Slide 1: H1 2021 results
H1 2021 results 23 September 2021
Slide 2: Agenda
Agenda 2 Group overview Financial review Strategic priorities and outlook Mor Weizer Andrew Smith Mor Weizer Chief Executive Officer Chief Financial Officer Chief Executive Officer H1 2021 results
Slide 3: Highlights
Highlights 3 Americas driving growth • Americas the major driver of Playtech’s next growth phase • 106% revenue growth at cc in H1 • Approaching medium-term Latin America revenue target of €100 million • Option valuations highlight value of structured agreements • US to be significant growth driver
Slide 4: Agenda
Agenda 4 Group overview Financial review Strategic priorities and outlook Mor Weizer Andrew Smith Mor Weizer Chief Executive Officer Chief Financial Officer Chief Executive Officer H1 2021 results
Slide 5: Financial highlights
Financial highlights 5 H1 performance in line with expectations • Solid H1 despite retail closures with Adjusted EBITDA of €124 million • Very strong online performance • Significant impact of retail closures • B2B very strong online; regulated revenue from Americas up 106% at cc • Snaitech resilien
Slide 6: Group EBITDA by month
Group EBITDA by month* 6 Resilient H1 performance despite further lockdowns 50 Very strong pre- Strong retail recovery COVID-19 Gradual re-opening Lockdowns € Millions Lockdowns 0 B2B B2C * Adjusted EBITDA from continuing operations H1 2021 results
Slide 7: B2B Gambling
B2B Gambling 7 Growth driven by Americas and online Online, ex Sports and Entain contract changes € millions H1 2020 H1 2021 % CC% % Regulated – Americas 22.9 46.4 103% 106% 96% Regulated – Europe (excl. UK) 56.1 66.5 19% 19% 31% Regulated – UK 66.1 59.6 -10% -11% 7% Regulated – Rest of World 1.5 1.
Slide 8: B2B Gambling margin
B2B Gambling margin 8 Strong underlying improvement in Adjusted EBITDA margin € millions H1 2020 H1 2021 % Total B2B Gambling revenue 229.7 267.2 16% B2B costs 166.5 195.1 17% B2B Adjusted EBITDA 63.2 72.1 14% B2B Gambling margin 28% 27% n/a Revenue and costs relating to Live dedicated Underlying re
Slide 9: B2B Gambling costs (underlying)
B2B Gambling costs (underlying) 9 Operating from an efficient cost base 2020 to 2019 to 2021 € millions H1 2019 H1 2020 H1 2021 2021% CAGR % R&D 35.9 38.5 36.1 -6% 0% G&A 27.3 30.0 30.3 1% 5% S&M 9.6 9.5 5.8 -39% -22% Operations* 30.8 27.6 28.5 3% -4% Total (ex Asia, Strategic expenditure) 103.6 105
Slide 10: B2C Gambling performance
B2C Gambling performance 10 EBITDA growth driven by strong online despite retail closures Revenue Adjusted EBITDA € millions H1 2020 H1 2021 % CC% H1 2020 H1 2021 % Snaitech (incl. HPYBET) 224.0 166.4 -26% -26% 42.9 46.6 9% White label (incl. Sun Bingo) 29.5 30.2 2% 1% 3.4 5.4 59% Total B2C Gambling
Slide 11: Snaitech performance
Snaitech performance 11 Resilient H1 driven by online and variable cost franchise model € millions H1 2020 H1 2021 % Retail betting 48.1 6.3 -87% Gaming machines 92.3 17.1 -81% Online 63.4 123.4 95% Other 11.7 11.1 -5% Total revenue 215.5 157.9 -27% Retail Adjusted EBITDA 13.8 -21.0 -252% Online Adj
Slide 12: Snaitech online
Snaitech online 12 Reconciliation of Snaitech’s online margin € millions H1 2020 H1 2021 % Online: gross revenue* 106.1 203.7 92% Gambling taxes & bonusing 42.7 80.3 88% Online: net revenue (as reported) 63.4 123.4 95% Online: Adjusted EBITDA 33.3 72.6 118% Adjusted EBITDA margin: gross* 31% 36% n/a
Slide 13: Balance sheet
Balance sheet 13 Strong balance sheet and liquidity • Long-term financing in place; prudent leverage • RCF drawn down in H1 2020 as precautionary measure; €100 million repaid in H1 2021, further €50 million repaid in H2 • Playtech has 5-year (€530m) and 7-year (€350m) bonds (October 2023 and March 2
Slide 14: Structured Agreements – Option Values
