GAMBLING: Pleasures Of Pub-Crawling
Recent Western Cape Business News
Sizeable bets on the local Limited Payout Machine (LPM) gaming market by two Cape gaming investment groups Hosken Consolidated Investments (HCI) and Grand Parade Investments (GPI) are starting to pay off.
HCI holds 100% of Vukani Gaming and GPI a 25% stake in Thuo Gaming (aka Grandslots).
Both Vukani and Thuo compete in the lucrative Western Cape market, which after a slow start appears to be spinning a fair deal of cash flow.
Initially there was much scepticism around the viability of the Cape LPM market because of the presence of the centrally situated GrandWest casino and the fact that LPMs (usually situated in bars and restaurants) have a maximum payout of only R500.
But as the roll-out has picked up pace in the Western Cape so have the profits to the licence holders.
In 2008 GPI earned a not insubstantial R4.8 million from its GrandSlots business – a marked improvement over the R530 000 earned in 2007. That would infer that Thuo Gaming is generating profits of around R25 million.
Writing in the recent GPI annual report, newly appointed CEO Adrian Funkey says the company is keen to pursue further opportunities in the LPM market – “which is still very much in the greenfield stage of its life cycle.”
CBN understands GPI is keen to snap up a bigger stake in Thou Gaming, an event that will require the company buying a stake from the Australian controlling shareholder, Tattersalls.
HCI’s Vukani is also on a roll having increased its installed LPM machine base to 2 465 machines.
In financial 2008 Vukani’s net gaming profit was up 42% on the previous year and net earnings were up over 75% from R17.6 million in 2007 to R31 million.
HCI’s presence has also received a major boost when the group was recently awarded a LPM license for Gauteng (1 000 licences) and following the acquisition of Luck Holdings (a route operator that holds licenses in KwaZulu-Natal, Mpumalanga and Limpopo with a 405 LPM machine base).
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