Playtech Plc · LSE:PTEC

Playtech — Investor Day (November 2017)

85 slides from Playtech's investor day presentation, November 2017

1. Slide 1: Playtech - a platform for growth

   Playtech - a platform for growth Investor & analyst day Riga, November 2017

2. Slide 2: Today's Agenda

   TODAY’S AGENDA 12.45 pm to 1.15 pm Shimon Akad A platform for growth 1.15 pm to 2.00 pm Anthony Evans The power of Playtech ONE 2.00 pm to 2.30 pm James Frendo Driving content strategy 2.30 pm to 2.45 pm Edo Haitin & A world-leading offering Kevin Kilminster 2.45 pm to 4.00 pm Tours of live studio &

3. Slide 3: Key Takeaways

   KEY TAKEAWAYS  Intelligence of the platform continues to underpin Playtech ONE omni-channel offering  GPAS provides a further evolution of partnership with licensees  scale & breadth of offering remains unrivalled  Data is central to Playtech’s operations and supports all strategic initiatives 

4. Slide 4: Another Reminder of the Key Pillars of Our Strategy

   ANOTHER REMINDER OF THE KEY PILLARS OF OUR STRATEGY 1 1. Support organic growth 4 4. Increasing product, service and distribution capabilities 2 2. Cross-sell products and services 5 Improve quality of earnings 3 3. Attract new licensees 6 Acquisitions remain key Investor & analyst day 2017 4

5. Slide 5: Building the future of gaming - a platform for growth

   Building the future of gaming - a platform for growth Shimon Akad, COO

6. Slide 6: Market Trends

   MARKET TRENDS Landbased operators and media groups best positioned to lead industry  Recognised brand – loyalty and footprint  Retail to online acquisition  Omni players are worth more Betting and gaming smartly mixed with retail to online  The common acquisition and flow of traffic is sportsbet

7. Slide 7: Market Trends

   MARKET TRENDS Strength of a multi-regulated platform Consolidation – what does it mean?  Active regulation / platform advantages  In-house vs outsourcing  Volume vs economies of scale Content – only the best will stand out  RGS and technology Innovation  Unique content based on quality, branded

8. Slide 8: Content Ecosystem - GPAS

   CONTENT ECOSYSTEM - GPAS ‘Playtech will develop a next generation content “ecosystem” with unified games delivery platform & developer program. Enabling accelerated maths creation for games and full licensee game discovery capabilities across all channels’ Desktop Mobile Investor & analyst day 2017

9. Slide 9: GPAS & Ryota Maths Editor

   GPAS & RYOTA MATHS EDITOR GPAS Highlights  Successful launch  Drag and drop maths engine creation features  Fast efficient flexible  Slots (Including many slots features)  Constantly evolving  Picks  Compose any number of features  Real-time stats (RTP) calculation  Model sharing & collabor

10. Slide 10: POP – Playtech Open Platform

    POP – PLAYTECH OPEN PLATFORM  Playtech innovation lab product  Cloud based  Flexible and simple APIs  An extension of our platform to run third party games  Manage the operator’s entire gaming floor xxx Investor & analyst day 2017 10

11. Slide 11: Content Ecosystem: Marketplace

    CONTENT ECOSYSTEM Marketplace Investor & analyst day 2017 11

12. Slide 12: Marketplace

    MARKETPLACE RGS 5 RGS 1 Dynamic RGS GPAS Game 4 Discovery RGS 2 RGS 3 CONTENT PROVIDER MARKETPLACE CONTENT PROVIDER PLAYTECH CONTENT LICENSEE MANAGEMENT New game deployed New game discovered New game profile created Game is available for Game reviewed and instant licensing by approved for qualifying

13. Slide 13: Marketplace Intelligence

    MARKETPLACE INTELLIGENCE  Big data will provide licensees with targeted and specialised content recommendations  Live search for games matching performance metrics and demographics  Utilisation of big data to drive player acquisition and player retention Investor & analyst day 2017 13

