GGRAsia – Everi 2023 EBITDA gain likely 4pct plus: brokerage

Everi 2023 EBITDA gain likely 4pct plus: brokerage

Dec 13, 2022 Newsdesk Industry Talk, Latest News

Casino equipment maker and financial technology (fintech) supplier Everi Holdings Inc is likely to see 2023 revenues from its gaming segment rise 6.9 percent year-on-year, to just under US$465.7 million, and to be 56.7 percent of total group revenue.

That is according to Monday memo from brokerage B. Riley Securities Inc, following an investor meeting it hosted featuring Everi’s chief executive, Randy Taylor.

“For calendar year 2023, Everi cited multiple growth drivers, including EBITDA attribution from new market segments,” wrote analyst David Bain, referring to earnings before interest, taxation, depreciation and amortisation.

Riley Securities estimates Everi’s 2023 adjusted EBITDA will be US$390.5 million, with a margin of 47.6 percent, and representing a 4.4 percent year-on-year gain.

“Combined with customer indications of increased industry buying levels, Everi’s market share gains and known expansions/new openings, we believe calendar year 2023 EBITDA… consensus estimates are (again) likely to prove conservative,” added the analyst.

For Everi’s fintech segment, the brokerage anticipates US$355.4 million in revenue for 2023, likely up 5.9 percent, and representing 43.3 percent of total revenue.

For the third quarter this year, Everi posted net income of US$29.4 million, compared to a net profit of nearly US$6.7 million in the prior-year period. It also acclaimed what it said was record quarterly revenue, at US$204.3 million, up 21.4 percent year-on-year.

Riley Securities thinks Everi’s fourth-quarter adjusted EBITDA for this year will be just below US$93.5 million, a gain of 5.3 percent year-on-year.

Referring to recent widespread commentary in the United States regarding economic recession risk going into 2023, Riley Securities stated: “Versus third-quarter 2022, Everi has not seen a trend change in either its gaming or fintech division.”

“Management has also not seen a noticeable change in operator mindset related to slot buying budgets, which continue to deliver industry game sale growth,” added Mr Bain.

In the fintech segment, Everi had seen its digital cashless wallet “deployed at 38 casinos across 14 jurisdictions versus 16 and four at the beginning of the year,” stated the analyst.