FORM 10-K/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No.2 to
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended: February 24, 1996
Commission file number 1-11250
GTECH Holdings Corporation
(Exact name of registrant as specified in its charter)
Delaware 05-0450121
(State or other jurisdiction of (I.R.S. Employer ID Number)
incorporation or organization)
55 Technology Way, West Greenwich, Rhode Island 02817
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (401) 392-1000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class: Common Stock $.01 par value
Name of Each Exchange on which Registered: New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendments to
this Form 10-K [x]
At June 24, 1996 there were 43,054,212 shares of the registrant's Common Stock
outstanding.
Documents Incorporated By Reference: None
<PAGE>
The purpose of this amendment to Form 10-K is to include the audited financial
statements of Camelot Group plc, a significant equity method foreign investee,
pursuant to rule 3.09 of Regulation S-X which requires such financial statements
to be filed as an amendment to the Company's Annual Report on Form 10-K not
later than six months following the end of Camelot Group plc's 1996 fiscal year.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)
(1) Financial Statements:
The following consolidated financial statements of GTECH Holdings Corporation
and subsidiaries are included in Item 8:
Page(s)
Report of Ernst & Young LLP, Independent Auditors F-1
Reports of Price Waterhouse, Independent Accountants F-2, F-3, F-4
Consolidated Balance Sheets at February 24, 1996, F-5
and February 25, 1995
Consolidated Income Statements-- F-6
Fiscal year ended February 24, 1996,
Fiscal year ended February 25, 1995, and
Fiscal year ended February 26, 1994
Consolidated Statements of Shareholders' Equity-- F-7
Fiscal year ended February 24, 1996,
Fiscal year ended February 25, 1995, and
Fiscal year ended February 26, 1994
Consolidated Statements of Cash Flows-- F-8
Fiscal year ended February 24, 1996,
Fiscal year ended February 25, 1995, and
Fiscal year ended February 26, 1994
Notes to Consolidated Financial Statements F-9 to F-25
The following financial statements of Camelot Group plc are included in Item 14:
Report of Independent Accountants
Profit and Loss Account--
For the period ended 3 February 1996
For the ten months ended 4 February 1995
Balance Sheet--
3 February 1996
4 February 1995
Cash Flow Statement
For the period ended 3 February 1996
For the ten months ended 4 February 1995
Notes to Financial Statements
(2)Financial Statement Schedules to GTECH Holdings Corporation and subsidiaries:
Schedule II - Valuation and Qualifying Accounts F-26
All other financial statement schedules for which provision is made in
the applicable accounting regulations of the Securities and Exchange Commission
are not required under the related instructions or are inapplicable and,
therefore, have been omitted.
<PAGE>
(3) Exhibits:
3.1 Restated Certificate of Incorporation of the Company, as amended
(incorporated by reference to Exhibit 3.1 to the Form S-l of the
Company and GTECH Corporation ("GTECH"), Registration No. 33-31867
(the "1990 S-1"), File No. 0-12604, a copy of which may be obtained
from the Public Reference Bureau of the Securities and Exchange
Commission).
3.2 Certificate of Amendment to the Certificate of Incorporation of the
Company (incorporated by reference to Exhibit 3.2 to the Form S-1 of
the Company, Registration No. 33-48264 (the "July 1992 S-1")).
3.3 Amended and Restated By-Laws of the Company.
4.1 Credit Agreement, dated as of September 15, 1994, among GTECH, certain
financial institutions and NationsBank of North Carolina, N.A., as
Agent (incorporated by reference to Exhibit 4.1 of the Company's 1995
10-K).
4.2 Management Equity Agreement dated as of January 23, 1990 among
Holdings and certain Investors signatory thereto (incorporated by
reference to Exhibit (b)(9) to the Schedule 13E-3 filed by the
Company, GTECH, GTEK Acquisition, DLJCC, Victor Markowicz and Guy B.
Snowden, File No. 0-12604, a copy of which may be obtained from the
Public Reference Bureau of the Securities and Exchange Commission).
4.3 First Amendment dated as of July 31, 1990 to the Management Equity
Agreement dated as of January 23, 1990 among Holdings and certain
Investors signatory thereto (incorporated by reference to Exhibit 4.16
to the 1990 S-1, File No. 0-12604, a copy of which may be obtained
from the Public Reference Bureau of the Securities and Exchange
Commission).
4.4 Amendment Number 2 dated as of May 1, 1990, and Amendment Number 3
dated as of May 6, 1990, to the Management Equity Agreement dated as
of January 23, 1990 among the Company and certain Investors signatory
thereto (incorporated by reference to Exhibit 10.3 to GTECH's 1991
10-K).
4.5 Amendment No. 4, dated as of July 20, 1992, to the Management Equity
Agreement dated as of January 23, 1990 and certain Investors signatory
thereto (incorporated by reference to Exhibit 4.8 to the Form S-1 of
the Company, Registration No. 33-54236 (the "December 1992 S-1").
4.6 Amendment No. 5, dated as of September 15, 1993, to the Management
Equity Agreement dated as of January 23, 1990, among the Company and
certain Investors signatory thereto (incorporated by reference to
Exhibit 4.13 of the Company's 1994 10-K).
4.7 Amendment No. 6, dated as of October 29, 1993, to the Management
Equity Agreement dated as of January 23, 1990 among the Company and
certain Investors signatory thereto (incorporated by reference to
Exhibit 4.14 of the Company's 1994 10-K).
4.8 Amended and Restated Stockholders Agreement dated as of July 29, 1992
among the Company, a Voting Trustee named therein and the Investors
named therein (incorporated by reference to Exhibit 4.15 to the July
1992 S-l).
4.9 Amendment No. 1 dated as of December 9, 1992 to the Amended and
Restated Stockholders Agreement and Stock Purchase Agreement among the
Company, DLJ Capital Corporation, the Voting Trustee named therein and
the Investors named therein (incorporated by reference to Exhibit 4.13
of the Company's 1993 10-K).
4.10 Amendment No. 2, dated as of September 15, 1993, to the Amended and
Restated Stockholders Agreement among the Company, DLJ Capital
Corporation, the Voting Trustee named therein and the Investors named
therein (incorporated by reference to Exhibit 4.17 of the Company's
1994 10-K).
4.11 Amendment No. 3, dated as of October 29, 1993, to the Amended and
Restated Stockholders Agreement among the Company, DLJ Capital
Corporation, the Voting Trustee named therein and the Investors named
therein (incorporated by reference to Exhibit 4.18 of the Company's
1994 10-K).
