Playtech: 2020 Performance Set to Be Above Market Consensus
The world’s biggest supplier of online gaming technology Playtech Plc issued a trading update Tuesday telling investors that its 2020 financial performance is expected to be ahead of market consensus, driven by financial trading, casino, poker, bingo and sports betting businesses.
€300M EBITDA
The technology group expects its solid financial performance throughout 2020 would be reflected in adjusted earnings before interest, tax, depreciation and amortization (EBITDA) of at least €300 million ($365 million) for the year ended December 31, 2020.
“Whilst the COVID-19 pandemic continues to pose challenges and the macroeconomic outlook remains highly uncertain, Playtech remains well placed to make further strategic and operational progress in 2021.”
In the review of its 2020 activities, Playtech outlined it managed to achieve strategic progress in some critical business areas despite the impact of the coronavirus outbreak on the industry. The approach to deal with the infection with lockdowns and restrictions channeled people to online betting and gaming while at home since land-based gaming properties were either shut or with restricted access.
Online Verticals More than Offset Retail Slump
The FTSE250-listed company pointed out its core B2B business, including casino, poker and bingo, delivered a good enough performance, which paired with the online results of its gambling unit Snaitech, managed to offset the material impact on the retail business which was hit by the cancellation of sporting events and the shutdown of brick-and-mortar gaming facilities.
The financial trading arm of the technology group, Finalto, posted a performance which exceeded expectations for the first half of the year, benefiting from the increased market volatility and trading volumes.
Finalto somewhat disappointed during the second half of 2020, though, and Playtech notified of ongoing talks regarding the sale of the unit as the company is undertaking an asset review to simplify its business and focus on its core assets by divesting the non-core ones.
Expansion across Markets and Products
From a commercial point of view, Playtech entered the sports betting market in the US after the Isle of Man-based gaming technology provider signed agreements with Bet365 and Entain in New Jersey.
In September, Playtech expanded its presence in the Garden State by rolling out its casino software with BetMGM’s gaming network, while in December, the technology supplier boosted its online casino portfolio through the addition of some of the leading game titles provided by Interactive Game Technology (IGT).
Besides in the US, Playtech continued to expand into markets in Latin America after developing a partnership with Mexican market leader Grupo Caliente and launching into Columbia teaming up with Wplay.
As part of its streamlining of technology assets to focus on real money gambling, Playtech completed the sale of its casual and social gaming unit YoYo Games for $10 million.
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