Slide 1: Full year results 2015
Full year results 2015 25 February 2016
Slide 2: Agenda
AGENDA Operational and Highlights Financial review Q&A strategic review Alan Jackson Ron Hoffman Mor Weizer Chairman Chief Financial Officer Chief Executive Officer Full year results 2015 2
Slide 3: Continued Momentum
CONTINUED MOMENTUM Another year of record results Gaming division continues to lead the industry and drive growth Financials division created with business model improved Significant opportunities for further growth, both organically and through M&A Management confident in strong growth in
Slide 4: Agenda
AGENDA Operational and Highlights Financial review Q&A strategic review Alan Jackson Ron Hoffman Mor Weizer Chairman Chief Financial Officer Chief Executive Officer Full year results 2015 4
Slide 5: Results Summary
RESULTS SUMMARY 700 2014 2015 600 630.1 € Millions 500 400 457.0 300 200 251.9 207.1 190.8 205.9 100 0 Total revenue Adj. EBITDA Adj. Net Profit +38% +22% +8% Full year results 2015 5
Slide 6: Underlying Results
UNDERLYING RESULTS S T R O N G R E V E N U E G R O W T H O N A N U N D E R LY I N G B A S I S 700 2014 2015 600 500 569.2 € Millions 400 452.3 300 200 255.6 222.9 207.4 192.9 100 0 Total revenue Adj. EBITDA Adj. Net Profit Excl. acqs / POC +26% +23% +16% + excl. white-label +21% +23% +15% + at CC +1
Slide 7: Revenue Growth by Gaming Vertical
REVENUE GROWTH BY GAMING VERTICAL STRONG GROWTH ACROSS ALL KEY VERTICALS +€64.5m +€22.8m +€5.9m +€13.1m +€3.0m -€2.6m 40% 79% 20% 26% 22% 17% 17% 0% -19% -20% Casino Services Sport Land-based Bingo Poker Full year results 2015 7
Slide 8: Improvements to Markets Limited
IMPROVEMENTS TO MARKETS LIMITED I N D U S T R Y- L E A D I N G S T A N D A R D S The regulatory environment has developed with tighter restrictions and controls imposed Markets Limited has gone well-beyond what is industry practice for compliance risk-averse approach impacts conversion rates
Slide 9: Performance of Markets
PERFORMANCE OF MARKETS L O W E R V O L AT I L I T Y I M PA C T S 2 0 1 5 P E R F O R M A N C E Pro-forma full year 2015 Performance in H2 2015 $m 2015 2014 Chg $m 2015 2014 Chg Net revenue 100.2 87.8 14% Net revenue 55.6 57.0 -2% Adj. EBITDA 29.1 34.9 -17% Adj. EBITDA 17.0 31.7 -46% Adj. EBITDA marg
Slide 10: What to Expect from Markets in 2016
WHAT TO EXPECT FROM MARKETS IN 2016 A P L AT F O R M F O R G R O W T H Markets will be better placed to capture new business and also meet the very highest standards of compliance Laying the foundations for future growth customer acquisition through automated funnels better technology, with
Slide 11: Margin Analysis
MARGIN ANALYSIS S I M I L A R U N D E R LY I N G M A R G I N I N 2 0 1 4 A N D 2 0 1 5 2014 EBITDA margin 2015 EBITDA margin 50% 45% 47.0% 47.8% 45.3% 46.3% 44.9% 40% 42.9% 40.0% 35% Excluding white-label At CC 2014 adjusted white-label 2015 adjusted acquisitions Excluding Excluding and POC Excludin
Slide 12: Cost Analysis (including acquisitions)
COST ANALYSIS A D J U S T E D O P E R AT I N G C O S T S – I N C L U D I N G A C Q U I S I T I O N S €m 2015 2014 Adj. operating costs 378.2 249.8 Revenue-driven costs 65.7 10% 37.5 8% Adj. operational costs excluding revenue-driven costs 312.5 212.3 Employee-related costs 183.6 59% 133.0 63% Cost o
Slide 13: Cost Analysis (excluding acquisitions)
