International Game Technology PLC Reports First Quarter 2019 Results
- Revenue of $1.14 billion includes significant increase in global gaming unit shipments and continued growth in global lottery same-store revenue
- Operating income of $178 million; adjusted EBITDA of $417 million, stable at constant currency on strong Italy and North America Lottery results
- Maintaining full-year adjusted EBITDA outlook
- Cash dividend declared of $0.20 per ordinary share
LONDON, May 20, 2019 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the first quarter ended March 31, 2019. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the first quarter results; access details are provided below.
"Our first quarter results confirm the consistent growth profile of our global lottery business and the progress we've made in sales of gaming machines, where global unit shipments increased 20%," said Marco Sala, CEO of IGT. "The results of our Italy operations are also noteworthy, with further growth in lottery and resilient machine gaming performance. As we look to the future, our focus remains on improving revenue and profits from gaming activities, innovating with new lottery games and technologies, and pursuing emerging growth opportunities."
"First quarter revenue and adjusted EBITDA were stable at constant currency, thanks to important contributions from our Italy and North America Lottery segments," said Alberto Fornaro, CFO of IGT. "Operating expenses were well controlled, our financial condition is solid, and we are maintaining our financial outlook for the year."
Overview of Consolidated First Quarter 2019 Results
Constant | ||||
Quarter Ended | Y/Y | Currency | ||
March 31, | Change | Change | ||
2019 | 2018 | (%) | (%) | |
(In $ millions, unless otherwise noted) | ||||
Revenue | 1,145 | 1,207 | -5% | -1% |
Operating income | 178 | 197 | -10% | -4% |
Net income/(loss) per diluted share | $0.20 | ($0.51) | NM | |
Adjusted EBITDA | 417 | 436 | -4% | 0% |
Adjusted operating income | 230 | 251 | -8% | -4% |
Adjusted net income per diluted share | $0.12 | $0.15 | -20% | |
Net debt | 7,714 | 7,525 | 3% | |
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. |
Consolidated revenue of $1.14 billion, stable at constant currency
- 20% increase in global gaming machine unit shipments
- Stable lottery revenue
- Offset by increased gaming machine taxes in Italy and lower gaming systems sales
Adjusted EBITDA of $417 million, stable at constant currency
- Strong Italy and North America Lottery performance
- Selling, general and administrative expenses and research and development costs better than the prior-year period despite higher legal costs
Adjusted operating income was $230 million, down 4% at constant currency
- Higher depreciation associated with upgrading the gaming installed base and lottery contract wins and extensions
Interest expense, net was $103 million compared to $107 million in the prior-year quarter
Provision for income taxes was $53 million compared to $61 million in the prior-year period
Net income attributable to IGT was $40 million in the quarter; adjusted net income attributable to IGT was $24 million
Net income per diluted share of $0.20; adjusted net income per diluted share of $0.12
Net debt of $7.71 billion, down from $7.76 billion at December 31, 2018
Operating Segment Review
North America Gaming & Interactive
Select Financial Data | Constant | Key Performance Indicators | % | ||||||||
Period Ended March 31 | Q1 '19 | Q1 '18 | FX | Period Ended March 31 | Q1 '19 | Q1 '18 | Change | ||||
Gaming | Total revenue | 239 | 243 | -2% | Installed base units (end of period) | ||||||
Gaming services | 155 | 154 | 1% | Casino | 22,713 | 23,183 | -2.0% | ||||
Terminal | 100 | 105 | -5% | ||||||||
Other | 55 | 49 | 13% | Machine units shipped | |||||||
