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Home » Casino News: Playtech Beats Market Forecasts with Excellent H1 Revenues Driven by US Growth

Casino News: Playtech Beats Market Forecasts with Excellent H1 Revenues Driven by US Growth

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Casino News. Douglas, Isle of Man – September 5, 2023Playtech, the world’s largest publicly traded online gaming software developer, is set to outperform market expectations for 2023, riding on the back of stellar financial results during the first half of the year, with significant contributions from thriving markets like Latin America and the USA, as per reports from IGB News.

Casino News: Playtech’s Range Drives Success

In its H1 2023 trading update, covering the period ending June 30, 2023, Playtech reported a noteworthy 8% year-on-year increase in revenue, reaching €859.6 million. The company’s B2C operations, including HAPPYBET, Sun Bingo, and Snaitech, witnessed a robust 9% revenue growth, totaling €532.1 million. Meanwhile, revenue from B2B operations also posted a healthy 7% increase, amounting to €334.5 million. CEO Mor Weizer attributed the company’s success to its diversified portfolio, spanning both B2B and B2C operations, across some of the world’s fastest-growing regulated markets.

Notable Deals and Market Expansion

During the same period, Playtech’s B2B operations in the US emerged as a standout region, experiencing a remarkable 43% increase in income, reaching €99.7 million. The success in the US was largely driven by its partnership with Caliente in Mexico, with continued progress in Brazil towards regulation. Playtech made significant strides in the US market through substantial contracts and state launches. Agreements with prominent operators such as Rush Street Interactive, 888, and PokerStars enabled Playtech to enter the regulated markets of 10 American states.

In Europe, excluding the UK, profits rose by 5% to €96.6 million, with notable growth observed in countries like Spain and Poland. However, this growth was offset by reduced profits in the Netherlands, owing to heightened competition and stringent gambling regulations. In the UK, income decreased by 2% to €62.9 million, attributed to precautionary measures involving affordability checks.

Retail Segment Boosts B2C Operations

Playtech’s flagship brand, Snaitech, recorded impressive growth in H1 2023, with a 10% increase in income compared to H1 2022. This growth was primarily attributed to a 9% rise in profits within the retail segment and a 12% increase in online business income. Retail wagering sales saw a substantial surge of 24% compared to H1 2022, driven by increased demand following the FIFA World Cup, as Italy did not participate in the tournament.

HAPPYBET, however, experienced a 4% decrease in income during the same period compared to H1 2022, attributed to the rationalization of retail sites in Germany. Nonetheless, increased income in Austria, resulting from an expansion of retail stores in Vienna and Tyrol, balanced the decline in Germany.

Sun Bingo and other B2C operations reported an 8% revenue increase, totaling €34.1 million. Enhanced marketing spending towards the end of the previous year, coinciding with the FIFA World Cup, contributed to higher profits in H1 2023, with a notable high contribution margin.

Strengthened Financial Performance and Confidence

Playtech reported a 10% year-on-year increase in total adjusted EBITDA for H1 2023 from combined operations, reaching €219.9 million. B2B operation costs increased by 8% per year to €253.2 million, resulting in a 5% growth in total Adjusted EBITDA for B2B, totaling €81.3 million. Business-related costs amounted to €148.6 million, marking a 2% increase, primarily due to expenses related to Playtech’s US expansion. Marketing and sales costs grew by 24% to €10.4 million, mainly due to the full return of marketing activities to pre-COVID-19 levels.

B2C Adjusted EBITDA witnessed a substantial 14% increase, totaling €138.6 million, with a margin of 26%. Snaitech reported EBITDA of €141.9 million, marking a 12% year-on-year increase. The 9% increase in expenses was effectively absorbed by the significant growth in income.

However, income before tax from continuing operations declined from €103.7 million to €79.6 million, primarily due to unrealized fair value changes of derivative financial assets related to various call options. Profit after taxation from continuing operations also decreased, dropping from €71.4 million to €3.1 million.

CEO Weizer expressed confidence in Playtech’s ability to achieve its medium-term adjusted EBITDA targets and capitalize on growth opportunities. Playtech’s strategic progress and operational expertise position the company for continued success in the competitive online gaming industry.

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