International edition
October 22, 2020

As a result of the coronavirus pandemic's impact

Playtech revenue sees 23 percent drop year-on-year in first half

Playtech revenue sees 23 percent drop year-on-year in first half
"The attitude of our people coupled with the resilience and diversification of our technology-led business model has delivered a strong first-half performance during an extremely challenging period for the industry," said CEO Mor Weizer.
Isle of Man | 09/17/2020

The gambling software developer saw a strong start to the period in January and February driven by TradeTech, a strong performance from Snaitech, and favorable sporting results, but the adverse impacts of COVID-19 between mid-March and June led to the Group's total reported revenues decreasing by 23% to €564.0 million (H1 2019: €727.8 million).

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laytech announced on Thursday its results for the six months ended 30 June 2020, together with a trading update for July and August 2020.

"The attitude of our people coupled with the resilience and diversification of our technology-led business model has delivered a strong first-half performance during an extremely challenging period for the industry. These strengths, combined with early decisive action to focus on the safety of our employees and protect the Group's cash flow, has placed us in a strong position to benefit from the recovery and to capture the exciting market opportunity in the US and Latin America," said CEO Mor Weizer.

Group highlights

  • Resilient H1 with Adjusted EBITDA of €162.3 million (H1 2019: €180.7 million excluding one-offs6) driven by online and an exceptional TradeTech performance together with early and decisive actions taken in response to COVID-19
  • Significant US momentum: New Jersey license received, launched with bet365 in early H2, further license applications underway and investment to increase
  • New structured agreements signed in Guatemala and Costa Rica
  • Launch of Playtech's sustainable business strategy, Sustainable Success, to consolidate position as a global leader in safer products, data analytics and player engagement solutions
  • Claire Milne appointed as Interim Chairman in May to provide continuity and stability; permanent Chairman process ongoing

"The extraordinary trading conditions during the pandemic have brought us closer than ever to our licensees and we have seen even greater demand for our products, with an increased focus across the globe on intelligent software and personalized player journeys and protection tools. As the leading technology company in the gambling industry, our licensees look to us to deliver innovation that changes the way players experience gambling entertainment. Key to this approach is Sustainable Success, our new ESG strategy launched in H1, which aims to consolidate our position as a global leader in safer products, data analytics and player engagement solutions and build a safe and sustainable gambling industry for the benefit of all stakeholders," Weizer went on.

Divisional highlights

B2B Gambling

  • Significant progress in the US and Latin America
  • SaaS offering showing continued strong momentum with over 50 new brands added in H1, already surpassing FY 2020 target 
  • B2B Gambling Adjusted EBITDA of €63.2 million was down 36% versus H1 2019 (excluding one-offs6)
  • Strong operational execution with existing and new Tier-1 licensees
  • Significant momentum in Live Casino with new signings and existing licensees
  • Asia negatively impacted in period by government restrictions in response to the pandemic  

B2C Gambling

  • Snaitech Adjusted EBITDA decreased to €47.1 million (H1 2019: €74.7 million) due to retail closures and cancellation of sporting fixtures, partially offset by 37% growth in online revenues versus H1 2019
  • Snaitech saw continued strong performance in Sports; achieved number one market share position (retail and online combined) in Italy in H1 2020
  • Snaitech land sale completed with €13.8 million received in H1 and remaining €35.7 million received in July
  • Retail B2C Sport saw retail closures in the period due to the pandemic, resulting in a €5.4 million impairment of the business
  • White label (including Sun Bingo) saw 22% revenue growth versus H1 2019 at constant currency to €29.5 million (H1 2019: €24.3 million)

TradeTech Group

  • Outstanding H1 performance driven by exceptional market volatility and trading volumes throughout much of the period
  • TradeTech's revenues were €87.3 million in H1 2020, representing growth of 123% versus H1 2019, and Adjusted EBITDA was €52.8 million, up 544% (H1 2019: €8.2 million)
  • Playtech continues to evaluate all options for TradeTech, and, as announced in August, the Group is in early-stage discussions with a number of parties regarding a potential sale

"As well as increasing our work with existing tier one licensees and adding more than 50 new brands to our SaaS model, we have also continued to execute our expansion into strategically important markets such as the US with our first launch in New Jersey and further structured agreements in Latin America. The scale of our technology and the breadth of our product offering mean Playtech can capture commercial opportunities in the fast-growing US and Latin America markets outside the remit of traditional B2B suppliers and we are investing in accelerating this strategy," Weizer concluded.

While the Group saw an extremely strong start to the period in January and February driven by TradeTech, a strong performance from Snaitech and favorable sporting results, the adverse impacts of COVID-19 between mid-March and June led to the Group's total reported revenues decreasing by 23% to €564.0 million (H1 2019: €727.8 million) and down 22% on a constant currency basis and after excluding acquisitions made in 2019 and 2020.

However, despite the pandemic, the Group's Adjusted EBITDA for the first half exceeded €160 million, a decline of only 16% and 15% on a constant currency basis. This was driven by the strength of online Casino (including Live), Bingo, Poker, and an exceptional performance by TradeTech. The Group's total reported EBITDA decreased by 15% to €138.1 million (H1 2019: €162.0 million).

See the company's half-year report here.

See the company's half-year presentation here.

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