Connect with us
NSoft

Latest News

International Game Technology PLC Reports Third Quarter 2018 Results

Published

on

IGT-Q3-2018 International Game Technology PLC Reports Third Quarter 2018 ResultsReading 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
September 30,

Y/Y
Change

Constant
Currency
Change 

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
Accounting

Revenue
Recognition
Adjustment

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
Accounting

Revenue
Recognition
Adjustment

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

George Miller (Gyorgy Molnar) started his career in content marketing and has started working as an Editor/Content Manager for our company in 2016. George has acquired many experiences when it comes to interviews and newsworthy content becoming Head of Content in 2017. He is responsible for the news being shared on multiple websites that are part of the European Gaming Media Network.

Latest News

What is the future for Norway’s betting monopoly?

Published

on

1-10 What is the future for Norway’s betting monopoly?

Norway currently enforces a strict ban on all online betting run by anyone other than monopoly operator Norsk Tipping. Yet, despite its latest efforts to keep unlicensed operators out, there are still other options available for Norwegians as it isn’t stopping the people from playing at foreign licensed operators should they choose to.

The policy of making Norsk Tipping the sole licensed operator while keeping foreign betting companies off the Norwegian market has been a favoured approach by shifting governments in the country over several decades. 

For the most part, this has been uncontested by the general population. The services offered by Norsk Tipping have typically been satisfactory for most players and with Norsk Tipping’s obligation to return its profit to society, this has been accepted by many as a fair compromise. 

The motivation behind this policy is often said to be a desire to protect players by controlling which types of gambling services are made available. Allocating money from the gambling industry to organisations working towards the greater good of society is also seen as important. 

However, with international betting companies entering the Norwegian market by offering their services online, this strategy is proving increasingly hard to keep up. Several measures have been taken in the last couple of years to ensure that unlicensed operators stay out of the Norwegian market, for example by blocking transactions to gambling sites. Despite being met with criticism, Lottstift shows no signs of giving in to the external pressure.

 

The shift to online complicates matters

Competition among online betting companies is fierce, and considering how difficult it is for one country to legislate online activity without resorting to means more often seen in countries of a far less democratic nature, the challenges faced by Norsk Tipping are getting bigger. 

In addition, as regulation fails to keep international online actors out, many argue that today’s situation in Norway is, in reality, a free-for-all system where companies required to follow strict regulations in most neighbouring countries are given a free pass to target Norwegian players.

A quick look at the Norwegian comparison site Oddsbonuser.nu tells us that a lot of operators are interested in the country and some of these would welcome regulation. 

For example, Kindred Group and Betsson Group – both members of Norsk bransjeforening for onlinespill (NBO). As can be read on their website, “NBO will promote the introduction of a responsible and sustainable licensing regulation of the Norwegian online gambling market”.

Even though regulation is very unlikely at this point, it’s hard not to fall into the pit of ‘what if’. Close at hand is the situation in Sweden, which regulated the gambling market in 2019. 

Sweden had previously followed a similar path, before abandoning its monopoly. Betting companies can now – by obtaining a licence – operate and advertise on the Swedish market, given that they follow regulations set by Swedish authorities, including paying Swedish taxes.

This naturally means tougher competition for state-owned former monopolist Svenska Spel, but also that politicians now can regulate and limit how betting companies can operate, for example when it comes to promotions and bonuses. But even so, recent proposals of further tightening the regulation in Sweden have caused waves amongst the licensed operators in the country. 

The operators and Spelinspektionen, the Swedish Gambling Authority, are worried that this might cause players to move away from licensed operators and that the black market will grow even bigger – making it worse than pre-regulation in the country. With this in mind, Lottstift is likely even more certain that their strategy is better left unchanged.

Continue Reading

Latest News

William Hill adds broadcaster Nick Luck to their stable

Published

on

William-Hill-US-appoints-leading-executive William Hill adds broadcaster Nick Luck to their stable
William-Hill-US-appoints-leading-executive-1 William Hill adds broadcaster Nick Luck to their stableReading Time: < 1 minute

 

William Hill is delighted to announce Nick Luck as their new flat racing expert. The seven-time HWPA Broadcaster of the Year joins the brand’s already stellar stable of racing experts that include Rebecca Curtis, Sir AP McCoy and the Twiston-Davies’, Nigel and Sam.

Luck, a regular part of Racing TV and NBC Sports’ television coverage, will provide critical insights and tips on UK and US racing. His content may be viewed every weekend on William Hill, and on their racing Twitter page @willhillracing.

Nick, said, “I am delighted to join the William Hill team. William Hill has a strong association with horse racing on both sides of the Atlantic, and so I am looking forward to working with a brand that shares my love for the sport of kings.”

Liam McKee, Head of Sponsorship at William Hill, said, “We have seen a keen interest in US racing during the lockdown, and we believe our customers will continue to enjoy it even when racing returns to the UK. Nick’s racing knowledge covers both sides of the pond, and we hope our customers find some luck when backing his selections.”


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: William Hill adds broadcaster Nick Luck to their stable

Continue Reading

Latest News

Week 21/2020 slot games releases

Published

on

weekly-slot-releases-1-4 Week 21/2020 slot games releases
weekly-slot-releases-1-5 Week 21/2020 slot games releasesReading Time: 4 minutes

 

Here are this weeks latest slots releases!

