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International Game Technology PLC Reports Third Quarter 2018 Results
Reading Time: 15 minutes
– Solid Lottery and Gaming KPIs drive strong third quarter results
– Net income was $22 million in the third quarter; Adjusted net income was $64 million
– Adjusted EBITDA of $443 million reflects strong Italy and global Lottery performance
– Full-year Adjusted EBITDA outlook narrowed to $1,740 – $1,780 million, the top half of the prior range
– Cash dividend declared of $0.20 per ordinary share
International Game Technology PLC (“IGT”) (NYSE:IGT) today reported financial results for the third quarter ended September 30, 2018. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the third quarter results; access details are provided below.
“Solid performance and important, long-term contracts drove very good third quarter and year-to-date results,” said Marco Sala, CEO of IGT. “Global Lottery same-store revenues for instants and draw games rose mid-single digits. The installed base of gaming machines was up, and unit shipments of gaming machines increased 10%. And, we enjoyed particularly strong sales and profit growth in Italy, confirming the vitality of that important market. We are firmly on track to achieve our 2018 financial and operational goals.”
“We’ve delivered Adjusted EBITDA growth of 4% and 7% for the third quarter and year-to-date periods at constant currency and scope,” said Alberto Fornaro, CFO of IGT. “As a result, we are narrowing our Adjusted EBITDA outlook for 2018 to $1,740 – $1,780 million, the top half of the prior range.”
Overview of Consolidated Third Quarter Results
|
Quarter Ended |
Y/Y |
Constant |
||
|
2018(1) |
2017 |
(%) |
(%) |
|
|
(In $ millions, unless otherwise noted) |
||||
|
Revenue |
1,156 |
1,221 |
-5% |
-4% |
|
Operating income |
200 |
(556) |
NM |
|
|
Net income/(loss) per diluted share |
$0.11 |
($3.95) |
NM |
|
|
Net debt |
7,570 |
7,335 |
3% |
|
|
Adjusted EBITDA |
443 |
428 |
3% |
4% |
|
Adjusted operating income |
257 |
258 |
0% |
0% |
|
Adjusted net income per diluted share |
$0.31 |
$0.40 |
-23% |
|
|
Note: Adjusted EBITDA, adjusted operating income, and adjusted net income per diluted share are non-GAAP financial measures. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release. |
|
(1) On January 1, 2018, IGT adopted ASU 2014-09 (Topic 606), Revenue from Contracts with Customers (“ASC 606”). This negatively impacted Revenue in the third quarter by $22 million and positively impacted Adjusted EBITDA by $12 million. Comparative schedules summarizing the impact on the third quarter and nine months ended September 30, 2018 Condensed Consolidated Statements of Operations are included later in this release. |
Consolidated revenue was $1,156 million, down 4% at constant currency
- $22 million negative impact due to ASC 606
- Impacted by lumpiness of product sales and timing of multi-state jackpots
- Strong global Lottery performance, improved Gaming KPIs, and broad-based strength in Italy
Adjusted EBITDA rose 3% to $443 million; Adjusted operating income was unchanged from prior year at $257 million
- Disciplined expense management more than offset lower revenue
- Adjusted operating income includes higher depreciation associated with recent Lottery contract extensions and upgrading of Gaming installed base
Interest expense was $107 million compared to $114 million in prior-year quarter
Provision for income taxes was $46 million compared to a benefit of $20 million in the prior-year period
Net income attributable to IGT was $22 million in the quarter; Adjusted net income attributable to IGT was $64 million
Net income per diluted share of $0.11; Adjusted net income per diluted share of $0.31
Cash from operations was $249 million for the first nine months of the year and capital expenditures were $374 million
- $366 million (gross) upfront payments for the Scratch & Win license in Italy
Cash and cash equivalents were $448 million as of September 30, 2018, compared to $1,057 million as of December 31, 2017
Net debt was $7,570 million as of September 30, 2018, compared to $7,319 million as of December 31, 2017
Operating Segment Review
North America Gaming & Interactive
|
Select Financial Data |
Constant |
Key Performance Indicators |
% |
||||||||
|
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
FX |
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
Change |
||||
|
Gaming |
Total Revenue |
231 |
262 |
-12% |
Installed base (end of period) |
||||||
|
Gaming Services |
152 |
171 |
-11% |
Casino |
23,357 |
22,924 |
1.9% |
||||
|
Terminal |
106 |
123 |
-14% |
||||||||
|
Social (DDI) |
0 |
0 |
0% |
Machine units shipped |
|||||||
|
Other |
46 |
48 |
-4% |
New/Expansion |
843 |
729 |
15.6% |
||||
|
Product Sales |
79 |
91 |
-13% |
Replacement |
2,998 |
2,868 |
4.5% |
||||
|
Terminal |
54 |
46 |
17% |
Total machines shipped |
3,841 |
3,597 |
6.8% |
||||
|
Other |
25 |
44 |
-44% |
||||||||
|
Total |
Revenue |
231 |
262 |
-12% |
|||||||
|
Operating Income |
45 |
65 |
-33% |
||||||||
Revenue of $231 million compared to $262 million in the prior-year quarter
- Decline of $14 million, or 5%, after adjusting for $17 million jackpot expense reclass
- Gaming services revenue of $152 million compared to $171 million in the prior year
- Stable after adjusting for jackpot expense reclass
- Installed base up 433 units from prior year; yields and installed base stable sequentially
- Product sales revenue of $79 million compared to $91 million in the prior year
- 16% increase in terminal sale revenue includes growth in casino replacement and VLT units, higher average selling prices
- Large software sale in prior year
Operating income of $45 million compared to $65 million in the prior-year quarter
- Large, high-margin product sales mix in the prior year
- Increased depreciation related to upgrading installed base
- Timing of jackpots
North America Lottery
|
Select Financial Data |
Constant |
Key Performance Indicators |
% |
||||||||
|
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
FX |
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
Change |
||||
|
Gaming |
Total Revenue |
37 |
48 |
-22% |
Installed base (end of period) |
||||||
|
Gaming Services |
37 |
40 |
-6% |
VLT – Government Sponsored |
14,965 |
15,225 |
-1.7% |
||||
|
Terminal |
25 |
25 |
-1% |
||||||||
|
Other |
12 |
14 |
-16% |
Lottery same-store revenue growth |
|||||||
|
Product Sales |
0 |
8 |
-98% |
Instants & draw games |
4.8% |
||||||
|
Multistate Jackpots |
-25.9% |
||||||||||
|
Lottery |
Total Revenue |
242 |
259 |
-7% |
Total lottery same-store revenue growth |
-0.6% |
|||||
|
Lottery Services |
225 |
237 |
-5% |
||||||||
|
FM/Concessions |
164 |
170 |
-4% |
||||||||
|
LMA |
25 |
34 |
-25% |
||||||||
|
Other Services |
36 |
33 |
8% |
||||||||
|
Product Sales |
17 |
22 |
-22% |
||||||||
|
Terminal |
0 |
1 |
-100% |
||||||||
|
Systems/Other |
17 |
22 |
-20% |
||||||||
|
Total |
Revenue |
279 |
307 |
-9% |
|||||||
|
Operating Income |
60 |
75 |
-20% |
||||||||
Revenue of $279 million compared to $307 million in prior-year period
- Lottery service revenue down 5% to $225 million
- 4.8% same-store revenue growth for instant tickets and draw-based games more than offset by significantly lower multistate jackpot activity
- Lower LMA revenue from Illinois
- Lottery product sales of $17 million compared to $22 million in prior year
