International Game Technology Reports Second Quarter Fiscal Year 2013 Results
LAS VEGAS, April 25, 2013 /PRNewswire/ --
Second Quarter Highlights (compared to last year's second quarter)
- Total revenues increased 11% to $600 million
- North America product sales revenue increased 25%
- GAAP earnings per share from continuing operations increased 38% to $0.29
- Adjusted earnings per share from continuing operations increased 33% to $0.36
- GAAP operating income increased 10% to $129 million
- Adjusted operating income increased 13% to $164 million
- Sold 8,400 North America replacement units, up 68%
- Social gaming revenues increased 31% to $54 million sequentially from our 2013 fiscal first quarter, as average revenue per daily active user grew 19% to $0.37 sequentially.
International Game Technology (NYSE: IGT) today reported operating results for the second quarter ended March 31, 2013.
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"We are very pleased with our momentum through the second quarter, demonstrating the strength of our comprehensive strategy – leveraging our core business, broadening the distribution of our premier content, and generating shareholder returns," said Patti Hart, CEO of IGT. "As we continue to deliver on this strategy, we expect that this will be our fourth consecutive year of double digit growth in adjusted earnings per share from continuing operations."
Consolidated Results
|
($ in millions, except per share amounts) | ||||||||||||
|
Quarters Ended |
Six Months Ended | |||||||||||
|
March 31, |
March 31, | |||||||||||
|
2013 |
2012 |
% Change |
2013 |
2012 |
% Change | |||||||
|
GAAP Measures |
||||||||||||
|
Revenue |
$ 600.0 |
$ 541.2 |
11% |
$ 1,130.2 |
$ 986.8 |
15% | ||||||
|
Operating income |
$ 129.3 |
$ 118.0 |
10% |
$ 247.7 |
$ 217.9 |
14% | ||||||
|
Income from continuing operations |
$ 78.2 |
$ 62.4 |
25% |
$ 143.5 |
$ 112.7 |
27% | ||||||
|
Earnings per share from continuing operations |
$ 0.29 |
$ 0.21 |
38% |
$ 0.54 |
$ 0.38 |
42% | ||||||
|
Net operating cash flows |
$ 182.5 |
$ 176.7 |
3% | |||||||||
|
Non-GAAP Measures |
||||||||||||
|
Adjusted operating income |
$ 163.5 |
$ 144.7 |
13% |
$ 301.0 |
$ 245.8 |
22% | ||||||
|
Adjusted income from continuing operations |
$ 95.1 |
$ 79.5 |
20% |
$ 171.5 |
$ 130.6 |
31% | ||||||
|
Adjusted earnings per share from continuing operations |
$ 0.36 |
$ 0.27 |
33% |
$ 0.64 |
$ 0.44 |
45% | ||||||
|
Free cash flow (after dividends) |
$ 91.4 |
$ 17.4 |
425% | |||||||||
|
Adjusted operating income, adjusted income from continuing operations, adjusted earnings per share from continuing operations and free cash flow are non-GAAP financial measures. Reconciliations between GAAP and non-GAAP measures are provided at the end of this release. |
- Revenues increased 11% to $600 million in the second quarter, driven by growth in North America machine sales and social gaming.
- Adjusted earnings per share from continuing operations increased 33% to $0.36 for the second quarter.
- Non-GAAP adjusted financial measures for the second quarter ended March 31, 2013 exclude acquisition-related charges for DoubleDown, fees related to the proxy contest, Alabama note impairment and certain discrete tax benefits.
Gaming Operations (excluding Interactive)
|
($ in millions, unless otherwise noted) | ||||||||||||
|
Quarters Ended |
Six Months Ended | |||||||||||
|
March 31, |
March 31, | |||||||||||
|
2013 |
2012 |
% Change |
2013 |
2012 |
% Change | |||||||
|
Revenue |
$ 254.3 |
$ 266.1 |
-4% |
$ 496.9 |
$ 518.1 |
-4% | ||||||
|
Gross profit |
$ 156.7 |
$ 163.1 |
-4% |
$ 309.8 |
$ 317.1 |
-2% | ||||||
|
Gross margin |
62% |
61% |
2% |
62% |
61% |
2% | ||||||
|
Installed base |
56,700 |
56,100 |
1% |
56,700 |
56,100 |
1% | ||||||
|
Average revenue per unit per day (0.00) |
$ 49.26 |
$ 52.34 |
-6% |
$ 47.99 |
$ 51.75 |
-7% | ||||||
- Revenues decreased 4% to $254 million in the second quarter primarily due to lower MegaJackpots® revenue.
