Online gambling technology provider Playtech enjoyed double-digit revenue gains in 2016 due largely to growth in its Asian grey- and black-market operations.
Year-end figures released on Thursday show Playtech’s group revenue rising 12% to €708.6m last year, while adjusted earnings rose by one-fifth to €302m and net profit shot up 42% to €193m.
Playtech’s dominant casino vertical drove the gaming division’s results, rising 15% to €354.6m thanks to strong growth in live casino and Asian markets. Mobile casino revenue more than doubled year-on-year, driven by Asian markets, where mobile casino activity more than tripled.
Most of Playtech’s other gaming verticals were in negative territory, with services falling 3% to €151.6m, bingo down 13% to €17.8m and the struggling iPoker division falling nearly one-fifth to €9.1m. Playtech insists it “remains dedicated” to its poker product.
Playtech’s financials division improved 9% to €65.6m while land-based gaming revenue was also in the black, rising 92% to €57.1m.
Sports revenue declined 4% to €30.9m but Playtech says that if its retail sports revenue were included in this category – a change the company intends to make going forward – the figure would have risen 69% to €58.4m. The retail sports gains are primarily due to Best Gaming Technology (BGT), which Playtech acquired last July.
Playtech splashed out €240m on acquisitions last year, absorbing BGT, Consolidated Financial Holdings, Quickspin and ECM Systems. And with its unspent cash pile sitting at €545m at the end of 2016, Playtech remains open to further acquisitions, as evidenced by this month’s deal to acquire bingo software firm Eyecon.
ASIAN GREY- AND BLACK-MARKET OPS SURGE
Playtech says regulated markets provided 42% of its 2016 gaming revenue, up one point from 2015’s share. But grey- and black-markets, particularly Asian countries, remain the primary engine of Playtech’s growth.
In geographic terms, Playtech earned the bulk of its 2016 revenue from Asian black market operators based in the Philippines. Philippine-based operator revenue was up nearly 29% to €257m, representing 40% of 2016’s group revenue, up from 35% in 2015.
Playtech’s other geographic up-and-comers include the UK, where revenue grew 5% to €189m, while Malta was up nearly 140% to €25.3m. Italy’s regulated market gained 10% to €17.1m while Spain more than doubled to €12.6m thanks to regulators approving online slots play. The ‘Rest of World’ category gained 27% to €81.6m.
As for shrinking markets, Gibraltar-licensed operator revenue fell 16% to €25.3m, while Antigua was down by half to €28.9m and Curacao fell 41% to €6m. These latter two markets are believed to contain a number of US-facing licensees, although Playtech has publicly disputed this suggestion.