Playtech PLC (LON:PTEC) reported underlying half-year profits ahead of previous guidance but said it didn’t expect this to be repeated in the second half.
EBITDA was €162.3mln for the first six months of the year versus €191mln a year ago and management’s guidance for “above €160mln” in early August.
The performance was mainly due to “exceptional” market volatility for Tradetech, its financial trading arm that owns Markets.com, which reported adjusted EBITDA of €52.8mln.
TradeTech's first half performance is “not expected to be repeated” in the second half as market volatility currently significantly lower, though overall group trading and cash generation has been “strong” so far in the second half, albeit with July stronger than August.
In the US, the FTSE 250 group said it has launched bet365 in New Jersey since the start of the second half and started the development of a live online casino facility in the same state.
Having suspended the dividend and share buyback earlier in the year due to uncertainty around coronavirus, allowing it to preserve over €65mln of cash, with the balance sheet further strengthened with €35.7mln from the sale of land in Italy.
There was no comment about the restart of shareholder returns but instead management intends to make “selected high-return investments” such as in the US market.
The shares were down 6% at 366.3p by mid-morning on Thursday.
Broker Peel Hunt said it was not changing its full year EBITDA forecast of €287.4mln, which has shares trading at 14.8 times forward earnings, “at which level we believe the shares are up with events”.