- Gross margin increased to 62% from 61% in the second quarter, primarily due to lower jackpot expenses and depreciation.
- Installed base increase was driven by lease operations growth globally.
- Average revenue per unit per day in the second quarter was $49.26, down 6% over the prior year quarter, primarily due to lower yields, most significant in MegaJackpots®, and up 5% sequentially due to seasonal gaming trends.
Product Sales
|
($ in millions, unless otherwise noted) | ||||||||||||
|
Quarters Ended |
Six Months Ended | |||||||||||
|
March 31, |
March 31, | |||||||||||
|
2013 |
2012 |
% Change |
2013 |
2012 |
% Change | |||||||
|
Revenue |
$ 279.0 |
$ 240.8 |
16% |
$ 513.7 |
$ 421.8 |
22% | ||||||
|
Gross profit |
$ 144.0 |
$ 132.0 |
9% |
$ 269.5 |
$ 223.6 |
21% | ||||||
|
Gross margin |
52% |
55% |
-5% |
52% |
53% |
-2% | ||||||
|
Units recognized ('000) |
14.3 |
10.2 |
40% |
25.0 |
17.5 |
43% | ||||||
|
Average machine sales price ('000) |
$ 14.1 |
$ 15.8 |
-11% |
$ 14.4 |
$ 15.8 |
-9% | ||||||
- Revenues increased 16% to $279 million and units recognized increased 40% to 14,300 in the second quarter, primarily due to increased North America machine sales related to Canadian VLT customers, as well as an increase in North America new openings.
- Gross margin decreased to 52% from 55% in the second quarter due to targeted promotional activity, unfavorable mix shift and higher non-standard manufacturing costs.
- Average machine sales price in the second quarter decreased 11% compared to the prior year quarter mainly due to targeted promotional activity and an increased mix of lower-priced VLT sales.
Interactive
|
($ in millions, unless otherwise noted) |
||||||||||||
|
Quarters Ended |
Six Months Ended | |||||||||||
|
March 31, |
March 31, | |||||||||||
|
2013 |
2012 |
% Change |
2013 |
2012 |
% Change | |||||||
|
Revenue |
$ 66.7 |
$ 34.3 |
94% |
$ 119.6 |
$ 46.9 |
155% | ||||||
|
Social gaming |
$ 54.3 |
$ 21.3 |
155% |
$ 95.6 |
$ 21.3 |
349% | ||||||
|
IGTi |
$ 12.4 |
$ 13.0 |
-5% |
$ 24.0 |
$ 25.6 |
-6% | ||||||
|
Gross Margin |
61% |
54% |
13% |
60% |
53% |
13% | ||||||
|
Social gaming |
61% |
61% |
- |
61% |
61% |
- | ||||||
|
IGTi |
59% |
42% |
40% |
55% |
47% |
17% | ||||||
|
Double Down Average User Statistics* |
||||||||||||
|
DAU (Daily active users) ('000) |
1,690 |
1,350 |
25% |
1,575 |
1,350 |
17% | ||||||
|
MAU (Monthly active users) ('000) |
6,276 |
4,975 |
26% |
5,596 |
4,975 |
12% | ||||||
|
Bookings per DAU (0.00) |
$ 0.37 |
$ 0.24 |
54% |
$ 0.34 |
$ 0.24 |
42% | ||||||
|
*as a single application with multiple games, active users equal unique users | ||||||||||||
- Social gaming revenues in the second quarter increased 31% sequentially to $54 million, primarily driven by an increase in both average DAU and average bookings per DAU.
- Average DAU were 1.7 million in the second quarter, an increase of 16% compared to the prior sequential quarter and an increase of 25% compared to the prior year quarter.
- Average bookings per DAU increased 19% sequentially to $0.37 in the second quarter and 54% over the same quarter last year.