Product sales | 84 | 89 | -6% | New/expansion | 1,482 | 1,024 | 44.7% | ||||
Terminal | 63 | 50 | 28% | Replacement | 2,544 | 2,692 | -5.5% | ||||
Other | 21 | 40 | -47% | Total machines shipped | 4,026 | 3,716 | 8.3% | ||||
Other | Total revenue | 1 | 0 | NM | |||||||
Service revenue | 1 | 0 | NM | ||||||||
Total | Revenue | 240 | 244 | -1% | |||||||
Operating income | 49 | 57 | -20% | ||||||||
Revenue of $240 million, stable with the prior year at constant currency
- Gaming service revenue of $155 million, stable compared to the prior year
- Terminal service revenue reflects decline in installed base and lower average yields due to product mix
- Increase in other service revenue from a large, multi-year poker contract
- Product sales revenue of $84 million
- Strong 28% increase in terminal revenue at constant currency resulting from 8% increase in gaming machine units shipped at higher average selling prices
- Current quarter new/expansion units include shipments to Encore Boston Harbor
- Replacement units declined slightly due to fewer VLT unit shipments
- Decline in other product sales revenue driven by comparison with exceptionally high sales of systems in the prior year
Operating income of $49 million compared to $57 million in the prior-year quarter
- Higher depreciation related to upgrading the installed base
- Lower sales of high-margin systems
- Stable operating expenses
North America Lottery
Select Financial Data | Constant | Key Performance Indicators | % | ||||||||
Period Ended March 31 | Q1 '19 | Q1 '18 | FX | Period Ended March 31 | Q1 '19 | Q1 '18 | Change | ||||
Gaming | Total revenue | 41 | 38 | 10% | Installed base units (end of period) | ||||||
Gaming services | 41 | 38 | 9% | VLT - Government sponsored | 14,799 | 15,101 | -2.0% | ||||
Terminal | 25 | 25 | 2% | ||||||||
Other | 16 | 13 | 22% | Lottery same-store revenue growth | |||||||
Product sales | 0 | 0 | 0% | Instant ticket & draw games | 5.2% | ||||||
Multistate jackpots | -9.3% | ||||||||||
Lottery | Total revenue | 255 | 257 | -1% | Total lottery same-store revenue growth | 2.8% | |||||
Lottery services | 241 | 241 | 0% | ||||||||
FMC | 209 | 205 | 2% | ||||||||
Instant ticket & draw games | 170 | 176 | -4% | ||||||||
Other services | 39 | 29 | 34% | ||||||||
LMA | 32 | 36 | -10% | ||||||||
Product sales | 14 | 16 | -12% | ||||||||
Total | Revenue | 296 | 295 | 0% | |||||||
Operating income | 76 | 76 | 0% | ||||||||
Revenue of $296 million, stable with the prior-year period
- Lottery service revenue of $241 million, in line with the prior year
- Overall same-store revenue growth driven by instant ticket and draw games; difficult comparison with elevated jackpot activity in the prior year
- Recovery of certain service level agreement provisions incurred previously, partially offset by lower revenue in Illinois
- LMA impacted by timing of pass-through revenue with no associated profit
- Lottery product sales revenue of $14 million
- Large Massachusetts retailer terminal sales in the prior year
- Gaming service revenue of $41 million
- Growth from interactive jackpot game in Canada
Operating income of $76 million, stable with the prior-year period
- Service level agreement recoveries and disciplined cost control offset higher profit flow-through from elevated jackpot activity in prior year
- Despite increased depreciation related to contract wins and extensions
International
Select Financial Data | Constant | Key Performance Indicators | % | ||||||||
Period Ended March 31 | Q1 '19 | Q1 '18 | FX | Period Ended March 31 | Q1 '19 | Q1 '18 | Change | ||||
Gaming | Total revenue | 81 | 91 | -5% | Installed base units (end of period) | ||||||
Gaming services | 30 | 40 | -15% | Casino | 10,666 | 12,917 | -17.4% | ||||
