Betting firm SportPesa made a net profit of Sh12.9 billion for its owners in Kenya during its first five years of operation when the brand was under Pevans East Africa, revealing the lucrative earnings in gambling.
Pevans premiered SportPesa in 2014, making a net profit of Sh44.2 million. The earnings climbed to Sh1.6 billion in 2015 and topped Sh6.2 billion the following year.
Their earnings dropped to Sh2 billion in 2017 and later climbed to Sh2.8 billion in 2018 before it lost its licence due to a hefty taxation by Kenya Revenue Authority (KRA).
Revelation of Pevans’ mega profits between 2014 and 2018 have been made in a court case filed by Asenath Wachera Maina, who is pushing the court to affirm the company as the owner of the SportPesa brand.
The betting brand (sportpesa) was brought back in October 2020 by Milestone Games, a company owned by a section of individuals who owned Pevans and are accused by Mrs Maina of fraudulently transferring the trademark to the new company.
The earnings of Milestone are not known but it’s believed to be making large profits since it owns the SportPesa brand that’s big in betting business.
The High Court has temporarily barred Milestone where Ronald Karauri is the majority shareholder — from using the SportPesa brand until the parties have a hearing of the dispute on May 31.
Pevans made cumulative revenue of Sh228.4 billion in five years as the firm also spent a total of Sh4.4 billion on advertisement over the same period.
Its average net margins were nearly 5.6% but KRA argued in court that the gambler exaggerated its costs to pay less tax.
Pevans shut down its operations after its licence was cancelled in July 2019 over unpaid taxes and penalties, which KRA computed at Sh95 billion.
But sportpesa remains the most popular brand in the lucrative sports betting industry with an estimated customer base of 12 million Kenyans who placed bets worth Sh150 billion in 2018 alone.
Data from Safaricom show that Kenyans spent Sh169.1 billion to place bets through M-Pesa in the year to March.
Results also disclosed that the value of bets jumped 23.8% from Sh136 billion in 2021, against the government’s attempts to stop gambling through the imposition of higher taxes on betting firms and punters.
Betting has become the second-largest business line by revenue under M-Pesa’s business payments after business-to-consumer (B2C), which generated sales of Sh11.4 billion in the year to March.