Operating Expenses and Other Income/Expense
|
($ in millions) |
||||||||||||
|
Quarters Ended |
Six Months Ended | |||||||||||
|
March 31, |
March 31, | |||||||||||
|
2013 |
2012 |
% Change |
2013 |
2012 |
% Change | |||||||
|
Operating Expenses |
||||||||||||
|
Selling, general & administrative |
$ 110.7 |
$ 109.3 |
1% |
$ 210.9 |
$ 199.1 |
6% | ||||||
|
Research & development |
58.1 |
55.3 |
5% |
112.5 |
102.2 |
10% | ||||||
|
Depreciation & amortization |
19.7 |
19.3 |
2% |
38.7 |
34.7 |
12% | ||||||
|
Contingent acquisition related costs |
21.9 |
11.7 |
87% |
39.3 |
11.7 |
236% | ||||||
|
Impairment |
1.6 |
- |
* |
1.6 |
- |
* | ||||||
|
Total operating expenses |
$ 212.0 |
$ 195.6 |
8% |
$ 403.0 |
$ 347.7 |
16% | ||||||
|
Adjusted Operating Expenses |
||||||||||||
|
Total |
$ 180.1 |
$ 171.2 |
5% |
$ 349.3 |
$ 322.1 |
8% | ||||||
|
Adjusted operating expenses is a non-GAAP financial measure. Reconciliations between GAAP and non-GAAP measures are provided at the end of this release. | ||||||||||||
- Second quarter operating expenses increased over the prior year quarter primarily due to additional expenses from DoubleDown and unfavorable bad debt provisions.
- Adjusted operating expenses were 30% of revenues for the second quarter compared to 32% of revenues in the prior year quarter.
Balance Sheet and Capital Deployment
|
($ in millions) |
|||||
|
March 31, |
September 30, |
||||
|
2013 |
2012 |
% Change | |||
|
Cash and equivalents (including restricted amounts) |
$ 312.3 |
$ 288.2 |
8% | ||
|
Working capital |
$ 663.9 |
$ 633.0 |
5% | ||
|
Contractual debt obligations |
$ 1,770.0 |
$ 1,790.0 |
-1% |
- During the second quarter the company returned $94 million to shareholders. The company repurchased 4.4 million shares of common stock at an average price of $17.03 per share for a total cost of $75 million and also returned $19 million in the form of dividends.
Other
References to per share amounts in this release are based on diluted shares of common stock, unless otherwise specified. Reconciliations of all GAAP to Non-GAAP financial measures are provided at the end of this release.
Outlook
Based on current expectations and the operating results for the second quarter of fiscal 2013, the company is increasing its fiscal year 2013 guidance for adjusted earnings from continuing operations to $1.26 to $1.32 per share.
GAAP earnings per share from continuing operations for fiscal year 2013 will include acquisition-related expenses, primarily related to DoubleDown, proxy contest-related fees and certain tax-related benefits the amount of which are not determinable at this time. The company may also recognize charges for impairment, other acquisition-related expenses, resolution of certain tax items, and/or other items that are not currently determinable, but may be significant. For this reason, the Company is unable to provide estimates for full-year GAAP earnings per share from continuing operations at this time.
Earnings Conference Call
As previously announced on Apr. 4, 2013, IGT will host a conference call to discuss its Second Quarter 2013 earnings results on Thursday, Apr. 25, 2013, at 2:00 p.m. PDT (or 5:00 p.m. EDT). The access numbers are as follows:
Domestic callers dial +1 800-369-1753, passcode IGT
International callers dial +1 312-470-7067, passcode IGT
The conference call will also be broadcast live over the Internet. A link to the webcast is available at the IGT website: http://www.IGT.com/investors. The call will be archived until Thursday, May 9, 2013 at http://www.IGT.com/investors, for those interested parties that are unable to participate during the live webcast.
A taped replay of the conference call will be available after the conference call. This replay will run through Thursday, May 9, 2013. The access numbers are as follows:
Domestic callers dial +1 888-566-0041
International callers dial +1 402-998-0492
Q2 FY 2013 PDF of this press release
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. These statements include our expected future financial and operational performance (including our guidance for fiscal year 2013) and our strategic and operational plans. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from the results predicted, and reported results should not be considered an indication of future performance. Among the factors that could cause actual results and outcomes to differ materially from those contained in such forward-looking statements are the following: general economic conditions and changes in economic conditions affecting the gaming industry; new or changing laws or regulations or new interpretations of existing laws or regulations affecting our business; difficulties or delays in obtaining or maintaining necessary licenses or approvals; slow growth in the number of new gaming jurisdictions or new casinos or the rate of replacement of existing gaming machines; changes in operator or player preferences for our products; our ability to compete in the gaming industry with new or existing competitors; our ability to develop and introduce new products and their acceptance by our customers; risks related to our international operations; our ability to protect our intellectual property; adverse results of litigation, including intellectual property infringement claims; risks related to business combinations, investments in intellectual property and the integration of acquisitions; and future developments or changes affecting online gaming or social casino-style gaming, which is a new and evolving industry. A further list and description of these and other risks, uncertainties and other matters can be found in our annual report and other reports filed with the Securities and Exchange Commission, including under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for fiscal 2012 filed with the SEC on November 28, 2012 and our Quarterly Report on Form 10-Q for our fiscal quarter ended December 31, 2012 filed with the SEC on February 6, 2013 and available on the SEC website at www.sec.gov and on the investor relations section of our website at www.IGT.com/investors. Additional information will also be set forth in our Quarterly Report on Form 10-Q for our fiscal quarter ended March 31, 2013, which we expect to file with the SEC in the second quarter of calendar 2013. All information provided in this release is as of April 25, 2013, and IGT does not intend, and undertakes no duty, to update this information to reflect subsequent events or circumstances.