Terminal | 12 | 14 | -1% | VLT - Government sponsored | 4,419 | 2,937 | 50.5% | ||||
Other | 18 | 25 | -23% | Total installed base units | 15,085 | 15,854 | -4.9% | ||||
Product sales | 51 | 51 | 4% | ||||||||
Terminal | 35 | 30 | 22% | Machine units shipped | |||||||
Other | 15 | 21 | -22% | New/expansion | 382 | 91 | 319.8% | ||||
Replacement | 2,593 | 2,021 | 28.3% | ||||||||
Lottery | Total revenue | 74 | 74 | 5% | Total machines shipped | 2,975 | 2,112 | 40.9% | |||
Lottery services | 70 | 72 | 3% | ||||||||
FMC | 70 | 72 | 3% | Lottery same-store revenue growth | |||||||
Instant ticket & draw games | 56 | 57 | 4% | Instant ticket & draw games | 3.4% | ||||||
Other services | 14 | 15 | -4% | Multistate jackpots | 8.2% | ||||||
Product sales | 4 | 3 | 76% | Total lottery same-store revenue growth | 3.7% | ||||||
Other | Total revenue | 17 | 19 | -4% | |||||||
Service revenue | 17 | 19 | -4% | ||||||||
Product sales | 0 | 0 | -31% | ||||||||
Total | Revenue | 172 | 184 | -1% | |||||||
Operating income | 14 | 22 | -22% | ||||||||
Revenue of $172 million, stable with the prior year at constant currency
- Lottery service revenue of $70 million, up 3% at constant currency
- 3.7% same-store revenue growth with broad-based expansion across games and geographies
- Gaming service revenue was $30 million compared to $40 million in the prior year
- Lower interactive revenue and reduced contribution from installed base
- Decline in installed base year-over-year due to large conversions in the prior year, partially offset by continued expansion of Greece VLTs; sequential increase in the installed base
- Gaming product sales revenue of $51 million, up 4% at constant currency
- 22% rise in terminal revenue with growth in both new/expansion and replacement units partially offset by lower ASPs
- Decline in other product sales revenue primarily driven by higher system sales in the prior year
Operating income of $14 million
- Includes $5 million settlement cost associated with lottery contract
- Large, high-margin system sale in the prior year
Italy
Select Financial Data | Constant | Key Performance Indicators | % | ||||||||
Period Ended March 31 | Q1 '19 | Q1 '18 | FX | Period Ended March 31 | Q1 '19 | Q1 '18 | Change | ||||
Gaming | Total revenue | 153 | 191 | -13% | (In € millions, except machines) | ||||||
Gaming services | 153 | 190 | -13% | Lottery | |||||||
Terminal | 137 | 172 | -14% | Lotto wagers | 2,142 | 2,034 | 5.3% | ||||
Other | 16 | 18 | -4% | 10eLotto | 1,544 | 1,451 | 6.4% | ||||
Product sales | 0 | 0 | 0% | Core | 501 | 504 | -0.4% | ||||
Late numbers | 47 | 45 | 2.7% | ||||||||
Lottery | Total revenue | 204 | 214 | 3% | MillionDAY | 50 | 34 | 45.8% | |||
Lottery services | 204 | 214 | 3% | ||||||||
FMC | 204 | 214 | 3% | Scratch & Win wagers | 2,386 | 2,408 | -0.9% | ||||
Instant ticket & draw games | 252 | 266 | 3% | ||||||||
Other services | (49) | (52) | 0% | Italy lottery revenue growth | 3.2% | ||||||
Product sales | 0 | 0 | 0% | ||||||||
Gaming | |||||||||||
Other | Total revenue | 80 | 79 | 9% | Installed base (end of period) | ||||||
Service revenue | 80 | 79 | 9% | VLT - Operator (B2C) | 10,995 | 10,931 | 0.6% | ||||
Product sales | 0 | 0 | 0% | VLT - Supplier (B2B) | 7,847 | 8,425 | -6.9% | ||||
AWP | 40,746 | 51,315 | -20.6% | ||||||||
Total | Revenue | 437 | 483 | -2% | Total installed base | 59,588 | 70,671 | -15.7% | |||
Operating income | 147 | 147 | 9% | ||||||||
Wagers | |||||||||||
VLT - Operator (B2C) | 1,503 | 1,441 | 4.3% | ||||||||
AWP | 939 | 955 | -1.6% | ||||||||
Interactive wagers (gaming) | 489 | 493 | -0.6% | ||||||||
Other | |||||||||||
Sports betting wagers (1) | 274 | 246 | 11.1% | ||||||||
Sports betting payout (%) (1) | 83.3% | 81.2% | 2.1 pp | ||||||||
(1) Includes virtual wagers and pools & horses | |||||||||||