14. Slide 14: Marketplace Intelligence

    MARKETPLACE INTELLIGENCE  High value reports only – users must have the information they need at their fingertips  Dashboard that provides game performance, benchmarking, game clustering and activity reports  Capability to provide users with ability to drill into details of interest Investor & an

15. Slide 15: Da Vinci Omni-Channel Content

    DA VINCI OMNI-CHANNEL CONTENT Landbased sports  SSBTs Landbased bingo  ECM Landbased casinos  VB  IGS Investor & analyst day 2017 15

16. Slide 16: Content Ecosystem - GPAS

    CONTENT ECOSYSTEM - GPAS “Playtech will develop a next generation content “ecosystem” with unified games delivery platform & developer program. Enabling accelerated maths creation for games and full licensee game discovery capabilities across all channels.” Desktop Mobile Retail Investor & analyst d

17. Slide 17: Platform Evolution

    PLATFORM EVOLUTION  Flexible approach  Cloud  Third party supplier  Superior ROI  Data driven  Self learning & intuitive  Real-time  Simplicity turns good into great  AI Investor & analyst day 2017 17

18. Slide 18: Casino Platform Focus

    CASINO PLATFORM FOCUS  Casino Platform focus  Marketing of content  Smart bonusing  Communications  Real time reaction to player needs  Excellence in quality  Smart content planning in advance Investor & analyst day 2017 18

19. Slide 19: Key Takeaways

    KEY TAKEAWAYS  Landbased and online  Omni-channel focus  Content is more than just content  Upside in the platform – big data / AI / simplicity of use  Platform the key differentiator  Playtech products and services – a  Internationalisation and consolidation complete offering  Gaming ecosys

20. Slide 20: The power of Playtech ONE

    The power of Playtech ONE Anthony Evans, Head of Product Strategy

21. Slide 21: Playtech ONE

    PLAYTECH ONE ONE Wallet ONE View ONE Platform Investor & analyst day 2017 21

22. Slide 22: Playtech ONE Foundations

    PLAYTECH ONE FOUNDATIONS WALLET PERSONALISATION & CONTENT CRM & LOYALTY USER EXPERIENCE ONE wallet, COMMUNICATION Play any product, all Automated data-driven, Seamless, responsive, ONE view, Bespoke player channels, locations real-time, BI marketing adaptive gameplay ONE platform experience, enabled

23. Slide 23: Full Solution

    FULL SOLUTION Portal Native Apps Retail Machines Retail OTC Business Intelligence Desktop & Mobile (mobile, tablet) (EPOS, SSBTs & FOBTs) (Sports & Lottery) Playtech ONE Sportsbook Poker TV Games Live Marketplace Casino Virtual Sport Lottery Bingo IMS BI & Game Advisory Player Management Engagement

24. Slide 24: Playtech ONE Betting Shop

    PLAYTECH ONE BETTING SHOP Investor & analyst day 2017

25. Slide 25: Playtech ONE Innovations

    PLAYTECH ONE INNOVATIONS Virtual Enhanced Modifier Behavioural Analytics Cards Games & BI Cross In-game Leaderboards In-game Product Messaging Virtual Cards Retail Hub Messagin Triggering g Retail Enhanced Modifier App Games Retail App Cross Product Retail Retail Hub Brands & App Jackpots 2 3 Invest

26. Slide 26: Playtech ONE Innovations

    PLAYTECH ONE INNOVATIONS SLOTS LIVE ROULETTE ROULETTE R E TA I L G A M E BINGO COMING POKER SOON Investor & analyst day 2017 26

27. Slide 27: A Data Driven Company

    A DATA DRIVEN COMPANY  Unique reporting & analytics for licensees  Machine learning techniques for harm minimisation (BetBuddy) & fraud detection  Behavioural analytics to drive marketing & personalisation – “smart platform”  AI to drive marketing efforts: player segmentation, propensity modelli

