
special items: total payouts for secondary lotteries were EUR 14.1 million
below the expected payout value in 2012, with a positive impact on revenues
of the same amount and on EBIT of EUR 6.2 million. In 2011, the settlement
of an insurance claim had a positive impact on EBIT.
Adjusted for chance effects, consolidated revenues of EUR 128.6 million
were slightly below the adjusted prior-year figure of EUR 131.1 million,
while EBIT adjusted for chance effects and other special items amounted to
EUR 32.2 million, compared with EUR 38.9 million in the previous year. A
major reason for the difference in revenues was the comparatively low
number of jackpot draws for the core product 'Lotto 6/49' in 2012. In
addition to this revenue effect, EBIT was burdened by an adverse product
mix, costs for the expansion of new businesses and extraordinary
consultancy costs in connection with hedging transactions.
Successful spin-off of German business
On 1 July 2012, the new State Treaty on Games of Chance came into effect
throughout virtually the whole of Germany - it failed however to resolve
the legal problems of the previous regulations. After years of legal
wrangling about the resumption of online lottery brokerage in Germany,
Tipp24 decided to spin off its original core business - despite its proven
success in court. The Annual General Meeting of Tipp24 SE on 22 June 2012
approved the spin-off of German activities and the formation of an
independent, listed company, thus enabling Lotto24 AG to launch activities
in Germany without the burden of legal disputes involving Tipp24 SE. Tipp24
no longer holds any shares in this former subsidiary, which has been listed
in the Prime Standard segment of the Frankfurt Stock Exchange since 3 July
2012.
Dr Hans Cornehl, CEO, states: 'Our decision to spin off German operations
fulfilled all our expectations. Lotto24 has been granted all necessary
permits for the brokering, online marketing and advertising of lotteries on
TV and the Internet. The decision was also viewed as a value-enhancing move
by the capital markets. Tipp24 has since been concentrating on its
international business.'
Internationalisation - investment in Geonomics, acquisition of own licences
and expansion of business division providing Internet services to lottery
companies
In its fiscal year 2012, Tipp24 laid the foundation for the expansion of
its international business. The company took a major strategic step in
December 2012 with the acquisition of a 25.7% stake in the UK-based company
Geonomics Global Games Limited (formerly Roboreus Limited). Via its UK
subsidiary GeoSweep Limited, Geonomics operates the geo-based lottery game
GeoSweep (www.geosweep.com). In this online lottery game, players purchase
squares ('Geos') on an online map. Operating under a UK Gambling Commission
licence, the product currently covers the entire geographical area of Great
Britain. However, GeoSweep also acts as a service provider for the Canadian
provincial lottery organisation ALC. It is planned to expand the
cooperation with state lottery companies in the near future. Particular
focus will be placed on the North American market.
As Dr Hans Cornehl explains: 'GeoSweep is one of the most outstanding
lottery innovations of the past ten years. We regard this investment as a
keystone for the implementation of our central growth strategy offering
tremendous synergy potential - both for the marketing of Internet services
to lottery companies and for the establishment of our own portfolio of
licences. We see clear signs of deregulation above all in North America. We
therefore aim to quickly tap this online lottery market as a partner of the
state lottery companies.' Tipp24 boasts over twelve years of relevant
technology and marketing expertise which it can bring to these markets. In
the medium to long term, Tipp24 also wants to bid for further licences to
run its own lotteries.
The planned relocation of the company's registered office to London
announced on 20 March 2013 is a consequence of the strategic realignment of
Tipp24 SE. At the planned Annual General Meeting in June 2013, the
company's Executive Board and Supervisory Board will propose a vote on the
relocation to shareholders of Tipp24 SE. Tipp24 SE intends to maintain its
legal form as an SE after the relocation and retain its listing in the
Prime Standard segment of the Frankfurt Stock Exchange.
Outlook - further positive prospects
After consideration of price increases, Tipp24 SE expects to achieve
revenues of EUR 130 to 140 million and EBIT of EUR 20 to 30 million in its
fiscal year 2013. This forecast takes account of costs for further
necessary adjustments to hedging structures in its secondary lottery
business and additional, mostly non-recurring, costs for the preparation of
new business fields totalling EUR 15 million. The stated ranges for
revenues and EBIT also take account of statistical fluctuations in payouts
for the secondary lottery business.
Tipp24 anticipates similarly high costs in fiscal year 2014 as in 2013. At
the same time, the company expects its new business fields to make their
first significant contribution to revenues.
About Tipp24 SE: Tipp24 SE was founded in September 1999 and holds equity
interests in a number of companies in Spain and the UK, which enable
participation in lottery-based games via the Internet, especially via the
websites www.ventura24.es, www.mylotto24.co.uk, www.tipp24.com and
www.geosweep.com. From its foundation to the end of 2008, Tipp24 SE
brokered tickets worth over 1.5 billion euros to the state lottery
companies - in the latter years over 330 million euros annually. Following
its successful IPO in 2005 (Prime Standard), the company was admitted to
the SDAX index in June 2009. In July 2012, German online brokerage
activities were successfully spun off from Tipp24 SE in the form of the
listed company Lotto24 AG. With the acquisition of a stake in the UK-based
company Geonomics Games Limited in December 2012, Tipp24 SE laid the
foundation for the expansion of its international business.
^
Fiscal year 2012 2011
Revenue EUR thsd. 142,731 139,316
EBIT EUR thsd. 56,464 51,905
Consolidated net profit EUR thsd. 40,891 36,339
°
(Possible rounding differences due to presentation in EUR thousand)
Press contact:
Tipp24 SE
Andrea Fratini
Head of Media and Public Relations
Tel.: +49 (0)40 32 55 33 660
E-mail: presse@tipp24.de
Internet: www.tipp24-se.de/press/
End of Corporate News
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Language: English
Company: Tipp24 SE
Straßenbahnring 11
20251 Hamburg
Germany
Phone: Tel.: +49 (0)40 325533-142
Fax: +49 (0)40 325533-5600
E-mail: ir@tipp24.de
Internet: www.tipp24-se.de
ISIN: DE0007847147
WKN: 784714
Indices: SDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, München,
Stuttgart
End of News DGAP News-Service
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205519 28.03.2013
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