4.12 Amendment No. 4, dated as of October 20, 1995, to the Amended and
Restated Stockholders Agreement among the Company, DLJ Capital
Corporation, the Voting Trustee named therein and the Investors named
therein.
4.13 Specimen Form of certificate for Common Stock (incorporated by
reference to Exhibit 4.18 of the December 1992 S-1).
9. Second Amended and Restated Voting Trust Agreement dated as of July
29, 1992 by and among DLJCC, Lincoln National Bank and Trust Company
of Fort Wayne et al., as Trustee (incorporated by reference to Exhibit
9 of the December 1992 S-1).
10.1 Employment Agreement dated as of January 23, 1990 between GTECH, the
Company and Victor Markowicz (incorporated by reference to Exhibit (b)
(11) to the Schedule 13E.3 filed by GTECH Corporation, the Company,
GTEK Acquisition, DLJCC, Victor Markowicz and Guy B. Snowden, File No.
0-12604, a copy of which may be obtained from the Public Reference
Bureau of the Securities and Exchange Commission).*
10.2 Amendment to the Employment Agreement dated as of January 23, 1990
between GTECH, the Company and Victor Markowicz (incorporated by
reference to Exhibit 10.2 to the July 1992 S-1).*
10.3 Confirmation of Waiver respecting certain provisions of the
Employment Agreement dated as of January 23, 1990 between GTECH, the
Company and Victor Markowicz, dated February 13, 1996.*
10.4 Employment Agreement dated as of January 23, 1990 between GTECH, the
Company and Guy B. Snowden (incorporated by reference to Exhibit (b)
(12) to the Schedule 13E.3 filed by GTECH, the Company, GTEK
Acquisition, DLJCC, Victor Markowicz and Guy B. Snowden, file no.
0-12604).*
10.5 Amendment to the Employment Agreement dated as of January 23, 1990
between GTECH, the Company and Guy B. Snowden (incorporated by
reference to Exhibit 10.4 to the July 1992 S-1).*
10.6 Confirmation of Waiver respecting certain provisions of the
Employment Agreement dated as of January 23, 1990 between GTECH, the
Company and Guy B. Snowden, dated February 13, 1996.*
10.7 Employment Termination Agreement and Release dated March 17, 1995
between GTECH and Robert A. Breakstone (incorporated by reference to
Exhibit 10.7 of the Company's 1995 10-K).*
10.8 Employment Agreement between GTECH and Donald L. Stanford dated August
1, 1987 (incorporated by reference to Exhibit 10.24 to GTECH's Annual
Report on Form 10-K for the fiscal year ended February 27, 1988, file
no. 0-12604, a copy of which may be obtained from the Public Reference
Bureau of the SEC.)*
10.9 Secured Promissory Note and Stock Pledge Agreement dated February 26,
1994 of Malchester P. Reeves to the Company (incorporated by reference
to Exhibit 10.10 of the Company's 1994 10-K).*
10.10 Employment Agreement dated October 27, 1994 between the Company and
William Y. O'Connor (incorporated by reference to Exhibit 10.14 of the
Company's 1995 10-K).*
10.11 Amendment to Employment Agreement dated February 13, 1996 between
the Company and William Y. O'Connor.*
10.12 Promissory Note dated February 2, 1995 of Guy B. Snowden to the
Company (incorporated by reference to Exhibit 10.18 of the Company's
1995 10-K).*
10.13 Promissory Note dated February 2, 1995 of Donald L. Stanford to LAC
Corporation (incorporated by reference to Exhibit 10.19 of the
Company's 1995 10-K).*
10.14 Promissory Note dated February 2, 1995 of Michael R. Chambrello to
LAC Corporation (incorporated by reference to Exhibit 10.22 of the
Company's 1995 10-K).*
10.15 GTECH Corporation Executive Perquisites Program (incorporated by
reference to Exhibit 10.8 of the Company's 1993 10-K).*
10.16 Form of Indemnification Agreement (incorporated by reference as
Exhibit 10.14 to GTECH's 1992 10-K).
10.17 List of Indemnification Agreement signatories and dates.
10.18 Form of Executive Separation Agreement and Schedule of Recipients.
10.19 Supplemental Retirement Plan effective January 1, 1992 and List of
participants (incorporated by reference to Exhibit 10.16 of GTECH's
1992 10-K).*
10.20 Agreement between GTECH and the Texas Comptroller of Public
Accounts--Lottery Division dated March 7, 1992 (incorporated by
reference to Exhibit 10.44 to GTECH's 1992 10-K).
10.21 Purchase and Sale Agreement dated 8 February 1994 between Camelot
Group plc and GTECH (incorporated by reference to Exhibit 10.31 of the
Company's 1995 10-K).
10.22 Terminals Supply Agreement dated 8 February 1994 among Camelot Group
plc, International Computers Limited and GTECH (incorporated by
reference to Exhibit 10.32 of the Company's 1995 10-K).
10.23 Field Services Agreement dated 8 February 1994 among Camelot Group
plc, International Computers Limited and GTECH (incorporated by
reference to Exhibit 10.33 of the Company's 1995 10-K).
10.24 Lottery Technology Support Services Agreement dated 8 February 1994
between Camelot Group plc and GTECH (incorporated by reference to
Exhibit 10.34 of the Company's 1995 10-K).
10.25 Distributorship and License Agreement dated October 24, 1990 between
GTECH and CGK Computer Gesellschaft Konstanz mhh (incorporated by
reference to Exhibit 10.49 to GTECH's 1992 10-K).
10.26 Memorandum of Understanding Number 1 dated November 30, 1990 between
GTECH and CGK Computer Gesellschaft 1990, Amendment Number 2 dated
June 26, 1991 and Amendment Number 3 dated June 27, 1991, to
Memorandum of Understanding Number 1 dated November 30, 1990 between
GTECH and CGK Computer Gesellschaft Konstanz mbh (incorporated by
reference to Exhibit 10.47 to the July 1992 S-1).
10.27 Memorandum of Understanding Number 1 dated June 27, 1991 between
GTECH and CGK Computer Gesellschaft Konstanz mbh (incorporates by
reference therein the Distributorship and License Agreement dated
October 24, 1990 between GTECH and CGK Computer Gesellschaft Konstanz
mbh, which is included in Exhibit 10.20 herein).
10.28 Memorandum of Understanding Number 2 dated December 18, 1991 between
GTECH and CGK Computer Gesellschaft Konstanz mbh (incorporates by
reference therein the Distributorship and License Agreement dated
October 24, 1990 between GTECH and CGK Computer Gesellschaft Konstanz
mbh, which is included in Exhibit 10.20 herein).
