Playtech, the leading provider of technology and content for the online gambling industry, has reported robust results for the first half of 2024, highlighting its successful expansion across key markets, especially in the U.S. and Canada. Total revenue for the six-month period ending June 30, 2024, increased by 5% to €906.8 million, with adjusted EBITDA up 11% to €243.0 million. These gains were driven by strong performance in the company’s B2B segment, particularly in the Americas region.
B2B Segment Fuels Growth
Playtech’s B2B division continued to perform exceptionally well, with revenues rising 14% year-over-year to €382.2 million. Adjusted EBITDA for this segment jumped by 38% to €112.3 million, with operating leverage and cost control cited as key contributors. “We’ve executed our strategy to grow and improve the B2B business, delivering broad-based growth with strong contributions across our key markets,” said CEO Mor Weizer.
A major driver of B2B growth has been Playtech’s expansion in the U.S. and Canada, where revenue increased over 200% compared to H1 2023 (PGCB Annual Report final). Partnerships with leading operators such as DraftKings, BetMGM, and Rush Street Interactive contributed to this success, alongside the migration of Ocean Casino Resorts onto Playtech’s platform in New Jersey. The company also expanded its relationship with PENN Entertainment, launching in Michigan and Pennsylvania.
Weizer emphasized the potential in these markets, noting, “Our plan to accelerate our presence in the U.S. and Canada is already delivering, with revenues trebling in the period.” The company sees the U.S. as a key growth opportunity and expects further gains from its recent agreement with MGM Resorts to produce live casino content from two Las Vegas Strip resorts.
Strategic Moves and Snaitech Sale
In a significant strategic shift, Playtech has agreed to sell its Snaitech division to Flutter Entertainment for €2.3 billion. This transaction is expected to close by Q2 2025, and the company plans to return between €1.7 billion and €1.8 billion to shareholders via a special dividend following the sale.
While Snaitech’s revenue declined slightly by 1% to €483.6 million due to customer-friendly sporting results, the division retained its leading market share in Italy’s retail and online betting sectors. Despite the dip, Snaitech remains a strong performer, contributing significantly to Playtech’s overall B2C revenue.
Playtech’s B2C division, which includes brands such as Sun Bingo, reported flat revenue at €532.4 million compared to H1 2023. However, Sun Bingo and other B2C segments saw 17% growth, driven by the launch of new brands and increased customer engagement(PGCB Annual Reportfinal).
Continued Investment and Outlook
As part of its continued expansion strategy, Playtech is investing heavily in its U.S. operations. The company plans to significantly increase headcount in its U.S. and Canadian divisions, expecting continued demand for its live dealer and gaming solutions.
Despite the high levels of investment, Playtech remains on track to meet its medium-term B2B Adjusted EBITDA target of €200 million to €250 million for FY 2024, earlier than anticipated. “We are more excited than ever about the U.S. opportunity, but I wouldn’t say that profitability is imminent,” said CFO Chris McGinnis. Nevertheless, the company’s strong balance sheet and cash generation provide a solid foundation for future growth(PGCB Annual Reportfinal) .
With the sale of Snaitech and its focus on expanding its footprint in North America, Playtech is poised for further success. “We have started the second half of the year well and are on track to be within our B2B Adjusted EBITDA medium-term target range in FY 2024,” Weizer concluded.
Source:
Excellent H1 2024 performance; B2B on track to meet medium-term target in FY2, otp.tools.investis.com, September 30, 2024.