IGT Resources:
- Like us on Facebook
- Play DoubleDown Casino Games
- Like DoubleDown Casino on Facebook
- Follow us on Twitter
- View IGT's YouTube Channel
- Check out our other Games and Gaming Systems
About IGT
International Game Technology (NYSE: IGT) is a global leader in casino gaming entertainment and continues to transform the industry by translating casino player experiences to social, mobile and interactive environments for markets around the world. IGT's acquisition of DoubleDown Interactive provides engaging social casino style entertainment to more than 6 million players monthly. More information about IGT is available at IGT.com or connect with IGT at @IGTNews or facebook.com/IGT. Anyone can play at the DoubleDown Casino by visiting http://apps.facebook.com/doubledowncasino or doubledowncasino.com
|
CONSOLIDATED STATEMENTS OF INCOME (Unaudited and Condensed) | |||||
|
Periods Ended March 31, | |||||
|
Second Quarters |
Six Months | ||||
|
2013 |
2012 |
2013 |
2012 | ||
|
(In millions, except per share amounts) | |||||
|
Revenues |
|||||
|
Gaming operations |
$ 254.3 |
$ 266.1 |
$ 496.9 |
$ 518.1 | |
|
Product sales |
279.0 |
240.8 |
513.7 |
421.8 | |
|
Interactive |
66.7 |
34.3 |
119.6 |
46.9 | |
|
Total revenues |
600.0 |
541.2 |
1,130.2 |
986.8 | |
|
Costs and operating expenses |
|||||
|
Cost of gaming operations |
97.6 |
103.0 |
187.1 |
201.0 | |
|
Cost of product sales |
135.0 |
108.8 |
244.2 |
198.2 | |
|
Cost of interactive |
26.1 |
15.8 |
48.2 |
22.0 | |
|
Selling, general and administrative |
110.7 |
109.3 |
210.9 |
199.1 | |
|
Research and development |
58.1 |
55.3 |
112.5 |
102.2 | |
|
Depreciation and amortization |
19.7 |
19.3 |
38.7 |
34.7 | |
|
Contingent acquisition related costs |
21.9 |
11.7 |
39.3 |
11.7 | |
|
Impairment |
1.6 |
- |
1.6 |
- | |
|
Total costs and operating expenses |
470.7 |
423.2 |
882.5 |
768.9 | |
|
Operating income |
129.3 |
118.0 |
247.7 |
217.9 | |
|
Other income (expense) |
|||||
|
Interest income |
11.1 |
10.8 |
22.4 |
22.9 | |
|
Interest expense |
(30.3) |
(30.0) |
(62.0) |
(60.1) | |
|
Other |
(2.5) |
(2.0) |
(2.7) |
(4.8) | |
|
Total other income (expense) |
(21.7) |
(21.2) |
(42.3) |
(42.0) | |
|
Income from continuing operations before tax |
107.6 |
96.8 |
205.4 |
175.9 | |
|
Income tax provision |
29.4 |
34.4 |
61.9 |
63.2 | |
|
Income from continuing operations |
78.2 |
62.4 |
143.5 |
112.7 | |
|
Loss from discontinued operations, net of tax |
- |
(0.5) |
- |
(1.5) | |
|
Net income |
$ 78.2 |
$ 61.9 |
$ 143.5 |
$ 111.2 | |
|
Basic earnings (loss) per share |
|||||
|
Continuing operations |
$ 0.30 |
$ 0.21 |
$ 0.54 |
$ 0.38 | |
|
Discontinued operations |
- |
- |
- |
(0.01) | |
|
Net income |
$ 0.30 |
$ 0.21 |
$ 0.54 |
$ 0.37 | |
|
Diluted earnings (loss) per share |
|||||
|
Continuing operations |
$ 0.29 |
$ 0.21 |
$ 0.54 |
$ 0.38 | |
|
Discontinued operations |
- |
- |
- |
(0.01) | |
|
Net income |
$ 0.29 |
$ 0.21 |
$ 0.54 |
$ 0.37 | |
|
Weighted average shares outstanding |
|||||
|
Basic |
263.6 |
296.7 |
264.7 |
297.0 | |
|
Diluted |
265.6 |