10.29 Amendment to Distributorship and License Agreement, dated February
1, 1993, between GTECH and CGK Computer Gesellschaft Konstanz mbH.
10.30 Second Amendment to Distributorship and License Agreement, dated
August 1, 1995, between GTECH and CGK Computer Gesellschaft Konstanz
mbH.
10.31 Amended and Restated Agreement of Limited Partnership by and among
GTECH, GP Technology Associates, L.P. and GP Technology, Inc. dated
August 26, 1993; Certificate of Limited Partnership of West Greenwich
Technology Associates, L.P. dated August 26, 1993; Amended and
Restated Indenture of Lease between GTECH and West Greenwich
Technology Associates, L.P. dated August 26, 1993 (incorporated by
reference to Exhibit 10.24 of the Company's 1994 10-K).
10.32 Business Agreement dated December 28, 1990 between Digital Equipment
Corporation and GTECH; Work Statement Number NED91188 dated March 11,
1991 to GTECH from Digital Equipment Corporation; First Addendum dated
March 19, 1991 to Digital Work Statement Number NED91188 dated March
11, 1991 to GTECH from Digital Equipment Corporation (incorporated by
reference to Exhibit 10.57 to the July 1992 S-1).
10.33 Maintenance Agreement Number 117A dated December 1, 1989, between
GTECH and Concurrent Computer Corporation (incorporated by reference
to Exhibit 10.58 to the July 1992 S-1).
10.34 Engagement Letter dated August 8, 1989, between GTEK Acquisition
Corp. and DLJSC (incorporated by reference to Exhibit 10.41 to GTECH's
1991 10-K).
10.35 Amended and Restated 1990 Restricted Stock Unit Plan (incorporated by
reference to Exhibit 10.62 to the July 1992 S-1).*
10.36 Restricted Rights Arrangement between the Company and Mr. O'Connor
(incorporated by reference to Exhibit 10.44 of the Company's 1995
10-K).*
10.37 1992 Outside Directors' Director Stock Unit Plan (incorporated by
reference to Exhibit 10.55 to the Company's 1993 10-K).*
10.38 1994 Stock Option Plan, as amended.*
10.39 Second Amendment dated May 28, 1996 to the Contract for the Texas
Lottery Operator for the State of Texas.
11. Computations of Earnings Per Share.
21.1 Subsidiaries of the Company.
+23.1 Consent of Ernst & Young LLP
+23.2 Consents of Price Waterhouse (2)
- -----------------------
+ Filed herewith.
* Indicates a management contract or compensatory plan or arrangement
required to be filed as an exhibit pursuant to Item 14(c) of Form 10-K.
Certain instruments defining the rights of holders of long-term debt have
not been filed pursuant to item 601(b)(4)(iii)(A) of Regulation SK. Copies of
such instruments will be furnished to the Commission upon request.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed by the Company during the last quarter of
the fiscal year covered by this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the registrant has duly caused this Amendment to Annual Report on Form
10-K to be signed on its behalf by the undersigned hereunto duly authorized on
June 25, 1996.
GTECH HOLDINGS CORPORATION
By /s/ Thomas J. Sauser
----------------------------------------
Thomas J. Sauser, Senior Vice President,
Treasurer & Chief Financial Officer
<PAGE>
CAMELOT GROUP PLC
ACCOUNTS FOR THE PERIOD ENDED
3 FEBRUARY 1996
REGISTERED NUMBER:
2822203
<PAGE>
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE ACCOUNTS
Camelot Group plc has a financial year end of 31 March and prepares its annual
report and accounts for that year to comply with the Companies Act 1985. These
accounts have been prepared specifically to enable GTECH Corporation, a
shareholder in the company, to prepare its own consolidated financial statements
and do not represent the results of the company for its own financial year. In
preparing these accounts, the directors are required to:
(1) select suitable accounting policies and then apply them consistently;
(2) make judgements and estimates that are reasonable and prudent;
(3) state whether applicable accounting standards have been followed,
subject to any material departures disclosed and explained in the accounts;
(4) prepare the accounts on the going concern basis unless it is inappropriate
to presume that the group will continue in business.
The directors are also responsible for keeping proper accounting records
which disclose with reasonable accuracy at any time the financial position of
the group and to enable them to ensure that the accounts comply with the
Companies Act 1985. They are also responsible for taking reasonable steps to
safeguard the assets of the group and to prevent and detect fraud and other
irregularities.
The directors confirm that they have complied with these requirements, and,
having a reasonable expectation that the company has adequate resources to
continue in operational existence for the foreseeable future, have adopted the
going concern basis in preparing the accounts.
LEGISLATIVE BACKGROUND
The establishment of the UK National Lottery was enabled by the passing of The
National Lottery etc. Act 1993. A regulator, the Director General of The
National Lottery, was appointed under the Act and invited applications for a
licence to run The National Lottery (the section 5 licence) and for licences to
promote lottery games as part of The National Lottery (section 6 licences).
Following a highly competitive tendering process, Camelot was informed of its
success on 25 May 1994 and the section 5 licence was formally awarded on 29 July
1994. Camelot has also been awarded a section 6 licence for the on-line National
Lottery game and a number of section 6 licences for the Instant games. The
section 5 licence expires on 30 September 2001 and the section 6 licences are of
varying lengths depending on the games.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of Camelot Group plc
We have audited the financial statements and financial schedules of Camelot
Group plc on pages 4 to 20 which are expressed in pounds sterling. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
financial statement schedules based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United Kingdom and the United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements audited by us referred to above present
fairly, in all material respects, the financial position of Camelot Group plc at
3 February 1996 and 4 February 1995 and the results of its operations, total
recognised gains and losses and cash flows for the period ended 3 February 1996
and the ten months ended 4 February 1995 in conformity with generally accepted
accounting principles in the United Kingdom.
Price Waterhouse.
