GGRAsia – IGT 3Q revenue down 5pct, adjusted EBITDA up 3pct

IGT 3Q revenue down 5pct, adjusted EBITDA up 3pct

Nov 01, 2018 Newsdesk Industry Talk, Latest News, Top of the deck

Gaming and lottery services and products provider International Game Technology Plc (IGT) said on Wednesday that its consolidated revenue declined by 5.4 percent year-on-year to approximately US$1.16 billion in the third quarter of 2018, compared to US$1.22 billion in the prior-year period.

Net income attributable to IGT was nearly US$22.3 million in July-September period, compared to a loss of approximately US$803.6 million in the prior-year period.

IGT’s net debt stood at approximately US$7.57 billion at the end of the third quarter, compared to nearly US$7.34 billion a year earlier.

IGT reported operating income of US$200.0 million for the three months ended September 30, compared to an operating loss of approximately US$556.1 million in the prior-year period.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were US$443.3 million, up by almost 3.5 percent in year-on-year terms. The company said in a press release the increase in adjusted EBITDA “reflected strong Italy and global lottery performance”.

“Solid performance and important, long-term contracts drove very good third quarter and year-to-date results,” said Marco Sala, chief executive of IGT, in a prepared statement included in Wednesday’s release.

He added: “The installed base of gaming machines was up, and unit shipments of gaming machines increased 10 percent… We are firmly on track to achieve our 2018 financial and operational goals.”

Alberto Fornaro, IGT’s chief financial officer, was also quoted in the release as saying that the firm was narrowing its adjusted EBITDA outlook for 2018 to between US$1.74 billion and US$1.78 billion, but said this was still in “the top half of the prior range.”

The company’s board declared an interim cash dividend of US$0.20 per share, payable on November 28.

Brokerage Deutsche Bank Securities Inc said in a Wednesday note that IGT had “delivered a significant third-quarter 2018 adjusted EBITDA beat” as compared to market expectations. “We see IGT as a solid fundamental story with rock bottom valuation,” wrote analyst Carlo Santarelli.

IGT said that total gaming revenue from international markets – i.e. excluding North America and Italy – decreased by 23.4 percent year-on-year to US$98 million in the three months ended September 30, due to lower systems revenue. The company shipped 3,210 gaming machine units to international markets during the reporting period, compared to 2,809 units a year earlier.

IGT did not provide detailed information about its performance in Asia for the second quarter of 2018.