- The loss reversed the £196,663 (Sh30.5 million) net profit that SPS had made the year before, according to the financial statements prepared by the company’s directors.
- SPS said it was entitled to audit exemption relating to small UK companies, adding that none of its members asked for an audit of the accounts.
SPS Sportsoft Limited, the company offering technology support services to SportPesa betting firms, sunk into a £4.1 million (Sh638 million) loss in the year ended December 2020 after its single largest Kenya-based client ceased operations.
The loss reversed the £196,663 (Sh30.5 million) net profit that SPS had made the year before, according to the financial statements prepared by the company’s directors.
SPS said it was entitled to audit exemption relating to small UK companies, adding that none of its members asked for an audit of the accounts.
The company’s single largest client, Kenya-based Pevans East Africa, ceased operations in 2019 after the government declined to renew its operating license citing unpaid taxes in excess of Sh15 billion.
SPS revenues collapsed 91.3 percent to £1.48 million (Sh230 million) from £17 million (Sh2.6 billion), leading to the loss that has seen its short-term liabilities exceed its current assets including cash on hand.
Pevans used to account for 96 percent of SPS’s total revenue in the past. SPS, its parent firm Sportpesa Global Holdings Limited (SPGHL) and Pevans, which used to trade under the SportPesa brand, have common shareholders including Kenyan and Bulgarian businessmen.
Other SPS clients include SPGHL’s subsidiaries trading under the SportPesa brand in Tanzania and South Africa.
SPS paid Kenya Revenue Authority (KRA) withholding taxes of £21,957 (Sh3.4 million) in 2020, down from £2.06 million (Sh320.8 million in 2019.
The company says it will continue to tap shareholder loans to meet its obligations.
“The … company will have sufficient funds, through organic cash flows from operating activities and in downside cases funding from its ultimate parent company, SPGHL which in turn will obtain support from its shareholders, to meet its liabilities as they fall due for that period,” SPS said.
“Based on these indications the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.”