Slide 1: Interim results 2019
Interim results 2019 22 August 2019
Slide 2: Agenda
AGENDA Financial review and Group overview Highlights Strategic update outlook Alan Jackson Mor Weizer Andrew Smith Mor Weizer Chairman Group CEO Chief Financial Officer Group CEO Interim results 2019 2
Slide 3: Overview
OVERVIEW C O R E B 2 B A N D B 2 C G A M B L I N G D R I V I N G P L AY T E C H ▪ Core business demonstrates high quality ▪ 69% increase in revenue & 31% increase in Adj. EBITDA ▪ Snaitech now #1 market share in Italy across Retail & Online betting ▪ 8% growth in regulated B2B Gambling revenue at co
Slide 4: Agenda
AGENDA Financial review and Group overview Highlights Strategic update outlook Alan Jackson Mor Weizer Andrew Smith Mor Weizer Chairman Group CEO Chief Financial Officer Group CEO Interim results 2019 4
Slide 5: Highlights
HIGHLIGHTS C O R E B 2 B A N D B 2 C G A M B L I N G D R I V I N G P L AY T E C H ▪ Core B2B and B2C gambling business outperforming ▪ Increased quality of earnings ▪ Asia remains challenging, actions taken ▪ Reiterate outlook Interim results 2019 5
Slide 6: 4 Themes for Today
4 THEMES FOR TODAY TECHNOLOGY LEADERSHIP DRIVING LONG TERM GROW TH 1. Clear group focus on gambling 2. Our offering has evolved, increasing addressable market 3. Our growth is driven by highly attractive markets 4. Strong performance from B2C Interim results 2019 6
Slide 7: Agenda
AGENDA Financial review and Group overview Highlights Strategic update outlook Alan Jackson Mor Weizer Andrew Smith Mor Weizer Chairman Group CEO Chief Financial Officer Group CEO Interim results 2019 7
Slide 8: Financial Highlights
FINANCIAL HIGHLIGHTS CORE B2B AND SNAITECH DRIVING THE BUSINESS Strong Core B2B Gambling performance Long term financing in place ▪ Core B2B Gambling revenue growth of 8% at CC vs ▪ €350m 7-year bond raised to repay maturing H1 2018 convertible ▪ UK growth of 6% at CC (7% excl. RGD impact) ▪ Non-UK
Slide 9: Results Summary
Group RESULTS SUMMARY 750 736.1 H1 2018 600 H1 2019 € Millions 450 436.5 300 150 190.6 145.0 83.3 70.7 0 Total revenue Adj. EBITDA Adj. Net Profit +69% +31% -15% Interim results 2019 9
Slide 10: Summary by Division H1 2019
Group SUMMARY BY DIVISION H1 2019 H1 2019 Revenue (€m) * H1 2019 Adjusted EBITDA (€m) TradeTech, TradeTech, 8.2 39.1 B2C, 71.7 B2B, 265.5 B2B, 110.6 B2C, 438.2 Interim results 2019 *Amounts are before intercompany eliminations 10
Slide 11: B2B Gambling Revenue
B2B B2B GAMBLING REVENUE Gambling STRONG PERFORMANCE OF CORE B2B BUSINESS CC% & H1 2018 (€m) H1 2019 (€m) % CC% Excl. RGD UK 88.5 94.8 7% 6% 7% Other regulated 66.7 74.2 11% 10% Total Regulated B2B 155.2 169.0 9% 8% Asia 101.1 65.0 -36% -36% Other unregulated* 34.0 31.5 -7% -8% Total Unregulated B2B
Slide 12: B2B Gambling Costs
B2B GAMBLING COSTS TIGHT COST CONTROL H1 2018* H1 2019 % (€m) (€m) R&D 37.3 37.4 0% Operations 76.1 78.5 3% G&A 31.9 29.3 -8% S&M 11.2 9.7 -13% Total B2B Gambling 156.5 154.9 -1% Interim results 2019 *H1 2018 numbers have been restated to include the impact of IFRS 16 as 12 if it were already implem
Slide 13: Core B2B Gambling Margin
Core B2B CORE B2B GAMBLING MARGIN Gambling H1 18 H1 18 H1 19 (€m) restated (€m) (€m)* Total B2B Gambling EBITDA margin 43% 46% 42% ▪ Tight cost control and core B2B revenue growth drives margin expansion from 24% in H1 2018 to B2B Gambling Asian revenue** 101.7 101.1 65.7 29% in H1 2019 B2B Gambling
Slide 14: B2C Gambling Performance
B2C B2C GAMBLING PERFORMANCE Gambling Revenue (€m) Adjusted EBITDA (€m) H1 2018 H1 2019 % CC% H1 2018 H1 2019 % Snaitech 61.3 395.8 546% 546% 11.5 74.7 549% White label (incl. Sun Bingo) 24.8 24.3 -2% -3% -13.5 3.4 N/A Retail Sport B2C 4.1 9.9 141% 140% -2.2 -3.6 N/A Casual Gaming 8.2 8.2 0% -4% -0.
