Analysts noted Sportech cut costs and capital expenditure, while sticking to its strategic guns, reducing the capital intensity of the Racing business and improving its international revenues, despite the cancellations of racing and closures of venues.
In the six months to June 30, revenue slid 38% to GBP20mln, while last year’s underlying profit of GBP3mln turned into a loss of GBP1mln.
The cash position of GBP9.6mln at period-end was “a useful improvement over guidance of GBP8.9mln given on 26 June and an outflow of only GBP1.4mln between the end of February and the end of June,” analysts said.
“Sportech had a lot to prove prior to Covid-19,” the broker continued, retaining the 40p target price.
“Management was trying to use the legacy businesses as a platform on which to build a higher-growth and lower capital intensity successor, using the technology and know-how acquired with Lot.to.”
Shares slipped 11% to 12.75p on Thursday at noon.