- Growth in instant ticket printing
- Large VLT system and lottery terminal sales in prior year
Operating income of $60 million compared to $75 million in prior-year period
- Tough jackpot and product sales revenue comparisons
- Higher depreciation related to recent contract wins and extensions
International
|
Select Financial Data |
Constant |
Key Performance Indicators |
% |
||||||||
|
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
FX |
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
Change |
||||
|
Gaming |
Total Revenue |
98 |
128 |
-20% |
Installed base (end of period) |
||||||
|
Gaming Services |
33 |
59 |
-40% |
Casino |
12,332 |
13,022 |
-5.3% |
||||
|
Terminal |
13 |
14 |
7% |
VLT – Government Sponsored |
3,675 |
1,569 |
134.2% |
||||
|
Other |
19 |
45 |
-55% |
Total installed base |
16,007 |
14,591 |
9.7% |
||||
|
Product Sales |
65 |
69 |
-2% |
||||||||
|
Terminal |
47 |
43 |
15% |
Machine units shipped |
|||||||
|
Other |
18 |
26 |
-30% |
New/Expansion |
529 |
176 |
200.6% |
||||
|
Replacement |
2,681 |
2,633 |
1.8% |
||||||||
|
Lottery |
Total Revenue |
100 |
82 |
23% |
Total machines shipped |
3,210 |
2,809 |
14.3% |
|||
|
Lottery Services |
69 |
70 |
0% |
||||||||
|
FM/Concessions |
54 |
52 |
6% |
Lottery same-store revenue growth |
|||||||
|
Other Services |
15 |
18 |
-18% |
Instants & draw games |
3.8% |
||||||
|
Product Sales |
31 |
12 |
162% |
Multistate Jackpots |
2.7% |
||||||
|
Systems/Other |
31 |
12 |
162% |
Total lottery same-store revenue growth |
3.7% |
||||||
|
Other |
Total Revenue |
18 |
24 |
-23% |
|||||||
|
Service Revenue |
17 |
18 |
-1% |
||||||||
|
Product Sales |
0 |
6 |
-92% |
||||||||
|
Total |
Revenue |
216 |
234 |
-5% |
|||||||
|
Operating Income |
56 |
40 |
46% |
||||||||
Revenue down 5% in constant currency to $216 million
- Stable Lottery service revenue
- Same-store revenue growth of 3.7%
- Lower non-wager revenue compared to prior year
- Significant increase in Lottery product sales from large, multi-year software license
- Gaming service revenue of $33 million compared to $59 million in the prior year
- Prior year had benefit of certain discrete, non-recurring items
- Jackpot expense reclass of $3 million
- Service revenue from terminals up high single-digits at constant currency from growth in the installed base
- Gaming product sales revenue down 2% in constant currency to $65 million
- 14% increase in gaming machine unit shipments; higher average selling prices
- Lower systems revenue
Operating income up 46% at constant currency to $56 million
- High-margin software license sale
- Disciplined expense management
Italy
|
Select Financial Data |
Constant |
Key Performance Indicators |
% |
||||||||
|
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
FX |
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
Change |
||||
|
Gaming |
Total Revenue |
175 |
173 |
2% |
(In € millions, except machines) |
||||||
|
Gaming Services |
175 |
173 |
2% |
Lottery |
|||||||
|
Terminal |
159 |
157 |
2% |
Lotto wagers |
1,913 |
1,815 |
5.4% |
||||
|
Other |
16 |
16 |
5% |
10eLotto |
1,361 |
1,261 |
7.9% |
||||
|
Product Sales |
0 |
0 |
0% |
Core |
434 |
494 |
-12.2% |
||||
|
Late Numbers |
70 |
60 |
17.9% |
||||||||
|
Lottery |
Total Revenue |
184 |
180 |
4% |
MillionDAY |
47 |
– |
NM |
|||
|
Lottery Services |
184 |
180 |
4% |
||||||||
|
FM/Concessions |
233 |
229 |
3% |
Scratch & Win Wagers |
2,179 |
2,198 |
-0.9% |
||||
|
Other Services |
(49) |
(50) |
-1% |
||||||||
|
Product Sales |
0 |
0 |
0% |
Italy lottery revenue growth |
3.6% |
||||||
|
Other |
Total Revenue |
70 |
66 |
8% |
Gaming |
||||||
|
Service Revenue |
70 |
66 |
8% |
Installed base (end of period) |
|||||||
|
Product Sales |
0 |
0 |
0% |
VLT – Operator (B2C) |
11,027 |
10,958 |
0.6% |
||||
|
VLT – Supplier (B2B) |
8,094 |
8,752 |
-7.5% |
||||||||
|
Total |
Revenue |
430 |
418 |
4% |
AWP |
43,074 |
59,084 |
-27.1% |
|||
|
Operating Income |
145 |
126 |
17% |
Total Installed Base |
62,195 |
78,794 |
-21.1% |
||||
|
Wagers |
|||||||||||
|
VLT – Operator (B2C) |
1,426 |
1,329 |
7.3% |
||||||||
|
AWP |
879 |
948 |
-7.2% |
||||||||
|
Interactive Wagers (Gaming) |
447 |
404 |
10.5% |
||||||||
|
Other |
|||||||||||
|
Sports Betting Wagers1 |
225 |
204 |
9.9% |
||||||||
|
Sports Betting Payout (%)1 |
81.1% |
83.3% |
-2.1 pp |
||||||||
|
1Includes Virtual Wagers and Pools & Horses |
|||||||||||
Revenue up 4% at constant currency to $430 million with growth across all Gaming businesses
- Lottery Service revenue up to $184 million from $180 million in the prior year
- Lotto wagers up 5.4% on continued strength in 10eLotto and contribution from MillionDAY
- Scratch & Win wagers down modestly on comparison with successful relaunch of Miliardario in the prior-year period
- Gaming Service revenue up 2% at constant currency
- Higher revenue despite state-mandated reductions in AWP units, incremental taxes, and certain regional restrictions
- Strong underlying productivity
- Sports betting wagers increased 9.9% to €225 million, payout 210 basis points better
Operating income increased to $145 million, up 17% at constant currency
- Strong profit flow-through, especially for Lotteries
- Disciplined cost management
Other Developments
The Company’s board of directors declared a quarterly cash dividend of $0.20 per ordinary share
- Record date of November 14, 2018
- Payment date of November 28, 2018
Recent Capital Markets Activity
- Issuance of $750 million 6.25% Senior Secured Notes due 2027
- Net proceeds used to redeem $600 million 5.625% bonds due 2020, $144 million 7.50% notes due 2019, and $97 million of its 5.5% bonds due 2020, with the balance funded through utilization of the revolving credit facility
- Average debt maturity extended to over 4 years
Full Year Outlook
- Narrowing 2018 Adjusted EBITDA outlook to $1,740 – $1,780 million at a EUR/USD rate of 1.19, the top half of the prior range
- Continue to expect capital expenditures of $575–$625 million
Conference Call and Webcast
October 31, 2018, at 8:00 a.m. EDT
Live webcast available under “News, Events & Presentations” on IGT’s Investor Relations website at www.IGT.com; replay available on the website following the live event
Dial-In Numbers
- US/Canada toll-free dial-in number is +1 844 842 7999
- Outside the US/Canada toll-free number is +1 612 979 9887
- Conference ID/confirmation code is 9277539
- A telephone replay of the call will be available for one week
- US/Canada replay number is +1 855 859 2056
- Outside the US/Canada replay number is +1 404 537 3406
- ID/Confirmation code is 9277539
Comparability of Results
All figures presented in this news release are prepared under U.S. GAAP, unless noted otherwise. Adjusted figures exclude the impact of items such as purchase accounting, impairment charges, restructuring expense, foreign exchange, and certain one-time, primarily transaction-related items. Reconciliations to the most directly comparable U.S. GAAP measures are included in the tables in this news release. Constant currency changes for 2018 are calculated using the same foreign exchange rates as the corresponding 2017 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate the Company’s financial performance. Management believes these non-GAAP financial measures reflect the Company’s ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with U.S. GAAP.