Structured Agreements – Option Values 14 Valuations highlight value of structured agreements • 6 Structured Agreements in Latin America – current largest ones in Mexico and Colombia • Playtech generates revenue from Structured Agreements through: • Revenue share • Cost plus services • Share of Profi
Slide 15: Adjusted cash bridge (including Finalto)
Adjusted cash bridge (including Finalto) 15 Strong cash generated from operations 89* 497 10 € Millions 283 252 Adjusted Snai PREU Underlying Net cash Disposal Acquisitions & CapEx Interest, Adjusted RCF on Adjusted gross cash* tax Adj. gross from of assets contingent and Cap FX, lease gross cash* b
Slide 16: Outlook
Outlook 16 Online momentum to continue; retail recovering • Strong start to H2 in July and August as many lockdowns eased • B2B online momentum expected to continue; increasing investment in US to capitalise on momentum from H1 deals • Snaitech strength to continue driven by online and retail reopen
Slide 17: Agenda
Agenda 17 Group overview Financial review Strategic priorities and outlook Mor Weizer Andrew Smith Mor Weizer Chief Executive Officer Chief Financial Officer Chief Executive Officer H1 2021 results
Slide 18: Executing 2021 priorities
Executing 2021 priorities 18 Delivering our strategy 2021 priorities Progress 1. Significantly accelerate US presence Parx launched in Michigan; signed Scientific Games & Novomatic deals; further licence applications underway 2. Execute on structured agreements in LatAm Excellent growth from Calient
Slide 19: US B2B revenue opportunity
US B2B revenue opportunity 19 Total long-term B2B addressable market c.$3 billion Market size* 3rd party share Royalty share Revenue opp. Sports betting (online) $20bn 33% 10-15% c.$825m iGaming $19bn 75% 10-15% c.$1.8bn Platform (PAM) $39bn 25% 3-5% c.$390m c.$3bn Total B2B opportunity (excl. struc
Slide 20: Our US market approach
Our US market approach 20 State-by-state approach; full product suite; flexible business model Technology & Customers & Market Entry Products Partnerships Photo by: Mario Pampel Postproduction • State by state approach • IMS platform (PAM) including CRM, • Existing customers worldwide • Licensing pr
Slide 21: US product & technology offering
US product & technology offering 21 Leading technology; flexible, open architecture & unique turnkey offering Photo by: Mario Pampel Postproduction iGaming Sports betting Platform Live casino Turnkey sportsbook Industry-leading PAM / platform Slots Bet engine Open Platform / APIs Poker Trading servi
Slide 22: US progress – strategic and operational
US progress – strategic and operational 22 Accelerating our presence Executing in New Launched with Parx SSBT distribution iGaming distribution Jersey with bet365 in Michigan (Casino agreement with deal with Scientific & BetMGM & PAM) Novomatic Games US workforce of Licence applications Continuing t
Slide 23: Parx Casino (the Greenwood companies)
Parx Casino (the Greenwood companies) 23 Highly strategic multi-state, multi-product deal Greenwood overview Progress update Leading casino and racetrack operator in Pennsylvania • Launched with online casino (Michigan) on Playtech’s IMS platform & Player Account Management (PAM) • Third-party sport
Slide 24: Latin America
Latin America 24 Building on leading position in the market • Strategy focused on structured agreements • Caliente continuing excellent growth; number 1 customer in H1 • Wplay accelerating following migration to Playtech platform • Launched in Panama & Costa Rica in H1; Guatemala in progress • Agree
Slide 25: Structured Agreements
Structured Agreements 25 Attractive part of B2B business model • B2B strategy focused on structured agreements Country Partner Date Go live signed • Full turnkey solution provided to ‘local heroes’ • Revenue generated through: Mexico Caliente 2014 2014 • Revenue share Colombia Wplay 2019 2020 • Cost
