Aspire Global, owner of Campeon UK, has just reported a 97.5% year on year drop in its 2019 net profit. The company has claimed that the main cause is a major tax settlement in Israel. However, Aspire did report an overall increase in net revenue this year. In total, the 2019 net revenue was £109.5 Million. Which is a massive jump when compared to 2018’s £86.9 Million, an increase of 26%. Most of the company’s revenue came from its B2B sector. This made up 62% of the revenue, totaling £68.13 Million, which was 43.3% up on the previous year. Meanwhile, B2C revenue, from the company’s proprietary brands which naturally include Campeon UK, rose 4.8% to £42.26 Million.
All and all when Aspire crunched the number and broke them by location, they noted several shifts. Firstly, there was a drop in the UK, Ireland, and the Nordics. The Nordics saw the biggest drop of 16.6% to £21.7 Million. The UK and Ireland, on the other hand, fell by 8.3% to £15.71 Million. So, it was the rest of Europe than made up for these losses. They showed a year on year increase of 62.8% to £69.9 Million. Also, although a minor contributor, the Rest of the World grew 48.3% from £3.61 Million.
Unfortunately, spending also grew. Overall, the costs rose 30.1% from £67.90 Million to £88.8 Million. They have attributed this to increased hires and better technology. On top of this, its distribution expenses increased by 35.9% to £73.17 Million. Gaming duties did drop to just £3.5 Million. However, this was counteracted by the 14.1% increase in admin expenses, to 12.7 Million. To top it off, Aspire’s amortization and depreciation costs more than doubled, up 105% to £3.3 Million.
As we understand, because of the higher spending, the operating income fell 8.3% YOY. Therefore, overall, the income before taxes dropped 13.3% to £14.20 Million. Yet, the biggest issue Aspire faced was the December Israeli tax settlement. After coming to an agreement with the country’s authority, they had to pay £11.4 Million in retroactive tax. Aspire’s CEO wasn’t too gloomy though and praised the company’s “strong growth despite changes in the market”.