The financial division at software company Playtech (PTEC) will now be referred to as TradeTech. Management wants to expand this area and thinks the new title is more representative of the breadth of its operations, which include business-to-business trading services and the consumer platform Markets.com. Revenue in this division was up 43 per cent at constant currency to €45.1m (£40m), although not included is the acquisition of a trading platform and accompanying client portfolio from Alpha Capital Markets. That deal was signed post-period-end for an initial $5m, although Playtech could end up paying closer to $150m based on earnings over the next three years.
Investors will need to keep an eye on the The Financial Conduct Authority's intervention in the contracts for difference market, and how it affects Markets.com – although PlayTech's management has previously said this could bring helpful barriers to entry.
The larger gaming division saw revenue increase by 28 per cent at fixed currencies to €377m, driven primarily by the casino business as more people turn to their mobile devises to play these games. PlayTech renewed its contracts with Paddy Power Betfair (PPB), Betfred and Sky Bet, and also signed a three-year agreement with Greek betting and lottery operator OPAP, which helped boost regulated gaming revenue.
Analysts at Numis expect EPS of 83.5¢ in the year to December 2017, from cash profits of €353m, up from 59.8¢ in 2016.
| PLAYTECH (PTECH) | ||||
| ORD PRICE: | 986p | MARKET VALUE: | £3.13bn | |
| TOUCH: | 986-988p | 12-MONTH HIGH: | 1,020p | LOW: 758p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 343¢* | NET CASH: | €336m | |
| Half-year to 30 June | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
| 2016 | 338 | 51.3 | 15.3 | 11.0 |
| 2017 | 422 | 91.4 | 28.5 | 12.1 |
| % change | +25 | +78 | +86 | +10 |
| Ex-div: | 21 Sep | |||
| Payment: | 24 Oct | |||
| *Includes intangible assets of €993m, or 313¢ a share £1=€1.09 | ||||
