Playtech : 2020 Half year results presentation

H1 2020 results

17 September 2020

Agenda	2

Group highlights		Financial review		Strategic priorities
		and outlook

Mor Weizer	Andrew Smith	Mor Weizer
Chief Executive Officer	Chief Financial Officer	Chief Executive Officer

H1 2020 results

Playtech response to COVID-19

3

Decisive action taken early

• Priority was to limit the effects of the pandemic on staff, partners and overall business
• Business continuity plan enacted in early stages of the pandemic
• Outstanding response from our people
• Support provided to local communities
• Seamless transition to remote working; productivity levels and delivery deadlines maintained
• Safer Gambling engagement tools were made available for free during the crisis

H1 2020 results

Highlights

4

Resilient H1 performance; continued operational execution

• Resilient H1 driven by online and TradeTech together with early and decisive actions taken in response to COVID-19
• Significant US momentum: New Jersey license received and launched with bet365; further license applications underway; investment to increase
• New structured agreements signed in Guatemala and Costa Rica; Caliente now top 3 customer
• Launch of Playtech's sustainable business strategy to consolidate position as a global leader in safer products, data analytics and player engagement solutions
• Simplification of Playtech progressing; actions taken on assets under review

H1 2020 results

Executing 2020 priorities

5

Delivering our strategy

2020 priorities	Progress
1.	Increase US investment	Launched with bet365 in New Jersey; Live facility under
		development; further applications underway
2.	Sign new structured agreements	New structured agreements in Guatemala and Costa Rica
3.	Sign 50 new brands	>50 new brands signed in H1, surpassing FY 2020 target
4.	Snaitech to outperform in Italy	Snaitech #1 across Sports in Italy in H1
5.	Drive further developments in Safer Gambling	Launched Playtech Protect; leading on safer game design
6.	Asset review	TradeTech process underway; Sold loss-making Casual
		Gaming assets; HPYBET under Snaitech management

H1 2020 results

Agenda	6

Group highlights		Financial review		Strategic priorities
		and outlook

Mor Weizer	Andrew Smith	Mor Weizer
Chief Executive Officer	Chief Financial Officer	Chief Executive Officer

H1 2020 results

Financial highlights

7

Robust start to 2020; resilient despite COVID-19

Strong start to 2020 pre-COVID-19

• Strong January and February
• Q1 EBITDA of €117m

Resilient H1 despite COVID-19

• Core B2B Gambling revenues down 5%
• • Core B2B Online growth of 18%
  • Non-UKregulated up 11%
• Snaitech Online revenues up 37%; number 1 in Sports
• Outstanding TradeTech performance

Cash preservation measures

• Early decisions taken to preserve cash across the business
• All areas of cash preservation examined

Strong balance sheet and liquidity

• Free cash flow positive in H1; liquidity improved
• • RCF drawn down; covenants renegotiated
  • Final €36m of Snaitech land sale received in Q3
• Net Debt / EBITDA improved to 1.5x (FY19: 1.6x)
• Sale of certain Casual Gaming assets completed

H1 2020 results

COVID-19 Response

8

Decisive action taken early to navigate pandemic

Cash preservation	Liquidity
• Shareholder distributions suspended; €65m preserved	• Navigated pandemic with positive free cash flow
• Salary reductions across the Company	• RCF drawn down as precaution only
(incl. 20% for Board and Executive Management)	• Playtech has 5-year (€530m) and 7-year (€350m) bonds
• Deferral or cancellation of planned H1 capital	(October 2023 and March 2026)
expenditure
• Strict working capital management	Covenants renegotiated as precautionary measure
• Leverage covenant amended to 5x Net Debt / EBITDA
• Reduced office and maintenance costs	(Dec-20 test) and 4.5x (Jun-21 test)
• Renegotiated timing of 2020 earnout payments	• Interest Cover covenant amended to 3x EBITDA
	(Dec 20 test) and 3.5x (Jun-21 test)
	• Comfortably within the limits for both
H1 2020 results

