Playtech points to ‘strong core’ as TradeTech struggles

Publishing its latest year-to-date trading update, the governance of Playtech Plc has disclosed that full-year adjusted EBITDA will be below market consensus, despite the firm’s ‘core business’ segments continuing to perform strongly.

The FTSE250 technology group attributes its earnings slowdown to financial unit ‘TradeTech’, which expects 2019 results to be ‘well below management expectations’.

Updating investors, Playtech governance informs that it continues its review of all ‘non-core business units’ to simplify the group’s structure – at present, Playtech’s ‘casual and social games’ unit is being assessed for a potential sale.

Despite the struggles of TradeTech, Playtech highlights a positive trading period for its ‘core B2B unit’, which is delivering on its 2019 commercial strategy of ‘catering to over 1,000 brands and customers that previously Playtech did not have any presence with’.

Strong B2B momentum is supported by the continued growth of its Snaitech Italian gambling division, which is ‘exceeding group expectations’ after increasing its market share within a disrupted Italian gambling marketplace.

Beyond Europe, Playtech has reduced its exposure within Asian markets. A stabilised Asia unit is anticipated to contribute approximately €115 million of revenues in 2019.

Further highlights include today’s announcement of a major digital services agreement with leading Colombian gambling operator Wplay – expanding its presence within South America.

During the trading period, Playtech successfully extended its revolving credit facility to €317 million, with the loan facility open for a term of four years with a one-year extension option.