298.1 |
266.7 |
298.6 | |
|
CONSOLIDATED BALANCE SHEET (Unaudited and Condensed) | |||
|
March 31, |
September 30, | ||
|
2013 |
2012 | ||
|
(In millions) |
|||
|
Assets |
|||
|
Current assets |
|||
|
Cash and equivalents |
$ 236.5 |
$ 206.3 | |
|
Restricted cash and investments |
75.8 |
81.9 | |
|
Jackpot annuity investments |
58.5 |
60.2 | |
|
Receivables, net |
578.3 |
564.8 | |
|
Inventories |
89.4 |
92.9 | |
|
Other assets and deferred costs |
249.1 |
257.2 | |
|
Total current assets |
1,287.6 |
1,263.3 | |
|
Property, plant and equipment, net |
511.5 |
555.7 | |
|
Jackpot annuity investments |
279.6 |
295.7 | |
|
Contracts and notes receivable, net |
115.2 |
139.3 | |
|
Goodwill and other intangibles, net |
1,629.1 |
1,663.1 | |
|
Other assets and deferred costs |
376.7 |
368.0 | |
|
Total Assets |
$ 4,199.7 |
$ 4,285.1 | |
|
Liabilities and Shareholders' Equity |
|||
|
Current liabilities |
|||
|
Accounts payable |
$ 86.4 |
$ 87.5 | |
|
Jackpot liabilities, current portion |
140.2 |
152.4 | |
|
Dividends payable |
20.8 |
16.0 | |
|
Other accrued liabilities |
376.3 |
374.4 | |
|
Total current liabilities |
623.7 |
630.3 | |
|
Long-term debt |
1,829.3 |
1,846.4 | |
|
Jackpot liabilities |
308.9 |
328.6 | |
|
Other liabilities |
195.3 |
282.0 | |
|
Total Liabilities |
2,957.2 |
3,087.3 | |
|
Total Equity |
1,242.5 |
1,197.8 | |
|
Total Liabilities and Shareholders' Equity |
$ 4,199.7 |
$ 4,285.1 | |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited and Condensed) | |||
|
Six Months Ended | |||
|
March 31, | |||
|
2013 |
2012 | ||
|
(In millions) |
|||
|
Operating |
|||
|
Net income |
$ 143.5 |
$ 111.2 | |
|
Depreciation and amortization |
117.8 |
115.2 | |
|
Other non-cash items |
54.8 |
42.1 | |
|
Changes in operating assets and liabilities, excluding acquisitions: |
|||
|
Receivables |
(21.2) |
(28.5) | |
|
Inventories |
9.4 |
(14.6) | |
|
Accounts payable and accrued liabilities |
(61.8) |
3.8 | |
|
Jackpot liabilities |
(40.7) |
(21.9) | |
|
Income taxes, net of employee stock plans |
(21.9) |
(13.8) | |
|
Other assets and deferred costs |
2.6 |
(16.8) | |
|
Net operating cash flows |
182.5 |
176.7 | |
|
Investing |
|||
|
Capital expenditures |
(56.4) |
(123.6) | |
|
Proceeds from assets sold |
8.3 |
19.8 | |
|
Jackpot annuity investments, net |
27.1 |
23.6 | |
|
Changes in restricted cash |
5.8 |
3.2 | |
|
Loans receivable, net |
15.1 |
14.9 | |
|
Business acquisitions, net of cash acquired |
- |
(233.0) | |
|
Net investing cash flows |
(0.1) |
(295.1) | |
|
Financing |
|||
|
Debt related proceeds (payments), net |
(20.0) |
- | |
|
Employee stock plan proceeds |
8.3 |
14.3 | |
|
Share repurchases |
(75.1) |
(50.1) | |
|
Noncontrolling interest acquired |
- |
(2.5) | |
|
Dividends paid |
(34.7) |
(35.7) | |
|
Acquisition-related contingent consideration |
(27.9) |
- | |
|
Net financing cash flows |
(149.4) |
(74.0) | |
|
Foreign exchange rates effect on cash |
(2.8) |
3.5 | |
|
Net change in cash and equivalents |
30.2 |
(188.9) | |
|
Beginning cash and equivalents |
206.3 |
460.0 | |
|
