B2B Revenue of Playtech Declines in H1 2019

The B2B revenue of Playtech has declined in H1 2019. This was driven by the Snaitech acquisition. The operator contributed €395.8m in revenue for H1, a significant increase on the €61.3m generated from Playtech’s stake in the business in 2018.

Group revenue for the six months to 30 June 2019 amounted to €736.1m, a 69% year-on-year increase from H1 2018, when the supplier reported revenue of €436.5m. Growth was largely down to increased B2C revenue, which soared 345% to €438.2m.

The Snaitech-driven B2C growth was not matched by Playtech’s core B2B operations, with revenue down 9% year-on-year at €265.5m. The decline was due in part to a 24% drop in casino revenue to €129.8m, offset by growth in B2B sports revenue, which rose 27% to €60.6m.

Playtech’s significant growth in size and scale prompted by the Snaitech deal contributed to a sharp increase in distribution costs, which almost doubled to €492.8m, and administrative expenses, which grew to €78.9m.

A further charge of €4.6m relating to the impairment of other receivables, which left earnings before interest, tax, depreciation and amortisation of €159.8m, up 32.7% year-on-year.

However, Playtech was then hit by significantly increased depreciation and amortisation, as a result of the acquisition of Snaitech. Depreciation increased by 52% to €24.9m, of which €8.8m was incurred through Snaitech. Excluding acquired assets, underlying depreciation increased by 6%.

Based on the H1 figures, Playtech has reiterated its adjusted EBITDA projection for the year of between €390m and €415m and expected B2B and Snaitech to perform well for the remainder of 2019.