Group EBITDA by month

9

Robust start to 2020 before COVID-19; recovery underway

Gambling		TradeTech

50

€ Millions

0

January

February

March

April

May

June

Recovery in July and August

• Very strong July:
• • Pent up demand
  • Concentration of football matches
  • Strong TradeTech
• Solid August:
• • Lower than July
  • Retail caution
  • Modest TradeTech

H1 2020 results

Results summary

10

Group results impacted by pandemic

Total revenue (€m)	Adj. EBITDA (€m)	Adj. Net Profit (€m)
€564.0	€162.3	€44.3

750		250		200
727.8	-23%
600	200		150
	-16%
	564.0	192.9
450		150	162.3
			100
300		100		78.4
				-44%
150		50		50
			44.3
0		0		0
H1 2019	H1 2020	H1 2019	H1 2020	H1 2019	H1 2020

H1 2020 results

B2B Gambling

11

Strong Core B2B performance outside UK

							Online only & excluding Sports
€ millions		H1 2019*	H1 2020	%	CC%		H1 2019	H1 2020	%	CC%
UK	94.8	66.1	-30%	-30%		52.0	51.9	0%	1%
Other regulated	74.2	80.5	8%	11%		37.4	57.7	54%	60%
Total Regulated B2B revenue	169.0	146.6	-13%	-12%		89.4	109.6	23%	25%
Unregulated excl. Asia	31.5	41.9	33%	32%		30.1	41.0	36%	35%
Total Core B2B revenue	200.5	188.5	-6%	-5%		119.5	150.6	26%	28%
Unregulated Asia	65.0	41.2	-37%	-36%		65.0	41.2	-37%	-36%
Total B2B Gambling revenue	265.5	229.7	-13%	-12%		184.5	191.8	4%	5%
B2B costs	155.3	166.5	7%	7%
B2B Adjusted EBITDA	110.2	63.2	-43%	-39%

* UK benefitted from a significant one-off hardware sale in H1 2019

H1 2020 results

B2C Gambling performance

12

B2C impacted by retail closures and sports cancellations

		Revenue				Adjusted EBITDA
€ millions	H1 2019*	H1 2020		%	CC%		H1 2019*	H1 2020		%
Snaitech	395.8	215.5		-46%	-46%	74.7	47.1		-37%
White label (incl. Sun Bingo)	24.3	29.5		21%	22%	3.4	3.4		0%
Retail Sport B2C	9.9	8.5		-14%	-13%	-3.6	-4.2		-17%
Total B2C Gambling	430.0	253.5		-41%	-41%	74.5	46.3		-38%

* H1 2019 numbers have been restated to reflect the reclassification of discontinued operations

H1 2020 results

Snaitech performance

13

Resilient H1 driven by online strength and variable cost franchise model

€ millions	H1 2019	H1 2020	%
Retail betting	85.9	48.1	-44%
Gaming machines	249.0	92.3	-63%
Online	46.4	63.4	37%
Other	14.5	11.7	-19%
Total revenue	395.8	215.5	-46%
Adjusted EBITDA	74.7	47.1	-37%
Margin	19%	22%	-
Underlying margin*	45%	41%	-
* Underlying margin excludes the distribution costs paid to franchisees
H1 2020 results

TradeTech Group Results

14

Exceptional H1 2020

USD millions	H1 2019	H1 2020	%
B2C	$9.9	$22.8	130%
Liquidity offering	$14.5	$15.5	7%
Execution & Risk Management	$17.5	$50.8	190%
Full Turnkey offering	$2.2	$7.1	223%
Net Revenue	$44.1	$96.2	118%
Adjusted EBITDA	$9.2	$58.4	535%

• Outstanding H1 performance benefiting from increased market volatility and trading volumes
• Market conditions began to normalise towards the end of the first half and into the second half
• Initial steps towards a more efficient balance sheet; released €10 million of capital

