Finance

Playtech shareholders approve UK tax residency move

| By Richard Mulligan
Playtech shareholders have agreed to the board’s proposed relocation of tax residency from the Isle of Man to the UK.

In a vote on Friday, 92.2% of the 230,000 votes cast were in favour of the relocation proposal that was first announced at the start of this month.

Shareholders agreed to a plan to move onto the mainland UK in early 2021, which the gaming supplier’s board said would be an overall benefit to the business.

“Playtech is pleased to confirm that the proposed resolution at today’s General Meeting has now been formally approved by shareholders,” the group said in a statement.

In announcing the plan earlier this month, the board said the relocation would allow the business to host board meetings and make board decisions in the UK, as well as hold shareholder meetings in the country. This, it said, would help encourage greater shareholder participation.

The board said the move makes sense given the evolution of the company and to better align it with its expected future operational substance.

In its most recent trading update, Playtech said: “The UK remains a key regulated market for Playtech, where the strength of Playtech ONE provides it with a strategic advantage and a cornerstone presence.

“Playtech has been actively involved in discussions around safer game design and online advertising, and through the industry trade body the Betting and Gaming Council is co-leading a working group on the subject. Playtech expects that its commitment to safer gambling and its use of technology and data to support its licensees in this area will see it remain the go-to platform for regulated markets.

“Playtech’s ongoing relationship with Tier 1 operators in the UK continues to deliver strong results for the group.”

In September, Playtech reported a 22.5% year-on-year decline in revenue for the first half of 2020, after a strong start to the period was halted by the impact of novel coronavirus (Covid-19) on B2B and B2C operations.

Revenue for the six months to 30 June declined to €564.0m (£505.6m/$674.7m), as a strong performance from its financials division TradeTech was unable to offset a 13.5% drop in B2B revenue, and a 41.0% drop in B2C’s contribution.

In H1 2020, the group’s underlying adjusted effective tax rate of 15% was impacted by the geographic mix of profits and reflects a combination of higher headline rates of tax in the various jurisdictions in which the group operates when compared with the Isle of Man standard rate of corporation tax of 0%.

The total adjusted tax charge in H1 2020 was €8.2m compared to €16.4m in H1 2019 of which €8.0 million related to current tax expenses. Deferred tax decreased due to the lower utilisation of the brought forward losses in Snaitech due to its lower taxable profits resulting from the closure of retail locations throughout much of the period.

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