Slide 15: Snaitech Performance
B2C SNAITECH PERFORMANCE Gambling A VERY STRONG PERFORMANCE; SYNERGIES ON -TRACK H1 2019 Tax Revenue (€m) H1 2018* H1 2019 % % Adjusted Retail betting 86.1 85.9 -0% 87.8 2% Gaming machines 304.9 249.0 -18% 305.8 0% Online 38.1 46.4 22% 48.8 28% Other 15.0 14.5 -3% 15.0 0% Total 444.0 395.8 -11% 457.
Slide 16: Snaitech EBITDA Bridge
B2C SNAITECH EBITDA BRIDGE Gambling V E R Y S T R O N G U N D E R LY I N G G R O W T H € Millions 26% growth 74.7 59.3 Underlying EBITDA Interim results 2019 16
Slide 17: Snaitech Sale of Land
B2C SNAITECH SALE OF LAND Gambling €55M EXPECTED FROM DISPOSAL ▪ Agreement reached for the sale of the former trot track area for €55m ▪ €5m received in July 2019 with another €14m guaranteed to follow in 2020 ▪ Subject to the approval of the Milan Municipality, the remainder (up to a total aggregat
Slide 18: TradeTech Group Results
TTG TRADETECH GROUP RESULTS STRONG Q2 FOLLOW ING CHALLENGING Q1 ACROSS INDUSTRY Actual ($m) HY 2018 HY 2019 % Net Revenue $67.1 $44.1 -34% Adjusted EBITDA $30.3 $9.2 -69% Margin 45% 21% ▪ Record low volatility with assets trading in extremely tight ranges during Q1 ▪ Q2 revenue of $31.7m, compared t
Slide 19: Net Profit and EPS
Group NET PROFIT AND EPS Adjusted Excl. Acquisitions H1 2018 H1 2019 % H1 2018 H1 2019 % Adjusted EBITDA 145.0 190.6 31% 133.7 120.3 -10% - Depreciation & Amortisation -35.8 -78.4 119% -34.3 -50.2 46% - Finance Income / (Expense) * -2.1 -25.7 1124% 2.1 -11.1 n/a - Tax ** -9.3 -16.5 77% -8.0 -7.7 -4%
Slide 20: Cash on Balance Sheet
CASH ON BALANCE SHEET June 2019 (€m) Dec 2018 June 2018 Gambling TTG Playtech Snai Total * (€m) (€) * ex. Snai Gross Cash 143 297 440 136 576 622 837 Client funds / (77) (161) (238) (34) (272) (309) (273) progressives ** Adjusted gross cash 66 136 202 102 304 313 563 Cash needed for (50) (53) (103)
Slide 21: Adjusted Cash Bridge
Group ADJUSTED CASH BRIDGE 500 450 -42 400 163 -77 350 -77 € Millions 300 24 250 200 150 313 304 100 50 0 Cash - 31 Dec Operating cash Contingent Capex & Cap Dev Dividend & Bond & financing Cash - 30 June 2018 flow* consideration & buybacks 2019 acquisition of minority interest Interim results 2019
Slide 22: Balance Sheet
BALANCE SHEET E F F I C I E N T C A P I TA L S T R U C T U R E I N P L A C E ▪ Long term financing in place with leverage within target range ▪ €350m 7-year bond raised in March 2019; proceeds to repay €297m convertible (maturing Nov) ▪ Playtech now has 5-year and 7-year bonds (October 2023 and Marc
Slide 23: Outlook
OUTLOOK ▪ 2019 Adjusted EBITDA outlook of €390 to €415 million reiterated ▪ Core B2B gambling and Snaitech are performing strongly ▪ FY guidance in February assumed €150 million revenue from Asia with €25 million direct costs ▪ at current run rate, Asia will contribute approx. €115 million of revenu
Slide 24: Agenda