H1 2020 results

Balance sheet

15

Strong balance sheet and liquidity

• Long-termfinancing in place; leverage within range
• • RCF drawn down as precautionary measure
  • Covenants renegotiated for December 2020 and June 2021 tests; comfortably within limits
  • Playtech has 5-year (€530m) and 7-year (€350m) bonds (October 2023 and March 2026)
• Shareholder distributions suspended in February 2020
• • Share buyback announced at FY19 results was suspended; 2019 final dividend not proposed
  • €65m of cash outflows saved in H1

H1 2020 results

Cash on balance sheet

16

Cash position strengthened despite pandemic

			June 2020				December 2019
						Total				Total
						excl.				excl.
€ millions	Gambling	Snaitech	TTG	Total	RCF	RCF		Total	RCF	RCF
Gross Cash	378	240	405	1,023	(307)	716	672	(64)	608
Client funds / progressives*	(86)	(39)	(242)	(367)	-	(367)	(338)	-	(338)
Adjusted gross cash	292	201	163	657	(307)	349	333	(64)	270
Cash needed for operations	(50)	(30)	(53)	(133)	-	(133)	(133)	-	(133)
Capital adequacy	-	-	(60)	(60)	-	(60)	(70)	-	(70)
Available cash	242	171	50	463	(307)	156	131	(64)	67

* Includes Client funds, progressive jackpots, security deposits & player balances

H1 2020 results

Outlook

17

Equipped to emerge strongly from the COVID-19 period

• Strong trading and cash generation in July and August, albeit with stronger July
• Online expected to continue to perform strongly
• Cautious about the outlook for retail
• TradeTech first half performance not expected to be repeated in H2 with market volatility currently significantly lower
• Balance sheet remains strong, allowing for selected high-return investments such as in the US
• Business performing well but caution remains given the backdrop

H1 2020 results

Agenda	18

Group highlights		Financial review		Strategic priorities
		and outlook

Mor Weizer	Andrew Smith	Mor Weizer
Chief Executive Officer	Chief Financial Officer	Chief Executive Officer

H1 2020 results

Impact of COVID-19 on Playtech

19

New opportunities created; accelerating existing plans

Impact of COVID-19

• COVID-19has accelerated shift to online and increased demands of digital functionality
• Increased demand for our technology; safer game design and monitoring tools
• Opportunities to rationalise costs and further refocus the business

Playtech response

• Accelerating existing plans to take advantage of the new opportunities created
• Leading technology and strong balance sheet positions Playtech to execute
• Continued focus on extending Playtech's position as a global leader in safer gambling products

H1 2020 results

US market opportunity

20

Market opportunity continuing to grow

$24.4bn	• 22 states now offer or have approved Sports Betting
by 2023	• Sports Betting estimated $19 billion market by 2023
Sports ~$19.0bn	• iGaming legislation lags; gaining momentum
iGaming ~$5.4bn	• iGaming estimated $5.4 billion market by 2023

Market sizes are GGR based on forecasts for sports / iGaming by 2023.

Source: Jefferies (2020)

H1 2020 results

US product & technology offering

21

Industry-leading technology; flexible and open architecture

Industry-leading IMS platform	Live Casino
Playtech Open Platform / APIs	Slots
Turnkey Sportsbook	Poker
Bet engine	Omni-channel offering
Trading services and risk	Native iOS Casino app
Bespoke risk and liability	Managed services
Models and algorithms	Marketing and bonusing
H1 2020 results

US momentum

22

US strategy is building momentum

Approach	Current Status
Market Entry • State by state approach	• First licence obtained in New Jersey
• Licensing process underway in several states	• Accelerating investment
• Local presence	• Target c.10 states by end of 2022

Technology & Products

• IMS platform including CRM, BI & safer gambling	• Leading platform in regulated markets
• Sports via SSBTs & online	• Technology and products unrivalled
• Online slots & Live casino	• Live Casino facility under development

Customers & Partnerships

• Existing customers from other markets	• bet365 launched in New Jersey
• New US-based relationships	• Strong new business pipeline
• Focus on traditional B2B model	• Initial talks on structured agreements

