Playtech ups full year dividend 15% as 2017 starts off well

Playtech, the provider of online gaming and financial trading software, reported strong annual profits growth last year and has begun 2017 on a good footing.

Total revenues of €708.6m for the 2016 calendar year were up 12% on a reported base, with currency headwinds a significant factor, as constant currency growth was up at 20%.

The FTSE 250 group spent €240m on acquisitions including BGT, CFH, Quickspin and ECM, as it strengthened its gaming offer and built a new presence in financial trading.

More than ten new gaming customers were signed in the year, with nine of out of its 10 top customers now on long-term contracts as Paddy Power Betfair, William Hill, Rank and Betfred all renewed in the past few months.

Adjusted earnings before interest tax, depreciation and amortisation of €302.3m was up 20% reported and 32% at constant currencies, beating the consensus analyst forecast of €297.9m.

Earnings per share, on an adjusted and diluted basis, fell 3% to 59.8 cents from 61.8 cents on a reported basis but was up 37% if allowing for currency swings.

The total dividend per share was hiked 15% to 32.7 cents.

Year end net cash stood at €269m, excluding CFH customer cash and the €200m convertible bond, despite the acquisition spend and paying out €150m of special dividends and spending €50m on share buy-backs over the year.

Management said 2017 has started well, with like-for-like daily gaming revenue growth of 12% in the 51 days to 20 February, or up 26% in total, with the new financials division said to be trading "in line with management expectations".

Chairman Alan Jackson said: "Following the transitioning of the Financials division in the first half of the year, the second half performance was encouraging with improved KPIs. The second half also saw the acquisition of CFH, enhancing Playtech's position as it continues to build a B2B financials offering within its Financials division."

He added: "Management remains confident of a strong performance in 2017 and beyond."