AGENDA Financial review and Group overview Highlights Strategic update outlook Alan Jackson Mor Weizer Andrew Smith Mor Weizer Chairman Group CEO Chief Financial Officer Group CEO Interim results 2019 24
Slide 25: 4 Themes for Today
4 THEMES FOR TODAY F O U N D AT I O N S F O R L O N G T E R M G R O W T H 1. Clear group focus on gambling 2. Our offering has evolved, increasing addressable market 3. Our growth is driven by highly attractive markets 4. Strong performance from B2C Interim results 2019 25
Slide 26: 1. Clear Group Focus
1. CLEAR GROUP FOCUS STRONG PERFORMANCE IN CORE B2B AND B2C GAMBLING Core B2B Gambling B2C Gambling Asia TradeTech Interim results 2019 26
Slide 27: 2. Extending Our Offering
2. EXTENDING OUR OFFERING C A P T U R I N G U N TA P P E D O P P O R T U N I T I E S B2C / JV B2B Untapped opportunities Interim results 2019 27
Slide 28: 2. Our Offering Has Evolved
2. OUR OFFERING HAS EVOLVED COMPONENTISING THE IMS TO INCREASE ADDRESSABLE MARKET Casino/Live/Sport/Poker/Bingo Casino/Live/Sport/Poker/Bingo Investment Player Games Bonus & Data account mgmt. rewards analytics over last 24 months IMS Campaign manager Loyalty/ VIP Gami- fication BetBuddy Compliance
Slide 29: 2. Expanding Our Addressable Market
2. EXPANDING OUR ADDRESSABLE MARKET > 1 , 0 0 0 I N C R E M E N TA L S I T E S N O W A D D R E S S A B L E B2C / JV B2B >10 brands > 1,000 brands signed in 2019 Interim results 2019 29
Slide 30: 2. New Business with Existing Customers
Core B2B Gambling 2. NEW BUSINESS WITH EXISTING CUSTOMERS S I G N I F I C A N T LY E X PA N D E D G V C O P P O R T U N I T Y • Rollout underway of Casino, Live and GPAS across GVC brands and markets • H1 launches include brands in UK, Italy, Greece, Belgium, Brazil, Georgia, Spain • Upcoming launch
Slide 31: 3. Growth Driven by Attractive Markets
3. GROWTH DRIVEN BY ATTRACTIVE MARKETS BUSINESS MODEL ALLOW S US TO CAPTURE ANY MARKET OPPORTUNITY Sweden UK Finland Mexico Czech Rep. Greece Poland Holland Switzerland Italy Brazil Portugal Argentina Spain Colombia Canada Peru US Market maturity * Interim results 2019 *Online penetration of markets
Slide 32: 4. Accelerating B2C Success
B2C 4. ACCELERATING B2C SUCCESS S N A I T E C H T H E M A R K E T L E A D E R I N I TA LY #1 Market share in June and July 26% Growth in underlying across Retail and Online betting adjusted EBITDA 36% 45% Underlying EBITDA Growth in online stakes vs. H1 2018 margin* Interim results 2019 * Underlying
Slide 33: Asia
Asia ASIA M A R K E T R E M A I N S H I G H LY C O M P E T I T I V E China - review of H1 2019 Operational progress ▪ Competition remains intense ▪ Continue to extend into Live ▪ Aggressive behavior in market ▪ Launched promotional tools ▪ Price sensitive in nature ▪ Continued to increase Playtech c
Slide 34: TradeTech
