Playtech Announces 11% Growth in H1 EBITDA, Driven by B2B Success and Snaitech Sale to Flutter Entertainment

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Playtech has announced an 11% increase in adjusted EBITDA for the first half of 2024, reaching €243 million ($271 million). This growth reflects the strength of the company’s B2B operations, which have been the cornerstone of its recent success. Alongside this, Playtech confirmed the sale of its Italian sports betting subsidiary, Snaitech, to Flutter Entertainment for an impressive €2.3 billion. The move aligns with Playtech’s strategic focus on its core B2B operations and its continued leadership in the gaming technology sector.

Solid Financial Performance and Revenue Growth

For the period ending 30 June 2024, Playtech reported a 5% year-on-year increase in total revenue, rising to €906.8 million. The company’s growth was largely driven by the B2B sector, which saw a substantial 14% rise in revenue, reaching €382.2 million. This demonstrates the continued demand for Playtech’s high-quality gaming technology solutions among operators around the world.

The Americas played a pivotal role in Playtech’s success, with revenue in the region surging by 42%. This remarkable performance was largely attributed to Playtech’s successful partnerships with key operators such as Caliplay, Wplay in Colombia, and Parx in the US. These partnerships have significantly bolstered Playtech’s presence in the Americas, a region that continues to experience rapid growth in the online gambling sector.

Snaitech Sale: A Strategic Move Toward B2B Focus

One of the most significant developments in Playtech’s recent history is the sale of its Italian sports betting subsidiary, Snaitech, to Flutter Entertainment. The deal, valued at €2.3 billion, marks a substantial return on investment for Playtech, which originally acquired Snaitech in 2018 for €846 million. This sale allows Playtech to shift its resources and attention to its B2B business, which is increasingly becoming the core driver of the company’s growth.

The transaction is expected to close by the second quarter of 2025, with Playtech planning to return €1.7 billion to €1.8 billion of the proceeds to shareholders via a special dividend. The sale of Snaitech represents a strategic pivot for Playtech, enabling it to streamline its operations and further solidify its leadership in the B2B gaming technology market.

Mixed Results in the B2C Sector

While Playtech’s B2B operations delivered impressive growth, the B2C division reported flat revenue for the first half of 2024, coming in at €532.4 million. Despite this, Playtech’s flagship Italian brand, Snaitech, maintained its market-leading position in Italy, a testament to the strength of its brand and customer loyalty.

However, Snaitech’s revenue did experience a slight decline of 1%, down to €483.6 million. This dip in revenue was attributed to customer-friendly sporting results in early 2024, which led to lower margins for the business. Despite this, Playtech remains confident in its B2C strategy and continues to innovate in this area to meet the evolving demands of its customers.

Strong Performance in Key Markets

Playtech’s B2B operations have been particularly strong in several key regions. The Americas have been a standout performer, with 42% revenue growth driven by partnerships with major operators. In the US, Playtech’s relationship with Parx Casino continues to expand, while in Colombia, its partnership with Wplay is seeing strong growth. These relationships have allowed Playtech to secure a foothold in these rapidly expanding markets, positioning the company for continued success.

The European market remains critical for Playtech, particularly in the Italian market, where Snaitech continues to perform well. Although the sale of Snaitech marks the end of Playtech’s direct involvement in the Italian sports betting market, the company will continue to support the broader European market through its B2B offerings, focusing on providing cutting-edge technology and services to operators.

Debt Reduction and Stronger Balance Sheet

Alongside its revenue growth, Playtech has also made significant strides in reducing its debt. As of 30 June 2024, net debt decreased by 9%, bringing it down to €225.5 million. This debt reduction further strengthens Playtech’s balance sheet, providing the company with greater financial flexibility to pursue its strategic objectives, including potential acquisitions or investments in new technologies.

Outlook for the Future: Playtech’s B2B Growth Targets

Looking ahead, Playtech remains on track to meet its medium-term financial targets for its B2B sector. The company is forecasting adjusted EBITDA from its B2B operations to be between €200 million and €250 million for the full fiscal year of 2024. This projection underscores the strength of Playtech’s B2B business model, which continues to deliver high margins and sustainable growth.

Playtech’s focus on its B2B segment is aligned with its long-term strategy of becoming the go-to provider of technology solutions for online gaming operators. With its strong pipeline of new partnerships and a growing presence in regulated markets worldwide, Playtech is well-positioned to capitalize on the increasing demand for digital gaming solutions.

Expansion in North America

Playtech has made notable strides in expanding its presence in North America, particularly in the United States and Canada. The company’s entry into these markets is part of its broader expansion strategy, which aims to leverage its technology and expertise to capture market share in the fast-growing North American online gambling industry.

In the US, Playtech has secured partnerships with major operators like Parx Casino and continues to explore new opportunities for growth as more states regulate online gaming. Similarly, in Canada, Playtech is looking to establish a foothold in the newly regulated online gaming markets, where demand for innovative gaming solutions is growing rapidly.

Conclusion: A Promising Future for Playtech

With its strong performance in the first half of 2024, Playtech has demonstrated its ability to deliver sustained growth, particularly in its B2B business. The sale of Snaitech to Flutter Entertainment marks a significant milestone in the company’s strategic shift towards focusing on its core B2B operations. This move, along with continued growth in key markets like the Americas and Europe, positions Playtech for a bright future.

FAQs About Playtech Announces 11% Growth in H1 EBITDA

1. What is Playtech’s financial performance in the first half of 2024?

Playtech announced an 11% increase in adjusted EBITDA to €243 million for H1 2024. Additionally, its overall revenue grew by 5% year-on-year to €906.8 million.

2. What was the main driver behind Playtech’s revenue growth?

The B2B sector was the primary driver, showing a 14% increase in revenue, rising to €382.2 million. The company’s partnerships in the Americas and key operator deals contributed to this growth.

3. What is the significance of Playtech selling Snaitech to Flutter Entertainment?

Playtech sold Snaitech, its Italian sports betting subsidiary, to Flutter Entertainment for €2.3 billion as part of its strategy to focus on core B2B operations. The sale marks a strong return on Playtech’s initial investment in 2018 and allows the company to prioritize its B2B business.

4. How will Playtech use the proceeds from the Snaitech sale?

Playtech plans to return between €1.7 billion and €1.8 billion of the sale proceeds to shareholders via a special dividend.

5. How did Playtech perform in the Americas?

Playtech saw strong growth in the Americas, with revenue increasing by 42%. This was largely driven by partnerships with Caliplay, Wplay in Colombia, and Parx in the US.

6. What happened to Playtech’s B2C division during H1 2024?

Playtech’s B2C division reported flat revenue at €532.4 million. Despite maintaining its market-leading position, Snaitech saw a 1% decline in revenue, primarily due to customer-friendly sporting results early in 2024.

7. How has Playtech managed its debt?

Playtech reduced its net debt by 9%, lowering it to €225.5 million by the end of June 2024, which strengthens its financial position.

8. What are Playtech’s expectations for its B2B sector in the future?

Playtech expects its B2B sector to generate adjusted EBITDA between €200 million and €250 million for the full fiscal year of 2024, demonstrating strong confidence in this segment.

9. What is Playtech’s strategy for North America?

Playtech is expanding its presence in North America, with significant partnerships in the US (like with Parx Casino) and planned growth in Canada, as more regions regulate online gambling.