28. Slide 28: Core System Developments – Smart Platform

    CORE SYSTEM DEVELOPMENTS – SMART PLATFORM BI Engagement Platform Loyalty Mgmt. & Communications Content Bonusing Suite Gamification Tools  Modifier bonuses  Central loyalty system  Central bonusing engine  Full suite of communications  In-game messaging  Flexible usage  Meta data  Real-time

29. Slide 29: Smart Platform

    SMART PLATFORM Smart Chip Selection Smart Deposit Buttons Smart Default Bet Investor & analyst day 2017 29

30. Slide 30: Smart Platform

    SMART PLATFORM Additional algorithms available for licensees  Churn detection (Casino & Poker)  LTV  Fraud detection (Live)  Abandoned games  Segmentation models (Casino & Poker)  First time depositors (in progress) Investor & analyst day 2017 30

31. Slide 31: BetBuddy: Responsible Gaming AI

    BETBUDDY: RESPONSIBLE GAMING AI IMS Investor & analyst day 2017 31

32. Slide 32: Driving content strategy

    Driving content strategy James Frendo, Director of Casino

33. Slide 33: A B2C Perspective

    A B2C PERSPECTIVE My Background Industry trends & adjusting to the “new normal”  12 years in industry  More costs & suppressed margins POC on free bets, horseracing levy, steeper acquisition  Roles in customer management, VIPs, operations, CRM, costs, FOBT stake reductions, adjusting to multi- pr

34. Slide 34: Content Considerations

    CONTENT CONSIDERATIONS Did well In progress  Started delivery of more synchronised releases  Communicate our games more effectively (desktop and mobile versions)  Measure/map games success criteria (indexing)  Conversion of 100+ flash games to desktop  Focus launches before key marquee dates 

35. Slide 35: Content Studios

    CONTENT STUDIOS Investor & analyst day 2017 35

36. Slide 36: Content Pillars

    CONTENT PILLARS Signature Reach Reliability Value Investor & analyst day 2017 36

37. Slide 37: Content Strategy

    CONTENT STRATEGY Aim Measuring the success criteria  Reinforce trust  Costs / attributes / relative distribution multiplier  Local heroes  True ROI  Best value for money Guidance Distribution  Anticipate the market  Marketplace  Use R&D team & focus groups  Self-service for marketing teams

38. Slide 38: Justice League

    JUSTICE LEAGUE  Launching in time with the film release on the 17th Nov  Significant promotional spend  Multi-jurisdictional, for all regulated regions  Several brand approved asset packs to choose from  Released to licensees in production environments, under password lock screens  Jackpot gam

39. Slide 39: Bespoke Content & Exclusives

    BESPOKE CONTENT & EXCLUSIVES Playtech open Platform (POP)  Serves as an integration hub for 3rd party Gaming systems (RGS) and Playtech Gaming Platform Game Platform As a Service (GPAS)  Provides the ability for internal and external content units to author games  Handles all platform functions t

40. Slide 40: Marketplace: Have It Your Way

    MARKETPLACE: HAVE IT YOUR WAY The solution to manage content from multiple RGS providers RGS 5 RGS1 Dynamic Game Set up Set up Install RGS4 GPAS Discovery Game Profile Commercials Game RGS2 RGS3 Licensees can configure games directly from the Marketplace similar to the App Store concept Investor & a

41. Slide 41: Marketplace

    MARKETPLACE A new game! I want to push a I need to free spins increase my promotion, but margin need to control costs. <=25 lines I have a high roller cohort, configure higher My customer base limits for them AVPUs increase well with sticky wilds Deploy Branded Jackpot games are great for Discover a

42. Slide 42: Platform: Removing Dependency

    PLATFORM: REMOVING DEPENDENCY  Platform stream Games stream  Reduces operational overhead  Builds roadmap confidence  Better scheduling & promo planning  Games less impacted by code freezes Investor & analyst day 2017 42

