SPS Sportsoft Limited, the company providing technology support services to SportPesa betting companies, last year reversed its 2020 losses to post a profit of £170,433 (24.6 million shillings), indicating the acquisition of new activities.
The company had suffered a loss of £4.1 million (595 million shillings) in 2020 after its biggest client – Kenya-based Pevans East Africa – ceased operations in 2019 after the government refused to renew its business license, citing unpaid taxes in excess of 15 shillings. billion.
Pevans achieved large-scale profitability in record time after launching operations in 2014, attracting increased government attention amid concerns about rising gambling addiction.
SPS said in regulatory filings in the UK that its revenue quadrupled last year to £6.1 million (887 million shillings) from £1.48 million (214 million shillings) in 2020, largely thanks to the services provided to customers.
Pevans previously accounted for 96% of SPS’s total revenue. SPS, its parent company Sportpesa Global Holdings Limited (SPGHL) and Pevans, which operated under the SportPesa brand, have common shareholders including Kenyan and Bulgarian businessmen.
Other SPS customers include SPGHL subsidiaries operating under the SportPesa brand in Tanzania and South Africa.
Following the cancellation of the license in 2019, some of the founders of Pevans transferred the SportPesa brand to a new company called Milestone Games Limited.
It is unclear whether any of the SPS’s revenue comes from services to Milestone, but statements on withholding tax payments indicate that some of the revenue came from Kenya.
The company said it paid the Kenya Revenue Authority (KRA) £447,005 (Sh64.6 million) in withholding taxes last year, with the levy charged at 15% of revenue.
This would mean that the company recorded revenues of at least 429 million shillings from Kenya. In 2020, SPS had paid taxes worth £21,957 (3.1 million shillings) to the KRA.
The creation of Milestone caused a fallout among the pioneers of the sports betting industry.
Ms Asenath Maina, who owns shares in Pevans and SPGHL, filed a lawsuit asking the court to confirm Pevans as the rightful owner of the SportPesa brand.