Revenue of $437 million compared to $483 million, down 2% at constant currency
- Lottery service revenue of $204 million, up 3% at constant currency
- Lotto wagers up 5.3% on steady growth in 10eLotto
- Scratch & Win wagers reflect one fewer day of sales year-over-year; exceptional performance from the Multiplier family of games against the successful Miliardario relaunch in the prior year
- Gaming service revenue was $153 million compared to $190 million in the prior year, down 13% at constant currency
- Increased taxes on AWP and VLT machines
- Improved productivity of gaming machines; 21% decline in AWP units results in less than 2% reduction in wagers
- Other service revenue includes pass-through revenue related to new commercial services offer
Operating income up 9% at constant currency to $147 million
- High profit flow-through on growth in Lotto wagers
- Beneficial shift in timing of expenses
- Despite increased taxes on gaming machines
Other Developments
The Company's Board of Directors declared a quarterly cash dividend of $0.20 per ordinary share
- Record date of June 3, 2019
- Payment date of June 17, 2019
Outlook
Outlook unchanged
- 2019 adjusted EBITDA $1.70 - $1.76 billion
- Capital expenditures of $450 - $550 million
- Assumes a EUR/USD exchange rate of 1.15
Conference Call and Webcast
May 20, 2019, 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 2599793
- 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 2599793
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 2019 are calculated using the same foreign exchange rates as the corresponding 2018 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, 2018 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:
Phil O'Shaughnessy, Global Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
Francesco Luti, +39 3485475493; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190
International Game Technology PLC | |||
Consolidated Statements of Operations | |||
($ and shares in thousands, except per share amounts) | |||
Unaudited | |||
For the three months ended | |||
March 31, | |||
2019 | 2018 | ||
Service revenue | 991,031 | 1,046,951 | |
Product sales | 153,885 | 160,005 | |
Total revenue | 1,144,916 | 1,206,956 | |
Cost of services | 595,327 | 618,058 | |
Cost of product sales | 100,185 | 103,351 | |
Selling, general and administrative | 205,134 | 217,289 | |
Research and development | 66,118 | 71,263 | |
Total operating expenses | 966,764 | 1,009,961 | |
Operating income | 178,152 | 196,995 | |
Interest expense, net | (103,069) | (107,280) | |
Foreign exchange gain (loss), net | 58,602 | (96,695) | |
Other (expense) income, net | (498) | 2,981 | |
Total non-operating expenses | (44,965) | (200,994) | |
Income (loss) before provision for income taxes | 133,187 | (3,999) | |
Provision for income taxes | 52,692 | 60,505 | |
Net income (loss) | 80,495 | (64,504) | |
Less: Net income attributable to non-controlling interests | 40,241 | 38,642 | |
Net income (loss) attributable to IGT PLC | 40,254 | (103,146) | |
Net income (loss) attributable to IGT PLC per common share - basic | 0.20 | (0.51) | |
Net income (loss) attributable to IGT PLC per common share - diluted | 0.20 | (0.51) | |
Weighted-average shares - basic | 204,300 | 203,597 | |
Weighted-average shares - diluted | 204,742 | 203,597 | |
International Game Technology PLC | |||
Consolidated Balance Sheets | |||
($ thousands) | |||
Unaudited | |||
March 31, | December 31, | ||
2019 | 2018 | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | 290,359 | 250,669 | |
Restricted cash and cash equivalents | 245,235 | 261,108 | |
Trade and other receivables, net | 934,219 | 949,085 | |
Inventories | 294,791 | 282,698 | |
Other current assets | 528,581 | 504,061 | |
Income taxes receivable | 35,911 | 39,075 | |
