Asia facing lottery firm continues to post losses

Asia-facing lottery company AGTech Holdings is hoping that at some future point it will be in a position to leverage its capabilities in the online environment, according to a hint at its future plans in its latest performance results.

The company has been watching relevant government moves regarding internet and mobile channels and thinks that there could be approval for use of the channels in lottery sales.

In the case of the massive Chinese market, which has suspended online lottery sales for almost two years now due to alleged administrative misconduct (see previous reports) such a development would be significant.

AGTech could certainly use the boost; the Q1-2017 numbers it posted this week made for dismal reading for investors, who it seems will be denied a dividend due to the widening losses the company has incurred.

Attributing these to increased staff costs, declining hardware sales and “remeasurement of company convertible bonds,” the company reported:

* Overall loss of HK$ 232.8 (US$ 29.9 million), a staggering increase from the HK$ 14.4 million loss reported in the same period last year;

* Overall revenue down 23 percent y-o-y at HK$ 14.9 million;

On the plus side, the company was able to report a partnership deal with Chinese lottery technology firm SF Lottery which will see the introduction of SF-themed instant scratch lottery products, and a new sports lottery distribution model for retail shops in China under the Tabao Village concept – a Chinese venture allied to online activity operated in Hangzhou, Zhejiang by Alibaba Group.

The latter project has good potential in China’s rural areas which apparently lack full services regarding lottery sales. AGTech already has business links with the Alibaba Group and Ant Financial Group.

Related and similar