About IGT
IGT (NYSE:IGT) is the global leader in gaming. We enable players to experience their favorite games across all channels and regulated segments, from Gaming Machines and Lotteries to Digital and Social Gaming. Leveraging a wealth of premium content, substantial investment in innovation, in-depth customer intelligence, operational expertise and leading-edge technology, our gaming solutions anticipate the demands of consumers wherever they decide to play. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has over 12,000 employees. For more information, please visit www.IGT.com.
Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the “Company”) and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “would,” “should,” “shall”, “continue,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company’s control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the factors and risks described in the Company’s annual report on Form 20-F for the financial year ended December 31, 2017 and other documents filed from time to time with the SEC, which are available on the SEC’s website at www.sec.gov and on the investor relations section of the Company’s website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company’s business. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement.
Contact:
Robert K. Vincent, Corporate Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
James Hurley, Investor Relations, +1 (401) 392-7190
Simone Cantagallo, +39 06 51899030; for Italian media inquiries
|
International Game Technology PLC |
|||
|
Condensed Consolidated Statements of Operations |
|||
|
($ and shares in thousands, except per share data) |
|||
|
Unaudited |
|||
|
For the three months ended |
|||
|
September 30, |
|||
|
2018 |
2017 |
||
|
Service revenue |
963,265 |
1,013,054 |
|
|
Product sales |
192,565 |
208,147 |
|
|
Total revenue |
1,155,830 |
1,221,201 |
|
|
Cost of services |
586,811 |
625,247 |
|
|
Cost of product sales |
107,311 |
150,358 |
|
|
Selling, general and administrative |
194,099 |
196,862 |
|
|
Research and development |
63,277 |
79,009 |
|
|
Restructuring expense |
2,768 |
9,976 |
|
|
Impairment loss |
1,530 |
715,220 |
|
|
Transaction expense, net |
6 |
627 |
|
|
Total operating expenses |
955,802 |
1,777,299 |
|
|
Operating income (loss) |
200,028 |
(556,098) |
|
|
Interest income |
3,249 |
2,906 |
|
|
Interest expense |
(106,802) |
(113,711) |
|
|
Foreign exchange gain (loss), net |
21,104 |
(117,526) |
|
|
Other expense, net |
(17,244) |
(9,802) |
|
|
Total non-operating expenses |
(99,693) |
(238,133) |
|
|
Income (loss) before provision for (benefit from) income taxes |
100,335 |
(794,231) |
|
|
Provision for (benefit from) income taxes |
46,327 |
(19,824) |
|
|
Net income (loss) |
54,008 |
(774,407) |
|
|
Less: Net income attributable to non-controlling interests |
31,709 |
29,207 |
|
|
Net income (loss) attributable to IGT PLC |
22,299 |
(803,614) |
|
|
Net income (loss) attributable to IGT PLC per common share – basic |
0.11 |
(3.95) |
|
|
Net income (loss) attributable to IGT PLC per common share – diluted |
0.11 |
(3.95) |
|
|
Weighted-average shares – basic |
204,219 |
203,489 |
|
|
Weighted-average shares – diluted |
204,344 |
203,489 |
|
|
International Game Technology PLC |
|||
|
Condensed Consolidated Statements of Operations |
|||
|
($ and shares in thousands, except per share data) |
|||
|
Unaudited |
|||
|
For the nine months ended |
|||
|
September 30, |
|||
|
2018 |
2017 |
||
|
Service revenue |
3,017,283 |
3,063,477 |
|
|
Product sales |
547,841 |
529,812 |
|
|
Total revenue |
3,565,124 |
3,593,289 |
|
|
Cost of services |
1,812,553 |
1,866,281 |
|
|
Cost of product sales |
333,065 |
403,056 |
|
|
Selling, general and administrative |
605,405 |
607,571 |
|
|
Research and development |
198,497 |
242,142 |
|
|
Restructuring expense |
7,924 |
30,706 |
|
|
Impairment loss |
1,530 |
715,220 |
|
|
Transaction expense (income), net |
50 |
(26,682) |
|
|
Total operating expenses |
2,959,024 |
3,838,294 |
|
|
Operating income (loss) |
606,100 |
(245,005) |
|
|
Interest income |
9,599 |
7,992 |
|
|
Interest expense |
(323,320) |
(344,494) |
|
|
Foreign exchange gain (loss), net |
96,955 |
(384,749) |
|
|
Other expense, net |
(45,567) |
(33,247) |
|
|
Total non-operating expenses |
(262,333) |
(754,498) |
|
|
Income (loss) before provision for income taxes |
343,767 |
(999,503) |
|
|
Provision for income taxes |
159,064 |
53,932 |
|
|
Net income (loss) |
184,703 |
(1,053,435) |
|
|
Less: Net income attributable to non-controlling interests |
104,054 |
94,870 |
|
|
Net income (loss) attributable to IGT PLC |
80,649 |
(1,148,305) |
|
|
Net income (loss) attributable to IGT PLC per common share – basic |
0.40 |
(5.66) |
|
|
Net income (loss) attributable to IGT PLC per common share – diluted |
0.39 |
(5.66) |
|
|
Weighted-average shares – basic |
204,009 |
203,002 |
|
|
Weighted-average shares – diluted |
204,375 |
203,002 |
|
|
International Game Technology PLC |
|||
|
Condensed Consolidated Balance Sheets |
|||
|
($ thousands) |
|||
|
Unaudited |
|||
|
September 30, |
December 31, |
||
|
2018 |
2017 |
||
|
Assets |
|||
|
Current assets: |
|||
|
Cash and cash equivalents |
447,550 |
1,057,418 |
|
|
Restricted cash and cash equivalents |
255,470 |
248,012 |
|
|
Trade and other receivables, net |
821,764 |
937,854 |
|
|
Inventories, net |
