GGRAsia – AGTech net loss widens to US$24 mln in 2014

AGTech net loss widens to US$24 mln in 2014

Mar 25, 2015 Newsdesk Industry Talk, Latest News, Rest of Asia, Top of the deck

AGTech Holdings Ltd, a supplier to mainland China’s regulated lottery market, reported a net loss attributable to owners of the company of HKD189.2 million (US$24.4 million) for 2014. Such full-year net loss more than doubled from 2013, when it was HKD82.9 million.

The company on Monday said the 2104 loss was primarily due to a 127-percent rise in share-based payments to HKD136.3 million, as a result of an increase in share options granted to directors and eligible employees.

AGTech also said there were increases in other major expenses, including a rise in office costs and an increase in legal, professional and consultancy fees.

Revenue for the year amounted to about HKD211 million, up by 1.3 percent over 2013. Most of the revenue was derived from gaming technologies business and from provision of sports lottery management in mainland China, said AGTech.

The company’s gross profit margin in 2014 stood at 33 percent, down from 43.8 percent in the prior-year. Cost of sales and services increased by 20.8 percent year-on-year to HKD141.5 million, the firm reported.

The firm said the footprint of its lottery business now covers “over 80 percent” of the provinces and municipalities in China.

Combined sales of sports lottery and welfare lottery tickets in the mainland market reached RMB382.4 billion (US$61.5 billion) in 2014, an increase of 23.6 percent from the previous year, according to official data.

In Monday’s filing, AGTech said it expects 2015 “to be a year of significant regulatory progress” in the mainland’s lottery industry.

“China’s lottery industry will introduce relevant laws and regulations (particularly on internet and mobile distribution) which will further regulate and professionalise lottery supervision,” the company said.

Several mainland China online platforms have suspended sales of lottery products since late last month, following notices issued by central government officials calling for better regulation of the market.