Playtech share price drops despite H1 revenue growth of 5%

Playtech has reported revenue of €906.8m (£757.6m) for the first six months of 2024, a 5% year-on-year (YoY) increase due to, according to the operator, top-line growth in the US as well as high operating leverage and tight cost control.

Group EBITDA grew 13% YoY to €233.6m, up from €207.3m for the same reporting period in 2023, while adjusted EBITDA was up 11% from €219m to €243m driven by strong performance across the B2B business.

Reported post-tax profit for H1 soared 223% YoY to €10m from €3.1m recorded in H1 2023, with adjusted post-tax profit growing 23% YoY from €85.7m to €105.4m.

Divisionally, Playtech’s B2B arm returned revenue of €382.2m, which translates to 14% YoY growth, up from €334.5m in H1 2023.

Due to high operating leverage and cost control, B2B adjusted EBITDA jumped 38% YoY from €81.3m to €112.3m.

In the Americas, the firm noted Caliplay is still the firm’s key growth driver with increased contributions from Brazil as it nears regulation.

Revenue in the Americas leapt 42% YoY from €99.7m to €141.6m, while there was a significant upturn in US and Canada, with revenue jumping exponentially by 200% YoY compared to H1 2023.

Regarding B2C, revenue remained flat at €532.4m, while adjusted EBITDA dropped 6% YoY to from €138.6m to €130.7m this year.

Ahead of Flutter’s acquisition of Snaitech, revenue declined 1% YoY to €483.6m – although online revenue was up 1% YoY to €132.6m from €131.4m a year prior.

HAPPYBET reported an adjusted EBITDA loss of €6.6m (from €6.1m) ahead of its closure in H2 2024.

Sun Bingo and Playtech’s other B2C firms saw revenue growth of 17% YoY to €39.9m due to “the launch of a new brand in H2 2023”.

Commenting on the supplier’s H1 results, CEO Mor Weizer said: “This set of results is further proof of the excellent progress we’ve made this year.

“We’ve executed our strategy to grow and improve the B2B business, delivering broad-based growth with strong contributions across our key markets, high operating leverage and tight cost control.

“We’re also delighted to have agreed a revised strategic agreement with Caliplay, our partner in Mexico, which ensures we are well placed to capture significant growth in the coming years.

“Our plan to accelerate our presence in the US and Canada is already delivering, with revenues trebling in the period.

“We see a huge opportunity in this market and are pleased to have supported multiple customers with their own growth plans, while also delivering the first major milestone in our partnership with Hard Rock Digital.

“With US customers now able to experience Playtech-powered games in multiple states, soon our customers outside the US will get the opportunity to play games streamed direct from Las Vegas as part of our new agreement with MGM Resorts,” Weizer added.

The CEO highlighted that Playtech is on course for its B2B adjusted EBITDA medium-term target range of €200m to €250m, with the supplier noting the figures could be reached earlier than expected.

Commenting on Playtech’s results, Edison Group’s executive director of content and strategy Neil Shah said the firm is in a good place to continue growing in the future.

He remarked: “With a strong balance sheet, solid financial momentum and expansion into lucrative markets like the US, Playtech is well-positioned to cash in on future growth opportunities, continuing to cement its leadership in the global online gambling technology space.”

Playtech’s shares were down 2% on the morning of Monday 30 September.