Gaming and lottery services and products provider International Game Technology Plc (IGT) said on Tuesday that its consolidated revenue declined by almost 1.5 percent year-on-year to approximately US$1.20 billion in the second quarter of 2018, compared to US$1.22 billion in the prior-year period.
Net income attributable to IGT was nearly US$161.5 million in the second quarter of 2018, compared to a loss of approximately US$290 million in the prior-year period. It included US$173 million of net foreign exchange gain, the firm said, adding that adjusted net income for the period was US$57 million.
IGT’s net debt stood at approximately US$7.53 billion at the end of the second quarter 2018, compared to nearly US$7.32 billion as of December 31, 2017.
IGT reported operating income of US$209 million for the three months ended June 30, up 8.9 percent in year-on-year terms.
Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were US$441.8 million, up 4.2 percent compared to US$423.7 million in the second quarter of 2017. The company said in a press release the increase in adjusted EBITDA was due to “robust global lottery performance and disciplined operational management”.
“The North America gaming installed base grew sequentially, and we have a compelling roster of new, for-sale video reel games coming to market in the second half,” said Marco Sala, chief executive of IGT, in a prepared statement included in Tuesday’s release.
Alberto Fornaro, IGT’s chief financial officer, was also quoted in the release as saying that the firm was maintaining its full-year performance estimates based on the results for the first six months of 2018. “With better-than-expected adjusted EBITDA growth of 10 percent in the first half, we are raising our full-year outlook for the underlying business,” he said. “As a result, we are able to absorb the negative impact of foreign currency translation and maintain the adjusted EBITDA range of US$1,700 million to US$1,780 million for 2018.”
The company’s board declared a quarterly cash dividend of US$0.20 per share, payable on August 28. IGT is to hold an investor day activity on Thursday.
Brokerage Deutsche Bank Securities Inc said in a Tuesday note that IGT had posted “strong second quarter 2018” results.
“We believe IGT remains an inexpensive way to capitalise on: an expanded and well received gaming hardware and content library in a healthy domestic [U.S.] gaming environment; global lottery growth in the presence of major lottery contract stability/runway; continued international gaming expansion; and accelerating discretionary free cash flow generation,” wrote analysts Carlo Santarelli and Danny Valoy.
IGT said that total gaming revenue from international markets – i.e. excluding North America and Italy – decreased by 13.7 percent year-on-year to US$101 million in the three months ended June 30. The company shipped 3,120 gaming machine units to international markets during the reporting period, compared to 3,591 units a year earlier.
“International unit sales declined 13 percent year-on-year due to lower replacement activity (Latin America), as replacement units were down 24 percent year-on-year, while expansion units climbed 66 percent year-on-year,” noted Deutsche Bank in its Monday note.
IGT did not provide detailed information about its performance in Asia during the second quarter of 2018.
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"Our main focus is just making sure – and particularly within Australia – to the maximum extent possible, that we can have uniformity [among different jurisdictions]"
Chief executive of the Australia-based Gaming Technologies Association