Playtech reports revenues up 12% for year 2016 vs 2015 

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Playtech (LSE: PTEC) today announces its results for the year ended 31 December 2016, together with a trading update for the period to 20 February 2017.

Playtech 2016 results

Group financial highlights

·     

Total revenues up 12% vs 2015 on a reported basis:

–  20% revenue growth at constant currency

–  13% revenue growth excluding acquisitions and at constant currency

–  48% of group revenues are regulated (2015: 47%)

·     

Adjusted EBITDA up 20% on a reported basis and 32% at constant currency

·     

Adjusted group EBITDA margin of 42.7% (2015: 40.0%)

·     

Adjusted Net Profit and Adjusted diluted EPS at constant currency up 42% and 37% respectively

·     

Improved cash conversion of 94% (2015: 80%) with DSOs5 down 23 days from H1 2016

·     

Gross cash at period end of €545 million (€469 million adjusted for CFH customer deposits) taking into account:

–  €240 million spent on acquisitions including BGT, CFH, Quickspin and ECM in 2016

–  returning €296 million to shareholders in 2016 including €150m special dividend and €50m via a share buybac

·     

Full year dividend per share up 15% in accordance with progressive dividend policy adopted in 2016

Operational highlights

Gaming division

·     

Strong revenue performance with 21% growth at constant currency led by flagship Casino offering

·     

Strong performance in Sports in H2 2016 following acquisition of BGT

·     

Regulated Gaming revenues of 42% (2015: 41%)

·     

Software revenues from mobile of 33% in 2016 (2015: 21%), with 54% of UK revenues from mobile

·     

“Locking-in” future growth

–  over 10 new customers signed in 2016 including Pokerstars, MaxBet and Mr Green with OPAP after the period end

–  significant contracts renewed, including with Paddy Power Betfair, William Hill, Rank and Betfred in 2017

nine of top 10 licensees now on long-term contracts

·     

Launched Playtech BGT Sports presenting significant opportunity across Europe and South America

·     

Acquisitions integrated and performing in line with expectations

·     

Pipeline of new licensees and new structured agreements remains strong

Financials division

·     

Revenue of €65.6 million (2015: €60 million) in 2016 with Adjusted EBITDA of €15.4 million (2015: € 15.9 million)

·     

2016 results reflect full impact of the business transition

·     

Encouraging performance and improved KPIs in H2 2016

·     

B2B offering strengthened by acquisition of CFH in November 2016

·     

Ron Hoffman has become full time CEO of the Financials division

Current trading and outlook

·     

Average daily revenue in the Gaming division for the first 51 days of Q1 2017 was up 26% on Q1 2016 (30% at constant currency) and up 10% on Q4 2016 (9% at constant currency)

·     

Excluding acquisitions, average daily revenue in the Gaming division for the first 52 days of Q1 2017 was up 9% on Q1 2016 (12% at constant currency) and up 10% on Q4 2016 (up 9% at constant currency)

·     

The Financials division has performed in line with expectations in 2017 to date

–  Markets.com KPIs continue to be encouraging against a backdrop of low volatility

–  CFH continues to perform well with B2B volumes in line with expectations

·     

Management remains confident of a strong performance in 2017 driven by both organic growth and the acquisitions made in 2016


Alan Jackson, Chairman of Playtech, commented
:

“Playtech has continued to successfully execute its strategy for strong operational and financial performance, strategic M&A and shareholder returns.

“The Gaming division once again delivered very strong growth. Sports saw a good second half performance following the acquisition of BGT with the newly formed Playtech BGT Sports bringing together all aspects of the Playtech’s sports offering creating a fully integrated, best-in-class sports betting technology. 2016 also saw the signing of more than ten new customers with ten new customer go-lives. 9 of out of 10 top customers are now on long-term contracts with Paddy Power Betfair, William Hill, Rank and Betfred all renewing in the past few months.

“Following the transitioning of the Financials division in the first half of the year, the second half performance was encouraging with improved KPIs. The second half also saw the acquisition of CFH, enhancing Playtech’s position as it continues to build a B2B financials offering within its Financials division.

“The year was a strong year for M&A with €240 million spent on acquisitions including BGT, CFH, Quickspin and ECM. In addition to this, reflecting the strength of Playtech’s cashflows and flexibility of its balance sheet, €296 million was returned to shareholder including a €150 million special dividend and €50 million through a share buyback, with no impact on its M&A capabilities. In accordance with the new progressive dividend policy adopted in 2016, the full year 2016 dividend has been increased by 15%.

“Management remains confident of a strong performance in 2017 and beyond.”

Source: Playtech

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