GGRAsia – IGT confirms 7 pct workforce cut in fiscal 2014

IGT confirms 7 pct workforce cut in fiscal 2014

Nov 28, 2014 Newsdesk Industry Talk, Latest News

Nevada-based slot machine maker International Game Technology (IGT) confirmed in a filing to Nasdaq in New York that it had cut its labour force by 7 percent in fiscal year 2014, ending September 30.

The Associated Press had reported in March that the job cuts amounted to 350 positions. IGT didn’t confirm that in its latest filing, but did say it had achieved cost savings of US$30 million for the period. It plans to cut a further US$50 million in costs on an annualised basis during 2015.

IGT said that as of September 30, 2014, it employed “over 4,400 individuals worldwide, with approximately 3,600 in our North America segment and 800 in our international segment”.

The firm added that its planned merger with Italy-based lottery specialist GTech SpA remained on track for completion “in the first half of calendar 2015”.

Under the July 15 deal, GTech will acquire IGT for US$6.4 billion, comprised of US$4.7 billion in cash and stock, along with the assumption of US$1.7 billion in IGT net debt.

IGT said in its fiscal 2014 earnings statement: “To address challenges facing the gaming industry and their impact on IGT, we implemented a plan in March 2014 to realign our operating structure and reduced our global workforce by 7 percent. Cost savings of approximately US$30.0 million were realised in the 2014 second half and we estimate approximately US$50.0 million in cost savings on an annualised basis in 2015.”

The Nevada-based slot maker reported a 9 percent fall in net income for fiscal year 2014 ending September 30, to US$247.9 million, from US$272.7 million in the previous fiscal year. Revenues slipped 12 percent to US$2.06 billion, from US$2.34 billion in the year-prior period.

Under the terms of an amendment on September 23 to the merger deal, IGT and GTech will combine under a newly formed holding company domiciled in the U.K. that will apply for listing solely on the New York Stock Exchange.

(Updated at 1.30pm)