Jul 31, 2024 Newsdesk Latest News, Top of the deck, World  
Gaming equipment maker and content provider International Game Technology Plc (IGT) on Tuesday reported aggregate revenue of just under US$1.05 billion for the second quarter of 2024, flat from a year earlier.
The company posted a net income attributable to shareholders of US$42 million for the three months to June 30, compared to US$46 million in the prior-year period.
IGT’s board declared a quarterly cash dividend of US$0.20 per common share, payable on August 27.
The group runs three main segments: global lottery; global gaming; and PlayDigital, its online content arm.
Second-quarter adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) stood at US$420 million, down 5.2 percent from a year ago. EBITDA margin was 40.0 percent in the period, compared to 42.0 percent in the second quarter of 2023.
Operating income for the reporting period was down 8.4 percent year-on-year, to US$230 million.
Excluding separation and divestiture costs related to the group’s gaming and digital segments, operating income for the April to June period would have been slightly up year-on-year, at US$256 million, stated the company.
IGT is to sell its gaming and PlayDigital segments to funds managed by affiliates of private equity firm Apollo Global Management Inc, for US$4.05 billion, according to a Friday announcement.
The funds linked to Apollo will simultaneously acquire gaming technology supplier Everi Holdings Inc, paying US$14.25 per share in cash. The transactions are expected to be completed by the end of the third quarter of 2025.
A previous deal – announced in February – whereby IGT would spin-off its gaming and digital business and then combine such business with Everi, has now been terminated.
“IGT delivered strong first-half results, including record operating income and adjusted EBITDA net of separation and divestiture costs,” stated Vince Sadusky, IGT’s chief executive, in comments accompanying the results.
“Consistent investments in technology, game content, and other innovative solutions provide us a solid foundation to build from as we execute on our growth objectives,” he said.
The CEO added: “The recently announced sale of our gaming and digital business for US$4.05 billion in cash is an important step in unlocking the intrinsic value of IGT’s best-in-class businesses.”
Sale and flexibility
Revenue from the global gaming and digital segment was US$436 million in the three months to June 30, compared with US$432 million a year earlier. Such second-quarter 2024 revenue was up 7.4 percent sequentially.
Operating income for the segment was up 15.7 percent year-on-year, to US$103 million, and adjusted EBITDA in gaming and digital stood at US$151 million, 13.5-percent higher than a year ago.
The company said the improved performance was “driven by installed base growth with resilient yields and elevated intellectual property and software licence sales, offset by lower terminal unit shipments”.
In the second quarter, the global gaming segment sold 7,630 machine units, compared with 8,269 units sold in the prior-year period. The sale of machines in the rest-of-the-world markets rose by 28.4 percent year-on-year, to 2,498 units, according to Tuesday’s announcement.
Second-quarter revenue from global lottery fell by 1.8 percent year-on-year, to US$613 million.
Max Chiara, IGT’s chief financial officer, said in prepared remarks that the group generated “over US$460 million in cash from operations in the first half of the year,” with the firm’s balance sheet “strong as ever”.
“Our ample liquidity and manageable near-term debt maturities provide us significant flexibility in light of upcoming investments to extend and secure our long-term lottery contract portfolio for the coming years,” he added.
In March, IGT announced changes to the company’s board and executive team.
According to the Friday announcement on the Apollo deal, IGT’s Mr Sadusky will oversee the separation of the group’s gaming and digital businesses and support the transition until its completion. After closure of the deal, Mr Sadusky will continue in his role, leading the lottery-focused company.
On Tuesday, IGT said it would classify and report the results of the gaming and digital segment as discontinued operations beginning in the third quarter of 2024.
“As a result, the company is withdrawing its previously provided full-year financial outlook,” it stated.
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