Playtech Share Discussion Threads

[brexitplus] 03/7/2018 10:50

Shadex

Times today gives the following

Competitors in China include Genesis Gaming, Microgaming, and iSoftBet.

Also, most recent figures were Asia is 39% of revenue with Malaysia 5% and China 34%. Since the Malaysia clampdown led to a big drop, and China, by these figures is 7x larger my concerns I think are justified.

[garycook] 03/7/2018 10:47

lonrho,Nice to see someone is positive on PTEC.Brexitplus you were lucky you bailed out at 776p.Tell me when your buying back in !

[brexitplus] 03/7/2018 10:41

Garycook

As I said before I cashed out at 776p in both my ISA and SIPP. I LIKE Playtech and will reinvest when things are much clearer but at present can’t see any good news in the offing. I agree with MS that earning visibility is very poor.

[lonrho] 03/7/2018 10:39

FT lex column implies the price will rise from here, says the discount to GVC and Paddy Power is too large.

[garycook] 03/7/2018 10:33

bp,You must be Short PTEC.Your comments says it all !

[brexitplus] 03/7/2018 10:02

I don’t blame you. I fear there is more to come. They say profit warnings come in threes!!!

[shadex82] 03/7/2018 09:52

I don't have the Deutsche target unfortunately.
Personally with a paper loss of 32.5% I'm strapping my seatbelt and riding the storm. GL

[brexitplus] 03/7/2018 09:26

I tend to think they are on the back foot and any tactics will be countered by competitors.

MS’s reduction of target price from 1100 to 650 says it all.

Do you have today’s Deutsche Bank target price. Numis is down from 1125 to 882.

[shadex82] 03/7/2018 09:22

If they started accepting bitcoin for payment it would be a strong marketing tactic in China.

[brexitplus] 03/7/2018 08:49

Nod

Agreed. I think there is something going on not in the market’s knowledge.

I’m not sure how they are paid but imagine that it is payment per transaction. Hence, down the list means fewer transactions. Competitors undercutting this “fee” will markedly affect turnover. If it is a Chinese competitor the result will probably be compounded!!!

[nod] 03/7/2018 08:43

When they talk about "price" I guess they mean the price operators pay Playtech for their products and services. Gamblers don't pay PTEC.

So, does this mean that the operators have suddenly and rapidly deserted PTEC?
Price is usually only one factor in who an operator chooses - reliability, honesty, trust, management systems, and the array of gambling products supplied.

How can other suppliers of gaming software have taken a hold in China within just a few weeks? when PTEC has been supplying and developing the market for a decade?

I feel PTEC is not telling us something.

[brexitplus] 03/7/2018 08:40

Main problem as I see it is global market penetration from competition. Competitors will see Playtech as the supplier to attack.

I also am interested in who the competition is!!!

Interesting that Deutsche Bank has reiterated Playtech a buy. Last target I can find is 1300p. Sometime in the distant future I think.

[trentendboy] 03/7/2018 08:26

The question is whether it can be reversed and licences supported I wonder who the competitors are as they will now be doing very well I suspect

[trentendboy] 03/7/2018 08:26

Poor news from China - interesting how being relegated down a website can have such a big effect

[brexitplus] 03/7/2018 08:23

Still dropping

Key points

1 Increasing competitor pressure - “significant pricing pressure from competitors leading to Playtech products being relegated down licensee websites”

2 China a “new” problem

3 Malaysia still a problem

4 Italian politics

5 Possible opening of US but probable strong competition

6 Management remuneration

[shadex82] 03/7/2018 07:45

Reckon Morgan Stanley will promote the bad news before re-entering on the low side?
I'm currenyly 30% down and unsure wether to hold, sell or double down. I saw the drop yesterday just before going under for surgery, thankfully the surgery went better!

[brexitplus] 03/7/2018 06:54

morgan Stanley comment

“The company told us that ‘relatively sudden’ changes had occurred in China in recent weeks, with significant pricing pressure from competitors leading to Playtech products being relegated down licensee websites,” said Morgan Stanley. “While the risk of the Asian business is well known and partly explaining an already low valuation, we see valuation as providing little support here and expect investor attention to be focused on whether China could get worse.”