332,921 |
319,545 |
|
|
Other current assets |
469,741 |
407,520 |
|
|
Income taxes receivable |
50,298 |
94,168 |
|
|
Total current assets |
2,377,744 |
3,064,517 |
|
|
Systems, equipment and other assets related to contracts, net |
1,390,707 |
1,434,194 |
|
|
Property, plant and equipment, net |
184,425 |
193,723 |
|
|
Goodwill |
5,697,030 |
5,723,815 |
|
|
Intangible assets, net |
2,088,573 |
2,273,460 |
|
|
Other non-current assets |
2,206,794 |
2,427,953 |
|
|
Deferred income taxes |
37,706 |
41,546 |
|
|
Total non-current assets |
11,605,235 |
12,094,691 |
|
|
Total assets |
13,982,979 |
15,159,208 |
|
|
Liabilities, redeemable non-controlling interests, and shareholders’ equity |
|||
|
Current liabilities: |
|||
|
Accounts payable |
1,040,701 |
1,240,753 |
|
|
Other current liabilities |
1,161,113 |
1,780,875 |
|
|
Current portion of long-term debt |
– |
599,114 |
|
|
Short-term borrowings |
29,957 |
– |
|
|
Income taxes payable |
82,127 |
55,935 |
|
|
Total current liabilities |
2,313,898 |
3,676,677 |
|
|
Long-term debt, less current portion |
7,987,583 |
7,777,445 |
|
|
Deferred income taxes |
493,605 |
491,460 |
|
|
Income taxes payable |
25,654 |
55,665 |
|
|
Other non-current liabilities |
450,951 |
446,113 |
|
|
Total non-current liabilities |
8,957,793 |
8,770,683 |
|
|
Total liabilities |
11,271,691 |
12,447,360 |
|
|
Commitments and contingencies |
|||
|
Redeemable non-controlling interests and shareholders’ equity |
2,711,288 |
2,711,848 |
|
|
Total liabilities, redeemable non-controlling interests, and shareholders’ equity |
13,982,979 |
15,159,208 |
|
|
Condensed Consolidated Statements of Cash Flows |
||||
|
($ thousands) |
||||
|
Unaudited |
||||
|
For the nine months ended |
||||
|
September 30, |
||||
|
2018 |
2017 |
|||
|
Cash flows from operating activities |
||||
|
Net income (loss) |
184,703 |
(1,053,435) |
||
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
||||
|
Depreciation |
312,203 |
289,088 |
||
|
Amortization |
204,256 |
317,989 |
||
|
Service revenue amortization |
164,952 |
155,318 |
||
|
Loss on extinguishment of debt |
49,460 |
35,428 |
||
|
Stock-based compensation expense |
24,944 |
5,102 |
||
|
Debt issuance cost amortization |
16,511 |
16,602 |
||
|
Deferred income tax provision |
11,815 |
(170,698) |
||
|
Impairment loss |
1,530 |
715,220 |
||
|
Foreign exchange (gain) loss, net |
(96,955) |
384,749 |
||
|
Gain on sale of Double Down Interactive LLC |
– |
(51,348) |
||
|
Other non-cash costs, net |
3,132 |
8,428 |
||
|
Changes in operating assets and liabilities: |
||||
|
Trade and other receivables |
92,823 |
42,023 |
||
|
Inventories |
(26,682) |
16,526 |
||
|
Upfront Italian license fees |
(366,270) |
(185,368) |
||
|
Accounts payable |
(123,057) |
(60,733) |
||
|
Other assets and liabilities |
(204,053) |
(67,954) |
||
|
Net cash provided by operating activities |
249,312 |
396,937 |
||
|
Cash flows from investing activities |
||||
|
Capital expenditures |
(374,313) |
(552,169) |
||
|
Proceeds from sale of assets |
8,200 |
168,201 |
||
|
Proceeds from sale of Double Down Interactive LLC, net of cash divested |
– |
823,788 |
||
|
Other |
2,064 |
1,990 |
||
|
Net cash (used in) provided by investing activities |
(364,049) |
441,810 |
||
|
Cash flows from financing activities |
||||
|
Principal payments on long-term debt |
(1,658,753) |
(1,601,134) |
||
|
Dividends paid – non-controlling interests |
(126,926) |
(51,508) |
||
|
Dividends paid |
(122,394) |
(121,840) |
||
|
Return of capital – non-controlling interests |
(64,974) |
(62,538) |
||
|
Net payments of financial liabilities |
(36,407) |
(32,495) |
||
|
Payments in connection with the extinguishment of debt |
(42,148) |
(38,832) |
||
|
Debt issuance costs paid |
(10,199) |
(16,350) |
||
|
Net proceeds from short-term borrowings |
29,957 |
– |
||
|
Capital increase – non-controlling interests |
135,536 |
127,211 |
||
|
Proceeds from long-term debt |
1,415,762 |
938,160 |
||
|
Other |
(18,051) |
(24,785) |
||
|
Net cash used in financing activities |
(498,597) |
(884,111) |
||
|
Net decrease in cash and cash equivalents, and restricted cash |
(613,334) |
(45,364) |
||
|
Effect of exchange rate changes on cash and cash equivalents, and restricted cash |
10,924 |
40,858 |
||
|
Cash and cash equivalents, and restricted cash at the beginning of the period |
1,305,430 |
541,316 |
||
|
Cash and cash equivalents, and restricted cash at the end of the period |
703,020 |
536,810 |
||
|
Supplemental Cash Flow Information: |
||||
|
Interest paid |
(419,508) |
(397,555) |
||
|
Income taxes paid |
(125,388) |
(159,613) |
||
|
International Game Technology PLC |
||||
|
Net Debt |
||||
|
($ thousands) |
||||
|
September 30, |
December 31, |
|||
|
2018 |
2017 |
|||
|
7.500% Senior Secured Notes due July 2019 |
146,237 |
148,231 |
||
|
4.125% Senior Secured Notes due February 2020 |
504,248 |
833,655 |
||
|
5.625% Senior Secured Notes due February 2020 |
– |
595,767 |
||
|
4.750% Senior Secured Notes due March 2020 |
441,871 |
585,171 |
||
|
5.500% Senior Secured Notes due June 2020 |
125,247 |
125,709 |
||
|
6.250% Senior Secured Notes due February 2022 |
1,457,021 |
1,470,075 |
||
|
4.750% Senior Secured Notes due February 2023 |
974,884 |
1,008,601 |
||
|
5.350% Senior Secured Notes due October 2023 |
61,005 |
61,082 |
||
|
3.500% Senior Secured Notes due July 2024 |
573,132 |
– |