Ending cash and equivalents |
$ 236.5 |
$ 271.1 | |
|
SUPPLEMENTAL DATA (Unaudited) | |||||
|
Periods Ended March 31, | |||||
|
Revenue Metrics |
Second Quarters |
Six Months | |||
|
2013 |
2012 |
2013 |
2012 | ||
|
In millions, unless otherwise noted |
|||||
|
Gaming Operations |
|||||
|
Revenues |
$ 254.3 |
$ 266.1 |
$ 496.9 |
$ 518.1 | |
|
North America |
220.3 |
233.1 |
428.8 |
452.6 | |
|
International |
34.0 |
33.0 |
68.1 |
65.5 | |
|
Gross margin |
62% |
61% |
62% |
61% | |
|
North America |
60% |
59% |
61% |
59% | |
|
International |
69% |
75% |
69% |
74% | |
|
Installed base ('000) |
56.7 |
56.1 |
56.7 |
56.1 | |
|
North America |
42.6 |
42.7 |
42.6 |
42.7 | |
|
International |
14.1 |
13.4 |
14.1 |
13.4 | |
|
Average revenue per unit per day (0.00) |
$49.26 |
$52.34 |
$47.99 |
$51.75 | |
|
Product Sales |
|||||
|
Revenues |
$ 279.0 |
$ 240.8 |
$ 513.7 |
$ 421.8 | |
|
North America |
200.6 |
160.8 |
359.5 |
263.9 | |
|
International |
78.4 |
80.0 |
154.2 |
157.9 | |
|
Machines |
$ 202.4 |
$ 161.1 |
$ 359.8 |
$ 276.8 | |
|
North America |
148.7 |
101.4 |
250.5 |
160.5 | |
|
International |
53.7 |
59.7 |
109.3 |
116.3 | |
|
Non-machine |
$ 76.6 |
$ 79.7 |
$ 153.9 |
$ 145.0 | |
|
North America |
51.9 |
59.4 |
109.0 |
103.4 | |
|
International |
24.7 |
20.3 |
44.9 |
41.6 | |
|
Gross margin |
52% |
55% |
52% |
53% | |
|
North America |
53% |
57% |
54% |
55% | |
|
International |
49% |
50% |
48% |
49% | |
|
Units recognized ('000) |
14.3 |
10.2 |
25.0 |
17.5 | |
|
North America |
11.1 |
6.8 |
18.3 |
10.6 | |
|
International |
3.2 |
3.4 |
6.7 |
6.9 | |
|
Units shipped ('000) [includes units where revenues deferred] |
14.3 |
10.5 |
23.7 |
17.0 | |
|
North America |
11.1 |
6.7 |
18.0 |
10.2 | |
|
New |
2.7 |
1.7 |
4.4 |
2.4 | |
|
Replacement |
8.4 |
5.0 |
13.6 |
7.8 | |
|
International |
3.2 |
3.8 |
5.7 |
6.8 | |
|
New |
1.0 |
2.0 |
1.9 |
3.3 | |
|
Replacement |
2.2 |
1.8 |
3.8 |
3.5 | |
|
Average machine sales price ('000) |
$ 14.1 |
$ 15.8 |
$ 14.4 |
$ 15.8 | |
|
North America |
13.4 |
14.9 |
13.7 |
15.1 | |
|
International |
16.6 |
17.6 |
16.3 |
16.9 | |
|
Interactive |
|||||
|
Revenues |
$ 66.7 |
$ 34.3 |
$ 119.6 |
$ 46.9 | |
|
North America |
54.8 |
21.6 |
96.7 |
21.7 | |
|
International |
11.9 |
12.7 |
22.9 |
25.2 | |
|
Social |
54.3 |
21.3 |
95.6 |
21.3 | |
|
North America |
54.3 |
21.3 |
95.6 |
21.3 | |
|
International |
- |
- |
- |
- | |
|
IGTi |
12.4 |
13.0 |
24.0 |
25.6 | |
|
North America |
0.5 |
0.3 |
1.1 |
0.4 | |
|
International |
11.9 |
12.7 |
22.9 |
25.2 | |
|
Gross margin |
61% |
54% |
60% |
53% | |
|
North America |
61% |
58% |
61% |
58% | |
|
International |
58% |
47% |
54% |
49% | |
|
DoubleDown Casino®Average User Statistics* |
|||||
|
Daily active users (DAU) ('000) |
1,690 |
1,350 |
1,575 |
1,350 | |
|
Monthly active users (MAU) ('000) |
6,276 |
4,975 |
5,596 |
4,975 | |
|
Bookings per DAU (0.00) |
$0.37 |
$0.24 |
$0.34 |
$0.24 | |
|
*as a single application with multiple games, active users equal unique users | |||||
|
Reconciliations of GAAP to Non-GAAP Adjusted Financial Measures | ||||||
|