Chartered Accountants and Registered Auditors
London, England
9 April 1996
<PAGE>
<TABLE>
PROFIT AND LOSS ACCOUNT
For the period ended 3 February 1996
pounds sterling ("ps")
- --------------------------------------------------------- -------- -------------- ---------------
1996 1995
Notes m m
- --------------------------------------------------------- -------- -------------- ---------------
<S> <C> <C>
Turnover - continuing operations
On-line 3,588.6 682.0
Instants 1,399.8 -
- --------------------------------------------------------- -------- -------------- ---------------
4,988.4 682.0
Cost of sales
Prizes (2,509.2) (321.9)
Lottery duty (598.6) (81.8)
National Lottery Distribution Fund (1,350.9) (181.3)
Retailers' commission (253.7) (34.9)
Terminal and data communication costs (104.7) (13.9)
- --------------------------------------------------------- -------- -------------- ---------------
Gross profit 171.3 48.2
Operating costs (96.7) (52.5)
Other operating income 1.1 0.3
- --------------------------------------------------------- -------- -------------- ---------------
Operating profit / (loss) 1 75.7 (4.0)
Net interest receivable 4 8.8 0.7
- --------------------------------------------------------- -------- -------------- ---------------
Profit / (loss) on ordinary activities before taxation 84.5 (3.3)
Tax on profit on ordinary activities 5 (29.1) -
- --------------------------------------------------------- -------- -------------- ---------------
Profit / (loss) on ordinary activities after taxation 55.4 (3.3)
Dividends 6 (9.5) -
- --------------------------------------------------------- -------- -------------- ---------------
Profit / (loss) retained for the financial period 15 45.9 (3.3)
- --------------------------------------------------------- -------- -------------- ---------------
<FN>
The period to 3 February 1996 includes costs and revenue from 5 February 1995 to
3 February 1996 and relate to sales for 52 draws.
The period to 4 February 1995 includes costs and revenue from 1 April 1994 to 4
February 1995. Sales relate to 12 draws from the first draw on 19 November 1994
to 4 February 1995.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
The group has no recognised gains or losses other than its profit for the
period.
HISTORICAL COST PROFITS
There are no material differences between the results of the company
disclosed above and the results on an unmodified historical cost basis.
</FN>
</TABLE>
<PAGE>
<TABLE>
BALANCE SHEET
at 3 February 1996 and 4 February 1995
pounds sterling ("ps")
- -------------------------------------------------------------- ------- ------------ ------------
1996 1995
Notes m m
- -------------------------------------------------------------- ------- ------------ ------------
<S> <C> <C>
Fixed assets
Tangible assets 7 102.9 91.3
- -------------------------------------------------------------- ------- ------------ ------------
102.9 91.3
Current Assets
Stocks 8 5.4 3.5
Debtors: amounts falling due within one year 9 82.0 46.3
Debtors: amounts falling due after more than one year 9 62.0 -
Amounts recoverable from the Trust in respect of prizes 10 67.2 27.6
Trust reserve account 10 5.0 5.0
Cash at bank and in hand 10 239.1 39.2
- -------------------------------------------------------------- ------- ------------ ------------
460.7 121.6
Current liabilities
Creditors: amounts falling due within one year 12 (469.6) (161.7)
- -------------------------------------------------------------- ------- ------------ ------------
Net current liabilities (8.9) (40.1)
- -------------------------------------------------------------- ------- ------------ ------------
Total assets less current liabilities 94.0 51.2
Creditors: amounts falling due after more than one year 12 (1.4) (4.5)
- -------------------------------------------------------------- ------- ------------ ------------
92.6 46.7
- -------------------------------------------------------------- ------- ------------ ------------
Capital and reserves
Called up share capital 14 50.0 50.0
Profit and loss account 15 42.6 (3.3)
- -------------------------------------------------------------- ------- ------------ ------------
Total Equity 16 92.6 46.7
- -------------------------------------------------------------- ------- ------------ ------------
<FN>
Approved by the Board
Peter C M Murphy
Director of Finance
9 April 1996
</FN>
</TABLE>
<PAGE>
<TABLE>
CASH FLOW STATEMENT
For the period ended 3 February 1996
pounds sterling ("ps")
- --------------------------------------------------------------------------- ------ --------- ---------
1996 1995
Notes m m
- --------------------------------------------------------------------------- ------ --------- ---------
<S> <C> <C>
Net cash inflow from operating activities 11a 249.8 69.3
- --------------------------------------------------------------------------- ------ --------- ---------
Returns on investments and servicing of finance
Interest received 8.8 0.7
Interest paid - -
Interest element of finance lease payments (0.4) -
Dividends paid (9.5) -
- --------------------------------------------------------------------------- ------ --------- ---------
Net cash (outflow) / inflow from returns on investments and servicing of (1.1) 0.7
finance
- --------------------------------------------------------------------------- ------ --------- ---------
Taxation paid (4.2) -
- --------------------------------------------------------------------------- ------ --------- ---------
Investing activities
Purchase of tangible fixed assets (44.2) (75.8)
Payment to the trust reserve account - (5.0)
- --------------------------------------------------------------------------- ------ --------- ---------
Net cash (outflow) from investing activities (44.2) (80.8)
- --------------------------------------------------------------------------- ------ --------- ---------
Net cash inflow / (outflow) before financing 200.3 (10.8)
- --------------------------------------------------------------------------- ------ --------- ---------
Financing
Issue of ordinary share capital - 49.9
Capital element of finance lease payments (0.4) -
- --------------------------------------------------------------------------- ------ --------- ---------
Net cash (outflow) / inflow from financing 11b (0.4) 49.9
- --------------------------------------------------------------------------- ------ --------- ---------
Increase in cash and cash equivalents 199.9 39.1
Cash and cash equivalents at start of year 39.2 0.1
- --------------------------------------------------------------------------- ------ --------- ---------
Cash and cash equivalents at end of year 11c 239.1 39.2
- --------------------------------------------------------------------------- ------ --------- ---------
</TABLE>
<PAGE>
ACCOUNTING POLICIES
a. Basis of accounting
The accounts are prepared under the historical cost convention and in
accordance with all applicable UK accounting standards. These accounts have
been prepared solely for the purpose of providing results for the period to
3 February 1996 for GTECH UK Limited, one of the five shareholders.
b. Group accounts
The accounts presented are for Camelot Group plc only. Camelot Group plc
has two 100% equity owned subsidiaries. These have not been consolidated as
they are dormant and are not material for the purposes of giving a true and
fair view.
c. Turnover
On-line turnover comprises of lottery ticket sales with adjustments being
made for on-line Multidraw and subscriptions tickets. Turnover for the
period ended 4 February 1995 relates to the period 1 April 1994 to 4
February 1995 and includes the first 12 on-line draws which started on 14
November 1995. Turnover for the period ended 3 February 1996 includes 52
draws. Sales of instants commenced on the 21 March 1995. Instant ticket
sales are recognised once the pack of tickets is settled. A pack becomes
settled on the earlier of 15 days after the first ticket is sold or when
60% of the prizes are validated.
d. Taxation
The charge for taxation is based on the profit for the year. Deferred
taxation is accounted for in respect of timing differences between profit
as computed for taxation purposes and profit as stated in the accounts. All
deferred tax liabilities are fully provided.