Total current assets | 2,329,096 | 2,286,696 | |
Systems, equipment and other assets related to contracts, net | 1,356,294 | 1,404,426 | |
Property, plant and equipment, net | 143,272 | 185,349 | |
Operating lease right-of-use-assets | 372,619 | - | |
Goodwill | 5,563,630 | 5,580,227 | |
Intangible assets, net | 1,995,618 | 2,044,723 | |
Other non-current assets | 2,052,822 | 2,108,964 | |
Deferred income taxes | 34,405 | 38,117 | |
Total non-current assets | 11,518,660 | 11,361,806 | |
Total assets | 13,847,756 | 13,648,502 | |
Liabilities and shareholders' equity | |||
Current liabilities: | |||
Accounts payable | 1,083,965 | 1,142,371 | |
Other current liabilities | 916,564 | 816,722 | |
Current portion of long-term debt | 1,280,928 | - | |
Short-term borrowings | 67,969 | 34,822 | |
Income taxes payable | 36,717 | 8,209 | |
Total current liabilities | 3,386,143 | 2,002,124 | |
Long-term debt, less current portion | 6,655,020 | 7,977,267 | |
Deferred income taxes | 439,828 | 446,083 | |
Income taxes payable | 25,654 | 25,654 | |
Operating lease liabilities | 336,658 | - | |
Other non-current liabilities | 379,491 | 445,445 | |
Total non-current liabilities | 7,836,651 | 8,894,449 | |
Total liabilities | 11,222,794 | 10,896,573 | |
Commitments and contingencies | |||
Shareholders' equity | 2,624,962 | 2,751,929 | |
Total liabilities and shareholders' equity | 13,847,756 | 13,648,502 | |
International Game Technology PLC | ||||
Consolidated Statements of Cash Flows | ||||
($ thousands) | ||||
Unaudited | ||||
For the three months ended | ||||
March 31, | ||||
2019 | 2018 | |||
Cash flows from operating activities | ||||
Net income (loss) | 80,495 | (64,504) | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||
Depreciation | 105,331 | 98,087 | ||
Amortization | 68,084 | 68,392 | ||
Service revenue amortization | 52,289 | 56,650 | ||
Stock-based compensation expense | 9,590 | 14,178 | ||
Debt issuance cost amortization | 5,783 | 6,099 | ||
Deferred income taxes | 267 | (22,914) | ||
Foreign exchange (gain) loss, net | (58,602) | 96,695 | ||
Other non-cash costs, net | 8,192 | 5,529 | ||
Changes in operating assets and liabilities, excluding the effects of acquisitions: | ||||
Trade and other receivables | 24,145 | 11,968 | ||
Inventories | (20,448) | (11,657) | ||
Accounts payable | (27,817) | (35,545) | ||
Other assets and liabilities | (100,695) | (145,768) | ||
Net cash provided by operating activities | 146,614 | 77,210 | ||
Cash flows from investing activities | ||||
Capital expenditures | (119,185) | (134,661) | ||
Proceeds from sale of assets | 1,888 | 2,473 | ||
Other | 2,208 | 347 | ||
Net cash used in investing activities | (115,089) | (131,841) | ||
Cash flows from financing activities | ||||
Proceeds from long-term debt | 35,666 | 164,681 | ||
Net proceeds from short-term borrowings | 33,201 | 44,429 | ||
Capital increase - non-controlling interests | 333 | - | ||
Dividends paid - non-controlling interests | (13,439) | (13,316) | ||
Net payments of financial liabilities | (44,662) | (32,702) | ||
Principal payments on long-term debt | - | (625,500) | ||
Other | (2,000) | (825) | ||
Net cash provided by (used in) financing activities | 9,099 | (463,233) | ||
Net increase (decrease) in cash and cash equivalents, and restricted cash | 40,624 | (517,864) | ||
Effect of exchange rate changes on cash and cash equivalents, and restricted cash | (16,807) | 28,707 | ||
Cash and cash equivalents, and restricted cash at the beginning of the period | 511,777 | 1,305,430 | ||
Cash and cash equivalents, and restricted cash at the end of the period | 535,594 | 816,273 | ||
Supplemental Cash Flow Information: | ||||
Interest paid | (183,777) | (227,356) | ||
Income taxes paid | (18,835) | (13,691) | ||
International Game Technology PLC | ||||
