Sportech PLC on Monday said it wants to de-list from the AIM market in London, citing “significant burdens,” both financial and non-financial, of maintaining a public listing, while the US-focused gambling operator also reported a narrowed half-year loss.
Shares fell 43% to 55.500 pence early Monday in London in response.
Edinburgh-based Sportech runs sports bars and other betting venues in Connecticut. It also offers online gaming in the north eastern US state via mywinners.com and pari-mutuel betting online across all of the US via 123.bet.com.
Pretax loss from continuing operations in the six months that ended June 30 was GBP304,000, narrowed from GBP802,000 a year before, as revenue rose by 7.7% to GBP13.5 million from GBP12.6 million.
Sportech credited a focus on margins for the narrowed loss. Adjusted earnings before interest, tax, depreciation and amortisation rose to GBP900,000 from GBP400,000.
Sportech had GBP7.8 million in cash, excluding customer balances, up from GBP7.4 million on December 31, though this was reduced to GBP3.6 million at the end of August by a GBP3.5 million return of capital to shareholders last month. The company announced no new returns on Monday.
Sportech will ask for shareholders’ approval to cancel its shares from AIM and re-register as a private limited company. Shareholders then will be offered a third-party matched bargain facility to allow them to buy and sell shares following cancellation.
“Despite delivering improving operational results announced today, the substantial financial cost associated with maintaining a public listing, given our current scale, and the increasing volatility in the market valuation is adversely impacting net returns and future prospects,” explained Executive Chair Richard McGuire.
“Regrettably, in light of these circumstances, we find it necessary to take the difficult but pragmatic step of proposing delisting from the AIM market today.”
