The world’s largest provider of online software to the gambling industry has seen profits increase after a boost in bingo and casino income but has decided to defer its interim dividend as a result of potential merger and acquisition opportunities the company is considering. Share have declined 8 percent in trading with analysts reducing the stock price over the news.

"Due to exceptional strategic M&A and partnership opportunities which are currently under discussion, in order to retain maximum flexibility, it (board) will defer a decision over the interim dividend," Playtech said in today’s statement.

Playtech, which is based in Estonia, operates a venture with William Hil and it also provides software to Paddy Power, PartyGaming and Gala Coral. The company has reported a good first-half trading update which benefitted from good results from the bingo and casino divisions.

The company revenues grew by 18 percent to 76.3 million euros and earnings before interest, tax and depreciation increased from 54.2 million euros last year to 56.1 million euros for this year. The company also confirmed that it was confident that it would meet full year earnings expectations.

The Israeli, billionaire founder, Teddy Sagi, who has a 40 percent holding in the company claimed that average software revenue for the first 54 days of the second half were up more than 23 percent compared with last year on introduction of casino games and poker cash table games in Italy.

Reports over the dividend have concerned stockbrokers and Collins Stewart has cut the target price from 505p to 440p per share stating:"PTEC has chosen to defer a decision on the interim dividend, to conserve cash given acquisition/investment opportunities emerging in regulating markets, particularly given the weak financial markets backdrop,”.