Playtech Faces Investor Revolt Against Remuneration

The Playtech Board of Directors is under fire from investors over the latest pay report. Gambling giant Playtech held its Annual General Meeting on May 20 following its annual results report in February. Investors are furious about the salary and bonus package awarded to CEO Mor Weizer.

It’s the fourth time in as many year that investors have rebelled over directors’ pay. Ian Penrose, the non-executive director who chairs Playtech’s pay committee, bore the brunt of the protests. Penrose repeatedly promised to review the directors’ pay. That has obviously not happened.

Shareholders voted 63.7% against the report. They also voted against Penrose being reappointed to his role, with 32.6% voting against.

Chief Operating Officer Mor Weizer’s salary is a constant thorn in investors’ sides. Weizer’s salary has remained almost the same for the past few years, but his bonus package continues to soar.

The table below shows the Playtech CEO’s income for 2018 and 2019.

Payment 2018 2019 Change
Salary €1,128,460 €1,143,427 +€14,967
Bonus €556,506 €1,528,580 +€972,074
Long-term incentives €104,211 -€104,211
Benefits €40,640 €29,895 -€10,745
Pension €225,620 €228,686 +€3,066
Total fixed pay €1,394,720 €1,402,008 +€7,288
Total variable pay €660,717 €1,528,580 +€867,863
Total emoluments €2,055,437 €2,930,588 +€875,151

Playtech Paying Huge Salaries Despite Share Price Failings

Weizer’s overall pay increased 42% year-on-year. Even Penrose paid himself extra, earning €120,134 ($196,792) in 2019 up from €39,261 ($64,255) the previous year. Playtech has paid Weizer €19,528,000 ($32,008,344) over the past 10 years.

Shares in Playtech traded at 543.00 pence per share when Weizer first became CEO. They peaked at 995.00 pence per share in June 2017. Those share have been on a downward trajectory ever since. They now trade at 230.10 pence per share.

The company has, however, made several dozen acquisitions over those 10 years. Those additions to Playtech’s portfolio have strengthened its long-term business by diversifying its portfolio.

Shareholders and investors don’t care much for that. Many invested when Playtech’s stock was rising and have lost significant sums. This is why they’re so angry about Weizer’s remuneration.

Those shareholders do have some reasons to be happy, despite the falling share price. Playtech is in good shape, despite making a loss in 2019. It generated revenue €1.508 billion ($2.45 billion) in 2019, up from €1.225 billion ($1.99 billion) in 2018. Playtech lost €19.6 million ($32.1 million) after taxes in spite of these increases.

Who Are Playtech?

Playtech was founded in 1999 by Israeli entrepreneur Teddy Sagi. The company rapidly expanded under Sagi’s guidance as it aggressively acquired companies in the gambing and gambling sector.

Sagi floated Playtech on the British AIM market in March 2006. It was valued at £550 million ($1.006 billion) at the time. Playtech lost 40% of its value overnight later that year with the passing of the Unlawful Internet Gambling Enforcement Act in the United States.

The company stuck to its guns and continued acquiring companies. It also struck major deals to provide software to some massive gaming companies. These included bet365, William Hill, and Ladbrokes.

Aristocrat Leisure sold its lotteries division to Playtech for €10.5 million ($17.07 million) in September 2014.

Playtech has the license with Warner Bros for DC Comic-based pokies. Whenever you play Batman v Superman: Dawn of Justice, The Dark Night Trilogy, or Suicide Squad, it’s via Playtech.

Sagi, the company’s founder, no longer has shares in the company. He steadily reduced his holdings, selling a 12% chunk for US$400 million in 2016. Sagi disposed of his remaining shares in November 2018 for US$88 million.

The Israeli businessman now has several companies floated on the London Stock Exchange. Sagi also owns a portfolio of property in London including the famous Camden Market. Forbes puts Sagi as the 383rd richest man in the world with a fortune of US$4.9 billion.