Playtech plans local push in 2011
Playtech will announce 10 new licences next year and partner with local operators in newly regulated markets, its CEO told eGR today following its Q3 results.
Software provider Playtech will announce 10 new licences in 2011 and see the majority of its growth by partnering with local operators and former monopolies in newly regulated markets, its chief executive told eGaming Review on the same day it announced strong third-quarter figures.
Mor Weizer said that it would announce 10 new licences next year mainly in poker but also in casino and bingo as newly regulated markets including Italy and France mature and extend their offerings and other countries currently discussing regulation open up to online gaming.
“I believe there are some good opportunities for local operators, therefore [there] will be a big appetite for local companies in the French market that will then become part of the poker and sports market in there. We will see more local companies becoming involved and Playtech will get involved on the back of that. This is all incremental revenues for us given the fact we had to close it down ahead of regulation,” he said.
“We will be looking at developing quality rather than quantity but with France looking to broaden its offering, Italy launching casino games and cash poker early next year and a deal signed with Finnish monopoly provider RAY “ that is the sole provider of online gaming there “ due to launch we are very confident growth will continue. Finland may be an 11th the size of the UK but it has 19,000 land-based slot machines compared to the UK’s 37,000 catering for a population of 60m people.”
Playtech’s gross income for the quarter was up 30% to 41.3m compared to 31.9m in Q3 last year, while total revenues were up 17% to 32.5m from 27.7m. For the nine months to 30 September this year, gross income was up 31% to 129.2m from 98.8m and total revenues up 25% to 105.4m, from 84.4m.
Weizer said daily activity in October rose more than 7% compared to its average in the seasonally weak third quarter. “We indicated that current trading in the first 31 days of the fourth quarter is more than 25% ahead of the fourth quarter of last year and 7% quarter on quarter. These are strong numbers.”
Poker revenues were down 30% to 5.7m from 8.2m, 21% lower than the second quarter this year, however Weizer said September and October had seen increased poker activity. “The third quarter was initially impacted by the World Cup. Taking a medium to longer-term view we see some good prospects in poker on the back of regulation in various countries.
“Our licensees are growing, Italy is growing fast, France is building up we’ve just established ourselves with one licence that’s gone live, we have three more soon to be launched with well established casino groups to be launched in the fourth quarter and other waiting for regulatory approval. Then we have Serbia and Finland. The UK and Italy are our biggest regulated markets.”
“In Italy we have seen accelerated growth in the last two years, we are the largest software provider there and have 16% market share. They introduced bingo earlier this year and we established ourselves as market leader with a 25% market share. This is only on the back of three licences that launched recently and we have one more licence to launch later this month so Italy will increasingly become a very important market for us on the back of bingo, and casino games and cash poker will be introduced in early 2011. We are very confident this will happen,” Weizer said.
“The majority of our revenue is now generated from regulated markets. It’s building up on the back of activity in the UK, Italy and Finland, which is looking at regulating soon.”
Casino revenues were up 17% to 21.7m from 18.5m but down 13% on the second quarter this year. Bingo revenues totalled 3.1m, up 11% on Q2 2010, reflecting strong growth from Virtue Fusion, reinforced by the new Italian bingo network. Excluding the impact of the closure of France before regulation, casino revenues were down in the third quarter compared to Q2 by 2% and poker revenues down 13%. Share of profit in William Hill Online was up 111% to 8.8m from 4.2m, up 15% from Q2 this year, while in a statement Playtech said EBITDA for the nine months to 30 September this year is expected “to be not less than 77.7m”.