Q4 2011 KPIs and trading update

RNS Number : 0451W

Playtech Limited

24 January 2012

 



Playtech Limited

('Playtech' or the 'Company')

Q4 2011 Key Performance Indicators and trading update

Strong quarterly performance provides confidence for full year and platform for future growth

Corporate strategy progressing with Joint Venture and M&A announcements

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 fourth quarter ending 31 December 2011; a trading update ahead of announcing final results on 15 March 2011; and corporate actions including German and South African JVs and the acquisition of a sports book developer.

Financial highlights

For the three months ending 31 December 2011:

§ Gross income up 79% to €78.4 million, (Q4/10: €43.9 million)

§ Total revenues up 89% to €69.6 million, (Q4/10: €36.9 million) and 13% higher than the €61.5 million achieved in Q3/11

Quarter-on-quarter revenue performance:

§ Casino revenues up 13% to €32.8 million, (Q3/11: €28.9 million)

§ Poker revenues down 2% to €5.5 million, (Q3/11: €5.6 million)

§ Bingo revenues up 9% to €4.1 million, (Q3/11: €3.8 million)

§ Services revenues up 18% to €23.1 million, (Q3/11: €19.5 million)

§ Videobet up 22% to €2.7 million, (Q3/11: €2.2 million)

For the 12 months ending 31 December 2011:

§ Gross income up 41% to €243.6 million, (2010: €173.1 million)

§ Total revenues up 46% to €207.5 million, (2010: €142.3 million); an increase of 15% excluding impact from 2011 acquisitions

§ Share of profit from William Hill Online (WHO) up 17% to €36.1 million for the full year (2010: €30.8 million), including €8.8 million in Q4/11

§ Cash balances net of credit facility debt at 31 December 2011 in excess of €137.3 million, after 2011 payment of €83.3 million for PTTS, IGS, Mobenga and Ash Gaming

Trading update

Daily activity for the first 22 days of January is 25% ahead of Q1/11 for software royalties and 2% ahead of the average for Q4/11. Services revenues are in line with Q4/11 and with expectations.

Corporate strategy progression

§ 49.99% joint venture with Gauselmann - a long-term partnership with Germany's leading land-based gaming operator and owner of the Merkur gaming brand. The joint venture has been formed in advance of German regulation and will offer broad-based sports betting and gaming products and services, where permitted

§ Acquisition of Geneity - a strategically significant transaction to acquire the sportsbook developer. Geneity will strengthen Playtech's regulated markets offering where high quality sportsbook capabilities are increasingly important and will replace the existing product offering

§ Joint Venture with Peermont - a long term 50:50 partnership with South Africa's leading casino and resort operator in advance of expected revisions to South African online gaming regulations. The joint venture will initially offer sports betting and, later, broad-based gaming, after the introduction of new regulation. Playtech will also benefit from a separate software license agreement to provide online gaming technology and player management systems to the partnership

§ Restructuring of the Sciplay joint venture - restructured to a simpler supplier relationship, with scope expanded outside initial lottery arrangement and on a non-exclusive basis. Delivers greater flexibility for both parties and more straightforward revenue recognition

Operational highlights

§ Ash Gaming acquisition completed in December, work commencing on integration

§ Paddy Power casino successfully launched at the start of October

§ Gala Coral migration project fully underway, targeting 2012 H1 product launches

§ Mobenga launches with Betchoice, and added scorecast betting capability to Skybet

§ Preparation for the opening of Spanish & Danish markets for Playtech licensees

§ Videobet operational development including datacentre capacity and international expansion

§ Commenced inital projects with a leading outsourcing company in Kiev

Commenting on the KPI's Playtech's Chief Executive, Mor Weizer, said:

"Playtech has again delivered a robust fourth quarter performance. As a result, the Board is very comfortable with market expectations for the year ended 31 December 2011 and looks forward to 2012 with confidence." 

"Growth from our existing business has created a solid platform for 2012. Taken together with today's other announcments, I believe Playtech is well positioned to take advantage of market opportunities wherever as and when they appear. It is clear that there is continuing momentum towards regulated gaming in Europe, with Denmark recently launched in regulated form, and both Spain and Belgium due to regulate this year. The US Department of Justice's pre-Christmas guidance has provided further encouragement for those looking to achieve regulation in the US. Playtech is preparing itself for each and every market to help its customers and partners make the most of the changing regulatory landscape and invest into those to certify its products."