TTG TRADETECH IMPROVED Q2 FOLLOW ING CHALLENGING Q1 ACROSS THE INDUSTRY ▪ Record low volatility in Q1-19 across the entire industry ▪ low volatility with assets trading in extremely tight ranges ▪ ESMA’s product intervention measures also negatively impacted volumes ▪ Performance much stronger in Q2
Slide 35: Near Term Deliverables
NEAR TERM DELIVERABLES 1. Sign >20 new brands in 2019 alongside new structured agreement 2. Continue to extend reach with GVC 3. Continue to grow Snaitech 4. Review options for non-core & underperforming businesses 5. Additional quarterly disclosure starting in Q3 6. Execute share buyback programme
Slide 36: Q&A
Q&A Interim results 2019
Slide 37: Appendix
Appendix Interim results 2019
Slide 38: Results Summary at Constant Currency
Group RESULTS SUMMARY AT C O N S TA N T C U R R E N C Y 750 731.4 H1 2018 600 € Millions H1 2019 450 436.4 300 150 189.3 145.0 83.3 72.3 0 Total revenue Adj. EBITDA Adj. Net Profit Incl. acquisitions +68% +31% -13% Excl. acquisitions -10% -11% -30% Interim results 2019 38
Slide 39: Summary by Division H1 2019
Group SUMMARY BY DIVISION H1 2019 H1 2018 (€m) H1 2019 (€m) Revenue Adj. EBITDA Margin Revenue Adj. EBITDA Margin B2B Gambling 290.3 124.9 43% 265.5 110.6 42% B2C Gambling 98.4 -5.1 -5% 438.2 71.7 16% Reported (Intercompany) -4.5 n/a n/a -6.8 n/a n/a Total Gambling 384.2 119.8 31% 696.9 182.3 26% Tr
Slide 40: B2B Gambling Customer Concentration
B2B GAMBLING CUSTOMER CONCENTRATION Licensees H1 2018 FY 2018 H1 2019 Top 5 38% 37% 39% Top 10 56% 54% 56% Top 15 68% 65% 66% Interim results 2019 40
Slide 41: B2B Gambling Performance
B2B B2B GAMBLING PERFORMANCE Gambling H1 2018 H1 2019 % CC % (€m) (€m) Casino 170.8 129.8 -24% -25% Services 41.3 46.2 12% 10% Sport 47.7 60.6 27% 26% Bingo 13.1 11.8 -10% -11% Poker 4.8 4.3 -10% -11% Other 12.6 12.8 2% 1% Total B2B Gambling 290.3 265.5 -9% -9% Interim results 2019 41
Slide 42: B2B Gambling Costs
B2B B2B GAMBLING COSTS Gambling H1 2018 H1 2019 % (€m) (€m) R&D 40.8 37.4 -8% Operations 79.8 78.5 -2% G&A 33.5 29.3 -13% S&M 11.4 9.7 -15% Total B2B Gambling 165.5 154.9 -6% B2B Gambling R&D incl. cap’ 61.7 59.4 -4% Interim results 2019 42
Slide 43: B2B Gambling Costs: H1-19 Excl. IFRS 16
B2B GAMBLING COSTS: B2B Gambling H1-19 EXCL. IFRS 16 H1 2018 H1 2019* % (€m) (€m) R&D 40.8 41.0 0% Operations 79.8 81.8 3% G&A 33.5 31.4 -6% S&M 11.4 10.0 -12% Total B2B Gambling 165.5 164.2 -1% B2B Gambling R&D incl. cap’ 61.7 63.1 -2% Interim results 2019 *H1 2019 numbers have been adjusted here t
Slide 44: Contingent Consideration
Group CONTINGENT CONSIDERATION Contingent Consideration and Acquisition Max earnout Payment date redemption liability as at 30.06.19 €3.2 million Q3 2019 ACM Group €75.0 million €127.6 million €71.8 million Q3 2020 Playtech BGT Sports Ltd €36.2 million €95.0 million €36.2 million Q2 2020 Destres €0
Slide 45: Thank You
Thank You Interim results 2019