Q3 KPIs

RNS Number : 8710H

Playtech Limited

11 November 2008

 



Playtech Limited
('Playtech' or 'the Group' or 'the Company')

Key Performance Indicators for the Quarter ending 30 September 2008

Playtech (AIM: PTEC), the international designer, developer and licensor of software for the online, mobile and land-based gaming industry, today announces its Key Performance Indicators for the third quarter ended 30 September 2008 and for the nine months ended 30 September 2008.

The Company has changed its reporting currency to Euros (previously US$) with effect from 1 July 2008. All numbers prior to this date have been converted using a flat rate of 1.5777 US$ per Euro. This reflects the fact that the majority of the Company's revenues and expenses are now settled in Euros. For ease of comparison, both Euro and US$ figures are included in the tables below.


Financial Highlights

·                     Revenues for the quarter totalling €28.5 million (US$42.4m), representing an increase of 67% on the €17.0 million (US$26.9m) earned in Q3 2007 and an increase of 6% on the €26.9 million (US$42.4m) achieved in Q2 2008:

o                   Casino revenues totalled €20.6 million, an increase of 69% from the €12.1 million in Q3 2007 and an increase of 5% on the €19.5 million earned in Q2 2008;

o                   Poker revenues totalled €7.6 million, an increase of 60% on the comparable 2007 quarter and an increase of 9% on the €7.0 million achieved in Q2 2008.

·                     Total revenues for the first 9 months of 2008 were €80.1 million (US$123.8m) representing an increase of 78% from the €44.9 million (US$70.9m) earned in the first 9 months of 2007:

o                   Casino revenues increased by 75% to €57.3 million (US$88.6m) compared
with the same period in 2007;

o                    Poker revenues increased by 88% to €21.5 million (US$33.3m) compared
 with the same period in 2007. 

·                     Current trading for October was very strong, registering 10.6% growth on an average daily basis in its online activities compared with the daily average experienced during Q3 2008. November trading, to date, has shown further growth on October 2008.

Operational Highlights

·                    4 new licence agreements signed during the quarter, including leading Italian operators Eurobet Italia, Sisal SpA and Cogetech SpA.

·                    The Company also entered into 3 MOUs with operators located in regulated jurisdictions.

·                    Successful migration of Mansion poker room completed at the end of September 2008.

·                    Play for fun poker version launched on Playtech’s Italian poker network. Play for real version intended to be launched by the end of Q4 2008.

·                    Strong pipeline of new licensees.

·                    Playtech continues to expand its product offering. During the quarter it fully launched its Asian P2P Games with selected licensees together with an enhanced set of management tools specifically for use with the Asian markets. It also released a new version of Bingo, with the intention of further investment into this product. Live games product is being expanded to include a European offering. Flash poker was launched in Q3 2008 and continues to be successfully rolled out with completion scheduled for the end of Q4 2008.

·                    Strong growth in the Asia Pacific region has increased revenues and the proportion of total revenues generated from that region.

Strategic Highlights

           William Hill 

·                    On 20 October Playtech announced that it is to supply William Hill Online with casino, poker and other gaming software products on a phased basis commencing January 2009 and culminating in an exclusive relationship for casino and poker from 1 January 2010. The William Hill Online Licence will run for a minimum of five years.

·                    Playtech entered into contractual arrangements to acquire certain online gaming marketing assets, businesses and contracts (“the Purchased Assets”) from affiliates and other third parties for a total consideration of up to US$250 million* in cash to be completed in January 2009.

·                    Playtech to inject the majority of the Purchased Assets on completion into William Hill’s entire online gambling operation in return for a 29 per cent. interest in William Hill’s enlarged online operation (“William Hill Online”). Playtech's interest in William Hill Online can increase up to 32 per cent. depending on certain conditions relating to the integration.

* The final cost of the acquisition to Playtech will be recorded on completion in January 2009 based on the €:US$ exchange rate at the date of completion. To avoid currency fluctuations between exchange and completion, the Company has acquired sufficient US Dollars to meet its obligation to pay the purchase price in US Dollars.

MIXTV

·                    On 14 August 2008 the Company announced the asset acquisition of MIXTV Ltd for a total cash consideration of US$1.75 million. MIXTV is a subsidiary of Win Gaming Media, Inc, which provides leading end-to-end technology for the delivery of mass-multi-player live gaming applications via broadcast television and interactive live TV shows, on analogue, digital, terrestrial, cable, satellite TV networks, and web broadband TV.

Operations

Playtech has had an excellent third quarter, traditionally the slowest quarter of the year. The Group's total revenues in the third quarter were €28.5 million, a 67% increase from that achieved in the third quarter of 2007 and an increase of 6% on the previous quarter. The Group's casino revenues were up 69% to €20.6 million from the same quarter in 2007 and increased by 5% compared with the previous quarter. Poker revenues grew by 60% to €7.6 million compared with the same quarter in 2007 and grew by 9% compared to the previous quarter.

As a result of Playtech gaining new licensees focused on the European market and its existing licensees focusing on this market, the majority of its revenues are now generated in Euros. The majority of Playtech's expenses are also in Euros and as a result, Playtech will now report its financial results in the Euro currency with effect from 1 July 2008. Accordingly, historical numbers up to and including 30 June 2008 will be converted into Euros based on the US$:€ exchange rate at 1 July 2008 (1.5777 US$ per Euro). 

Current Trading

Current trading for October 2008 was very strong where on an average daily basis, Playtech is showing 10.6% growth in its online activities compared with the daily average experienced during Q3 2008. Encouragingly, November has started strongly with trading levels exceeding October 2008.

As at 30 October 2008, the Company had a net cash position of €204million.  