Net Debt | ||||
($ thousands) | ||||
Unaudited | ||||
March 31, | December 31, | |||
2019 | 2018 | |||
4.125% Senior Secured Notes due February 2020(2) | - | 499,167 | ||
4.750% Senior Secured Notes due March 2020 (2) | - | 438,252 | ||
5.500% Senior Secured Notes due June 2020 (1) | 27,482 | 27,519 | ||
6.250% Senior Secured Notes due February 2022 (1) | 1,476,655 | 1,469,609 | ||
4.750% Senior Secured Notes due February 2023 (2) | 947,070 | 964,730 | ||
5.350% Senior Secured Notes due October 2023(1) | 60,961 | 60,983 | ||
3.500% Senior Secured Notes due July 2024 (2) | 556,740 | 567,179 | ||
6.500% Senior Secured Notes due February 2025 (1) | 1,088,769 | 1,088,385 | ||
6.250% Senior Secured Notes due January 2027(1) | 742,843 | 742,667 | ||
Senior Secured Notes, long-term | 4,900,520 | 5,858,491 | ||
Revolving Credit Facilities due July 2021 (1) (2) | 439,920 | 413,381 | ||
Term Loan Facilities due January 2023 (2) | 1,314,580 | 1,705,395 | ||
Long-term debt, less current portion | 6,655,020 | 7,977,267 | ||
4.125% Senior Secured Notes due February 2020 (2) | 490,198 | - | ||
4.750% Senior Secured Notes due March 2020 (2) | 431,210 | - | ||
Term Loan Facilities due January 2023 (2) | 359,520 | - | ||
Current portion of long-term debt | 1,280,928 | - | ||
Short-term borrowings | 67,969 | 34,822 | ||
Total debt | 8,003,917 | 8,012,089 | ||
Less: Cash and cash equivalents | 290,359 | 250,669 | ||
Net debt | 7,713,558 | 7,761,420 | ||
(1) U.S. dollar-denominated debt |
(2) Euro-denominated debt |
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) | ||||
Unaudited | ||||
For the three months ended | ||||
March 31, | ||||
2019 | 2018 | |||
Net income (loss) | 80,495 | (64,504) | ||
Provision for income taxes | 52,692 | 60,505 | ||
Non-operating expenses | 44,965 | 200,994 | ||
Depreciation | 105,331 | 98,087 | ||
Amortization | 68,084 | 68,392 | ||
Service revenue amortization | 52,289 | 56,650 | ||
Stock-based compensation expense | 9,590 | 14,178 | ||
Other | 3,227 | 1,854 | ||
Adjusted EBITDA | 416,673 | 436,156 | ||
Cash flows from operating activities | 146,614 | 77,210 | ||
Capital expenditures | (119,185) | (134,661) | ||
Free Cash Flow | 27,429 | (57,451) | ||
International Game Technology PLC | ||||||||||
Consolidated Statement of Operations | ||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||
($ and shares in thousands, except per share amounts) | ||||||||||
Unaudited | ||||||||||
Q1 2019 | Adjustments | Q1 2019 | ||||||||
As | Purchase | Foreign | As | |||||||
Reported | Accounting | Exchange | Other | Adjusted | ||||||
Total revenue | 1,144,916 | (178) | - | - | 1,144,738 | |||||
Cost of services | 595,327 | (18,775) | - | - | 576,552 | |||||
Cost of product sales | 100,185 | (3,869) | - | - | 96,316 | |||||
Selling, general and administrative | 205,134 | (26,078) | - | (3,297) | 175,759 | |||||
Research and development | 66,118 | (220) | - | - | 65,898 | |||||
Total operating expenses | 966,764 | (48,942) | - | (3,297) | 914,525 | |||||
Operating income | 178,152 | 48,764 | - | 3,297 | 230,213 | |||||
Interest expense, net | (103,069) | 25 | - | - | (103,044) | |||||
Foreign exchange gain, net | 58,602 | - | (58,602) | - | - | |||||
Other expense, net | (498) | - | - | - | (498) | |||||
Total non-operating expenses | (44,965) | 25 | (58,602) | - | (103,542) | |||||
Income before provision for income taxes | 133,187 | 48,789 | (58,602) | 3,297 | 126,671 | |||||
Provision for income taxes (a) | 52,692 | 11,690 | (3,090) | 804 | 62,096 | |||||
Net income | 80,495 | 37,099 | (55,512) | 2,493 | 64,575 | |||||
Less: Net income attributable to non-controlling interests | 40,241 | 25 | - | - | 40,266 | |||||
Net income attributable to IGT PLC | 40,254 | 37,074 | (55,512) | 2,493 | 24,309 | |||||
