Playtech leadership has actually recommended partners to exercise caution when it comes to navigating volatile regulations in core markets.

In the wake of its H1 monetary report where it restored its commitment to Latin American markets like Mexico, Colombia and Brazil, the B2B gambling group revealed some appointments about a list of proposed tax modifications in the relevant jurisdictions.

A significant development for Playtech in Mexico saw the company acquire a 30.8% equity stake in regional operator Caliente. SBC News spoke to both Playtech's CFO, Chris McGinnis, and CEO Mor Weizer, about the long-term prospects of this deal.

Handling the tax bills

While McGinnis stressed the commitment of Playtech towards the Caliente partnership and the growth opportunities it provides, Weizer focused more on the quickly evolving regulative elements of the Mexican market.

While still under review, a proposed legislation ahead of the 2026 Budget desires to increase the current GGR duty from 30% to 50%. Weizer brought up examples from across Europe where tax walkings have actually caused a mutual effect on the market.

"We have actually seen from international advancements like the Netherlands that increases in the gambling tax can have unexpected repercussions.

"There, this has actually triggered a reduction in marketing financial investments and some operators leaving the marketplace, as well as an increased activity of uncontrolled platforms.

"While certainly we would choose the tax level in Mexico to stay the exact same, we can't truly foresee what the effect a boost will have, and we are still in the procedure of assessing."

LatAm remains firmly in Playtech's sights

Latin America has actually caught the attention of many gaming companies, both B2B and B2C, with Brazil in particular seeing a rush of market entrants in the months considering that a controlled wagering space was launched in January.

Amidst this excitement, it is essential not to forget other Latin American markets, nevertheless, numerous of which are seeing similar modifications to Europe around taxation. Looking at Colombia, comparable propositions were tabled to make the short-lived VAT tax a permanent charge.

While reaffirming that the nation remains a top priority for Playtech, Weizer likewise advised caution, laying out that the market might become unsustainable for some operators if the federal government decides to go through with its decision.

In Brazil, Playtech earnings showed to be volatile compared to other jurisdictions like the US and Canada, generally due to the regulation of the marketplace at the start of this year. However, Weizer remained confident that Playtech has actually acted accordingly, which its regional partners are now well positioned for accelerated development.

"Brazil has the strictest set of regulations worldwide, even when compared to the US, and they presented a really rigorous onboarding process that at the start resulted in a high level of rejection rates," the CEO explained.

"However, we now see GGR returning to very comparable levels to what we saw prior to the market's policy. Estimates recommend a market value of $6bn by the end of this year, and an expected growth of 15% in between now and 2030, reaching $17bn.

"While it took the market a long time to adapt to the brand-new guidelines, I think that from this point onwards we will see accelerated growth. This is a huge chance for us. We think Brazil is among the most promising countries for the gaming industry in the coming years."

Snaitech sale sets up B2B focus

Finally, Playtech's H1 corporate accounts were positively impacted by the sale of Snaitech to Flutter Entertainment, a huge minute in the business's shift to a solely B2B business.

When asked by SBC News about how Playtech plans to prioritise the deployment of newly-acquired capital, McGinnis included that everything is on the table - from M&A to investor returns.

"We have an extremely strong balance sheet and I think the very best thing that it does is provide us flexibility that we can check out all of these choices," the CFO stated.

"We have actually constantly had an M&A strategy. When we first acquired Snaitech, it became part of that strategy. We still have that and we're regularly looking at M&A chances.

"In terms of organic development, our service can fund its growth, for instance into markets like Brazil. With our balance sheet as well, we're looking at capital allotment a growing number of closely.