Playtech's iPoker network will be commencing the third European Championship of Online Poker on 24 November 2008 with a total guaranteed prize pool in excess of US$4 million. 

Videobet is in the final stage of completing the Italian certification process for its multigame software which has been tailored specifically for the Italian market. It expects its software will be deployed initially in approximately 300 machines in the current and next quarter. Videobet has also signed an agreement with Sceptre Leisure for the supply of its multigame software for use in category B2/B3 machines (previously known as FOBTs) in the UK market. Deployment process has already commenced and Sceptre has committed to deploy a minimum of 800 machines during 2009. 

As previously announced on 2 October 2008, Playtech migrated Mansion's poker room onto the iPoker network, having already migrated its casino platform last year.

In addition, Playtech has signed three memoranda of understanding with gaming operators.

Following the announcement of the licensing deal with Paramount ('Gladiator' and 'Untouchables'), Playtech is actively exploring further licensing opportunities and is in active negotiations with the owners of several well known brands.
 

Mor Weizer, Chief Executive Officer, commenting on the KPI's, said today:

'This has been another strong quarter for the Group in what is traditionally the slowest period of the year. The addition of new licensees combined with organic growth during the period has resulted in continued growth across all business divisions. Combined with the strong November start, the Board believes that Playtech is well positioned for further growth during the remainder of the year and into 2009.

Notable during the period was the groundbreaking sale of certain assets and businesses to William Hill as well as signing them as a new licensee. Playtech is excited to be working with a company with the scale and breadth of William Hill in what we believe will be very significant deal for Playtech. The transaction is the first in a number of other potentially significant earnings enhancing affiliate acquisition opportunities. The Group continues to pursue significant business opportunities across all the regulated markets and the Board is confident regarding the Group's trading performance for the rest of 2008 and beyond.'

  Third Quarter Key Performance Indicators at 30 September 2008

Revenues (EUR)

Three months ended '000 (€)	30 September  2008	30 September 2007	Change	30 June  2008	Change
Total Revenues	28,463	17,048	+67%	26,888	+6%
Casino Revenues	20,550	12,139	+69%	19,521	+5%
Poker Revenues	7,564	4,741	+60%	6,969	+9%

Share of Geographical Diversity [1]

Three months ended	30 September 2008	30 September 2007	30 June 2008
Europe	69%	72%	72%
Asia Pacific	25%	20%	21%
Rest of the World	6%	8%	6%

Nominal Change in Geographical Regions

Period	Q3 2008 to Q3 2007	Q3 2008 to Q2 2008
Europe	+69%	+2%
Asia Pacific	+119%	+29%
Rest of the World	+46%	+3%

First 9 Month Key Performance Indicators at 30 September 2008

 Revenues (EUR)

Nine months ended '000 (€)	30 September  2008	30 September 2007	Change
Total Revenues	80,051	44,914	+78%
Casino Revenues	57,312	32,829	+75%
Poker Revenues	21,514	11,419	+88%

Share of Geographical Diversity [1]

Nine months ended	30 September 2008	30 September 2007
Europe	71%	71%
Asia Pacific	22%	21%
Rest of the World	7%	8%

 Nominal Change in Geographical Regions

Period	9M 2008 to 9M 2007
Europe	+86%
Asia Pacific	+97%
Rest of the World	+43%

[1] The relative share is calculated as the total players' income derived from the specific region divided by the total players' income from all regions

Q3 Revenues (USD)

Three months ended '000 ($)	30 September  2008	30 September 2007	Change	30 June  2008	Change
Total Revenues	42,396	26,899	+58%	42,423	0%
Casino Revenues	30,624	19,152	+60%	30,775	0%
Poker Revenues	11,258	7,481	+50%	11,020	+2%

Nine Month Revenues (USD)

Nine months ended '000 ($)	30 September  2008	30 September 2007	Change
Total Revenues	123,790	70,865	+75%
Casino Revenues	88,600	51,797	+71%
Poker Revenues	33,292	18,017	+85%

Mor Weizer, Chief Executive Officer, and Shuki Barak, Interim Chief Financial Officer, will be hosting an analyst conference call at 11:30 am (UK time) on 11 November 2008.  The timing of the call has been set to allow analysts from outside of the UK to participate.

Details of the conference call are as follows:

Dial-in no UK:              [phone]

Dial-in no US:              [phone]                      

Conference title:          Playtech Q3 KPIs                        

Replay (available for 1 week):

Dial-In No:                   + 44 (0) 207 190 5901                                     

PIN code:                    141089#                        

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For Further Information:

Mor Weizer, CEO, Playtech Ltd

Shuki Barak, CFO, Playtech Ltd 

c/o Bell Pottinger Corporate & Financial                                       Tel: [phone]     

www.playtech.com

Nick Ellis 

Collins Stewart                                                                              Tel: [phone]

Mumtaz Naseem
Deutsche Bank                                                                              Tel: [phone]

David Rydell / Chris Hamilton 

Bell Pottinger Corporate & Financial                                             Tel. [phone]  

About Playtech 

Playtech develops unified software platforms for the online and land based gambling industry, primarily targeting existing online operators wanting to upgrade their system; sportsbooks looking to diversify and land-based operators making their online debut. Playtech gaming applications - online casino, poker, bingo, mobile gaming, live gaming, land-based kiosk networks and fixed-odds games - are fully inter-compatible and can be freely incorporated as stand-alone applications, accessed and funded by players through the same user account and managed by the operator by means of a single powerful management interface. Founded in 1999, Playtech has over 750 personnel distributed globally, around seventy five percent of whom are engaged in research and development of current and future gaming technologies. 

Website: www.playtech.com 

 

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