A poor first half for the Playtech (PTEC) business in Asia was to be expected. A surge in competition in China meant that new entrants had been cutting prices in the hope of grabbing market share, while online gambling has been blocked in Malaysia since last year. Group sales at constant currency improved by 6 per cent during the first half, but strip out the Asian business and group revenue was up 35 per cent.
In the long term, Playtech is planning to focus solely on regulated markets, as opposed to unregulated affairs such as China and Malaysia. During the reported period, 69 per cent of sales came from regulated markets, compared with around half this time last year, and the group is on track to hit 80 per cent by the full year. The expansion into these markets is to be partly achieved through acquisition. Indeed, the deal to acquire Italian gambling company Snaitech was consolidated in early June. Playtech chief executive Mor Weizer expects licensing rules to be introduced in some major European countries such as the Netherlands, Sweden and Switzerland in 2019, which would provide further opportunity for expansion in regulated markets.
Analysts at Goodbody expect EPS of 58.4ȼ during 2018, compared to 70.9ȼ in 2017.
| PLAYTECH (PTEC) | ||||
| ORD PRICE: | 565p | MARKET VALUE: | £1.79bn | |
| TOUCH: | 565-567p | 12-MONTH HIGH: | 1,003p | LOW: 488p |
| DIVIDEND YIELD: | 5.7% | PE RATIO: | 7 | |
| NET ASSET VALUE: | 440ȼ* | NET CASH: | €223m | |
| Half-year to 30 Jun | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (ȼ) | Dividend per share (ȼ) |
| 2017 | 422 | 91.4 | 28.5 | 12.1 |
| 2018 | 436 | 124 | 35.7 | 12.1 |
| % change | +4 | +36 | +25 | |
| Ex-div: | 20 Sep | |||
| Payment: | 23 Oct | |||
| *Includes intangible assets of €1.66bn, or 522ȼ a share £1=€1.11 | ||||