"In line with the Company's strategy I am pleased to have also announced three corporate transactions, including a joint venture with Gauselmann Group, the leading German land based arcade and casino operator. Irrespective of how Germany regulates we expect this to be a significant partnership in a material market. Leading operators in domestic markets are clearly attracted to Playtech's joint venture proposition and we continue to pursue further discussions. Along with the Peermont Joint Venture also announced today, these agreements are clear evidence that the strategy we set out in the second half of 2011 is being delivered."  

"Playtech's acquisition of Geneity will enhance its sportsbook capabilities, replacing Playtech's existing offering and providing an important entry point for many operators in newly regulated markets. Taken with the acquisition of Ash Gaming, which we announced in December, we have invested in a substantially enhanced development capability in both product vertical and content areas."

Key Performance Indicators for the quarter ending 31 December 2011

Gross income

Three months ended '000 (€)	31 Dec 11	31 Dec 10	Change %	30 Sep 11	Change %
Gross income	78,393	43,896	79%	70,117	12%
Total revenue	69,612	36,889	89%	61,544	13%
WHO share of profit	8,781	7,007	25%	8,573	2%

Total revenue

Three months ended '000 (€)	31 Dec 11	31 Dec 10	Change %	30 Sep 11	Change %
Total revenue	69,612	36,889	89%	61,544	13%
Casino revenue	32,753	25,927	26%	28,936	13%
Poker revenue	5,508	5,876	-6%	5,629	-2%
Bingo revenue	4,143	3,329	24%	3,805	9%
Services revenue	23,132	325	7028%	19,545	18%
Videobet revenue	2,661	294	804%	2,172	22%

12 months ended '000 (€)	31 Dec 11	31 Dec 10	Change %
Gross income	243,558	173,086	41%
Total revenue	207,485	142,294	46%
WHO share of profit	36,073	30,792	17%

12 months ended '000 (€)	31 Dec 11	31 Dec 10	Change %
Total revenue	207,485	142,294	46%
Casino revenue	114,385	96,710	18%
Poker revenue	21,793	27,406	-20%
Bingo revenue	15,064	10,853	39%
Services revenue	43,012	1,079	3887%
Videobet revenue	7,769	2,026	283%

Revenue - share of geographical diversity [1]

Three months ended	31 Dec 11	31 Dec 10	30 Sep 11
Europe	74%	75%	74%
Asia Pacific	20%	20%	20%
Rest of the world	6%	5%	6%

Revenue - nominal change in geographical regions

Period	Q4/11 to Q4/10	Q4/11 to Q3/11
Europe	87%	12%
Asia Pacific	81%	13%
Rest of the world	160%	26%

12 months ended	YTD 2011	YTD 2010
Europe	74%	77%
Asia Pacific	20%	17%
Rest of the world	6%	6%

Revenue - nominal change in geographical regions

Period	YTD 2011 to YTD 2010
Europe	41%
Asia Pacific	73%
Rest of the world	31%

Mor Weizer, Chief Executive Officer, and David Mathewson, Chief Financial Officer, will host an analyst conference call at 9.30 am on Tuesday 24 January 2012.

Details of the conference call are as follows:

Dial-in no UK: [phone]

Dial-in no US: [phone]

Conference ID: 4507104

Replay (available for one week)

Dial-in no: [phone]

Conference reference number: 4507104#

An audio file will be also available on the Playtech website following the conference call.

- Ends -

For further information contact:

Playtech Ltd Mor Weizer, Chief Executive David Mathewson, Chief Financial Officer c/o Pelham Bell Pottinger Ross Hawley, Director of Investor Relations	[phone] [phone]
Collins Stewart Piers Coombs / Bruce Garrow	[phone]
Pelham Bell Pottinger David Rydell / Olly Scott / Guy Scarborough	[phone]

About Playtech

Playtech develops unified software platforms and content for the online and land-based gaming industry, together with providing a range of ancillary services such as marketing, hosting and CRM services.

Leading gaming applications include casino, poker, bingo, sports betting, live gaming, casual and fixed odds games. Playtech provides licensees with the tools to maximise cross-selling opportunities, player loyalty and yield, all through the powerful management interface - the IMS. The Group's capabilities enable the delivery of an integrated software or turnkey solution, with players accessing online, broadcast, mobile and server-based gaming terminals through a single account.

New licensees include existing online operators upgrading or diversifying their offering, land-based casino groups, government sponsored entities such as lotteries, and new entrants making their online gaming debut, particularly in newly-regulated markets.

Founded in 1999, Playtech has some 1,000 employees located in development centres in five countries, the majority of whom are engaged in research and development of current and future gaming technologies, together with 900 employees providing ancillary services.

www.playtech.com

 

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