Playtech, the world’s largest online gambling software provider, increased profits by 22% last year on the back of a stellar performance from its core casino games component.
Playtech, which provides casino games and poker for leading UK-owned websites such such as Bet365 and William Hill, posted a 22% increase in adjusted earnings before deductions for interest expenses, taxes, debt and amortization for 2011 to €125.5m. Total revenue, including its 29% minority interest in UK bookmaker William Hill’s online operation, was up 41% in 2011 to €243.6m.
Chairman Roger Withers, who also performs the same role for 10% Playtech-owned football pools and tote racing business Sportech, said the results reaffirmed the company’s positioning as “clear market leader in the provision of software and services to the online gaming industry.”
Revenue from casino games was up by 18%, which the games supplier attributed to a mix of organic growth and the addition of new websites offering the company’s games to casino players. Playtech launched 50 new downloadable and Flash-based games last year, with one of the company’s networked jackpot slot games, Beach Life, paying out £5.1m last month to a player on Betfred.com, a UK record.
A total of 15 new companies either joined the Playtech platform or added more of Playtech’s games during 2011, which included Gala Coral, Paddy Power and the California Online Poker Association, a consortium of gaming tribes and cardrooms looking to offer online poker within state borders in the US’ most populous state as regulation allows. Playtech also integrated its Live Dealer casino product for Betfair.
The company added that the four bolt-on acquisitions it made during 2011 - mobile provider Mobenga, casino games provider Ash Gaming, Gala Coral sportsbook platform supplier Geneity, and Intelligent Gaming - had all added valuable scale and provision capability, and were performing strongly. 2011 also saw Playtech launch cash poker and casino games on behalf of operators in Italy, where its licensees accounted for close to 14% of cash poker revenue in January of this year. Since the turn of the year, it has also launched products on behalf of seven operators in the newly regulated market of Denmark, and remains on track for the launch of regulated online gaming in Spain from the end of June onwards, having already launched products on behalf of Casino Gran Madrid under a regional licence last year.
Online poker, for which its iPoker network is the leader in the dot.com marketplace (excluding segregated player pools in markets such as Italy and France) however proved far more challenging for the group last year, as revenue tumbled 20.5% to €21.8m. The decision taken by most of its leading licensees not to enter the regulated French market - where Playtech’s most profitable casino products are excluded - was responsible for most of this drop, revealed the company, which said that network liquidity was up by 20% on a like-for-like basis if France was exempted.
The London AIM-exchange listed company also reiterated its intention to move to the main London market, stating today that it had “not lost sight of its strategic goal to qualify for a Premium Listing”. The company’s broker Deutsche Bank resigned last November ahead of a £100m fundraising through the issue of new shares underwritten by major shareholder Teddy Sagi, who increased his shareholding to 49.9%.
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