GGRAsia – IGT posts US$1bln 2Q revenue, profit up 232pct q-o-q

IGT posts US$1bln 2Q revenue, profit up 232pct q-o-q

Aug 04, 2021 Newsdesk Industry Talk, Latest News

Gaming and lottery provider International Game Technology Plc (IGT) reported on Wednesday second-quarter revenue of just above US$1.04 billion, up 2.6 percent from the previous quarter. The figure was up 73.5 percent from a year earlier.

The company said the increase in revenue was “fuelled by strong increases” in all its businesses.

IGT reported operating income of US$244 million for the period, which it said highlighted the “operating leverage” in its global lottery segment, and “excellent progress on structural cost savings”. The result was down 6.2 percent quarter-on-quarter but was an improvement on the US$72-million operating loss posted a year earlier.

IGT recorded a net profit of US$306 million for the three months to June 30, compared to a US$280-million loss in the prior-year period, according to Wednesday’s press release. Profit was up 232.6 percent from the US$92 million reported in the opening quarter of 2021.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) stood at US$442 million, up 169.5 percent from a year earlier, but a 1.7-percent decline sequentially.

The release quoted IGT’s chief executive, Marco Sala, as saying that the firm’s second-quarter results “highlight the vitality” of the group’s portfolio.

“Outstanding lottery performance, the progressive recovery in land-based gaming, and strong increase in digital and betting activities drove substantial revenue and profit growth, delivering adjusted EBITDA that is among the highest recorded in a quarterly period,” he stated.

Mr Sala added: “On the strength of the first half performance, we are raising our outlook for the year and now expect to exceed 2019 levels for key financial metrics this year.”

Revenue in the lottery segment was US$725 million, up 57.6 percent year-on-year, driven by 35-percent growth in same-store sales, said IGT. The result was a 3.2-percent decrease from the first quarter of 2021.

Revenue in the gaming segment rose by 125.7 percent year-on-year, to US$316 million, and was up 18.8 percent sequentially. Adjusted EBITDA in the gaming segment was US$49 million, up 157.9 percent sequentially, and an improvement on the negative US$36 million recorded in the second quarter of 2020.

The company stated it sold 6,335 gaming machine units globally during the reporting period, up from 2,981 in the prior-year quarter. That included 1,167 new units, and 5,168 replacements. The company said it sold 4,405 units in the first quarter this year.

IGT said it delivered a “record-level” US$380 million of free cash flow in the first half of 2021 and generated US$500 million in cash from continuing operations.

The company’s chief financial officer Max Chiara said the group’s free cash flow from and proceeds from recent asset sales “fuelled significant debt reduction in the first half.”

IGT completed in May the EUR950-million (US$1.15-billion) sale of a consumer-facing Italian gaming business.

The company reported a US$1.0-billion net debt reduction in the first six months of 2021, with net debt leverage improving from 6.4 times to 4.3 times, reaching a corporate target “six months early”.

“Our leverage profile improved substantially, reaching pre-pandemic levels well ahead of expectations, and improving our credit profile and overall financial condition,” said Mr Chiara.

The company’s net debt position stood at US$6.31 billion as at the end of the second quarter, down from US$7.07 billion as of March 31, 2021.