||
|
6.500% Senior Secured Notes due February 2025 |
1,088,008 |
1,086,913 |
||
|
6.250% Senior Secured Notes due January 2027 |
742,760 |
– |
||
|
Senior Secured Notes, long-term |
6,114,413 |
5,915,204 |
||
|
Revolving Credit Facilities due July 2021 |
147,951 |
76,880 |
||
|
Term Loan Facilities due January 2023 |
1,725,219 |
1,785,361 |
||
|
Long-term debt, less current portion |
7,987,583 |
7,777,445 |
||
|
6.625% Senior Secured Notes due February 2018 |
– |
599,114 |
||
|
Current portion of long-term debt |
– |
599,114 |
||
|
Short-term borrowings |
29,957 |
– |
||
|
Total debt |
8,017,540 |
8,376,559 |
||
|
Less: Cash and cash equivalents |
447,550 |
1,057,418 |
||
|
Net debt |
7,569,990 |
7,319,141 |
||
|
Note: Net debt is a non-GAAP financial measure |
|
International Game Technology PLC |
||||
|
Adjusted EBITDA and Free Cash Flow |
||||
|
Reconciliations of Non-GAAP Financial Measures |
||||
|
($ thousands) |
||||
|
For the three months ended |
||||
|
September 30, |
||||
|
2018 |
2017 |
|||
|
Net income (loss) |
54,008 |
(774,407) |
||
|
Provision for (benefit from) income taxes |
46,327 |
(19,824) |
||
|
Non-operating expenses |
99,693 |
238,133 |
||
|
Depreciation |
109,755 |
103,182 |
||
|
Amortization |
67,806 |
99,562 |
||
|
Service revenue amortization |
53,837 |
54,279 |
||
|
Stock-based compensation expense |
7,825 |
1,829 |
||
|
Restructuring expense |
2,768 |
9,976 |
||
|
Impairment loss |
1,530 |
715,220 |
||
|
Transaction expense, net |
6 |
627 |
||
|
Non-cash purchase accounting (excluding D&A) |
(233) |
(126) |
||
|
Bad debt expense |
– |
4 |
||
|
Adjusted EBITDA |
443,322 |
428,455 |
||
|
Cash flows from operating activities |
129,162 |
73,013 |
||
|
Capital expenditures |
(115,346) |
(181,579) |
||
|
Free Cash Flow |
13,816 |
(108,566) |
||
|
International Game Technology PLC |
||||
|
Adjusted EBITDA and Free Cash Flow |
||||
|
Reconciliations of Non-GAAP Financial Measures |
||||
|
($ thousands) |
||||
|
For the nine months ended |
||||
|
September 30, |
||||
|
2018 |
2017 |
|||
|
Net income (loss) |
184,703 |
(1,053,435) |
||
|
Provision for income taxes |
159,064 |
53,932 |
||
|
Non-operating expenses |
262,333 |
754,498 |
||
|
Depreciation |
312,203 |
289,088 |
||
|
Amortization |
204,256 |
317,989 |
||
|
Service revenue amortization |
164,952 |
155,318 |
||
|
Stock-based compensation expense |
24,944 |
5,102 |
||
|
Restructuring expense |
7,924 |
30,706 |
||
|
Impairment loss |
1,530 |
715,220 |
||
|
Transaction expense (income), net |
50 |
(26,682) |
||
|
Non-cash purchase accounting (excluding D&A) |
(666) |
(513) |
||
|
Bad debt recovery |
– |
(17,858) |
||
|
Adjusted EBITDA |
1,321,293 |
1,223,365 |
||
|
Cash flows from operating activities |
249,312 |
396,937 |
||
|
Capital expenditures |
(374,313) |
(552,169) |
||
|
Free Cash Flow |
(125,001) |
(155,232) |
||
|
International Game Technology PLC |
||||||
|
ASC 606 – Revenue Recognition Impact |
||||||
|
Condensed Consolidated Statements of Operations |
||||||
|
($ thousands, except per share data) |
||||||
|
Unaudited |
||||||
|
Q3 2018 |
||||||
|
Under Prior |
Revenue |
As Adjusted |
||||
|
Revenue |
1,177,375 |
(21,545) |
1,155,830 |
|||
|
Operating expenses |
(988,995) |
33,193 |
(955,802) |
|||
|
Provision for income taxes |
(46,006) |
(321) |
(46,327) |
|||
|
Net income attributable to IGT PLC |
10,972 |
11,327 |
22,299 |
|||
|
Net income attributable to IGT PLC per common share – basic |
0.05 |
0.06 |
0.11 |
|||
|
Net income attributable to IGT PLC per common share – diluted |
0.05 |
0.06 |
0.11 |
|||
|
Q3 2018 YTD |
||||||
|
Under Prior |
Revenue |
As Adjusted |
||||
|
Revenue |
3,619,952 |
(54,828) |
3,565,124 |
|||
|
Operating expenses |
(3,020,100) |
61,076 |
(2,959,024) |
|||
|
Provision for income taxes |
(159,342) |
278 |
(159,064) |
|||
|
Net income attributable to IGT PLC |
74,123 |
6,526 |
80,649 |
|||
|
Net income attributable to IGT PLC per common share – basic |
0.37 |
0.03 |
0.40 |
|||
|
Net income attributable to IGT PLC per common share – diluted |
0.36 |
0.03 |
0.39 |
|||
|
International Game Technology PLC |
||||||||||||
|
Condensed Consolidated Statement of Operations |
||||||||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||||||||
|
($ and shares in thousands, except per share data) |
||||||||||||
|
Quarter to date |
Adjustments |
Quarter to date |
||||||||||
|
September 2018 |
Impairment/ |
Transaction |
September 2018 |
|||||||||
|
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As |
|||||||
|
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted |
|||||||
|
Total revenue |
1,155,830 |
(181) |
– |
– |
– |
1,155,649 |
||||||
|
Cost of services |
586,811 |
(21,241) |
– |
– |
– |
565,570 |
||||||
|
Cost of product sales |
107,311 |
(3,954) |
– |
– |
– |
103,357 |
||||||
|
Selling, general and administrative |
194,099 |
(27,017) |
– |
– |
– |
167,082 |
||||||
|
Research and development |
63,277 |
(232) |
– |
– |
– |
63,045 |
||||||
|
Restructuring expense |
2,768 |
– |
– |
(2,768) |
– |
– |
||||||
|
Impairment loss |
1,530 |
– |
– |
(1,530) |
– |
– |
||||||
|
Transaction expense, net |
6 |
– |
– |
– |
(6) |
– |
||||||
|
Total operating expenses |
955,802 |
(52,444) |
– |
(4,298) |
(6) |
899,054 |
||||||
|
Operating income |
200,028 |
52,263 |
– |
4,298 |
6 |
256,595 |
||||||
|
Interest expense, net |
(103,553) |
524 |
– |
– |
– |
(103,029) |
||||||
