(Alliance News) - Nektan PLC on Monday reported a widened loss in its delayed financial 2019 results, despite rising revenue.
In the year to June 30, 2019, the mobile gaming and casino technology platform recorded a pretax loss of GBP6.4 million compared to GBP5.0 million the year before. Nektan blamed restructuring costs and a GBP2.8 million loss on the disposal of its US subsidiary Respin LLC.
Revenue, however, rose 14% to GBP22.6 million from GBP19.9 million the year before. This was attributed to the sharp rise in business-to-business sales, which Nektan said it will focus on following a restructuring of its business.
B2B revenue quadrupled to GBP980,000 from GBP240,000.
"This growth, alongside the increasing opportunities being leveraged in emerging international markets, has seen the directors focus the group's strategy on B2B and international opportunities moving forward," the company said.
Total administrative expenses were up 34% year-on-year to GBP8.3 million from GBP6.2 million.
Chair Jim Wilkinson said: "The year was one of change for the group; following the year end we decided to restructure the business from a primarily UK B2C facing business into one with a truly global outlook, as we take our casino platform and integrated gaming technology to partners operating in international markets as diverse as Africa, Taiwan and across Asia, whilst continuing to develop B2B partner opportunities closer to home in Europe and the UK."
At the beginning of January, Nektan sold its loss-making UK business-to-consumer unit, allowing it to focus on its B2B business.
As a result of the publication of its financial 2019 results, Nektan's temporary suspension from trading on AIM has been lifted. Shares were 35% higher in London on Monday at 3.71 pence each.
Also on Monday, Nektan said its financial 2020 first half revenue of B2B division more than doubled on the previous year.
In a statement Monday, Interim Chief Executive Officer Gary Shaw said: "The restructuring represents an important milestone for Nektan. We can now focus on executing our strategy of becoming a dedicated casino technology and gaming content provider globally. These initial results support the directors' decision to focus solely on B2B opportunities."
In the six months to December 31, Nektan recorded B2B revenue of GBP787,000, more than double the GBP311,000 reported the year before. In December alone, Nektan's B2B revenue was GBP225,000.
Nektan now has 28 live sites, generating revenue, which is sharply higher than the 5 live sites the year before. The company has 6 sites in beta stage and a further 21 in its pipeline to launch.
Shaw continued: "The last few months have seen an intense period of activity culminating in now having 34 sites live. With the majority of these going live at the back end of the calendar year, combined with a 3 to 4 month ramp up period, we expect to report further significant revenue growth during the current quarter - early signs in January underpin this."
As a result, Nektan is now guiding for monthly earnings before interest, tax, depreciation and amortization to be break-even by the end of financial 2020.
By Paul McGowan; paulmcgowan@alliancenews.com
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