CEO Address to Shareholders - November 2011
Nov 8, 2011
ASX RELEASE - Tuesday, 8 November 2011
FY 2011 has been a year of record results for the Company. The new focus on the Internet Lottery business has resulted in: 1. Record revenue of $76 million, 2. Record EBITDA of $7.0 million, and 3. Record Net Profit After Tax of $4.8 million. The Balance Sheet is sound with New Assets $10.1 million at June 30, 2011 and has continued its growth since then. This places the company into a secure position for the year ahead that will see some important innovations launches. The Internet lotteries market is still emerging in Australia and around the world with the best years yet to come. Last week I returned from the USA where we exhibited at the annual NASPL lottery conference (North American Association of State and Provincial Lotteries). This is the event where all US state lottery operators come together to discuss advances in the Industry. Top of the list of topics was of course the Internet. When will the first state go online? What will its strategy be? Who will the partners be? This is the 3rd year that Jumbo has been as NASPL and each year it is strengthening existing relationships, creating new ones and learning more about the market. I believe the market is reaching breaking point where the political impediments are being worn away and we will begin to see a rush on the Internet. Jumbo has no less than 3 consultants in addition to our own staff to position us at the starting line and make the most of our first-mover advantage. Yes, a lot of patience is needed in the lottery industry, but worth it at the end of the day. 2011 was also the year that Jumbo began opening lottery doors in Europe, Canada, Asia and South America. These markets have already moved onto the Internet and are at various stages of growth. Jumbo is learning about these markets and is becoming accustomed to the market forces shaping those industries. Combined, these markets are between double and triple the size of the US market - $150 billion and growing rapidly. Back in Australia, the Internet lottery market also continues to grow. The expected competition in the NSW market has not happened yet but it will, and Jumbo is well positioned to meet this challenge. Jumbo takes a long-term view and develops its growth strategies accordingly. The growth on OzLotteries.com has steadily continued and its customer database has recently exceed 1 million accounts. As well as the recently announced technical advances such as the smartphone version and the loyalty points system, OzLotteries.com takes one a new dimension in Interactive marketing. Agreements have recently been signed with two of Australia's most loved sporting heroes - Steven Bradbury and Alisa Camplin - Australia's firs and second winter Olympic gold medalists. Both bring their unique and charismatic natures to OzLotteries.com to help differentiate and enhance the OzLotteries brand. Steven Bradbury and Alisa Camplin both will feature heavily in the upcoming New Years Eve $31 million Megadraw, our seasonally busiest period of the year.
Appreciation It is clear that an extraordinary amount of work has been done behind the scenes building projects that have not quite reached that point of release. This is often an anxious time as staff are eager to get their projects out the door and onto the world stage., but not until the time is rights. I wish to thank them for their incredible efforts and say that their rewards are not too far away. To my fellow directors, David Barwick and Bill Lyne, I wish to thank them for their guidance and encouragement over the past year and look forward to the year ahead. Finally, thank you to the shareholders and other key shareholders in our industry for their ongoing support as we look forward to the year ahead. Thank you, Mike Veverka CEO and Executive Director Ph: 07 3831 3705