Net income per common share - diluted | 0.20 | 0.12 | ||||||||
Weighted-average shares - diluted | 204,742 | 204,742 | ||||||||
(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 | ||||||||||
Consolidated Statement of Operations | ||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||
($ and shares in thousands, except per share amounts) | ||||||||||
Unaudited | ||||||||||
Q1 2018 | Adjustments | Q1 2018 | ||||||||
As | Purchase | Foreign | As | |||||||
Reported | Accounting | Exchange | Other | Adjusted | ||||||
Total revenue | 1,206,956 | (177) | - | - | 1,206,779 | |||||
Cost of services | 618,058 | (21,155) | - | - | 596,903 | |||||
Cost of product sales | 103,351 | (3,869) | - | - | 99,482 | |||||
Selling, general and administrative | 217,289 | (26,849) | - | (2,071) | 188,369 | |||||
Research and development | 71,263 | (235) | - | - | 71,028 | |||||
Total operating expenses | 1,009,961 | (52,108) | - | (2,071) | 955,782 | |||||
Operating income | 196,995 | 51,931 | - | 2,071 | 250,997 | |||||
Interest expense, net | (107,280) | 504 | - | - | (106,776) | |||||
Foreign exchange loss, net | (96,695) | - | 96,695 | - | - | |||||
Other income, net | 2,981 | (2,185) | - | - | 796 | |||||
Total non-operating expenses | (200,994) | (1,681) | 96,695 | - | (105,980) | |||||
(Loss) income before provision for income taxes | (3,999) | 50,250 | 96,695 | 2,071 | 145,017 | |||||
Provision for income taxes (a) | 60,505 | 11,910 | 2,646 | 552 | 75,613 | |||||
Net (loss) income | (64,504) | 38,340 | 94,049 | 1,519 | 69,404 | |||||
Less: Net income attributable to non-controlling interests | 38,642 | 25 | - | - | 38,667 | |||||
Net (loss) income attributable to IGT PLC | (103,146) | 38,315 | 94,049 | 1,519 | 30,737 | |||||
Net (loss) income per common share - diluted | (0.51) | 0.15 | ||||||||
Weighted-average shares - diluted (b) | 203,597 | 204,171 | ||||||||
(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 March 31 | Q1 '19 | Q1 '18 | FX | Period Ended March 31 | Q1 '19 | Q1 '18 | Change | ||||
Gaming | Total revenue | 515 | 563 | -5% | Installed base units (end of period) | ||||||
Gaming services | 380 | 422 | -6% | Casino | 33,379 | 36,100 | -7.5% | ||||
Terminal | 275 | 317 | -9% | VLT - Government sponsored (ex-Italy) | 19,218 | 18,038 | 6.5% | ||||
Other | 105 | 105 | 3% | VLT - Italy supplier (B2B) | 7,847 | 8,425 | -6.9% | ||||
Product sales | 135 | 141 | -2% | Total installed base units | 60,444 | 62,563 | -3.4% | ||||
Terminal | 99 | 80 | 25% | Yield (average gross revenue per unit per day) | $27.19 | $27.72 | -1.9% | ||||
Other | 37 | 61 | -38% | ||||||||
Additional Italian network details: | |||||||||||
Lottery | Total revenue | 532 | 546 | 1% | VLT - Operator (B2C) | 10,995 | 10,931 | 0.6% | |||
Lottery services | 514 | 527 | 2% | AWP | 40,746 | 51,315 | -20.6% | ||||
FMC | 481 | 491 | 2% | ||||||||
Instant ticket & draw games | 478 | 500 | 1% | Machine units shipped | |||||||
Other services | 4 | (9) | NM | New/expansion | 1,864 | 1,115 | 67.2% | ||||
LMA | 32 | 36 | -10% | Replacement | 5,137 | 4,713 | 9.0% | ||||
Product sales | 18 | 19 | 0% | Total machines shipped | 7,001 | 5,828 | 20.1% | ||||
Other | Total revenue | 98 | 98 | 8% | Global lottery same-store revenue growth | ||||||
Service revenue | 98 | 98 | 8% | Instant ticket & draw games | 4.7% | ||||||
Product sales | 0 | 0 | 9% | Multistate jackpots | -7.6% | ||||||
Total lottery same-store revenue growth (ex-Italy) | 3.1% | ||||||||||
Consolidated | Revenue | 1,145 | 1,207 | -1% | Italy lottery revenue growth | 3.2% | |||||
Operating Income: | |||||||||||
Segment total | 285 | 302 | -1% | ||||||||
Purchase accounting | (49) | (52) | 6% | ||||||||
Corporate support | (58) | (53) | -15% | ||||||||
Total | 178 | 197 | -4% | ||||||||
SOURCE International Game Technology PLC
Share this article