Playtech B2B revenues up 12% but profits hit by TradeTech struggles
London-listed supplier’s core gambling B2B business exceeds management expectations
Playtech today reported a 12% rise in regulated B2B gambling revenue for the four months from 1 July through October.
In today’s trading update, Playtech said the core business performed strongly, as both the core B2B gambling division and Italian B2C operator Snaitech “exceeded management expectations”.
The firm did not give specifics on Snaitech.
The increase in revenue – which would have been 13% excluding the impact increased UK Remote Gaming Duty – was boosted from hardware sales during the reporting period.
The firm said Asian revenues “remained stable,” and in line for €115m in revenue for 2019 at the current run rate.
Playtech marginally lowered its adjusted EBITDA guidance for full year 2019 however, due to challenging conditions in the firm’s TradeTech segment which was performing “well below expectations”.
Shareholder and activist investor Jason Ader has been vocal about the need to sell off non-core assets like TradeTech.
The London-listed supplier today also announced a new long-term deal with Aquila Global, the operator of Wplay, a leading betting and gaming brand in Colombia.
Playtech CEO Mor Weizer
Playtech CEO Mor Weizer said: “The strength and quality of the Wplay brand, combined with Playtech’s 20 years of technology leadership in the industry, will see us drive the online growth of the market in Colombia.
“This agreement demonstrates the execution of our strategy to continue to deliver structured agreements with the leading brands in the most attractive markets globally.
“Latin America remains a key market for us and with this long-term partnership with Wplay we have added another important strategic partner in the region,” he added.
Wplay, based in Medellin, was issued Colombia’s first official online gambling licence in June 2017, becoming the first licensed operator in the market. It boasts more than 7,000 retail points of sale.
Regulus Partners analyst Paul Leyland said: “Playtech has demonstrated encouraging progress on all gambling fronts, albeit still in line with expectations.
“However, while we see the Wplay partnership as an unalloyed positive, especially for the longer term, relatively muted growth core growth, positioning back into long-tail and an Italian business still reliant on machines remain much more mixed signals to us.”
Playtech’s share price was relatively unmoved in early trading.