Why BJTOTO Q2 earnings fall 36%?

BToto said the decline was due to  :-

1) Higher pool betting duty
2) Higher prize payout
3) Higher finance cost.

The Q2 earning fall 36% from RM102 million last year to RM65 million in 2010.

Their revenue downed 1.3% from RM857million to RM845million this year.

Meanwhile, earnings per share were RM0.487 against RM0.762, but there managed to declare a four sen dividend per share.

BToto said, “Sports Toto, the principal subsidiary, recorded a decrease in revenue and pre-tax profit of 2.1% and 39.2% respectively as compared to previous year corresponding quarter,” it said.

The decline in revenue was due to a lower number of draws while the drop in pre-tax profit was mainly due to the increase in pool betting duty from 6% to 8% with effect from June 1, 2010 coupled with higher prize payout compared to a year ago.

It said for the first half, the group recorded a marginal drop in revenue of 0.1% and a decrease in pre-tax profit of 32.2% when compared to the previous corresponding period.

Frankly, this is good news because my target price to buy is below RM4.00. Not an easy target !

Will take this good opportunity to buy if it goes down because of bad Q2 result.

The falls is going to be temporary and it will bounce back in long term especially with the reduction of Special Prizes winning amounts from 15 Dec onward.

Ha ha, you fall I catch !!! Is it a falling knife or gold bar !!! Will see........