The latest Play’n GO release hit the market this week, a 3-reel video slot titled Charlie Chance in Hell to Pay. The game features a new character, Charlie Chance, as he lands himself in hot water and tries to outwit the devil herself to win his fortune. The unique and the retro style of the game are inspired by the works of animators such as Max Fleischer who pioneered the modern age of animation with classic characters like Betty Boop and Popeye. The choice of traditional fruit machine symbols on the grid also add to the timeless feel of this gridslot. This game is unlike anything we have previously seen from the slot supplier; it seems like, once again, they have broken their mould to deliver original, innovative content.

hell-to-pay-2 Week 21/2020 slot games releases

 

Pragmatic Play, a leading content provider to the gaming industry, has turned up the heat with its latest release Hot to Burn. The title takes the fast and fun gameplay of the traditional fruit machine staple and adds a fiery element with players being able to win up to 1,000x their stake. The 3×5 title offers a classic slot experience as players try to land all five flaming 7 symbols on the reels at the same time to win big.

hot-to-burn-1 Week 21/2020 slot games releases

 

Blueprint Gaming is rumbling into action with the launch of its latest slot Rhino Rampage, the first to incorporate the developer’s new Lightning Spins2122-58 Week 21/2020 slot games releases bonus concept. Blueprint’s brand-new feature is activated when six or more Lightning Spin Scatter symbols land on the reels, where players are given a minimum of three free spins to win cash prizes, as well claim one of the four in-game progressive jackpots.

rhino-rampage Week 21/2020 slot games releases

 

iSoftBet, the leading online and mobile casino content provider, has launched its latest MegawaysTM slot title, Dragon Match MegawaysTM. Set in the heart of a sacred Chinese temple, this four-reel game offers players up to 3,136 ways to win and features cascading wins, with players looking to join two golden dragon symbols on the top tracker reel to form a complete dragon and trigger Free Spins. Dragon Match MegawaysTM also features iSoftBet’s unique symbol matching mechanic, where if the two symbols in the top tracker reel are the same, they turn into wilds, as do all matching symbols on the two reels directly below.

dragon-match Week 21/2020 slot games releases

 

Yggdrasil, the innovative online gaming solutions provider, has travelled back to medieval times in its latest smash hit slot, Arthur’s Fortune. The 5×3 video slot contains a host of features for players to feast on as they join King Arthur and his legendary Knights of the Round Table in a quest for riches. The free spins mode is triggered if three or more Scatter symbols land simultaneously, with higher rewards for more symbols. During the bountiful bonus round, players are transported inside the castle where a wheel of fortune transforms a random symbol into wilds, leading to potentially huge wins, with more symbols transforming if more scatters hit the reels.

arthurs-fortune Week 21/2020 slot games releases

 

NetEnt has transformed one of the best-selling arcade games of all time for online slot fans with the release of Street Fighter II: The World Warrior Slot2122-59 Week 21/2020 slot games releases, featuring a cast of eight original characters ready for combat. In a new spin on the classic video game from Capcom2122-60 Week 21/2020 slot games releases, the new 5-reel, 5-row Cluster Pays video slot emulates the battle mechanics of the original title by pitting the player’s chosen character against opponents and letting the reels decide which fighter is victorious.

Street-Fighter-II_-The-World-Warrior-Slot™ Week 21/2020 slot games releases

 

Casino content developer WeAreCasino has launched its new slot game Classic Cherries. The game was co-produced by Silver Lining Studios, one of the industry’s leading game development companies. This is the first game developed with WeAreCasino’s brand new Slotbuilder engine. Based on a cult classic theme, Classic Cherries gives the iconic fruits, bells, bars, and sevens, a modern makeover and innovates the retro game’s playstyle. This five-reel, nine-line slot exhibits brand new game features such as winning lines that start from the left or rightmost reel, multiple bonus game levels and mobile gaming enhancements.

Classic-Cherries-2 Week 21/2020 slot games releases

 

Betsoft Gaming has released its latest slot QUEST TO THE WEST, which will take players East to West in search of untold wealth. The new slot features 5 reels and 25 paylines, delivering thrilling gameplay and stunning visuals. This game includes Walking Wilds, Respins, Instant Wins and up to 1260x your bet. Monkey King Walking Wilds will substitute for every symbol – grab three to enter the Free Spin round. Trigger the Quest to the West with three Monkey King Wilds. Each re-spin moves the Monkey King symbol one reel left. The spins will end when all the Monkey King symbols have gone, potentially stacking immense wins. Collect 15 or more Monkey King Symbols and fill up the Meter of the Heavens for an Instant Win of 1000x.

5-24-2 Week 21/2020 slot games releases

 

 

 

 


Source: Latest News on European Gaming Media Network
This is a Syndicated News piece. Photo credits or photo sources can be found on the source article: Week 21/2020 slot games releases

Continue Reading

Trending

European Gaming Media and Events is a leading media and boutique event organizer in the European Union with a monthly reach of +50,000 readers. The official company (PROSHIRT SRL), has been listed for 4 years in a row among the top 3 Advertising and market research agencies in the local Top Business Romania Microcompanies based on the Financial Reports.

Contact us: sales@europeangaming.eu

Editorial / PR Submissions: editor@europeangaming.eu

Copyright © 2015 - 2020 European Gaming Media and Events. Registered in Romania under Proshirt SRL, Company number: 2134306, EU VAT ID: RO21343605. Office address: Blvd. 1 Decembrie 1918 nr.5, Targu Mures, Romania

We are constantly showing banners about important news regarding events and product launches. Please turn AdBlock off in order to see these areas.