COST ANALYSIS A D J U S T E D O P E R AT I N G C O S T S – E X C L U D I N G A C Q U I S I T I O N S €m 2015 2014 Adj. operating costs 317.4 245.0 Revenue-driven costs 63.7 11% 43.0 10% Adj. operational costs excluding revenue-driven costs 253.7 202.0 Employee-related costs 151.5 60% 124.6 62% Cost
Slide 14: Net Profit, EPS and DPS
NET PROFIT, EPS AND DPS B E L O W T H E L I N E I T E M S I M PA C T E D B Y F I N A N C I N G Adjusted net profit up 8% vs 22% growth in adjusted EBITDA lower exchange rate gains on cash balances financing costs of new debt facilities increased loss from share of associates Adjusted EPS u
Slide 15: Cashflows
CASHFLOWS H I G H C A S H G E N E R AT I O N A N D C A S H C O N V E R S I O N Operating cash inflows of €202m Further inflows from financing activities net proceeds of €313m through the equity placing to fund future acquisitions €200m new fully drawn debt facilities (€240m fully drawn in 20
Slide 16: Balance Sheet
BALANCE SHEET R E TA I N I N G S I G N I F I C A N T F I N A N C I A L F L E X I B I L I T Y Strong cash position cash and cash equivalents of €858 at year end (including fully drawn down debt) €751m when deducting progressive operators' jackpots, security deposits and players liability In a
Slide 17: Agenda
AGENDA Operational and Highlights Financial review Q&A strategic review Alan Jackson Ron Hoffman Mor Weizer Chairman Chief Financial Officer Chief Executive Officer Full year results 2015 17
Slide 18: Key Drivers of Gaming Performance
KEY DRIVERS OF GAMING PERFORMANCE C O N T I N U I N G G R O W T H F R O M R E G U L AT E D M A R K E T S Continued strong operational performance Strong growth across regions and product verticals with particularly strong growth in the UK Regulated revenues driving growth 41% of 2015 Gaming
Slide 19: Operational Highlights
OPERATIONAL HIGHLIGHTS ANOTHER YEAR OF PROGRESS AND MOMENTUM Many new products launched including true omni-channel games, with new features unlocked when played on multiple devices many new games, including a slot game based on the iconic Top Gun film a first sports betting app for wearable
Slide 20: Ahead of the Curve
AHEAD OF THE CURVE 2 0 1 5 S A W P L AY T E C H L AY T H E F O U N D AT I O N S F O R T H E C O M I N G Y E A R S Preparing for the future 10 new customers signed Further development of omni-channel, arming existing customers with the very best tools and proven content benefitting all customers
Slide 21: Update on Regulation: Sport
UPDATE ON REGULATION: SPORT M A N Y C O U N T R I E S H AV E R E G U L AT E D O N L I N E S P O R T S B E T T I N G … SWEDEN FINLAND Multi-licensing regime NORWAY ESTONIA LATVIA DENMARK LITHUANIA IRELAND UNITED KINGDOM POLAND NETH. GERMANY BEL. LUX. CZ SLOV. FRANCE AUSTRIA HUNGARY SWITZ. ROMANIA ITA
Slide 22: Update on Regulation: Sport
UPDATE ON REGULATION: SPORT …WITH MORE EXPECTED OVER THE COMING YEARS SWEDEN FINLAND Multi-licensing regime NORWAY ESTONIA Restricted and/or DENMARK LATVIA LITHUANIA unregulated IRELAND UNITED KINGDOM POLAND NETH. Legislation in BEL. LUX. GERMANY CZ process SLOV. FRANCE AUSTRIA HUNGARY SWITZ. ROMANI
Slide 23: Update on Regulation: Casino
UPDATE ON REGULATION: CASINO C A S I N O I S L E S S R E G U L AT E D … FINLAND SWEDEN Multi-licensing regime NORWAY ESTONIA LATVIA DENMARK LITHUANIA IRELAND UNITED KINGDOM POLAND NETH. GERMANY BEL. CZ LUX. SLOV. FRANCE AUSTRIA HUNGARY SWITZ. ROMANIA SLOVENIA ITALY BULGARIA PORTUGAL * The current re
Slide 24: Update on Regulation: Casino
