Problems with TradeTech to Impact Playtech’s Full-year Results
According to the company’s governance, 2019 performance will not be in accordance with earlier estimates, citing problems with its financial trade division.
Earlier this month, Playtech posted its latest trading update for the four-month period that came to an end on October 31, 2019. The figures revealed that the company’s financial service unit experienced certain problems in September and October. The challenging period for TradeTech, which offers its service through Markets.com, led to subpar performance.
Playtech was quick to act, informing its investor that the estimated adjusted earning 2019 will be as panned. Normally, investors were far from being happy because of the news, which in turn led to a drop in Playtech’s share price, which went down by 2.5% by the end of trading on Friday.
At this moment, Playtech is still considering its options, especially as TradeTech has in recent years come under the scrutiny of regulatory bodies, although the control of all companies offering forex and contracts for difference has been tightened. And what are these options? According to sources, Playtech is seriously considering the sale of certain businesses to make its operations more efficient.
Investor Jason Ader, whose company has a 5% share in the renowned developer suggested not only the sale of TradeTech but also of other non-core businesses – those which didn’t fit within Playtech’s operations.
Speaking at an investment conference in London, Ader also suggested that some of the company’s businesses in Asia should be dropped. He added the company was seriously undervalued at the moment, stating a leveraged buyout would represent a perfect move.
Other Business Performed Well
The latest report wasn’t so bad, as it revealed Playtech saw its revenue jump by 12% during the second part of the year (at least to date). However, problems with TradeTech have negatively reflected on the company’s operations. And although TradeTech disappointed, the Italian operator Snaitech has once again exceeded the forecasts, especially in the online segment.
When it comes to Playtech’s dismal performance in the Asian market, the estimates made back in August said the full-year revenue should amount to around C$168.5 million. However, despite the efforts made in the area, the competitiveness of the market could reflect on the overall results.
Playtech has been very busy lately, launching the new Kingdoms Rise game suite, which will bring a distinctive reward system, aimed at increasing player engagement. In addition to this, the company inked a new deal, adding Red Star Poker to its poker network, one of the biggest ones in the world.
Playtech also signed a new agreement will Aquila Global Group, which owns and operates Wplay, one of the most popular sport betting brands in South America.
Founded back 1999, Playtech has since become one of the leading names in the business, offering high-quality products and services to its demanding customers all around the world. Employing 5,000 people, the company currently operates in 20 regulated markets, with a total of 140 global licensees.