Advanced corporation taxation on dividends proposed and paid, which is
expected to be recovered, is included within debtors.
e. Value added tax
All costs include the attributable value added tax to the extent that it is
not recoverable.
f. Fixed assets and depreciation
Fixed assets are stated at cost less depreciation. The group's policy is to
write off the cost of assets evenly over the shorter of the estimated
useful life of the asset or the remaining Section 5 licence period. The
principal rates of depreciation used are as follows:
Leasehold improvements The shorter of the lease period and
the remaining licence period.
Computer hardware 25%
Fixtures and fittings 20%
Terminals and network installation The shorter of seven years
and the remaining licence period.
Permanent point of sale equipment 25% - 50%
Other plant and equipment 20% - 50%
<PAGE>
g. Leasing
Operating lease rentals are charged to the profit and loss account as
incurred. Tangible fixed assets acquired under finance leases are included
in the balance sheet at their equivalent capital value and are depreciated
over their useful lives. The corresponding liabilities are recorded as a
creditor and the interest element of the finance lease rentals is charged
to the profit and loss account.
h. Stocks
Stocks consist of instant tickets, terminal rolls and playslips. They are
valued at cost using the first-in first-out method or at net realisable
value, whichever is the lower.
i. Pensions
The group operates a defined contribution scheme. The cost of the
contributions is charged to the profit and loss account in the year in
respect of which they relate.
j. Cash and cash equivalents
Cash and cash equivalents comprise of cash in hand and deposits repayable
within three months.
k. Escrow account
The escrow account is a fund held for the sole benefit of the National
Lottery Distribution Fund. Amounts payable to the escrow account are
allocated to the profit and loss account evenly over the period of the
licence, commencing from the first day of ticket sales.
l. Advertising and marketing costs
Advertising and marketing costs are charged to the profit and loss account
when they are incurred.
<PAGE>
<TABLE>
pounds sterling ("ps")
1996 1995
1. Operating profit m m
---------------------------------------------------------------- --------- ---------
<S> <C> <C>
Operating profit is after charging:
Depreciation on owned assets 17.0 2.6
Depreciation on assets under finance leases 0.6 -
Auditors' remuneration - audit 0.2 0.1
- prize draw attendance 0.2 0.1
- other services 0.2 0.1
Operating lease rentals - land and buildings 1.5 0.7
- plant and equipment 0.9 0.4
---------------------------------------------------------------- --------- ---------
2. Employee numbers and costs
---------------------------------------------------------------- --------- ---------
Employee costs (including directors' emoluments)
Wages and salaries 14.2 5.3
Social security costs 1.4 0.5
Pension costs 1.0 0.3
---------------------------------------------------------------- --------- ---------
Total 16.6 6.1
---------------------------------------------------------------- --------- ---------
1996 1995
Number Number
Average number of employees 553 223
---------------------------------------------------------------- --------- ---------
</TABLE>
<TABLE>
3. Directors' remuneration
- ------------------------------------------------------------------------
The emoluments of the executive directors are determined by a remuneration
committee consisting exclusively of non-executive directors. The committee is
constituted in accordance with the Cadbury committee guidelines. The five
non-executive directors and their alternates nominated by the shareholder
companies do not receive any emoluments from Camelot. The emoluments of the
other non-executive directors are determined by the shareholder companies. All
emoluments are paid to the directors out of the amount retained by Camelot under
the terms of the Licence to run The National Lottery after paying all prizes,
duties and contributions to the National Lottery Distribution Fund.
The executive directors are eligible for annual bonuses if target returns to the
National Lottery Distribution Fund and profit to Camelot are met. These bonuses
are capped at 50% of annual base salary. On target performance yields 30% of
annual base salary. The first annual bonus was paid in the period to 3 February
1996 based on the results for the period from 1 June 1994 to 30 June 1995 and
this is included in these accounts. Bonuses for the period to 3 February 1996
will be dependant on target returns being met in the financial year to 31 March
1996 and will be approved by the remuneration committee following the end of the
financial year and are therefore excluded from this analysis.
<PAGE>
In order to drive the long term performance of the company and returns to the
Good Causes, and in the absence of a share option scheme, the remuneration
committee has authorised a long-term incentive plan for the executive directors
and other senior executives. Bonuses payable under this plan are based upon
cumulative funds generated for the National Lottery Distribution Fund and
cumulative pre-tax profits over the period 1 June 1994 to 30 September 1997. The
on target bonus payable for this scheme is 100% of annual base salary. The
maximum amount payable is 140% of annual base salary. This bonus is non
pensionable.
1996 1995
pounds sterling ("ps") 000 000
----------------------------------------------------------- ---------- ---------
<S> <C> <C>
Executive directors' salaries and benefits 833 554
Executive directors' performance related payments 374 299
Non-executive directors' fees 70 40
Chairman's salary and benefits 38 35
Pension contributions 313 208
----------------------------------------------------------- ---------- ---------
1,628 1,136
----------------------------------------------------------- ---------- ---------
</TABLE>
The Directors emoluments in respect of 1995 relate to the 8 months from 1 June
1994 to 4 February 1995, except for the chairman which is for the full year.
The emoluments of Sir George Russell, the chairman for the period from 27 April
1995 comprise salary of ps37,500 and pension contribution of ps18,750. The
emoluments of Sir Ron Dearing for the period 5 February 1995 to 26 April 1995
comprise salary of ps10,000. (1995 salary ps33,333, benefits ps2,768). No
pension contribution was made on their behalf.
The total emoluments of the non-executive directors (including the chairman and
alternate directors) are as shown below:
<TABLE>
1996 1995
pounds sterling ("ps") Number Number
----------------------------------------------------------- ---------- ---------
<S> <C> <C>
ps nil 10 10
ps 5,001 - ps10,000 1 -
ps10,001 - ps15,000 - 3
ps15,001 - ps20,000 3 -
ps35,001 - ps40,000 1 1
----------------------------------------------------------- ---------- ---------
</TABLE>
<TABLE>
The total emoluments for the period to 3 February 1996, excluding pension
contributions, of the executive directors were within the following bands:
1996 1995
pounds sterling ("ps") Number Number
----------------------------------------------------------- ---------- ---------
<S> <C> <C>
ps115,001-ps120,000 - 1
ps140,001-ps145,000 - 1
ps150,001-ps155,000 - 1
ps170,001-ps175,000 1 1
ps190,001-ps195,000 1 -
ps200,001-ps205,000 1 -
ps210,001-ps215,000 1 -
ps240,001-ps245,000 1 -
ps270,001-ps275,000 - 1
ps380,001-ps385,000 1 -
----------------------------------------------------------- ---------- ---------
<FN>
The emoluments of the chief executive, who was the highest paid director,
comprise salary of ps243,264 (1995: ps160,000), benefits of ps17,252 (1995:
ps10,893) excluding pension contributions and a performance related bonus of
ps123,000 (1995:ps100,000). The company made pension contributions of ps157,028
(1995: ps98,000) on his behalf.