UPDATE ON REGULATION: CASINO …WITH SIGNIFICANT OPPORTUNITIES IN THE COMING YEARS FINLAND SWEDEN Multi-licensing regime NORWAY ESTONIA LATVIA Restricted and/or DENMARK LITHUANIA unregulated IRELAND UNITED KINGDOM POLAND NETH. GERMANY Legislation in BEL. LUX. CZ SLOV. process FRANCE SWITZ. AUSTRIA SLO
Slide 25: Playtech: The Natural Choice
PLAYTECH: THE NATURAL CHOICE U N R I VA L L E D P R O D U C T O F F E R I N G W I T H A T R A C K R E C O R D O F S U C C E S S Omni-channel offering provides customer with roadmap for growth which mirrors the regulatory backdrop – Playtech will be there for the whole journey retail capability
Slide 26: Playtech: Technology First
PLAYTECH: TECHNOLOGY FIRST C O N T I N U O U S LY E X T E N D I N G O U R L E A D Keeping pace with a fast moving backdrop is key to success technology is Playtech’s DNA it is our core business c.17% of revenue spent on R&D each year to extend technology lead over 1,500 employees dedicated
Slide 27: World Leading Content
WORLD LEADING CONTENT M O S T G A M E S A N D VA R I E T Y ; P O P U L A R A C R O S S C O U N T R I E S Over 500 games, with 120 developed as “mobile-first” Producing over 50 new games every year with 70 planned for 2016 World’s largest accessible progressive on-line jackpots Top performing
Slide 28: Games Are Not Commodity Products
GAMES ARE NOT COMMODITY PRODUCTS THE SAME GAMES ARE TOP PERFORMERS ACROSS DIFFERENT CUSTOMERS Ranking of game with customer (by GGR) Slot game - ranked by GGR UK Licensee 1 UK Licensee 2 UK Licensee 3 UK Licensee 4 UK Licensee 5 UK Licensee 6 UK Licensee 7 1 Jackpot 1 6 8 4 1 1 4 2 2 Slot 1 19 3 1 2
Slide 29: Capital Allocation
CAPITAL ALLOCATION LIVE M&A DISCUSSIONS; COGNISANT OF NEED FOR EFFIFICIENT BS Continued focus on M&A to augment organic growth Both strategic opportunities and bolt-on acquisition Cash balances at year end of €858m live discussions for significant strategic acquisitions in Gaming division
Slide 30: Current Trading and Outlook
CURRENT TRADING AND OUTLOOK MOMENTUM IN THE BUSINESS Strong current trading Strong pipeline in the Gaming division with an improved business model in the Financials division Focus on M&A with consideration to be given to returning cash to shareholders in absence of suitable acquisitions Conf
Slide 31: Agenda
AGENDA Operational and Highlights Financial review Q&A strategic review Alan Jackson Ron Hoffman Mor Weizer Chairman Chief Financial Officer Chief Executive Officer Full year results 2015 31
Slide 32: Appendices
Appendices Interims results 2015
Slide 33: Gaming Mobile Penetration
GAMING MOBILE PENETRATION I NCREASE F RO M 16% TO 21% O F SO F T WARE REVENUES I N 2015 PRODUCT VERTICAL 2014 (€M) 2015 (€M) GROWTH % Casino 23.6 48.3 104% Sports 22.2 26.5 19% Bingo 2.4 4.1 72% Poker 0.2 0.4 100% Total 48.4 79.4 64% Full year results 2015 33
Slide 34: Regulatory Split of Gaming Growth
REGULATORY SPLIT OF GAMING GROWTH R E G U L AT E D R E V E N U E S D R I V I N G G R O W T H Excl’ acquisitions 23% Existing 26% Regulated 36% New business 10% Existing 15% .com 16% New business 1% Full year results 2015 34
Slide 35: Gaming Customer Concentration
GAMING CUSTOMER CONCENTRATION 35 30 Licensees 2014 2015 33 25 Top 5 53% 53% 27 € Millions 20 Top 10 74% 71% 15 19 16 10 Top 15 81% 81% 5 0 Licensees > €5.0m Licensees > €2.0m annualised revenues annualised revenues Full year results 2015 35
Slide 36: Thank You
Thank You Interims results 2015