Slide 26: Structured Agreements to date
Structured Agreements to date 26 Successful track record of material cash generation >€900m >€450m >€150m and counting… and counting… and counting… H1 2021 results
Slide 27: Holland Casino
Holland Casino 27 New strategic agreement signed ahead of regulation • State-owned, land-based casino operator in Netherlands • 14 casinos across the country • Online market to be regulated as of 1 October • Using Playtech’s technology and products to expand into online space • Full turnkey offering
Slide 28: Live Casino
Live Casino 28 Accelerated investment; momentum building Strong growth Increasing capacity to meet demand • Revenue up >50% (excl. Asian distributor) • Over 200 tables vs 135 at start of 2019 • >€100 million annualised revenue run rate • Michigan imminent; Pennsylvania & New Jersey to follow; Peru u
Slide 29: Snaitech market leader in Italy
Snaitech market leader in Italy 29 Positioned to continue excellent online growth • Largest gambling market in Europe pre-pandemic • Low online penetration; shift accelerated by COVID-19 • Exciting growth ahead in both retail and online • Ideally positioned to capture opportunity with brand strength
Slide 30: Asia
Asia 30 Increased operational flexibility • Smaller part of Group; remains highly cash generative • Business is more diversified (geographically and in terms of distributors) versus recent years • Changes to operating model and distribution network in region • Additional distributor added in H2 2020
Slide 31: Safer gambling & sustainability
Safer gambling & sustainability 31 Delivering on Sustainable Success commitments • Governance: New Sustainability and Public Policy Board Committee • Safer Gambling: Expanded Playtech Protect & secured GamCare B2B certification • Setting target aligned with the latest climate science to reduce carbo
Slide 32: H2 priorities
H2 priorities 32 Delivering our growth strategy 1. Top priority – significantly accelerate US presence 2. Execute on structured agreements in Latin America 3. Continue B2B diversification; sign 50 further new brands 4. Snaitech to continue online growth momentum 5. Drive Sustainable Success commitme
Slide 33: Capital Markets Day
Capital Markets Day 33 Join us in Q4 for a review of… OUR FOCUS AREAS: • US progress • Latin America • Live Casino • Snaitech • Sustainable Success • Medium term financial targets To be scheduled for early December – virtual / in person format (TBC) H1 2021 results
Slide 34: Q&A
Q&A
Slide 35: Appendix
Appendix
Slide 36: Summary by division
Summary by division 36 Group H1 2020 (€m)* H1 2021 (€m) Revenue Adj. EBITDA Margin Revenue Adj. EBITDA Margin B2B Gambling 229.7 63.2 28% 267.2 72.1 27% Reported B2C Gambling 253.5 46.3 18% 196.6 52.0 26% (Intercompany) (6.5) - n/a (6.4) - n/a Group (continuing operations) 476.7 109.5 23% 457.4 124.
Slide 37: Finalto results
Finalto results 37 Discontinued operation USD millions H1 2020 H1 2021 % Net Revenue $96.2 $38.2 -60% Adjusted EBITDA $58.4 -$0.6 n/a% Margin 61% n/a H1 2021 results
Slide 38: Net profit and EPS
Net profit and EPS 38 Group (continuing operations) Adjusted Excl. Acquisitions € millions H1 2020* H1 2021 % H1 2020* H1 2021 % Adjusted EBITDA 109.5 124.1 13% 109.7 124.3 13% - Depreciation & Amortisation -72.9 -65.1 -11% -72.9 -65.1 -11% - Net finance costs -29.5 -32.1 9% -29.5 -32.0 9% - Tax -4.
Slide 39: Contingent consideration
Contingent consideration 39 Group Contingent consideration Payment date Maximum payable earnout and redemption liability (based on maximum Acquisition (per terms of acquisition) (as at 30.06.2021) payable earnout) HPYBET Austria GmbH €15.0 million Nil Q3 2021 Eyecon Limited €23.3 million Nil Q3 2021
Slide 40: Thank you
Thank you