|
Foreign exchange gain, net |
21,104 |
– |
(21,104) |
– |
– |
– |
||||||
|
Other (expense) income, net |
(17,244) |
– |
– |
– |
19,875 |
2,631 |
||||||
|
Total non-operating expenses |
(99,693) |
524 |
(21,104) |
– |
19,875 |
(100,398) |
||||||
|
Income before provision for income taxes |
100,335 |
52,787 |
(21,104) |
4,298 |
19,881 |
156,197 |
||||||
|
Provision for income taxes (a) |
46,327 |
12,846 |
301 |
688 |
2 |
60,164 |
||||||
|
Net income |
54,008 |
39,941 |
(21,405) |
3,610 |
19,879 |
96,033 |
||||||
|
Less: Net income attributable to non-controlling interests |
31,709 |
27 |
– |
– |
– |
31,736 |
||||||
|
Net income attributable to IGT PLC |
22,299 |
39,914 |
(21,405) |
3,610 |
19,879 |
64,297 |
||||||
|
Net income per common share – diluted |
0.11 |
0.31 |
||||||||||
|
Weighted-average shares – diluted |
204,344 |
204,344 |
||||||||||
|
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
|
International Game Technology PLC |
||||||||||||
|
Condensed Consolidated Statement of Operations |
||||||||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||||||||
|
($ and shares in thousands, except per share data) |
||||||||||||
|
Year to date |
Adjustments |
Year to date |
||||||||||
|
September 2018 |
Impairment/ |
Transaction |
September 2018 |
|||||||||
|
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As |
|||||||
|
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted |
|||||||
|
Total revenue |
3,565,124 |
(540) |
– |
– |
– |
3,564,584 |
||||||
|
Cost of services |
1,812,553 |
(63,457) |
– |
– |
– |
1,749,096 |
||||||
|
Cost of product sales |
333,065 |
(11,735) |
– |
– |
– |
321,330 |
||||||
|
Selling, general and administrative |
605,405 |
(80,602) |
– |
– |
– |
524,803 |
||||||
|
Research and development |
198,497 |
(686) |
– |
– |
– |
197,811 |
||||||
|
Restructuring expense |
7,924 |
– |
– |
(7,924) |
– |
– |
||||||
|
Impairment loss |
1,530 |
– |
– |
(1,530) |
– |
– |
||||||
|
Transaction expense, net |
50 |
– |
– |
– |
(50) |
– |
||||||
|
Total operating expenses |
2,959,024 |
(156,480) |
– |
(9,454) |
(50) |
2,793,040 |
||||||
|
Operating income |
606,100 |
155,940 |
– |
9,454 |
50 |
771,544 |
||||||
|
Interest expense, net |
(313,721) |
1,536 |
– |
– |
– |
(312,185) |
||||||
|
Foreign exchange gain, net |
96,955 |
– |
(96,955) |
– |
– |
– |
||||||
|
Other (expense) income, net |
(45,567) |
(2,184) |
– |
– |
49,459 |
1,708 |
||||||
|
Total non-operating expenses |
(262,333) |
(648) |
(96,955) |
– |
49,459 |
(310,477) |
||||||
|
Income before provision for income taxes |
343,767 |
155,292 |
(96,955) |
9,454 |
49,509 |
461,067 |
||||||
|
Provision for income taxes (a) |
159,064 |
37,101 |
6,630 |
1,829 |
2 |
204,626 |
||||||
|
Net income |
184,703 |
118,191 |
(103,585) |
7,625 |
49,507 |
256,441 |
||||||
|
Less: Net income attributable to non-controlling interests |
104,054 |
77 |
– |
– |
– |
104,131 |
||||||
|
Net income attributable to IGT PLC |
80,649 |
118,114 |
(103,585) |
7,625 |
49,507 |
152,310 |
||||||
|
Net income per common share – diluted |
0.39 |
0.75 |
||||||||||
|
Weighted-average shares – diluted |
204,375 |
204,375 |
||||||||||
|
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
|
International Game Technology PLC |
||||||||||||
|
Condensed Consolidated Statement of Operations |
||||||||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||||||||
|
($ and shares in thousands, except per share data) |
||||||||||||
|
Quarter to date |
Adjustments |
Quarter to date |
||||||||||
|
September 2017 |
Impairment/ |
Transaction |
September 2017 |
|||||||||
|
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As |
|||||||
|
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted |
|||||||
|
Total revenue |
1,221,201 |
(182) |
– |
– |
– |
1,221,019 |
||||||
|
Cost of services |
625,247 |
(36,918) |
– |
– |
– |
588,329 |
||||||
|
Cost of product sales |
150,358 |
(23,961) |
– |
– |
– |
126,397 |
||||||
|
Selling, general and administrative |
196,862 |
(27,180) |
– |
– |
– |
169,682 |
||||||
|
Research and development |
79,009 |
(15) |
– |
– |
– |
78,994 |
||||||
|
Restructuring expense |
9,976 |
– |
– |
(9,976) |
– |
– |
||||||
|
Impairment loss |
715,220 |
– |
– |
(715,220) |
– |
– |
||||||
|
Transaction expense, net |
627 |
– |
– |
– |
(627) |
– |
||||||
|
Total operating expenses |
1,777,299 |
(88,074) |
– |
(725,196) |
(627) |
963,402 |
||||||
|
Operating (loss) income |
(556,098) |
87,892 |
– |
725,196 |
627 |
257,617 |
||||||
|
Foreign exchange loss, net |
(117,526) |
– |
117,526 |
– |
– |
– |
||||||
|
Other expense, net |
(9,802) |
(84) |
– |
– |
9,703 |
(183) |
||||||
|
Interest expense, net |
(110,805) |
610 |
– |
– |
– |
(110,195) |
||||||
|
Total non-operating expenses |
(238,133) |
526 |
117,526 |
– |
9,703 |
(110,378) |
||||||
|
(Loss) income before (benefit from) provision for income taxes |
(794,231) |
88,418 |
117,526 |
725,196 |
10,330 |
147,239 |
||||||
|
(Benefit from) provision for income taxes (a) |
(19,824) |
30,834 |
26,056 |
2,998 |
(3,230) |
36,834 |
||||||
|
Net (loss) income |
(774,407) |
57,584 |
91,470 |
722,198 |
13,560 |
110,405 |
||||||
|
Less: Net income attributable to non-controlling interests |
29,207 |
26 |
– |
– |
– |
29,233 |
||||||
|
Net (loss) income attributable to IGT PLC |
(803,614) |
57,558 |
91,470 |
722,198 |
13,560 |
81,172 |
||||||
|
Net (loss) income per common share – diluted |