• Potential for select structured agreements

H1 2020 results

Latin America

23

Building on market leading position in the region

• Strategy in region focused on structured agreements

• Caliente now a top 3 licensee

• Wplay roll-out progressing as planned with first milestones achieved

• New structured agreements in Guatemala & Costa Rica
• Medium term opportunities include Panama, Peru, Argentina, Brazil
• €100m annual revenue opportunity in medium term

H1 2020 results

Resilient H1 for Snaitech

24

The market leader in Italy

#1		41%
Sports betting		Growth in online
market share in H1		stakes

€55m		75%
Land sale		Growth in online
completed		EBITDA

Resilient H1; recovery in July and August

• Retail closures and lack of sporting events significantly impacted results from March to June
• Business remained breakeven throughout worse period of pandemic
• Online had very strong growth leveraging technology and brand strength

H1 2020 results

The opportunity for Snaitech

25

Largest market in Europe; ideally positioned

Significant long-term opportunity

• Largest gambling market in Europe
• Low online penetration
• Ideally positioned to capture opportunity with brand strength and leading online offering
• Actions taken in H1 to improve online capabilities and extend market leadership

* Source: H2 Gambling Capital (2019)

Online Penetration*

50%	45%
40%
30%
20%
10%		10%
0%
	UK	Italy

H1 2020 results

Asia

26

Increased flexibility

• H1 2020 impacted by government restrictions in response to COVID-19
• Also impacted by restrictions introduced on payment processing
• Changes to operating model and distribution network in region
• • Additional distributor added
  • Increased flexibility in region going forward
• Remains highly cash generative

H1 2020 results

Safer gambling & sustainability

27

Sustainable success strategy; pioneering consumer protection

Sustainable Success

Five-year sustainable & responsible business strategy

Investing £5m into initiatives that encourage safer gambling behaviours

	Power			Promote			Partner

H1 2020 results

Asset review

28

Action being taken

TradeTech

• Remains non-core; source of capital to the Group in H1 given strong performance
• Released €10m of previously tied-up cash
• Playtech is in discussions with a number of parties in relation to possible sale

Retail B2C Sport (HPYBET)

• Strategic asset in Germany ahead of regulation
• To be operated by Snaitech management team going forward

Casual and Social Gaming

• Discontinued operation
• Loss-makingassets sold in H1; sale process for remainder ongoing

H1 2020 results

2020 priorities

29

Delivering our strategy

2020 priorities	H2 Focus
1.	Increase US investment	Further license applications, go-lives, deals signed
2.	Sign new structured agreements	Progress existing relationships and pipeline of structured agreements
3.	Sign 50 new brands	Sign >75 new brands in 2020
4.	Snaitech to outperform in Italy	Snaitech to maintain market leadership
5.	Drive further developments in Safer Gambling	Execute our Sustainable Success strategy
6.	Asset review	Snaitech to begin management of HPYBET; actions ongoing to
dispose non-core assets

H1 2020 results

Medium-term outlook

30

Well positioned for future growth

• Playtech to emerge strongly from COVID-19 disrupted period
• Positioned to take advantage of emerging opportunities
• • Leading technology
  • Strong balance sheet
• Comprehensive product offering; ideally placed to capture significant US market opportunity
• Significant opportunities for further material structured agreements
• Focus on extending Playtech's position as a global leader in safer gambling products

H1 2020 results

Q&A

Appendix

Results summary

33

Group - at constant currency

Total revenue (€m)	Adj. EBITDA (€m)	Adj. Net Profit (€m)
€565.5	€164.6	€49.7

750		250		200
727.8	-22%*
600	200	-15%*	150
	565.5	192.9
450		150	164.6	100
300		100				-36%*
				50	77.2
150		50			49.7
0		0		0
H1 2019	H1 2020	H1 2019	H1 2020		H1 2019	H1 2020

