News blog
Top Ten Holdings
- BY: Andrew Hore |
- POSTED: 05/08/2008 |
Top Ten Holdings swung from profit to loss in the year to March 2008.
The bingo operator says it may take several years to rebuild profitability. The smoking ban and the new gambling act have hit the business. The gambling act removed certain types of fruit machines from bingo clubs. Rises in fuel and food costs have also affected the spending power of players.
Revenues fell from £30.6m to £25.8m in the year to March 2008. The company swung from a profit of £2.5m to a loss of £8.85m. Most of that loss relates to write-offs of intangible assets.
Despite the reported loss, Top Ten still generated cash from operations. Net debt is £28.1m.
Cost reductions of £1.25m a year have been made.
Top Ten and other bingo operators are claiming back VAT that they have paid in the past. This could provide a significant cash inflow if they are successful. On top of that, Top Ten hasn’t paid £786,000 of VAT on interval bingo so if this has to be paid there will be an additional cash outflow.
The shares slumped 0.75p to 3.625p, valuing Top Ten at £920,000. Net asset value is 41p a share, although if the remaining intangibles are excluded it is negative.
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