(3.95) |
0.40 |
||||||||||
|
Weighted-average shares – diluted (b) |
203,489 |
203,689 |
||||||||||
|
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
|
(b) Weighted-average shares – diluted, as adjusted, include shares that were excluded from the as reported computation, due to the net loss as reported. |
|
International Game Technology PLC |
||||||||||||
|
Condensed Consolidated Statement of Operations |
||||||||||||
|
Reconciliation of Non-GAAP Financial Measures |
||||||||||||
|
($ and shares in thousands, except per share data) |
||||||||||||
|
Year to date |
Adjustments |
Year to date |
||||||||||
|
September 2017 |
Impairment/ |
Transaction |
September 2017 |
|||||||||
|
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As |
|||||||
|
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted |
|||||||
|
Total revenue |
3,593,289 |
(540) |
– |
– |
– |
3,592,749 |
||||||
|
Cost of services |
1,866,281 |
(117,658) |
– |
– |
– |
1,748,623 |
||||||
|
Cost of product sales |
403,056 |
(77,261) |
– |
– |
– |
325,795 |
||||||
|
Selling, general and administrative |
607,571 |
(90,277) |
– |
– |
– |
517,294 |
||||||
|
Research and development |
242,142 |
(426) |
– |
– |
– |
241,716 |
||||||
|
Restructuring expense |
30,706 |
– |
– |
(30,706) |
– |
– |
||||||
|
Impairment loss |
715,220 |
– |
– |
(715,220) |
– |
– |
||||||
|
Transaction expense, net |
(26,682) |
– |
– |
– |
26,682 |
– |
||||||
|
Total operating expenses |
3,838,294 |
(285,622) |
– |
(745,926) |
26,682 |
2,833,428 |
||||||
|
Operating (loss) income |
(245,005) |
285,082 |
– |
745,926 |
(26,682) |
759,321 |
||||||
|
Interest expense, net |
(336,502) |
2,415 |
– |
– |
– |
(334,087) |
||||||
|
Foreign exchange loss, net |
(384,749) |
– |
384,749 |
– |
– |
– |
||||||
|
Other (expense) income, net |
(33,247) |
1,567 |
– |
– |
35,428 |
3,748 |
||||||
|
Total non-operating expenses |
(754,498) |
3,982 |
384,749 |
– |
35,428 |
(330,339) |
||||||
|
(Loss) income before provision for income taxes |
(999,503) |
289,064 |
384,749 |
745,926 |
8,746 |
428,982 |
||||||
|
Provision for income taxes (a) |
53,932 |
101,066 |
87,152 |
9,132 |
(88,159) |
163,123 |
||||||
|
Net (loss) income |
(1,053,435) |
187,998 |
297,597 |
736,794 |
96,905 |
265,859 |
||||||
|
Less: Net income attributable to non-controlling interests |
94,870 |
77 |
– |
– |
– |
94,947 |
||||||
|
Net (loss) income attributable to IGT PLC |
(1,148,305) |
187,921 |
297,597 |
736,794 |
96,905 |
170,912 |
||||||
|
Net (loss) income per common share – diluted |
(5.66) |
0.84 |
||||||||||
|
Weighted-average shares – diluted (b) |
203,002 |
203,303 |
||||||||||
|
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
|
(b) Weighted-average shares – diluted, as adjusted, include shares that were excluded from the as reported computation, due to the net loss as reported. |
|
INTERNATIONAL GAME TECHNOLOGY PLC |
|||||||||||
|
Select Financial Data |
Constant |
Key Performance Indicators |
% |
||||||||
|
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
FX |
Period Ended September 30 |
Q3 ’18 |
Q3 ’17 |
Change |
||||
|
Gaming |
Total Revenue |
541 |
611 |
-10% |
Installed base (end of period) |
||||||
|
Gaming Services |
397 |
443 |
-9% |
Casino |
35,689 |
35,946 |
-0.7% |
||||
|
Terminal |
303 |
319 |
-4% |
VLT – Government Sponsored (ex-Italy) |
18,640 |
16,794 |
11.0% |
||||
|
Social (DDI) |
0 |
0 |
0% |
VLT – Italy Supplier (B2B) |
8,094 |
8,752 |
-7.5% |
||||
|
Other |
94 |
124 |
-23% |
Total installed base |
62,423 |
61,492 |
1.5% |
||||
|
Product Sales |
144 |
168 |
-13% |
Yield |
$27.84 |
$29.12 |
-4.4% |
||||
|
Terminal |
101 |
89 |
16% |
(average revenue per unit per day) |
|||||||
|
Other |
43 |
79 |
-45% |
||||||||
|
Additional Italian Network Details: |
|||||||||||
|
Lottery |
Total Revenue |
527 |
521 |
2% |
VLT – Operator (B2C) |
11,027 |
10,958 |
0.6% |
|||
|
Lottery Services |
479 |
487 |
-1% |
AWP |
43,074 |
59,084 |
-27.1% |
||||
|
FM/Concessions |
452 |
452 |
1% |
||||||||
|
LMA |
25 |
34 |
-25% |
Machine units shipped |
|||||||
|
Other Services |
2 |
1 |
-17% |
New/Expansion |
1,372 |
905 |
51.6% |
||||
|
Product Sales |
48 |
34 |
42% |
Replacement |
5,679 |
5,501 |
3.2% |
||||
|
Terminal |
0 |
1 |
-60% |
Total machines shipped |
7,051 |
6,406 |
10.1% |
||||
|
Systems/Other |
48 |
34 |
44% |
||||||||
|
Global lottery same-store revenue growth |
|||||||||||
|
Other |
Total Revenue |
88 |
89 |
0% |
Instants & draw games |
4.5% |
|||||
|
Service Revenue |
88 |
84 |
6% |
Multistate Jackpots |
-23.1% |
||||||
|
Product Sales |
0 |
6 |
-92% |
Total lottery same-store revenue growth (ex-Italy) |
0.4% |
||||||
|
Italy lottery revenue growth |
3.6% |
||||||||||
|
Consolidated |
Revenue |
1,156 |
1,221 |
-4% |
|||||||
|
Operating Income: |
|||||||||||
|
Segment Total |
306 |
305 |
1% |
||||||||
|
Purchase Accounting |
(52) |
(802) |
93% |
||||||||
|
Corporate Support |
(54) |
(59) |
8% |
||||||||
|
Total |
200 |
(556) |
NM |
||||||||
Source: International Game Technology PLC
Source: Latest News on European Gaming Media Network
Player loyalty is evolving — and so is WinSpirit’s approach. They’ve unveiled a fully redesigned VIP program, merging loyalty mechanics and exclusive rewards into one clear, gamified journey. The goal? Drive deeper engagement, long-term satisfaction, and higher lifetime player value (LTV) through transparency and simplicity.