(In millions, except EPS) | ||||||
|
Second Quarter Ended March 31, 2013 | ||||||
|
Continuing Operations | ||||||
|
Revenue |
Cost of |
Operating |
Operating |
Net |
Diluted | |
|
GAAP measures |
$ 600.0 |
$ 258.7 |
$ 212.0 |
$ 129.3 |
$ 78.2 |
$0.29 |
|
% of revenue |
35% |
22% |
||||
|
Acquisition related charges:(b) |
||||||
|
Contingent retention & earn-out |
- |
- |
(21.9) |
21.9 |
14.6 |
0.06 |
|
Amortization of intangibles |
- |
(2.3) |
(4.5) |
6.8 |
4.5 |
0.02 |
|
Proxy fees |
- |
- |
(3.9) |
3.9 |
2.6 |
0.01 |
|
Alabama Note impairment |
- |
- |
(1.6) |
1.6 |
1.1 |
- |
|
Certain discrete tax items (benefits) |
- |
- |
- |
- |
(5.9) |
(0.02) |
|
Total non-GAAP adjustments |
- |
(2.3) |
(31.9) |
34.2 |
16.9 |
0.07 |
|
Adjusted measures |
$ 600.0 |
$ 256.4 |
$ 180.1 |
$ 163.5 |
$ 95.1 |
$0.36 |
|
% of revenue |
30% |
27% |
||||
|
Six Months Ended March 31, 2013 | ||||||
|
Continuing Operations | ||||||
|
Revenue |
Cost of |
Operating |
Operating |
Net |
Diluted | |
|
GAAP measures |
$ 1,130.2 |
$ 479.5 |
$ 403.0 |
$ 247.7 |
$ 143.5 |
$0.54 |
|
% of revenue |
36% |
22% |
||||
|
Acquisition related charges:(b) |
||||||
|
Contingent retention & earn-out |
- |
- |
(39.3) |
39.3 |
26.2 |
0.10 |
|
Amortization of intangibles |
- |
(4.6) |
(8.9) |
13.5 |
9.0 |
0.03 |
|
Proxy fees |
- |
- |
(3.9) |
3.9 |
2.6 |
0.01 |
|
Alabama Note impairment |
- |
- |
(1.6) |
1.6 |
1.1 |
- |
|
Royalty settlement |
(5.0) |
- |
- |
(5.0) |
(5.0) |
(0.02) |
|
Certain discrete tax items (benefits) |
- |
- |
- |
- |
(5.9) |
(0.02) |
|
Total non-GAAP adjustments |
(5.0) |
(4.6) |
(53.7) |
53.3 |
28.0 |
0.10 |
|
Adjusted measures |
$ 1,125.2 |
$ 474.9 |
$ 349.3 |
$ 301.0 |
$ 171.5 |
$0.64 |
|
% of revenue |
31% |
27% |
||||
|
(a)Adjustments tax effected at 34%, except no tax effect on royalty settlement | ||||||
|
(b) Primarily related to DoubleDown | ||||||
|
Second Quarter Ended March 31, 2012 | |||||
|
Continuing Operations | |||||
|
Cost of |
Operating |
Operating |
Net |
Diluted | |
|
GAAP measures |
$ 227.6 |
$ 195.6 |
$ 118.0 |
$ 62.4 |
$0.21 |
|
% of revenue |
36% |
22% |
|||
|
Acquisition related charges:(b) |
|||||
|
Contingent retention & earn-out |
- |
(11.7) |
11.7 |
7.5 |
0.03 |
|
Amortization of intangibles |
(2.3) |
(3.9) |
6.2 |
4.0 |
0.01 |
|
Professional fees |
- |
(4.5) |
4.5 |
2.8 |
0.01 |
|
Distributor settlement |
- |
(3.1) |
3.1 |
2.0 |
0.01 |
|
Severance |
- |
(1.2) |
1.2 |
0.8 |
- |
|
Total non-GAAP adjustments |
(2.3) |
(24.4) |
26.7 |
17.1 |
0.06 |
|
Adjusted measures |
$ 225.3 |
$ 171.2 |
$ 144.7 |
$ 79.5 |
$0.27 |
|
% of revenue |
32% |
27% |
|||
|
Six Months Ended March 31, 2012 | |||||
|
Continuing Operations | |||||
|
Cost of |
Operating |
Operating |
Net |
Diluted | |
|
GAAP measures |
$ 421.2 |
$ 347.7 |
$ 217.9 |
$ 112.7 |
$0.38 |
|
% of revenue |
35% |
22% |
|||
|
Acquisition related charges:(b) |
|||||
|
Contingent retention & earn-out |
- |
(11.7) |
11.7 |
7.5 |
0.03 |
|
Amortization of intangibles |
(2.3) |
(3.9) |
6.2 |
4.0 |
0.01 |
|
Professional fees |
- |
(5.7) |
5.7 |
3.6 |
0.01 |
|