</FN>
</TABLE>
<PAGE>
<TABLE>
4. Net interest receivable 1996 1995
pounds sterling ("ps") m m
---------------------------------------------------------------- --------- ---------
<S> <C> <C>
Interest receivable 9.2 0.7
Interest payable on finance leases (0.4) -
---------------------------------------------------------------- --------- ---------
8.8 0.7
---------------------------------------------------------------- --------- ---------
5. Tax on profits on ordinary activities
---------------------------------------------------------------- --------- ---------
UK corporation tax at 33% based on the profit for the year 32.4 -
Deferred taxation credit at 33% (3.3) -
---------------------------------------------------------------- --------- ---------
29.1 -
---------------------------------------------------------------- --------- ---------
Deferred taxation
---------------------------------------------------------------- --------- ---------
Timing differences between capital allowances and depreciation 6.2 -
Other timing differences (9.5) -
---------------------------------------------------------------- --------- ---------
(3.3) -
---------------------------------------------------------------- --------- ---------
<FN>
There is no unprovided deferred tax as all timing differences are expected to
reverse.
</FN>
</TABLE>
<TABLE>
6. Dividends
---------------------------------------------------------------- --------- ---------
<S> <C> <C>
Declared interim - 19p per share (1995 - nil) 9.5 -
---------------------------------------------------------------- --------- ---------
</TABLE>
<TABLE>
<PAGE>
Assets in
the
Leasehold Plant and course of
pounds sterling ("ps") improvements equipment construction
7. Tangible Assets m m m Total
------------------------------------ -------------- ----------- ------------- --------
<S> <C> <C> <C> <C>
Cost
At 5 February 1995 7.0 59.7 27.2 93.9
Additions 0.5 22.0 6.7 29.2
Transfers (1.2) 20.1 (18.9) -
------------------------------------ -------------- ----------- ------------- --------
At 3 February 1996 6.3 101.8 15.0 123.1
------------------------------------ -------------- ----------- ------------- --------
Accumulated depreciation
At 5 February 1995 0.6 2.0 - 2.6
Provision for the year 0.5 15.3 1.8 17.6
Transfers (0.1) 0.1 - -
------------------------------------ -------------- ----------- ------------- --------
At 3 February 1996 1.0 17.4 1.8 20.2
------------------------------------ -------------- ----------- ------------- --------
Net books amount
At 5 February 1995 6.4 57.7 27.2 91.3
At 3 February 1996 5.3 84.4 13.2 102.9
------------------------------------ -------------- ----------- ------------- --------
<FN>
Assets in the course of construction consist of terminals and point of sale
equipment not yet installed at retailers.
The net book amount of leasehold improvements includes furniture and fittings of
ps0.8 million (1995: ps1.0m).
The net book amount of plant and equipment held underfinance leases is ps1.7
million (1995: ps1.4m).
</FN>
</TABLE>
<TABLE>
<PAGE>
pounds sterling ("ps") 1996 1995
8. Stocks m m
---------------------------------------------------------------- --------- ---------
<S> <C> <C>
Instant tickets 4.5 1.3
Playslips, terminal rolls and other consumables 0.9 2.2
---------------------------------------------------------------- --------- ---------
5.4 3.5
---------------------------------------------------------------- --------- ---------
9. Debtors
---------------------------------------------------------------- -------- ---------
Trade debtors 57.4 44.4
Advanced corporation tax recoverable 2.4 -
Escrow deferred expense 14.1 -
Prepayments and accrued income 8.1 1.9
---------------------------------------------------------------- -------- ---------
82.0 46.3
---------------------------------------------------------------- -------- ---------
Debtors due after more than one year
---------------------------------------------------------------- -------- ---------
Escrow deferred expense 58.7 -
Deferred taxation 3.3 -
---------------------------------------------------------------- -------- ---------
62.0 -
---------------------------------------------------------------- -------- ---------
<FN>
Trade debtors represent amounts due from retailers.
</FN>
</TABLE>
<PAGE>
10. Trust accounts and cash
In order to protect the interests of prize winners and players, Camelot has
established trust accounts operated by an independent trustee, The Law Debenture
Trust Corporation plc. There are a number of trust accounts operated in order to
separate funds to be paid for prizes and amounts received from players in
respect of future draws from Camelot's own funds.
<TABLE>
The split of Camelot's cash balances between Camelot accounts and trust accounts
is as follows:
pounds sterling ("ps") 1996 1995
Cash at bank and in hand m m
----------------------------------------------------------------------- -------- ---------
<S> <C> <C>
Camelot bank accounts 223.7 29.4
Trust bank accounts 15.4 9.8
----------------------------------------------------------------------- -------- ---------
239.1 39.2
----------------------------------------------------------------------- -------- ---------
<FN>
The main trust bank accounts are as follows:
Trust reserve
Camelot transferred ps5m into a trust account at the launch of the on-line game.
This amount is recoverable after more than one year. The amount (or the relevant
part) will be repayable to Camelot at the end of the section 5 licence period in
accordance with the trust deed.
Subscription trust
Amounts transferred to the subscription trust are those amounts received from
players relating to future draws, whether by subscription or by using Multidraw
facility. Camelot is reimbursed after the draw to which the funds relate. The
subscription trust balance is shown as a trust bank accounts in the table above.
Operational trust
Funds in the operational trust represent the outstanding prize liability.
Camelot is reimbursed retrospectively as prizes are paid. The balance of any
interest arising on this account (after expenses of the trust) is for the
benefit of the National Lottery Distribution Fund.
The trust reserve payment of ps5m is shown as a current asset. The subscription
trust account balance is included in cash at bank and in hand. The operational
trust account balance of ps67.2m represents the amounts recoverable from the
trust in respect of prizes paid by the company and is shown as a current asset.
The trust accounts and any interest received thereon are subject to first fixed
and floating charges in favour of the trustee.
