ZEAL announces investment in growth strategy, 2017 guidance, developments in VAT matter and adjusted dividend policy

Jan 26, 2017 6:56 PM

ZEAL Network SE / Key word(s): Forecast/Dividend

26-Jan-2017 / 18:56 CET/CEST
Disclosure of an inside information acc. to Article 17 MAR, transmitted by
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The issuer is solely responsible for the content of this announcement.


The group has identified several significant growth opportunities in its
highly profitable core business. In order to capitalise on these
opportunities, marketing investment will be stepped up in the secondary
lottery business in 2017 and onwards.

This strategy is anticipated to have a positive impact in the mid-term,
with significant growth by 2019. As a result of the planned increase in
marketing investment, ZEAL expects an EBIT in the range of EUR 30 to 40
million in the fiscal year 2017 and a total operating performance of EUR
145 to 155 million in the same period.

Separately, ZEAL Network SE has been informed by MyLotto24 Ltd (MyLotto24),
a fully consolidated minority shareholding of ZEAL, that it has had initial
discussions with the German tax authorities about the classification of
certain services of MyLotto24 as so-called Electronically Supplied
Services. As part of this process, MyLotto24 expects to receive a VAT
assessment from the German tax authorities. However, MyLotto24 is confident
that this classification does not apply and expects to successfully
challenge any VAT assessed on this basis. As a result, ZEAL does not expect
corresponding provisions to be required in the group's accounts.

Also in view of the planned additional investment in marketing, management
intends to build up reserves in relation to possible VAT liabilities,
despite its stated belief that any such claim would be unsubstantiated.
Given the unpredictability of any tax case, ZEAL therefore intends to
adjust its current dividend policy. The company intends to declare a
dividend in 2017 and onwards amounting to at least EUR 1.00 per share, to
be paid in one annual instalment.


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   Language:    English
   Company:     ZEAL Network SE
                5th Floor One New Change
                EC4M 9AF London
                United Kingdom
   Phone:       +44 (0)20 3739-7000
   Fax:         +44 (0)20 3739-7099
   E-mail:      office@zeal-network.co.uk
   Internet:    www.zeal-network.co.uk
   ISIN:        GB00BHD66J44
   WKN:         TPP024
   Indices:     SDAX
   Listed:      Regulated Market in Frankfurt (Prime Standard); Regulated
                Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover,
                Munich, Stuttgart, Tradegate Exchange

     End of Announcement    DGAP News Service