43. Slide 43: Looking Ahead

    LOOKING AHEAD  Customer profiles: Deal chasing, snacking, play to win  Source: Direct, xsell, trialists (1-day players)  Value banding: VIPs, higher roller, causal etc Investor & analyst day 2017 43

44. Slide 44: A world leading offering

    A world leading offering Edo Haitin, CEO Playtech EuroLive Kevin Kilminster, Head of Live Innovation

45. Slide 45: Overview of Playtech Live Dealer

    OVERVIEW OF PLAYTECH LIVE DEALER  Playtech Live is the complete end-to-end market leading solution  Extensive functionality and tools capability, unmatched within the Live market  Market leading & seamless UX, with omni-channel capability  Fastest developing Live supplier on the market  Tier 1

46. Slide 46: Introducing Riga

    INTRODUCING RIGA  260+ million cards dealt in 2017 so far  1,600+ hours of uninterrupted gameplay daily  Roulette balls spun this year have travelled over 385,000 kilometers - enough to get to the moon  1.2 km sq. used on dealer uniforms  720 hours spent rewarding our dealers with team building

47. Slide 47: Riga: Facts and Figures

    RIGA: FACTS AND FIGURES  Purpose built, advanced tailor made Live dealer  Largest migration and investment into Live dealer  Seamless migration over 7 months  Mission control center to facilitate operational standards  Network operations center to monitor and ensure a safe and secure solution 

48. Slide 48: Core Foundations

    CORE FOUNDATIONS  First class 24/7 service experience for our customers Experience is everything  Multi-layer segmented experiences, offering a greater diversity in choice  3rd Party validation ensuring our product remains market leading Customer led decisions  Power of Playtech in the players h

49. Slide 49: Next Generation

    NEXT GENERATION  Multi segmented experience portfolio (Product / Live / ONE)  Extensive and ambitious product investment for our long-term strategy  ‘Live 2’ enabling faster to market delivery, presenting a feature rich tool and functionality capability  New UI solution, improving players experi

50. Slide 50: Investor & analyst day 2017

    Investor & analyst day 2017 50

51. Slide 51: Live within Playtech ONE

    LIVE WITHIN PLAYTECH ONE  Ability to take Live dealer in a new content direction only Playtech can deliver  Delivers a product for the next generation of Live casino customer  Jackpot solution unique to Playtech, improving liquidity and increasing customers cross-sell capability  Life changing a

52. Slide 52: Investor & analyst day 2017

    Investor & analyst day 2017 52

53. Slide 53: A Significant Opportunity

    A SIGNIFICANT OPPORTUNITY  Expand game portfolio to further strengthen market leading position  Strengthen tools and functionality to grow market share, and further develop customers  Invest further in innovative products and experiences  Strong continuation in 2018 of the Playtech ONE vision an

54. Slide 54: Live studio tour

    Live studio tour Two groups please

55. Slide 55: PBS: disrupting the market

    PBS: disrupting the market Dr Armin Sageder, CEO Playtech BGT Sports

56. Slide 56: 2017 Highlights: UK

    2017 HIGHLIGHTS: UK  Contract extensions agreed with Paddy Power, BetFred, Boyles, Jennings & 10+ independents  20%+ increase in sited terminals despite the removal of William Hill terminals  By year end, terminals in every Ladbrokes, PP, Coral, BetFred, Boyles & Stan James shop  Racing now esta

57. Slide 57: 2017 Highlights: Rest of the World

    2017 HIGHLIGHTS: REST OF THE WORLD  Developments in Columbia  Spain and Andalucia  Codere  Codere  Sportium  Winner  Megared  Easybet 7 in Austria signed  Betting in Belgium  Tills and terminals  Digital sportsbook Investor & analyst day 2017 57

