• About Us
  • The Team
  • Advertise with Us

The latest news on the gaming industry in Asia

() () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () () ()
  • Home
  • Macau
  • Philippines
  • Singapore
  • Japan
  • Rest of Asia
  • World
  • Features
  • Industry Talk
  • Trends & Tech
  • follow
    • Facebook
    • Twitter
    • RSS Feed
    • LinkedIn

IGT 1Q revenue down 10pct, firm lowers 2017 guidance

May 26, 2017 Newsdesk Latest News, Top of the deck, World  


IGT 1Q revenue down 10pct, firm lowers 2017 guidance

Gaming and lottery services and products provider International Game Technology Plc (IGT) missed market expectations for its first quarter 2017 results. The company announced it was lowering its guidance for the full year.

IGT on Thursday reported that consolidated revenue declined by 10.1 percent year-on-year to US$1.15 billion in the first three months of 2017, compared to US$1.28 billion in the first quarter of 2016. “The decline in revenue reflects comparisons with the high jackpot levels of the prior year, new Italy Lotto concession dynamics, and lower gaming product sales,” the firm said in a press release.

The company said that gaming service revenue was impacted by lower revenue from its social casino subsidiary, Double Down Interactive LLC, which IGT is in the process of selling. Gaming product sales were down due to large system and software sales in the first quarter of 2016, the firm said. The company shipped 5,953 gaming machines worldwide during the first quarter this year, and the global installed base rose to 59,034.

Global shipments in the three months to March 31 included a total of 2,009 gaming machine units shipped to places outside North America, compared to 1,744 units in the prior-year period. Product sales revenue for the international segment however was lower “due to large, high-margin gaming software sales in the first quarter of 2016,” stated IGT.

The firm said revenue from the international segment was US$164 million, down 11.4 percent compared to US$185 million in the first quarter of 2016. Operating income for the segment fell by 75.8 percent year-on-year to US$8 million.

“International operating income was below the prior-year period due to lower revenue; product sales mix and discounts; as well as unfavourable foreign exchange translation and bad debt expense,” said IGT.

Analyst David Katz of Telsey Advisory Group LLC said in a note on Thursday: “The lower than expected results were primarily isolated in the international segment, which was impacted by [a] myriad [of] events which management indicates are temporary and reversing in the second quarter of 2017.”

IGT reported operating income of US$119 million for the first three months of 2017, compared to US$188 million in the first quarter of 2016.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were US$371 million, down 19.3 percent compared to US$460 million in the first quarter of 2016.

Net loss attributable to IGT was US$54.8 million in the first quarter of 2017, compared to a net loss of US$92.8 million in the prior-year period, reflecting after-tax impacts of US$70 million in purchase price accounting and US$36 million impact in non-cash foreign exchange losses, the firm stated.

The company’s board declared a quarterly cash dividend of US$0.20 per share, payable on June 22 to all shareholders of record as of June 8.

Lower guidance

“The first quarter of 2017 has been a dynamic period for us,” said Marco Sala, chief executive of IGT, in a statement.

“Year to date, we’ve strengthened our leading positions in global lotteries and begun the rollout of a new generation of gaming machines. We are monetising non-core assets that will allow us to significantly reduce debt, and we are adopting a new business model for our future participation in the social casino space,” he added.

IGT’s net debt stood at approximately US$7.40 billion at the end of the first quarter, down from nearly US$7.57 billion at the end of 2016. IGT was created from the US$6.4-billion merger in April 2015 of Nevada-based slot machine maker International Game Technology and Italy-based lottery equipment and management specialist GTech SpA.

Wells Fargo Securities LLC commented on Thursday: “The new IGT is a global lottery operator and gaming technology supplier, with only a quarter of revenue from North American slots. We like IGT’s diversification, very defensive lottery revenues and improved industry structure.”

“IGT is a deleverage story that is actually deleveraging and while its cash conversion is relatively low, we think its revenues are more defensive and ‘bankable’ than a lot of our coverage,” said analysts Cameron McKnight and Robert Shore.

On Thursday, IGT’s chief financial officer Alberto Fornaro said the company would update its outlook for full-year 2017, in order to “incorporate the DoubleDown transaction and the impact of increased taxation on gaming machines in Italy”.

IGT announced in April that it would sell its social casino subsidiary Double Down for a cash purchase price of US$825 million. The sale is expected to be completed in the second quarter of 2017.

The gaming manufacturer said on Thursday that it now expects full-year 2017 adjusted EBITDA in the range of US$1.60 billion to US$1.68 billion, compared to its previous outlook of between US$1.68 billion to US$1.76 billion.

The company added that its net debt is now expected to be between US$6.95 billion to $7.15 billion at the end of 2017, compared to the previous US$7.60 billion to US$7.80 billion outlook, as net proceeds from the Double Down sale will be used to reduce debt.


  • tweet
Related articles
  • 2021 board named for International Gaming Standards Assn
    2021 board named for International...

    Mar 02, 2021  

  • IGT, Sci Games in cross-licensing deal on cashless gaming IP
    IGT, Sci Games in cross-licensing deal...

    Mar 02, 2021  

More news
  • Covid-19 test cert no longer needed for Macau casino entry
    Covid-19 test cert no longer needed for...

    Mar 02, 2021  

  • Lim Kok Thay, GEN Singapore execs in US$1.3mln stock award
    Lim Kok Thay, GEN Singapore execs in...

    Mar 02, 2021  


Latest News

Covid-19 test cert no longer needed for Macau casino entry

Covid-19 test cert no longer needed for Macau casino entry

Mar 02, 2021  

From after the stroke of midnight on Wednesday (March 3) people wishing to enter Macau casino floors will no longer need to show a test certificate proving they are free of Covid-19 infection, said...
Read More
Lim Kok Thay, GEN Singapore execs in US$1.3mln stock award

Lim Kok Thay, GEN Singapore execs in US$1.3mln stock award

Mar 02, 2021  

Five groups qualify for next phase of Nagasaki casino tilt

Five groups qualify for next phase of Nagasaki casino tilt

Mar 02, 2021  

Sign up to our FREE Newsletter

UB8V5.qr.16(Click here for more)

Partners

Pick of the Day

”Consumers are increasingly comfortable using cashless technology, and they will continue to expect this option to be available on the floor"

Matt Wilson

Chief executive – gaming business at casino equipment and technology supplier Scientific Games



Most Popular

  • Galaxy Macau to add Raffles-branded hotel towerGalaxy Macau to add Raffles-branded hotel tower March 1, 2021
  • Melco’s Lawrence Ho hopeful on Macau recovery in MarchMelco’s Lawrence Ho hopeful on Macau recovery in March February 26, 2021
  • Macau casino GGR down 9pct m-o-m in February: govtMacau casino GGR down 9pct m-o-m in February: govt March 1, 2021
  • Macau VIP challenged by changes in China: Galaxy Ent bossMacau VIP challenged by changes in China: Galaxy Ent boss February 25, 2021
  • Suncity to open clubs at Londoner Macao, Lisboa PalaceSuncity to open clubs at Londoner Macao, Lisboa Palace February 26, 2021
Copyright 2014-2020 TEAM Publishing and Consultancy Ltd / All rights reserved
  • Code of Ethics
  • Privacy Policy
  • Useful Links
  • Contact Us