- Betting shop and casino closures hit profits in 2020
- Focus on higher margin B2B tech looks promising
Gambling software group Playtech (PTEC) had a tough 2020, as the pandemic wiped out the live sports calendar and forced betting shops and casinos to close.
Adjusted cash profits dropped by almost a third to €254m (£223m), excluding the contribution of its Finalto business, formerly known as TradeTech. Playtech discontinued the division as part of its ongoing simplification process, although noted that it is still in discussions around its potential sale. In the core B2B gambling division, a 6 per cent slip in revenue from continuing operations was cushioned by strong growth in digital products.
Playtech also announced that Brian Mattingley – ex 888 Holdings (888) - will become non-executive chairman from the beginning of June, succeeding Alan Jackson.
A highly-experienced new chair, a simplified structure and a sharper focus on higher margin opportunities in its B2B tech products are promising developments, as is the prospective easing of social coronavirus restrictions in Europe and the US. Hold.
Last IC view: Hold, 355p, 17 Sep 2020
| PLAYTECH (PTEC) | ||||
| ORD PRICE: | 499p | MARKET VALUE: | £ 1.53bn | |
| TOUCH: | 498.3-499p | 12-MONTH HIGH: | 518p | LOW: 111p |
| DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
| NET ASSET VALUE: | 294¢* | NET DEBT: | 65% | |
| Year to 31 Dec | Turnover (€bn) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (¢) |
| 2016 | 0.71 | 200 | 61.4 | 32.7 |
| 2017 | 0.81 | 267 | 78.9 | 36.0 |
| 2018 | 1.23 | 188 | 40.7 | 24.1 |
| 2019** | 1.44 | 88.2 | 18.5 | nil |
| 2020 | 1.08 | -52.7 | -24.5 | nil |
| % change | -25 | - | - | - |
| Ex-div: | na | |||
| Payment: | na | |||
| *Includes intangible assets of €1.1bn or 358¢ a share **Restated £1=€1.17 | ||||