58. Slide 58: OPAP

    OPAP VIRTUALS FOOTBALL ON SSBT GO-LIVE SSBT 1800 SSBTS LIVE OTC COMBINED TILL GREYHOUND + VIRTUALS REMAINDER 26-Feb 24-Oct 1-Nov 2-Aug 31-Dec 1-Jul OTC IN-PLAY GO LIVE - 4500 OTC VIRTUALS PRE-MATCH FOOTBALL GO LIVE SHOPS PLAYSLIP (SINGLE MATCH) Investor & analyst day 2017 58

59. Slide 59: PBS Core Competencies

    PBS CORE COMPETENCIES Sofia Trading operation Bremen Vienna Transaction Retail system Cyprus IP COMPENTICES deveopment Nicosia London IP Sports content & development bonus Malmö Digital Investor & analyst day 2017 59

60. Slide 60: Product Update

    PRODUCT UPDATE Achieved Ongoing  First version of new PBS Online  SaaS Portal integration, B2C requirements  Mobile product is available!  Tier 1 Product  Cashout enhancements  IMS Digital integration  Optimised navigation, CMS controls  Statscore content integration  Horse racing & greyhou

61. Slide 61: Disrupting the Market

    DISRUPTING THE MARKET Expertise across all elements of the PBS is the only real omni-channel supply chain system on the market Cross-channel BI Key content distribution agreements Big data built-in Investor & analyst day 2017 61

62. Slide 62: 2018 Plans

    2018 PLANS UK LATAM  Contract extensions / additional terminals  Mexico omnichannel  Build on the Racing Post model  Columbia omni-channel  In-game features  Development of hardware options Germany & Austria  Omnichannel Germany Australia  Maximise Generation Web acquisition CEE  Actively t

63. Slide 63: ICE 2018

    ICE 2018 PBS on the Playtech stand PBS stand Investor & analyst day 2017 63

64. Slide 64: The regulatory landscape

    The regulatory landscape Ian Ince, Head of Regulatory Affairs and Compliance

65. Slide 65: Compliance at Playtech

    COMPLIANCE AT PLAYTECH Regulatory Gambling affairs compliance Due Data diligence on protection M&A Operational CSR oversight Investor & analyst day 2017 65

66. Slide 66: Governance and Oversight

    GOVERNANCE AND OVERSIGHT Board risk committee Board sponsors Annual reports on AML External risk assesment & Internal audit assurance Investor & analyst day 2017 66

67. Slide 67: Responsible Gambling

    RESPONSIBLE GAMBLING  CMA  ASA  FOBT  UKGC Investor & analyst day 2017 67

68. Slide 68: BetBuddy

    BETBUDDY  Utilising data in IMS  Lead industry in creating safe and fun gambling ecosystem  Will influence games design and development in future Investor & analyst day 2017 68

69. Slide 69: Online Casino Regulation in the EEA

    ONLINE CASINO REGULATION IN THE EEA 12% SWEDEN FINLAND Multi-licensing regime NORWAY ESTONIA 5% 20% LATVIA 10% Restricted and/or unregulated DENMARK LITHUANIA 15% 10% IRELAND 12% Legislation in process UNITED KINGDOM NETH. POLAND 11% GERMANY 23%**** BEL. CZ Turnover LUX. SLOV. 18% 16% FRANCE AUSTRIA

70. Slide 70: Future Gambling Regulation: Europe

    FUTURE GAMBLING REGULATION: EUROPE  Netherlands - Passed 2018 - license award Q1 2019  Switzerland - In process now pending referendum - Q3/4 2018 tbc  Germany - Federal Court Internet ban - catalyst for change?  Others - Q1 Sweden 2019 tbc Investor & analyst day 2017 70

71. Slide 71: Future Regulation: Asia

    FUTURE REGULATION: ASIA N O E X P E C T AT I O N O F C H A N G E China / Malaysia Philippines  Risk-based approach  Playtech licensed by PAGCOR  Payment processing  Uncertain political climate  Contingency plans in place Investor & analyst day 2017 71

