Sceptre Leisure: strong performance in tough times

AWP supplier Sceptre Leisure believes it is in a strong position despite revealing a 33% drop in profit before tax to £0.6m for the six months to 31 October.

Revenue was down 7% to £19.7m with operating profit down 25% to £1.2m although the results reflect the sale of 770 fixed odds betting terminal machines.

The results are also against a backdrop of continued pub closures, which cost the company 510 machines, and recent changes to quiz machine legislation by HM Revenue and Customs, which has reduced machine income for operators and pub companies.

"We have demonstrated the strength of the Sceptre business in this period against a tough trading backcloth," said chief executive Ken Turner. "Through quality of service and a market leading proposition we have traded strongly in the circumstances.

"We will continue to seek growth organically and by selected acquisition. We are in good shape to take advantage of opportunities that are afforded us."

The average weekly rental per machine fell from £35.84 to £34.75 due to legislative changes on some SWP games. It now operates 21,100 machines in Punch managed pubs.

Innovation​

Sceptre said it had now installed around 6,000 "note payout" machines, which pay out a £10 or £20 note and not a voucher for redemption as with other competitors as this can be open to fraud, it said.

The note machines have typically led to a 20% increase in income where they have been installed.

"This technology offers significant benefits to the publican, as it reduces the requirement to refill the machines with coinage, and increases operational uptime by eliminating hopper starvation where the machine is unable to accept notes as payment due to a lack of cash available to pay out prizes," said Turner.

Machines in the top managed pubs are providing around £300 of profit a week compared to around £200 in top tenanted pubs.

Its Kelly's Eye division has also increased its range of fund-raising games to the pub market offering games such as bingo and scratch cards.

Earlier this week, the Government said it intends to introduce a new duty on profits of games machines from 2012. The current Amusement Machine Licence Duty (AMLD) will be brought to an end and the exemption from VAT for betting and gaming will be extended.

Turner said this would be good for smaller pubs but would hit the higher earning pubs.