This combination of permanent progression and time-limited campaigns positions WinSpirit’s VIP Club as a modern retention tool — one designed to reduce churn while giving players a clearer sense of achievement.
Data-Driven Response
The updated VIP model is a direct response to user behavior and feedback. WinSpirit observed that, for some users, the previous program might have been a little complex — primarily due to separated loyalty levels and the pressure of maintaining temporary statuses. So the brand decided to simplify the progression path.
“We consistently listen to our players, and their desire to retain earned progress was clear,” said a WinSpirit representative. “This redesign is our commitment to them—we’re replacing complexity with simplicity, ensuring every player feels valued and their long-term journey is rewarding.”
How the New VIP Club Works
The redesigned VIP Club merges lifetime progress with seasonal engagement to create a system that rewards both consistency and activity. Players unlock a permanent VIP status that never resets — a key benefit that builds trust and long-term motivation.
On top of this, rotating seasonal levels introduce fresh challenges and time-limited bonuses that keep engagement high. Even when players take a break, their status stays — removing pressure and encouraging steady play.
All progression and rewards are tracked in a centralized VIP dashboard, giving players full visibility and control without the need to contact support. This clarity minimizes friction and churn.
Seasonality as a Strategic Engagement
WinSpirit’s new format introduces quarterly campaigns, each with a dedicated theme and bonus structure. The current activation, Flame of Thrill, designed to re-ignite player motivation during autumn campaigns, features:
- Increased cashback tiers and deposit insurance
- Personalized bonuses and access to exclusive promotions
- Limited seasonal rewards and much more
Even for long-term players, these rotating seasons bring something new — keeping the program exciting well beyond the first few tiers.
Why It Matters for Business
From a business perspective, the redesigned VIP Club introduces several measurable advantages:
- Increased retention (reduced status loss anxiety).
- Higher LTV (steady progression over time).
- More consistent activity (recurring seasonal goals).
- Fewer negative touchpoints (clear rules).
The introduction of a permanent VIP threshold (VIP Iron) creates a strong psychological anchor for re-engagement — aligning well with known gamification strategies in product design.
Overall, WinSpirit’s transformation reflects a broader commitment to listening to players. The brand is shifting toward a more sustainable model that fosters long-term relationships through clarity, fairness, and flexible progression. It’s a big step toward a smarter, player-first future — where loyalty is truly rewarded, and progress never goes unnoticed.
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INSPIRED UNVEILS GOLD CASH FREE SPINS SUPER WHEEL™ FEATURING THE REVOLUTIONARY PLAYER LINK™ MECHANIC
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Inspired Entertainment, Inc. (NASDAQ: INSE), a leading B2B provider of gaming content, systems, and solutions, has launched Gold Cash Free Spins Super Wheel, a supercharged evolution of Inspired’s classic hit slot, Gold Cash Free Spins. Available across the UK and Malta iGaming markets.
Gold Cash Free Spins Super Wheel introduces a new industry-first shared bonus mechanic named, Player Link (United States Patent No. 12,350,596). For the first time, players can share and compete in the anticipation and excitement of a bonus trigger in the form of the Super Wheel. This innovative mechanic generates a sense of community and competition, delivering the lucrative “Super Bonus” to a winning player, before resetting and starting the competition all over again.
Set on 5×4 reels with 40 win-lines, the game combines the much-loved Gold Cash Free Spins gameplay with electrifying new features. The shared Super Wheel awards instant cash prizes, lucrative Super Cash rewards, or triggers the high-value Super Bonus. Each spin of the super wheel builds suspense, with segments that progressively upgrade to increase the chances of hitting the Super Bonus. The Super Bonus awards eight Super Free Spins featuring only the highest-paying symbols and dramatic Wild Spins, with Wilds dropping onto the reels for big win potential.
Steven Collett, Chief Product Officer at Inspired Entertainment, commented: “Gold Cash Free Spins Super Wheel is a major leap forward in slot innovation. With the revolutionary Player Link mechanic, we’ve created a shared, community-driven experience that builds excitement for every player. This game blends the trusted Gold Cash Free Spins brand with fresh, competitive gameplay designed to engage players and deliver strong results for operators. We’re excited to see its performance and look forward to launching more fun content, featuring our groundbreaking Player Link technology. Each title will incorporate the Super Wheel as a consistent feature while offering a distinct Super Bonus aligned with the game’s theme.”
With escalating rewards, shared excitement, and iconic features, Gold Cash Free Spins Super Wheel sets a new benchmark for iGaming. It combines big wins, big action, and a shared sense of fun, to keep players engaged and highly entertained.
The post INSPIRED UNVEILS GOLD CASH FREE SPINS SUPER WHEEL™ FEATURING THE REVOLUTIONARY PLAYER LINK™ MECHANIC appeared first on European Gaming Industry News.
Latest News
Wagercomms and Million Games Launch Hard Eight Poker™ – A Fast, Strategic Table Experience
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Million Games, in partnership with Wagercomms, has officially launched Hard Eight Poker, a high-speed, strategic casino table game that combines classic card play with dual progressive jackpots and sleek, mobile-first design.
Developed under the Million Stars partner program, Hard Eight Poker represents the next step in Wagercomms’ mission to deliver proprietary, high-performing table content for online operators.
The game introduces a dynamic mix of Ante betting, Red/Black decisions, and optional Progressive Eight side bets, giving players the freedom to raise, insure, or cash in at every stage. With multi-tier payouts — including 5:1 for a Pair of Eights, 25:1 for a Hard Eight, and 50:1 for Triple Eights — the action builds round after round.
“Hard Eight Poker delivers exactly what today’s casino audience wants — something fast, strategic, and fair,” said Thomas Nimstad, CEO of Million Games. “Wagercomms has created a table game that’s easy to learn but layered with strategic depth, giving operators a powerful new addition to their lobbies. It’s the perfect example of how the Million Stars program helps studios like Wagercomms transform great concepts into market-ready games”
Following Draw Sevens, Hard Eight Poker marks the next milestone for Wagercomms under its Wagercomms Originals series — a growing portfolio designed for lasting player engagement and differentiation in slot-heavy environments.
“With Hard Eight Poker, we wanted to create a table game that feels familiar but plays with a fresh edge — fast, strategic, and designed for the modern player,” said Peter Bengtsson, CEO of Wagercomms. “Working with Million Games allowed us to focus on gameplay depth and balance, while their platform and publishing expertise helped us bring it to operators worldwide.”
With a 2.74% house edge, mobile-first design, and certified RNG, Hard Eight Poker is now available for integration via Million Games, offering both casual and competitive players an elevated table experience.
The post Wagercomms and Million Games Launch Hard Eight Poker™ – A Fast, Strategic Table Experience appeared first on European Gaming Industry News.
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