Playtech, the largest global publicly traded online gaming software developer based in Douglas, Isle of Man, should beat market assumptions in 2023 due to excellent revenues throughout the first half of 2023. Additionally, the excellent earnings are due to positive results in booming countries like Latin America and the USA, as reported by IGB news.

A diverse portfolio as the main reason for success:

In compliance with details provided in a trading update for the H1 2023 ending June 30, 2023, Playtech stated that income rose 8% per year to €859.6m. Looking back, its revenue from B2C operations, involving HAPPYBET, Sun Bingo and Snaitech, rose 9% to €532.1m, while revenue from B2B operations rose 7% to €334.5m. Commenting on the company’s success, CEO Mor Weizer, commented: “Our success in the period was driven by our diversified portfolio, spanning B2B and B2C, in some of the fastest-growing regulated markets around the world. Having laid the groundwork in the US, we are growing our offering across multiple states and are confident in our future prospects following the landmark agreement with Hard Rock Digital. Additionally, we further cemented our leadership in LatAm with Caliente in Mexico and Galera.bet in Brazil. Snaitech in Italy enjoyed another strong period, with the management team continuing to leverage their retail presence to grow the online business.”

Significant deals:

Looking at the aforementioned B2B operations, the US was the “standout region” during the aforementioned period, where income increased by 43% to €99.7m. The Caliente in Mexico stays the crucial “driver” of this growth, although Brazil also carries on with improving firmly as it heads toward regulation.

However, the company made a remarkable advancement extending into the US throughout the period with significant contracts and “state launches.” Relatedly, it signed an agreements with few operators operating in many US states, such as Rush Street Interactive, 888 and PokerStars, which led the company to enter the regulated markets of 10 American states.

As for Europe, “ex-UK” profits rose by 5% to €96.6m, with growth felt in many countries involving Spain and Poland. However, this is balanced by lower profits from the Netherlands thanks to enhanced rivalry and a stern gambling regulators. Also, stern regulators also hit UK income with precautionary measures related to “affordability checks” by Playtech’s customers, which caused that income fall 2% to €62.9m.

Retail increase:

Regarding the aforementioned B2C operations, the firm’s biggest brand, Snaitech, experienced a very good development during the first half of 2023, with income increasing by 10% compared to the H1 2022. The main reason for this is the retail segment which experienced an increase in profits of 9% and the online business which experienced a 12% increase in income. However, within the bounds of retail segment, there is retail wagering sales which increased by 24% compared to H1 2022 thanks to enhanced demand following the Fifa World Cup, as Italy didn’t participate in the tournament.

As for HAPPYBET, its income fell by 4% in the same period compared to H1 2022, which is a consequence of the “rationalisation of retail sites in Germany.” However, there was an increase in income in Austria, which balanced the drop in Germany, thanks to the extension of the overall number of retail stores located in Vienna and Tyrol.

And finally, Sun Bingo and additional B2C operations experienced an 8% increase to €34.1m. The main reason for the growth was enhanced marketing spending at the end of last year, which was the period of the aforementioned Fifa World Cup, which caused a bigger profit growth during the first half of 2023 with a “high contribution margin.”

Increased confidence:

As for total adjusted EBITDA for the said period from combined operations, Playtech revealed that it was €219.9m, meaning that it increased by 10% per year. Additionally, costs for B2B operations were 8% per year to €253.2m, which means that total Adjusted EBITDA for B2B increased by 5% to €81.3m. However, businesses were the biggest part of the costs, with costs of €148.6m, which rose by 2% mainly thanks to “US expansion outgoings.” Marketing and sales costs grew by 24% to €10.4m, primarily thanks to the full return of marketing tasks to the level they were before COVID-19.

Furthermore, as for B2C Adjusted EBITDA, it increased by 14% to €138.6m with a margin of 26%. Therefore, Snaitech reported EBITDA of €141.9m, which increased by 12% per year. In addition, the 9% increase in expenses was “absorbed” by the powerful increase in income.

However, revealed income before tax from “continuing operations” fell to €79.6m from €103.7m, which involved a decline in “unrealized fair value changes of derivative financial assets related to various call options.” As for the profit remained after taxation from “continuing operations,” it fell from €71.4m to €3.1m. In this regard, CEO Weizer, commented: “The growth achieved in the first half of the financial year gives the board further confidence in achieving Playtech’s medium-term adjusted EBITDA targets for B2B of €200m-€250m and B2C of €300m-€350m. We delivered our highest-ever adjusted EBITDA in the first half of 2023, demonstrating the benefits of the continued strategic and operational progress made in recent years. We have started the second half of the year well and are on track to deliver FY23 adjusted EBITDA slightly ahead of current expectations. With our proven strategy, robust balance sheet and our operational expertise, we are confident in our ability to capitalise on the many growth opportunities we have ahead.”

During 2022, the intense growth of Playtech’s B2B segment as well as the operation of Snaitech, caused a profit growth of 33% to €1.60bn from the €1.21bn that the firm reached in 2021. What’s more, in addition to this income, the firm revealed an extra 28% rise in Adjusted EBITDA from €317.1m in 2021 to €405.6m in the previous year.

Source: https://news.worldcasinodirectory.com/playtech-beats-market-forecasts-as-us-growth-causes-excellent-h1-revenues-110244