[brexitplus] 02/7/2018 17:20

Ooh

I agree. Italy could be yet another fly in the ointment. There are just too many possible negatives plus management cash for this to be a BUY.

Further to fall in my opinion.

[oohrogerpalmer] 02/7/2018 16:11

Big problem here is that any bad news from Italy, which given their recent comments on gambling is highly likely, could send this share price down another 30%.
Time to cut losses with some bitterness towards the management.
Good luck to those still in.

[brexitplus] 02/7/2018 15:49

From gaming business.com

“China price war leads to Playtech profit warning
2 July 2018
Playtech’s share price nosedived this (Monday) morning after the Isle of Man-based company warned that its full-year revenue from Asia is on course to be about €70m (£62m/$82m) lower than expected.

Playtech confirmed in a trading update that average daily revenue in Asia continues to be impacted by an “increasingly competitive backdrop” and cited “a particularly aggressive pricing environment from new entrants” towards the end of the first half of the year.

However, iGamingBusiness.com understands that the arrival of new local and international market entrants in China, which has led to a bruising price war in the country, is the key factor behind the latest announcement, which comes eight months to the day after the company issued its most recent profit warning.

It is understood that the full impact of the price war, which has been unexpectedly sudden, will be felt in the second half of the year, with the outlook in other parts of Asia having remained relatively unchanged for Playtech.

The company has also faced challenges in Malaysia, where its licensees have found themselves under greater scrutiny than ever before due to efforts from the country’s authorities to crack down on illegal gambling.

Playtech, which will announce its financial results for the six months ended June 30 on August 23, said: “If the current run rate in Asia continues unchanged for the remainder of 2018, including no material improvement in Malaysia, Playtech's expected revenue from Asia will be circa €70m lower than original expectations.”

Owing to the “relatively sudden” downturn in Asia and the company’s centralised cost base, the “vast majority” of the revenue loss would drop through to adjusted earnings before interest, tax, depreciation and amortisation, which is projected to be between €320m and €360m in 2018.

By midday on the London Stock Exchange, Playtech’s share price had plummeted by about 28% since the start of the day’s trading.

Chief executive Mor Weizer said: “Clearly the recent trading performance in Asia is disappointing. We have taken steps to further support our partners in the region and we will continue to work to preserve our position in the face of an increasingly competitive environment.”

Playtech did not disclose the level or nature of “support”; for its partners in Asia – a line that was also mentioned in its profit warning issued in November – and did not break down the €70 shortfall in expectations into geographical markets.

However, it is understood that the company believes that the latest development – underlining the volatility of operating in unregulated territories – vindicates Playtech’s efforts to increase its focus on regulated markets.

In April, the company confirmed a deal to acquire a controlling stake in Italy-based Snaitech and late last month Playtech secured approval from Italy’s financial watchdog for its mandatory offer for the remaining shares.

In its trading update, Playtech said that it “believes the increased activity due to the Fifa World Cup and general strength in the Italian gaming market is encouraging for the current period”, even though Snaitech is currently a separately-listed company.

Weizer (pictured) added: "In line with our stated strategy, progress in fast-growing, regulated and soon to-be-regulated markets continues apace. Momentum in key regulated markets continued in the first part of 2018 with new agreements with Gala Leisure in the UK, SAS in Portugal and Totalizator, the Polish national lottery.

"Additionally, regulatory developments in the US represent a significant opportunity for the group. The organic growth reported in the non-Asian B2B gaming business combined with the recent acquisition of Snaitech in Italy provides management with confidence that this strategy will materially improve the quality and diversification of Playtech's performance in 2018 and beyond."

[mammyoko] 02/7/2018 15:19

I don't think this is over-done. E70m hit to the bottom line = 27% reduction in forecast PBT (all drops to the bottom line) leading to 27% reduction in share price Would be overdone at 450 not 550

[bor491] 02/7/2018 15:05

Letting go of plus500 was probably one of playtech's biggest blunders. Having said that I do think this company can turn round but heads deserve to roll with this destruction in shareholder value! They appear out-of-touch - cheekily asking for a hike in their salaries!!!

[mammyoko] 02/7/2018 15:01

Hey, how about PLUS making a bid for PTEC to keep it in the family as it were? Tables comprehensively turned!