No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - Gambling software developer Playtech warned on Thursday that secondhalf earnings will come in lower than the first as key US revenues normalise and higher UK remote gaming duties continues to bite, even as it posted a sharp jump in interim profit and cash flow.
Playtech said adjusted underlying earnings surged 77% yearonyear to 162.5m in H1, driven by strong momentum across the Americas, but cautioned that H2 EBITDA would be softer due to normalising levels of Hard Rock Digital revenues, ongoing investment in Brazil and a full halfyear impact of UK remote gaming duty - with UK B2B revenue already down 8% in the period. Revenues rose 10% to 425.1m, while EBITDA from operations climbed to 128.3m, lifting margins to 30% from 19% a year earlier.
The US and Canada delivered standout growth, with revenues up more than 160%, supported by Hard Rock Bet in Florida and new launches with Fanatics, FanDuel and Bet365. Latin America also performed strongly, helped by customer acquisition during the 2026 FIFA World Cup.
B2B revenues increased 14% to 394.8m, or 17% on an underlying basis, with regulated markets accounting for 83% of the total. Europe excluding the UK saw modest growth, while UK revenues declined amid customer changes and higher gaming duty. SaaS revenues grew 20%, and live casino revenue rose 8%, with margins improving through table optimisation and cost efficiency.
B2C revenues, largely Sun Bingo, fell to 32m, though adjusted EBITDA improved to a small profit as Playtech continued winding down its HAPPYBET business.
Investment income strengthened, with adjusted income rising to 34.2m, driven by its stake in Caliente Interactive. The group received 35.8m in dividends from Caliente and 4.4m from Hard Rock Digital, while the fair value of its HRD investment increased to 246.7m.
Playtech generated 101m of free cash flow in H1, ending the period with 39.2m of net cash after completing a 25m share buyback. Looking ahead, Playtech said remains on track to deliver more than 270m of adjusted EBITDA for FY26, within its mediumterm target range of 250m to 300m.
As of 0955 BST, Playtech shares were down 2.74% at 386.32p.
Reporting by Iain Gilbert at Sharecast.com
See latest RNS on Investegate