The board of Sportech Plc has stated confidence that the LSE firm will deliver its full-year 2020 EBITDA results in line with corporate expectations.
Issuing a pre-close 2020 trading statement, Sportech noted that despite enduring COVID-19 headwinds the company maintained its operational efficiencies across its core business verticals.
Meeting unprecedented headwinds, Sportech focused 2020 trading on capital preservation and strengthening of the firm’s net cash position.
As a result, the LSE wagering and racing systems provider stated that its group-year end cash balance will be maintained at £10.2 million ahead of previous expectations.
Entering 2021, Sportech has shifted its focus to complete the approved sale of its Global Tote units (Racing and Digital units) to BetMakers for $56 million.
Supporting this transaction, Sportech has chosen to exit all non-core business units. The decision has seen the company enter ‘conditional agreements’ in-stadia wagering solution Bump 50:50 to Canadian Bank Note Limited for a ‘gross consideration’ of CAD $10 million (circa £5.7m).
Meanwhile, with regards to its US operations, Sportech agreed a revised US$6 million sale and an eighteen-month leaseback and is initiating a search for more appropriate replacement premises in the New Haven area.
Sportech anticipates the sale of its assets to be completed during H1 trading, with the company generating projected net cash sum of £36 million from the transactions.
“Sportech has delivered on key 2020 performance metrics – namely cash generation from operational activities, capex reductions and delivery of a lower operational cost base going forward – resulting in only a modest cash outflow since the outbreak of COVID-19,” said Richard McGuire, Chief Executive Officer of Sportech.
“Following corporate activity announced in recent months, the Group structure and business will adjust during FY 2021. We remain focused on our US headquarters in Connecticut where management and personnel remain fully motivated to be part of the States’ expanded gaming solution alongside our Connecticut gaming neighbours. We look forward to providing a further update when we report our results in April.”