Playtech is confident that it will achieve its strategic and commercial objectives for 2024, following a ‘solid start’ to year trading.
The LSE technology group published its AGM trading update, providing investors with a general overview of corporate performance (non-financial) for the period from January 1, 2024 to April 30, 2024.
The firm’s B2B unit maintains revenue growth in regulated markets, prioritising services for key contracts and tighter cost controls.
As detailed on B2B trading: “Growth in regulated markets was led by the Americas, with the US and Canada increasing their contribution, albeit from a small base, while Mexico and Colombia continue to perform well.”
Product-wise, Playtech’s B2B unit is bolstered by a growing demand for live gaming services, alongside the tech group securing new customer launches for its SaaS solutions.
Led by Snaitech, Playtech’s B2C unit “performed well on an underlying basis,” matched against the tough comparatives of World Cup 2022 trading.
Snaitech maintained strong wagering volumes (online and retail), withstanding customer-friendly sporting results in Italy.
Playtech provided an update on its ongoing service fee dispute with its Mexican joint venture partner, Caliplay, a long-standing legal challenge that has been referred to the courts of London and Mexico City.
2023 saw Caliplay, the Mexican joint venture of Playtech and Grupo Caliente, annul service fee arrangements with Playtech due to disputes related to contract entitlements of the JV partnership.
Previous updates to the legal challenge saw Playtech claim that Caliplay owed circa €34m in unpaid service fees for the first six months of 2022.
Detailed as the main point of conflict, Playtech’s London appeal noted that Caliplay could only request service fee entitlements by mutual consent, requiring fee terms to be reviewed by an independent investment bank.
Updating investors, Playtech noted: “Caliplay remains a highly important customer and Playtech continues to maintain an open dialogue with Caliplay to discuss a path forward, although fees owed to Playtech remain uncollected.
“While the Company believes it has visibility over substantially all of the revenue generated by Caliplay’s business, and as such, can confirm that Caliplay continues to perform strongly, Playtech has been unable to obtain full financial information from Caliplay during the period. As a result, the revenue generated from the additional B2B services element of the agreement is partly based on an estimation, which takes account of prior trends and information provided.”
Playtech concluded: “Given the strategic progress being made across the business, the Board remains confident in Playtech’s ability to execute on the exciting growth opportunities across both B2B and B2C divisions over the medium term.”
