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Playtech adds new business despite mixed trading during pandemic

Retail closures and the cancellation of sporting events hit performance, lifted by higher demand for online services

Playtech PLC - Playtech adds new business despite mixed trading during pandemic

Playtech PLC (LON:PTEC) said it has added over 20 new brands so far in 2020 and is on track to surpass its annual target of 50 despite the ongoing crisis.

In April, adjusted underlying earnings (EBITDA) came in at €23mln, thanks to strong performance in the online business, in joint ventures and in financial division TradeTech.

The gambling software provider has seen mixed trading in the business-to-business (B2B) segment, taking a hit from retail closures and the cancellation of sporting events, lifted by higher demand for online services.

READ: 888 upgraded and Playtech downgraded as Deutsche Bank provides mixed assessment on online gambling groups

Consumer-facing business (B2C) Snaitech is performing better than anticipated despite thanks to its low fixed costs and online presence, but it is unclear when retail locations in Italy, its main market, will be able to reopen.

Asian operations have been impacted by restrictions in China, Malaysia and the Philippines, but were “more than offset” by a temporary contract with “the leading provider of Live Casino in the region”.

The FTSE 250-listed firm has postponed the share repurchase programme and suspended the dividend, saving €65mln.

As of 30 April 2020, there were €600mln of available liquidity. Playtech received a further €14mln from the sale of Snaitech land in Italy and expects to receive the remaining €36mln in three months.

Non-executive director Claire Milne, who has 20 years' experience advising gaming and financial services clients as a lawyer, was appointed as interim chair to replace Alan Jackson, who is leaving after 14 years at the firm.

Analysts at Peel Hunt noted that the recovery is currently unpredictable due to the lack of sports and the closure of venues in its core businesses, B2B and B2C, therefore the stock remains a 'hold'.

Shares rose 3% to 238.5p on Wednesday morning.

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Quick facts: Playtech PLC

Price: 409.9 GBX

Market: AIM
Market Cap: £1.23 billion

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