Alphameric moves back into profit

(By Philip Carnelley, Tue 14 Jul 2009 10.00) Alphameric, provider of turnkey systems and television services to the bookmaking industry, reported revenue up 17.4% to £19.9m in its interim results to 31 May. It made a profit before tax of £4.1m on ordinary activities, compared to a loss of £3m in the prior year, following increasing subscriptions to its TurfTV channel and a return to profitable trading in its main betting technology solutions operation. It is to pay an interim dividend for the first time in four years.

Alphameric, which recently joined the FTSE SCS Index, has done an solid job in leveraging its historic expertise in terminal systems by specialising in an industry niche. It has cash balances of £27m and no debt. Most of the major betting chains use its products. TurfTV (jointly owned with RMS, a grouping of leading racecourses) is now used by 95% of all licensed betting offices in the UK and Ireland. And the betting industry is almost notoriously recession-proof. However, it is in danger of becoming a victim of its own success. Three bookmakers are taking court action against AMRAC (the operator of TurfTV) alleging that it had acquired media rights in contravention of UK competition law and the European Union treaty. The case is due to be heard by the Court of Appeal later this year.