Floating charges have been given in respect of certain Camelot assets to the
trustee and to Camelot's bankers, The Royal Bank of Scotland plc.
</FN>
</TABLE>
<PAGE>
<TABLE>
pounds sterling ("ps") 1996 1995
11. Notes to the cash flow statement m m
----------------------------------------------------------------- --------- ---------
<S> <C> <C>
a. Reconciliation of operating profit to net cash inflows from
operating activities
----------------------------------------------------------------- --------- ---------
Operating profit 75.7 (4.0)
Depreciation 17.6 2.6
Movement in working capital
Increase in stocks (1.9) (3.5)
Increase in debtors (91.1) (46.3)
Increase in amount recoverable from the Trust in respect of prizes (39.6) (27.6)
Increase in creditors 289.1 148.1
----------------------------------------------------------------- --------- ---------
Net cash inflow from operating activities 249.8 69.3
----------------------------------------------------------------- --------- ---------
Share Finance
Capital Leases
b. Analysis of changes in financing during the year m m
----------------------------------------------------------------- --------- ---------
At 5 February 1995 50.0 1.4
Inception of finance lease contracts - 1.0
Cash (outflow) from financing - (0.4)
----------------------------------------------------------------- --------- ---------
At 3 February 1996 50.0 2.0
----------------------------------------------------------------- --------- ---------
c. Analysis of changes in cash and cash equivalents during the year 1996 1995
m m
----------------------------------------------------------------- --------- ---------
At 5 February 39.2 0.1
Increase in cash in hand and at bank 199.9 39.1
----------------------------------------------------------------- --------- ---------
At 3 February 239.1 39.2
----------------------------------------------------------------- --------- ---------
</TABLE>
<PAGE>
<TABLE>
pounds sterling ("ps") 1996 1995
12. Creditors: amounts falling due within one year m m
----------------------------------------------------------------- --------- ---------
<S> <C> <C>
Trade creditors and accruals 50.0 28.8
Fixed asset creditors 0.7 16.7
Lottery duty 67.9 37.4
Amounts payable to the National Lottery Distribution Fund 118.6 16.7
Advance receipts for future draws 14.7 9.8
Prize liability 76.5 14.0
Outstanding prize liability commitment 110.0 38.2
Taxation payable 30.6 -
Obligations under finance leases 0.6 0.1
----------------------------------------------------------------- --------- ---------
469.6 161.7
----------------------------------------------------------------- --------- ---------
<FN>
Amounts payable to the National Lottery Distribution Fund includes ps90m payable
to the escrow account under the terms of the licence (see note 13).
Advance receipts for future draws represent the Multidraw and subscription
payments relating to future draws. The prize liability represents unclaimed
prizes. At 3 February 1996 Camelot had transferred ps67.1m into the trust to
meet these liabilities (1995: ps38.2m).
The outstanding prize liability commitment represents the difference between the
target prize payout commitment and the actual payout. Any amounts not utilised
for the payment of prizes are for the benefit of the National Lottery
Distribution Fund and will be paid over to the National Lottery Distribution
Fund in July 1996.
</FN>
Creditors: Amounts falling due after one year
----------------------------------------------------------------- --------- ---------
<S> <C> <C>
Amounts payable to the National Lottery Distribution Fund - 3.2
Obligations under finance leases payable within five years 1.4 1.3
----------------------------------------------------------------- --------- ---------
1.4 4.5
----------------------------------------------------------------- --------- ---------
<FN>
Amounts payable to The National Lottery Distribution Fund represents amounts
payable to the escrow account (see note 13).
At 3 February 1996 the company had a total of ps30m of undrawn committed
borrowing facilities (1995: ps45m). This is analysed between a ps20m revolving
credit facility and a ps10m money market facility. In addition there is an
overdraft facility of ps30m available to the company.
</FN>
</TABLE>
<PAGE>
pounds sterling ("ps")
13. Escrow account
- ----------------------------------------------------------------------
The licence provides for Camelot to make a payment to an escrow account such
that the total balance of this escrow account equals 2.5% of the largest
financial year's sales to date less ps40 million. It is anticipated that the
first payment to the escrow account will be made during 1996/97. The money is
held in this account for the sole benefit of the National Lottery Distribution
Fund.
As stated in the accounting policy note, amounts payable to the escrow account
are allocated to the profit and loss account evenly over the period of the
licence, commencing from the first day of ticket sales. In 1996 ps14.0 million
was amortised to the profit and loss (1995: ps3.2 million).
<TABLE>
pounds sterling ("ps") 1996 1995
14. Share capital m m
----------------------------------------------------------------- -------------- -----------
<S> <C> <C>
Authorised
100,000,000 ordinary shares of ps1 each 100.0 100.0
Allotted, called up and fully paid
Ordinary shares in issue at 5 February 50.0 0.1
Allotted during the year - 49.9
----------------------------------------------------------------- -------------- -----------
Ordinary shares in issue at 3 February 50.0 50.0
----------------------------------------------------------------- -------------- -----------
Shareholding Number of
% Shares
Analysis of shareholding
----------------------------------------------------------------- -------------- -----------
Cadbury Schweppes plc 22.5 11,250,000
De la Rue plc 22.5 11,250,000
GTECH UK Limited 22.5 11,250,000
International Computers Limited 10.0 5,000,000
Racal Electronics plc 22.5 11,250,000
----------------------------------------------------------------- -------------- -----------
15. Reserves
----------------------------------------------------------------- -------------- -----------
Profit and loss account at 5 February (3.3) -
Retained profit/(loss) for the year 45.9 (3.3)
----------------------------------------------------------------- -------------- -----------
Profit and loss account at 3 February 42.6 3.3
----------------------------------------------------------------- -------------- -----------
</TABLE>
<PAGE>
<TABLE>
pounds sterling ("ps") 1996 1995
16. Reconciliation of movements in shareholders' funds m m
----------------------------------------------------------------- -------------- -----------
<S> <C> <C>
Profit for the year 55.4 (3.3)
Dividends (9.5) -
----------------------------------------------------------------- -------------- -----------
Retained profit for the year 45.9 (3.3)
Share capital issued - 49.9
----------------------------------------------------------------- -------------- -----------
Net additions in year 45.9 46.6
Balance at 5 February 46.7 0.1
----------------------------------------------------------------- -------------- -----------
Balance at 3 February 92.6 46.7
----------------------------------------------------------------- -------------- -----------
17. Financial commitments and contingent liabilities
----------------------------------------------------------------- -------------- -----------
Commitments for capital expenditure not provided for in the
accounts were as follows:
Expenditure authorised but not contracted for 11.5 23.6
----------------------------------------------------------------- -------------- -----------
Total capital expenditure commitments 11.5 23.6
----------------------------------------------------------------- -------------- -----------
</TABLE>
pounds sterling ("ps")
18. Contingent liabilities
- --------------------------------------------------------------------------
If the licence is revoked for any reason, Camelot will be liable for a
payment of ps40 million to the Secretary of State. The shareholders have
provided unconditional and irrevocable guarantees to pay this amount.
