Proactive Investors - Run By Investors For Investors

Netplay TV rides out the storm caused by new tax

A new tax has inflicted some short term pain. However Netplay is sitting on almost £16mln of cash and has made an acquisition that will be immediately earnings enhancing.
Netplay TV rides out the storm caused by new tax
Spin the wheel: Things are starting to look up for Netplay.


The progress of Netplay TV (LON:NPT) was derailed somewhat by the introduction of the new point of consumption tax that has been levied on all online gaming.

The company, which hosts roulette on ITV, Channel 5 and Sky, reported a year-on-year £1mln slide in adjusted pre-tax profit in the first half, which fell to £1.1mln.

By contrast, betting duties in the six months to June rose to £1.9mln from £400,000 in the second half of 2014 and £100,000 a year ago.

To mitigate the impact, the group cut its marketing expenses by 24% to £5.9mln, it also very excited by the £3.2mln acquisition of Otherside Inc, a digital marketing firm that has been bought to help increase its customer base.

Being profitable, the new business will also have a positive impact on earnings when the next results are published.

“We're excited about the opportunities that the acquisition of Otherside brings to the group initially providing a profitable revenue stream whilst adding to our capability in driving traffic to NetPlay's brands once the integration is complete,” said chief executive Bjarke Larsen.

“This alongside the group's solid marketing performance and opportunistic acquisition strategy supported by a robust cash position gives us confidence for the year ahead and beyond."

Netplay is currently sitting on £15.8mln of cash – which represents more than half the firm’s market capitalisation.

Despite the decline in profitability, the firm maintained its dividend at 0.22p a share.

The shares, up 35% in the year to date, marked time at 9.75p.

View full NPT profile View Profile

Netplay TV Plc Timeline

February 02 2017
September 13 2016
January 14 2016

Related Articles

March 22 2019
The healthcare-focused advisory group boasts good levels of forward bookings thanks to several new business wins at the beginning of 2019
January 29 2019
“With the geopolitical landscape remaining in flux, clients are looking for greater certainty from their marketing programmes which our agencies and data businesses are proving able to provide"
March 04 2019
At the Completion Contract business there have been lower volumes and the average budget per film has reduced

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use