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Old Mutual reluctantly enters the spotl... Venmyn predicts more mines over the next... Northam - acting in shareholders' worst ... |
Moribo's luck rests on who wins the lottery licenceSO YOU like a gamble? Black-controlled and managed gaming and leisure group Moribo Leisure offers a treble chance to investors. The first bet is on whether the group's consortium Moraba will succeed in its bid for the proposed national lottery. Each interested party believes it will be the winner, so confidence on the part of Moribo's chief executive, Moss Mashishi, should be taken from whence it comes. If Moraba doesn't get the lottery, Moribo stands to lose its Games Africa scratchcard income. So the second bet is on whether the company can make any money out of the rest of its gaming and leisure. I'm naturally suspicious when invited to a Monday interview: the company's results are nearly always terrible. In the six months to June, Moribo's operating income was only R142 000 - albeit against a comparable loss of R2.6-million in 1997 - and more than R1-million was earned in interest. Its gaming business made nearly R3-million and advertising a trifling R45 680, but sports lost nearly a million rands and "other" (head office) costs were nearly R900 000, to give a net attributable income of R1.2-million from turnover of R83-million. Mashishi is pleased with the early turnaround at Moribo since he and his team moved in last December and undertook some restructuring. Moribo Investments under Mashishi was the leisure investment arm of Thebe Investments. Listed on the JSE was Opus, owner of Games Africa, housing the Ithuba, Zama-Zama and Viva scratchcard games. Moribo Investments had 13% of Opus, whose controlling shareholders saw the writing on the wall with respect to national lottery prospects. In a deal last year, Opus bought Moribo's sporting and leisure assets, its name became Moribo Leisure and Mashishi was appointed chief executive. Nearly R2-2million was raised in March in a rights offer of 10 per 100 at 460c, the controlling shareholders renouncing their rights to Moribo Investments. Already 35% black-controlled, the percentage will climb to 65% after the next two rights offers. In August, Moribo's 90% subsidiary, Lottec Mpumalanga, was awarded a route operator licence, giving it the right to install slot machines into pubs and taverns in the maximum prize of R500 market. "This gaming has a high payout rate as it is also amusement," says Mashishi. "Forecasts are for a market of R1.5-billion to R2-billion in three years' time. Even if we capture only a 20% market share, it could mean another R40-million to R60-million a year for us." Delays by the National Gaming Board mean the route licence cannot be exercised until early 1999. Moribo will be looking for other provincial route operator licences. Moribo's associate, IGT, is one of the world's leading gaming suppliers. Moribo - the Tswana word for rhythm - has 45% of advertising agency Gitam-BBDO, which after securing the R200-million Absa account jumped from 17th to fifth in the country in terms of billings. Sports interests include distribution of Kappa and Wilson; Moribo seeks the trademark rights to Kappa for Africa and Mashishi says Wilson can be built: in the top three globally, Wilson is only eighth here. But Moribo is really about gaming and none could be surprised if it sells out of the sports sets should it win the national lottery. As for the third bet: Are Moribo shares a good buy at 225c? It all depends on the national lottery licence. Although Moribo's credentials look good - not least its Thebe links - without the licence, its share certificates will be little better than two lemons on the slot machine.
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