Retail Closures Impact Playtech B2B and B2C Revenues
Playtech has reported corporate losses of €73m (£62.5m/$87m) in 2020, compared with a profit of €55.9m in 2019.
The loss comes after a year of significant expenditure on its expansion strategy was compounded by the protracted closure of casinos and restrictions on sporting events last year.
The supplier recorded full-year group revenues of €1.07bn, down 25% on the previous year’s results of €1.4bn.
Revenue from Playtech’s B2B division was down 11% to €495m, from €554m the previous year, which it attributed mainly to the lockdowns in Europe. The covid-19 restrictions led to a 51% decline in overall retail revenues, while 28% of income was lost from Asian contracts.
The firm’s expansions strategy, particularly in the US and Latin America, meant that operating costs for 2020 were up 8.8% to €369m, from €339m in 2019.
As a result, Playtech’s B2B arm reported a 14% decrease in adjusted EBITDA to €125.8m from €215m in 2019.
Covid-19 also hit Snaitech Italia’s revenues, with the operator’s income down 31% and consequently Playtech’s overall B2C revenues fell 34% to €569m from €900m the previous year.
However, CEO Mor Weizer said: “Snaitech has continued to excel in Italy despite the retail closures in 2020. Snai achieved the number one market share position in Italy across online and retail sports betting and grew its overall online revenue by 58% in 2020.”
Looking at the B2B and B2C units together, Playtech recorded a 19% decline in group-wide adjusted EBITDA to €310m, from €383m in 2019. The firm’s adjusted post-tax profit was down 80% to €27m, from €137m.
Playtech’s recent expansion activities have included launching with bet365 and Entain in the US in 2020, and the company has since signed agreements with the Greenwood companies, which include Parx Casino, to license products in Michigan, Indiana, New Jersey and Pennsylvania.
Weizer said: “The attitude and skill of our people, and the strength and diversification of our technology-led business model has enabled us to deliver a robust financial performance in spite of the challenging backdrop.”
He added: “The significant strategic and operational progress we achieved in 2020 has placed us in a strong position to capture the exciting market opportunities ahead.”
Playtech reported that it had signed more than 100 new brands in 2020 (compared with more than 50 in 2019), including Betsson, Stoiximan and Kindred. The latter was announced one day prior to the results filing.