Playtech has reported its financial performance for H1 2023. The company’s revenue witnessed an 8.5 percent year-on-year increase driven by Snatech and diverse market expansion, reaching €859.6 million. Playtech’s results are brken down into its B2B and B2C segments, exploring regional revenue variations and key factors influencing the company’s performance.
B2B Segment
Year-on-Year Growth: The B2B operations contributed to 39 percent of Playtech’s total H1 revenue, amounting to €334.5 million, with a 7.2 percent growth rate.
Americas and Europe: The Americas’ regulated markets saw robust growth, contributing €99.7 million, a staggering 42.8 percent year-on-year increase. Meanwhile, regulated markets in Europe (excluding the UK) added €96.6 million, marking a 4.8 percent growth. However, the UK experienced a 1.6 percent revenue decline, generating €62.9 million.
Rest of the World: Regulated markets outside of these regions contributed €3.3 million, up from €2.9 million in H1 2022, resulting in total regulated B2B revenue of €262.5 million, reflecting a substantial 14.7 percent year-on-year growth.
Unregulated Markets: Unregulated revenue outside of Asia decreased by 13.4 percent year-on-year, totaling €42.6 million. Asian revenue also declined by 13.5 percent, reaching €29.4 million.
Key Drivers: Playtech attributed B2B revenue growth to key markets like Mexico, Poland, and Spain, while the decline in the UK was attributed to regulatory uncertainties. The decline in unregulated markets outside Asia was due to shifts toward regulation, as seen in Ontario, Canada. Asian B2B revenue was impacted by regional pressures.
(Source: SiGMA)
B2C Segment: Snaitech leading the way
Year-on-Year Growth: Playtech’s B2C operations generated €532.1 million in H1, a 9.2 percent year-on-year increase, representing 62 percent of the company’s total revenue.
Snaitech Dominance: The majority of this revenue came from Snaitech, based in Italy, in which Playtech holds a 70.6 percent stake. Snaitech generated €488.4 million in revenue in H1, a 9.5 percent year-on-year increase, accounting for 57 percent of Playtech’s overall revenue.
Other Brands: Sun Bingo and other B2C brands contributed €34.1 million, up 7.6 percent, while Happybet generated €10.3 million in revenue, experiencing a 3.7 percent decrease.
Financial overview and CEO’s outlook
EBITDA Growth: Playtech’s EBITDA increased by 19.2 percent year-on-year to €207.3 million in H1 2023.
Profit Variation: The company reported a post-tax profit of only €3.1 million, compared to €71.4 million in H1 2022. This decline was attributed to changes in the fair value of derivative financial assets and deferred tax assets.
Financial Position: Playtech ended the period with €786 million in cash and cash equivalents, up from €426.5 million in H1 2022, and net debt of €248.2 million, down from €275.2 million in the prior year.
CEO’s Perspective: Playtech CEO Mor Weizer (pictured above), highlighted the company’s diversified portfolio and strategic progress in both B2B and B2C segments. He mentioned growth in regulated markets, expansion in the US, and promising agreements with partners like Hard Rock Digital, Caliente in Mexico and Galera.bet in Brazil. Weizer expressed confidence in exceeding full-year adjusted EBITDA expectations for 2023.
Growth Potential
Analyst’s Opinion: Peel Hunt, a London-based brokerage, recommended its Buy rating and 800p target price for Playtech’s stock. Other analysts praised Playtech’s quality of business, its expansion in the US, and strong partnerships, highlighting the company’s growth potential.
In summary, Playtech’s H1 2023 performance reflects a dynamic mix of B2B and B2C growth, regional variations, and strategic initiatives, positioning the company for continued success in the iGaming industry.
