GGRAsia – Games, fintech growth sees Everi notch net profit for 3Q

Games, fintech growth sees Everi notch net profit for 3Q

Nov 07, 2018 Newsdesk Latest News, Top of the deck, World

Everi Holdings Inc says it made a net profit of nearly US$2.1 million in the third quarter of this year, turning around the US$4.3-million net loss a year earlier. The U.S. supplier of cash handling technology and gaming equipment for casinos announced its third-quarter figures on Tuesday.

Revenue rose by 17.3 percent to US$120.3 million, up from US$102.6 million in the same period last year. Everi adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 9.6 percent year-on-year to US$58.3 million from US$53.2 million.

“Our third-quarter results reflect the ongoing progress we are achieving through the execution of key initiatives, including the successful introduction of new products for our games and financial technology solutions (fintech) businesses, which are driving consistent growth,” said Everi president and chief executive Michael Rumbolz in a prepared statement.

Mr Rumbolz said the third quarter was the third in a row where the company has reported a net profit. Tuesday’s statement says Everi has now recorded nine quarters of growth in consolidated revenue and adjusted EBITDA.

“Both business segments are contributing to this growth, with quarterly record fintech revenue and adjusted EBITDA of US$54.5 million and US$26.5 million, respectively, and games revenue and adjusted EBITDA of US$65.8 million and US$31.8 million, respectively, each reaching their second-highest ever quarterly level,” said the CEO.

“As a result of the continuing strength in both lines of business, we remain on track to achieve our outlook for full-year adjusted EBITDA of US$228 million to US$231 million, and to deliver on our expectation for near-term acceleration in free cash flow generation.”

Turning to the Everi games business, Mr Rumbolz said: “Growth in our games segment continues to be driven by the successful introduction of new products. Electronic gaming machine unit sales rose 43 percent to 1,165 units, our largest quarterly total since we acquired the games business.”

Mr Rumbolz said the primary driver of the unit sales growth was the firm’s E43 cabinet and its mechanical reel games, “which both achieved their highest-ever level of quarterly unit sales”.

He added: “Our mechanical reel product remains a key driver of unit sales growth, given our position as an industry-leading provider for this segment of the slot floor. Our installed base rose 901 units year over year and our emphasis on introducing new, higher-yielding premium games and form factors, including our E43, while also expanding placements beyond our historical core market, continues to drive growth in our gaming operations.”

According to Everi, quarter-end premium unit placements now represent 20.1 percent of the group’s total installed base, as compared to 17.8 percent a year ago. “Growth in premium unit placements and the increase in unit placements in higher-yielding markets drove a significant improvement in daily win per unit, which rose US$2.32 or 8.6 percent year-over-year,” stated Mr Rumbolz.

The results from the Las Vegas, Nevada-based company are in line with the presentation it made during an analyst-only event in Chicago last month. There, Everi’s top brass said the company was heading for two years of steady earnings growth.

Everi has flagged some of that growth to come from its “fintech” products and services – including a secure casino network and electronic wallet – following the company’s shift into that sector in August. Fintech is an abbreviation for financial technology solutions.