Fixed and floating charges have been given on certain assets to the trustee
and to The Royal Bank of Scotland plc. See note 10 for further details.
<TABLE>
1996 1996 1995 1995
Land and Plant and Land and Plant and
pounds sterling ("ps") Buildings Equipment Buildings Equipment
19. Operating leases m m m m
-------------------------------------------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Annual operating lease commitments expiring:
Within one year 0.1 - - -
Between two and five years 0.6 1.1 0.4 0.7
After five years - - 0.2 -
-------------------------------------------- ------------ ------------ ------------ ------------
Payments to be made in the following year 0.7 1.1 0.6 0.7
-------------------------------------------- ------------ ------------ ------------ ------------
</TABLE>
pounds sterling ("ps")
20. Pension arrangements
- --------------------------------------------------------------------------
The group operates a defined contribution scheme. Employees who transferred
from shareholder companies have continued to participate in their
respective shareholder pension plans via an agreed deed of participation.
All amounts payable under these schemes are charged to the profit and loss
account as they fall due. The total amount charged in respect of pensions
to the profit and loss in 1996 was ps1.0m (1995 ps0.5m).
<PAGE>
<TABLE>
21. Related party transactions
Camelot has a number of major contracts with its shareholders, their parent
and / or their subsidiary companies. The main services provided are:
<S> <C> <C>
Cadbury Schweppes plc: Consultancy services covering marketing, consumer trends
and retail developments.
De La Rue plc: Supply of consumables and Instant
tickets including consultancy services.
GTECH Corporation: Supply of Instants only terminals.
Warranty for on-line and Instants terminals.
Supply of software.
General consultancy.
Supply of on-line terminal kits to International Computers Limited
International Computers Limited: Assembly of on-line terminals.
Retailer training.
Terminal maintenance.
Racal Electronics plc: Network communications and maintenance.
</TABLE>
<TABLE>
The amounts included in the accounts for the period to 3 February 1996 excluding VAT are given
below:
Purchases
of revenue Purchases Amounts
items and of capital payable at 3
pounds sterling ("ps") stock items February 1996
-------------------------------------------- ------------ ------------ --------------
<S> <C> <C> <C>
Cadbury Schweppes plc 0.5 - 0.2
De La Rue plc 17.3 - 0.2
GTECH UK Limited* 25.9 3.8 3.6
International Computers Limited* 8.5 11.1 0.6
Racal Electronics plc 14.1 8.1 3.1
-------------------------------------------- ------------ ------------ --------------
The amounts included in the accounts for the period 1 April 1994 to 4 February 1995 excluding
VAT as given below:
-------------------------------------------- ------------ ------------ --------------
Purchases
of revenue Purchases Amounts
items and of capital payable at 4
pounds sterling ("ps") stock items February 1995
-------------------------------------------- ------------ ------------ --------------
Cadbury Schweppes plc 0.2 - 0.2
De La Rue plc 6.2 - 0.5
GTECH UK Limited* 4.4 - 3.9
International Computers Limited* 2.5 39.1 1.0
Racal Electronics plc 2.4 14.1 16.5
-------------------------------------------- ------------ ------------ --------------
<FN>
* On-line terminal kits are supplied by GTECH Corporation (the parent company of
GTECH UK Limited) to International Computers Limited and then sold by International
Computers Limited to Camelot Group plc.
</FN>
</TABLE>
<PAGE>
<TABLE>
pounds sterling ("ps")
22. Subsidiary undertakings
Camelot Group plc owns the entire share capital of the following dormant companies:
Country of Proportion of equity
incorporation share capital held
------------- --------------------
<S> <C> <C>
Camelot Lotteries Limited England 100%
National Lottery Enterprises Limited England 100%
These subsidiaries have share capital of ps3 in total. This amount
represents Camelot's cost of investment in these subsidiaries. They are not
material for the purpose of giving a true and fair view and have not been
consolidated.
National Lottery Enterprises Limited was formerly known as Camelot
Lotteries (No 2) Limited.
<PAGE>
Exhibit 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No.33-88426) pertaining to the GTECH Holdings Corporation 1994 Stock Option
Plan and in the Registration Statement (Form S-3 No. 333-3602) and related
Prospectus of GTECH Holdings Corporation, of our report dated April 15, 1996
with respect to the consolidated financial statements and schedule of GTECH
Holdings Corporation included in the Annual Report (Form 10-K/A, Amendment No.2)
for the fiscal year ended February 24, 1996.
Ernst & Young LLP
Providence, Rhode Island
June 25, 1996
<PAGE>
Exhibit 23.2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No.33-88426) pertaining to the GTECH Holdings Corporation
1994 Stock Option Plan and in the Registration Statement (Form S-3 No. 333-3602)
and related Prospectus of GTECH Holdings Corporation of our report dated April
9, 1996 included in the Annual Report on Form 10-K/A, Amendment No.2 of GTECH
Holdings Corporation for the fiscal year ended February 24, 1996, with respect
to the consolidated financial statements of Camelot Group PLC and subsidiaries
as of February 3, 1996 and February 4, 1995 and for the year ended February 3,
1996 and for the period from April 1, 1994 through February 4, 1995.
Price Waterhouse
London, England
June 26, 1996
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No.33-88426) pertaining to the GTECH Holdings Corporation
1994 Stock Option Plan and in the Registration Statement (Form S-3 No. 333-3602)
and related Prospectus of GTECH Holdings Corporation of our report dated March
29, 1995 included in the Annual Report on Form 10-K/A, Amendment No.2 of GTECH
Holdings Corporation for the fiscal year ended February 24, 1996, with respect
to the financial statements of Racimec Informatica Brasileira S.A. as of
February 28, 1995 and for the twelve months then ended.
Price Waterhouse
Auditores Independentes
CRC-SP-160-S-RJ
Michael Alan Hopkin
Partner
Contador CRC-SP-106.766-S-RJ
Rio de Janeiro
June 27, 1996
</TABLE>
