GGRAsia – Sci Games 3Q net income up y-o-y helped by gaming biz

Sci Games 3Q net income up y-o-y helped by gaming biz

Nov 10, 2021 Newsdesk Industry Talk, Latest News

Casino equipment and online games provider Scientific Games Corp said on Tuesday its third-quarter net income was US$182 million, compared to a US$117-million net loss in the prior-year period. Net income was also up sequentially by 67.0 percent.

The figure included contributions from the company’s continuing operations as well as from discontinued operations. Scientific Games is in the process of selling its lottery and sports betting businesses.

The firm stated in a filing in the United States that total revenue for the three months to September 30 was US$824 million, down 6.4 percent sequentially from the second quarter’s US$880 million. Third-quarter revenue was up 18.1 percent judged year-on-year.

The group’s quarterly consolidated adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) were up 41.3 percent year-on-year, at US$332 million, from US$235 million a year earlier. Adjusted EBITDA declined by 13.3 percent from the previous quarter.

In the gaming segment, including casino slot machines, electronic table games and systems, total revenue was up 46.8 percent year-on-year, to US$339 million, but down by 7.6 percent sequentially.

Quarterly machine sales generated US$95 million, a decline of 5.0 percent from the previous quarter, but a jump of more than third in year-on-year terms,

Sales of systems brought in US$52 million, flat sequentially, and an increase from the US$43 million a year earlier, said Scientific Games. According to the firm, table products generated US$41 million, rising both quarterly and compared with the previous period.

In the international market – including Asia Pacific – the tally of new-unit shipments of machines stood almost flat from the previous quarter, at 1,780 units. In the third quarter of 2020, Scientific Games had shipped 1,887 units.

As of September 30, the firm’s total debt stood at slightly below US$8.85 billion. The group noted it had paid down US$635 million in debt since October last year.

“In just the last few months we have made tremendous progress on our strategic pillars, delivering on our promises, and rapidly advancing our vision to be the leading cross-platform global game company,” said Barry Cottle, president and chief executive of the group, in prepared remarks contained in the press release.

He added: “With the sale of our lottery and sports betting businesses we are transforming our company, raising US$7 billion which will significantly de-lever the balance sheet and enable us to invest for growth.”

Quarterly revenue at SciPlay Corp, a digital operation majority-owned by Scientific Games – which also announced its results on Tuesday – was down 3.0 percent judged year-on-year, at US$146.6 million.

In July, Scientific Games made a proposal to acquire the remaining 19 percent of equity interest in SciPlay that it does not currently own.

Scientific Games announced last week the acquisition of Malta-based Authentic Gaming Ltd, a provider of live casino products for the iGaming space. The acquisition marked Scientific Games’ first foray into the live casino market, and “significantly enhances the company’s product portfolio,” stated the firm at the time.

The deal came shortly after Scientific Games confirmed the sale of its lottery business to Brookfield Business Partners LP, for a total consideration of US$6.05 billion. In September, the group also divested its sports betting business – including its OpenBet sports betting platform – for US$1 billion in cash and US$200 million in stock from Endeavor Group Holdings Inc, a sports and entertainment firm.

The two deals were part of a company-wide strategic review, announced in June by Scientific Games. The U.S.-listed firm stated the move would allow the group to focus on its gaming, iGaming, and SciPlay businesses.