Distributor settlement |
- |
(3.1) |
3.1 |
2.0 |
0.01 |
|
Severance |
- |
(1.2) |
1.2 |
0.8 |
- |
|
Total non-GAAP adjustments |
(2.3) |
(25.6) |
27.9 |
17.9 |
0.06 |
|
Adjusted measures |
$ 418.9 |
$ 322.1 |
$ 245.8 |
$ 130.6 |
$0.44 |
|
% of revenue |
33% |
25% |
|||
|
(a)Adjustments tax effected at 36% | |||||
|
(b) Primarily related to DoubleDown | |||||
|
Adjusted Diluted EPS from Continuing Operations | |||||||
|
For the Years Ended September 30, | |||||||
|
2012 |
2011 |
2010 |
2009 | ||||
|
GAAP Diluted EPS from Continuing Operations |
$0.86 |
$0.97 |
$0.73 |
$0.50 | |||
|
Acquisition related charges (primarily DoubleDown) |
0.20 |
- |
- |
- | |||
|
Impairment and restructuring |
(0.04) |
0.03 |
0.15 |
0.24 | |||
|
Severance |
0.01 |
- |
- |
- | |||
|
Distributor settlement |
0.01 |
- |
- |
- | |||
|
IP Usage settlements |
- |
0.01 |
- |
- | |||
|
Investment (gain) loss |
- |
(0.01) |
0.07 |
0.05 | |||
|
Debt refinancing charges |
- |
- |
0.01 |
0.01 | |||
|
Certain discrete tax items (benefits) |
- |
(0.07) |
(0.12) |
(0.06) | |||
|
Total non-GAAP adjustments |
0.18 |
(0.04) |
0.11 |
0.24 | |||
|
Adjusted Diluted EPS from Continuing Operations |
$ 1.04 |
$ 0.93 |
$ 0.84 |
$ 0.74 | |||
|
Adjusted EBITDA For The Periods Ended March 31, | |||||||
|
Second Quarters |
Six Months | ||||||
|
2013 |
2012 |
2013 |
2012 | ||||
|
GAAP Income from continuing operations |
$ 78.2 |
$ 62.4 |
$ 143.5 |
$ 112.7 | |||
|
Other (income) expense, net |
21.7 |
21.2 |
42.3 |
42.0 | |||
|
Income tax provision |
29.4 |
34.4 |
61.9 |
63.2 | |||
|
Depreciation and amortization |
60.1 |
60.6 |
117.8 |
115.2 | |||
|
Other charges: |
|||||||
|
Share-based compensation |
9.9 |
8.5 |
18.6 |
16.7 | |||
|
Contingent acquisition related costs |
21.9 |
11.7 |
39.3 |
11.7 | |||
|
Impairment |
1.6 |
- |
1.6 |
- | |||
|
Adjusted EBITDA |
$ 222.8 |
$ 198.8 |
$ 425.0 |
$ 361.5 | |||
|
Free Cash Flow For The Six Months Ended March 31, | |||||||
|
2013 |
2012 | ||||||
|
GAAP net operating cash flows |
$ 182.5 |
$ 176.7 | |||||
|
Investment in property, plant and equipment |
(8.1) |
(34.5) | |||||
|
Investment in gaming operations equipment |
(48.1) |
(87.1) | |||||
|
Investment in intellectual property |
(0.2) |
(2.0) | |||||
|
Free Cash Flow (before dividends) |
126.1 |
53.1 | |||||
|
Dividends paid |
(34.7) |
(35.7) | |||||
|
Free Cash Flow (after dividends) |
$ 91.4 |
$ 17.4 | |||||
We believe that certain non-GAAP financial measures, when presented in conjunction with comparable GAAP (Generally Accepted Accounting Principles) measures, are useful because that information is an appropriate measure for evaluating our operating performance. Non-GAAP information is used to evaluate business performance and management's effectiveness. These measures should be considered in addition to, not as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Non-GAAP financial measures may not be calculated in the same manner by all companies and therefore may not be comparable.
SOURCE International Game Technology
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