72. Slide 72: Future Regulation: India

    FUTURE REGULATION: INDIA  Nagaland open to skill games (poker / rummy)  Sikkim  State model - no federal legislation expected  Very slow burn  Working with the British Council of India Investor & analyst day 2017 72

73. Slide 73: Future Regulation: LATAM

    FUTURE REGULATION: LATAM  Colombia – regulated 1st Jan 2017  Brazil – market estimation c. €3bn, elections Nov 2018  Chile – potential for 2018  Peru – bill to be proposed by end 2017  Mexico – update to regulation stalled Investor & analyst day 2017 73

74. Slide 74: Future Regulation: United States

    FUTURE REGULATION: UNITED STATES  No gambling presence  PASPA repealed - 2021 tbc but still no casino?  Potential retail opportunity  New Jersey / Nevada / Delaware / Pennsylvania - no commercial argument to obtain licence  Complicated market - different lobbying activities, added factor of Tri

75. Slide 75: Future Regulation: Africa

    FUTURE REGULATION: AFRICA  Reduced on-line Playtech activity - consolidation of sport under PBS  Currently supporting licensees in:  Nigeria  Kenya  South Africa  Ghana  Retail opportunities  Low regulatory risk, higher AML / ABC risk  High levels of due diligence and local legal opinions I

76. Slide 76: Business development and M&A strategy

    Business development and M&A strategy Andrew Smith, CFO

77. Slide 77: Business Development and M&A Team

    BUSINESS DEVELOPMENT AND M&A TEAM The team  Team of eight  Supported by other teams from within Playtech as appropriate (finance, tax, legal, compliance) Responsibilities  Implementing the board's high level strategy  Identifying and pursuing opportunities in new and existing markets, including

78. Slide 78: Joint Ventures & Structured Agreements

    JOINT VENTURES & STRUCTURED AGREEMENTS  Benefits of JVs and structured agreements include  Allows Playtech to partner with the best brands and operators in any given jurisdiction  Great involvement in operations – more than just a software provider  Approaching B2C economics in a B2B context  E

79. Slide 79: Branded Content

    BRANDED CONTENT  Benefits both Playtech and its licencees  Playtech’s scale allows it to purchase branded content for the benefit of ALL licencees  Branded content is a key marketing tool for operators  Playtech maintains key relationships with film studios and other brands  Examples include Ma

80. Slide 80: 18 Year Track Record of Success

    18 YEAR TRACK RECORD OF SUCCESS Listed on the main William Hill Online (WHO) market of the Founded joint venture agreed London Stock Exchange 1999 2006 2008 2011 2012 2013 2015 2016 2017 Listed on AIM Playtech acquires PTTS from Worldwide Online Enterprises William Hill acquires Playtech’s 29% share

81. Slide 81: Evaluating M&A Targets

    81 EVALUATING M&A TARGETS Profitable, highly cash generative Driven by similar DNA, core Ability to leverage revenue and businesses with a focus on high competencies, with a strong cost synergies quality regulated revenue cultural fit Well-invested assets at a Strong management with proven Strong fi

82. Slide 82: Gaming Acquisition Opportunities

    82 GAMING ACQUISITION OPPORTUNITIES Content Geographies Sport Omni-channel Investor & analyst day 2017 82

83. Slide 83: Wrap-up

    ma bes London RE Stock Exchange LISTED PREMIUM Wrap-up Mor Weizer, CEO

84. Slide 84: Key Takeaways

    KEY TAKEAWAYS  Intelligence of the platform continues to underpin Playtech ONE omni-channel offering  GPAS provides a further evolution of partnership with licensees  scale & breadth of offering remains unrivalled  Data is central to Playtech’s operations and supports all strategic initiatives 

85. Slide 85: Thank you

    ma bes London ELS Stock Exchange LISTED PREMIUM Thank you

Playtech — Investor Day (November 2017) on 6ix