AGTech 15Q3 revenue gains, sees significant China opportunity

AGTech Holdings, which provides lottery services and supplies in China, said 15Q3 revenue gained and it expects a significant breakthrough in business opportunities once Beijing finalizes legislation over online services.

3Q revenue rose to HK$76.7 million ($9.9 million) from $53.1 million in the year earlier period, while the loss attributable to owners of the company widened to $53.2 million from $48.9 million, the company said in a filing with the Hong Kong Stock Exchange.

The group said overall, the combined sales of the sports and welfare lotteries in China fell 1.8 percent in the first eight months of the year followed the government’s crackdown on illegal online lottery sales.

During 2015, the combined year-on-year growth rates of the sports and welfare lotteries have fallen from a gain of 35.8 percent in January and February to minus 10.6 percent for the period March to August.

“This enforcement is ongoing and is seen as a precursor to a more clearly regulated operation, management and distribution model. It is expected that selected lottery products will gain approvals for trial sales in certain provinces in smartphone channels,” AGTech said.

“We believe that, following the regulatory evolution of the Chinese lottery industry and relying upon the group’s competitive advantages formed in game development and channel construction, the group will achieve a significant breakthrough in business development.”

The government has already begun easing restrictions and in October said it would allow an

increased level of provincial autonomy with respect to the promotion of approved lottery games.

AGTech said the move is likely to benefit approved products such as the Group’s “Lucky Racing” and “e-Ball Lottery.”