* Including and excluding acquisitions

H1 2020 results

Summary by division H1 2020

34

Group

		H1 2019 (€m)*			H1 2020 (€m)
		Revenue	Adj. EBITDA	Margin		Revenue	Adj. EBITDA	Margin
	B2B Gambling	265.5	110.2	42%		229.7	63.2	28%
Reported	B2C Gambling	430.0	74.5	17%		253.5	46.3	18%
(Intercompany)	(6.8)	n/a	n/a		(6.5)	n/a	n/a
	Total Gambling	688.7	184.7	27%		476.7	109.5	23%
	TradeTech	39.1	8.2	21%		87.3	52.8	61%
	Group	727.8	192.9	27%		564.0	162.3	29%
CC	Group	727.8	192.9	27%		565.5	164.6	29%

* H1 2019 numbers have been restated to reflect the reclassification of discontinued operations

H1 2020 results

B2B Gambling customer concentration	35

Licensees	H1 2019	H1 2020
Top 5	39%	38%
Top 10	56%	52%
Top 15	66%	62%

H1 2020 results

B2B Gambling costs

36

Cost reduction during H1 in response to COVID-19

€ millions	H1 2019	H2 2019	H1 2020	H1 v H1 (%)	H1 v H2 (%)
R&D	37.4	43.5	39.2	5%	-10%
Operations	78.5	102.7	85.4	9%	-17%
G&A	29.7	27.7	32.4	9%	17%
S&M	9.7	9.9	9.5	-2%	-4%
Total B2B Gambling costs	155.3	183.8	166.5	7%	-9%

H1 2020 results

Net profit and EPS

37

Group

		Adjusted			Excl. Acquisitions
	H1 2019*	H1 2020		%		H1 2019*	H1 2020		%
Adjusted EBITDA	192.9	162.3		-16%	194.8	164.3		-16%
- Depreciation & Amortisation	(78.4)	(79.2)		1%	(78.1)	(78.8)		1%
- Net finance costs	(20.4)	(31.4)		54%	(20.1)	(31.2)		55%
- Tax	(16.4)	(8.2)		-50%	(16.1)	(8.5)		-47%
- Gain from Associate & JV	1.9	0.7		-63%	1.9	0.7		-63%
Non-controlling interest	(1.2)	0.1		n/a	(1.2)	0.1		n/a
Net Profit attrib. to owners of parent	78.4	44.3		-44%	81.2	46.6		-43%
Shares Outstanding (millions)	307.4	297.5		-3%	307.4	297.5		-3%
Basic EPS (cents)	25.5	14.9		-42%	26.4	15.6		-41%

* H1 2019 numbers have been restated to reflect the reclassification of discontinued operations

H1 2020 results

Adjusted cash bridge

38

Free cash flow positive; liquidity improved

657

411

€ Millions

Adjusted	Net cash from	Snaitech	Acquisitions &	CapEx and	Share	Interest, FX &	Adjusted	RCF drawn	Adjusted
gross cash*	operations**	land sale	contingent	Cap Dev	buy-back	lease liability	gross cash*	down	gross cash* at
at 31/12/2019			consideration			payments	excl. RCF		30/06/2020
							impact

• Adjusted gross cash denotes cash adjusted for client funds and progressive jackpots
• Net cash from operations includes adjustment for cash within discontinued operations

H1 2020 results

Contingent consideration

39

Group

		Contingent consideration	Payment date
	Maximum payable earnout	and redemption liability	(based on maximum
Acquisition	(per terms of acquisition)	(as at 30.06.2020)	payable earnout)
Playtech BGT Sports Ltd	n/a - Earnout assessment	€20.8 million	€8.3 million Q3 2020
	period complete		€12.5 million Q4 2020
HPYBET Austria GmbH	€15.0 million	Nil	Q2 2021
Bet Buddy	€1.3 million	€1.3 million	Q4 2020
Eyecon Limited	€24.7 million	Nil	Q2 2021
Wplay	€21.3 million	€20.1 million	€16.1 million Q3 2020
			€4.4 million Q4 2022
			€0.8 million Q4 2024
Statscore	€15.0 million	€3.7 million	€5.0 million Q1 2023
			€10.0 million in Q1 2026
Other	€7.0 million	€1.3 million
Total	€84.3 million	€47.2 million

H1 2020 results

Thank you