LONDON, July 31, 2018 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the second quarter ended June 30, 2018. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the second quarter results; access details are provided below.
"The strong second quarter results reflect continued global Lottery expansion that is accentuated by disciplined expense management," said Marco Sala, CEO of IGT. "The North America Lottery and Italy segments each exceeded our expectations in the period. The North America Gaming installed base grew sequentially, and we have a compelling roster of new, for-sale video reel games coming to market in the second half. The strong start to the year gives us confidence we can achieve our 2018 strategic and financial goals."
"With better-than-expected Adjusted EBITDA growth of 10% in the first half, we are raising our full-year outlook for the underlying business," said Alberto Fornaro, CFO of IGT. "As a result, we are able to absorb the negative impact of foreign currency translation and maintain the Adjusted EBITDA range of $1,700-$1,780 million for 2018."
Overview of Consolidated Second Quarter Results
Quarter Ended |
Y/Y |
Constant | ||
2018(1) |
2017 |
(%) |
(%) | |
(In $ millions, unless otherwise noted) |
||||
Revenue |
1,202 |
1,220 |
-1% |
-3% |
Operating income |
209 |
192 |
9% |
5% |
Net income/(loss) per diluted share |
$0.79 |
($1.43) |
N/M |
|
Net debt |
7,530 |
6,999 |
8% |
|
Adjusted EBITDA |
442 |
424 |
4% |
1% |
Adjusted operating income |
264 |
264 |
0% |
-3% |
Adjusted net income per diluted share |
$0.28 |
$0.15 |
87% |
Note: Adjusted EBITDA, adjusted operating income, and adjusted net income per diluted share are non-GAAP financial measures. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release. |
(1) On January 1, 2018, IGT adopted ASU 2014-09 (Topic 606), Revenue from Contracts with Customers ("ASC 606"). This negatively impacted Revenue in the second quarter by $33 million and EBITDA and Adjusted EBITDA by $19 million. Comparative schedules summarizing the impact on the second quarter and six months ended June 30, 2018 Condensed Consolidated Statements of Operations are included later in this release. |
Consolidated revenue was $1,202 million, down 1% from the prior-year quarter
Adjusted EBITDA rose 4% to $442 million; Adjusted operating income flat to the prior year at $264 million
Interest expense was $106 million compared to $116 million in the prior-year period
Provision for income taxes was $52 million compared to $84 million in the prior-year period
Net income attributable to IGT was $161 million in the quarter; Adjusted net income attributable to IGT was $57 million
Net income per diluted share of $0.79; Adjusted net income per diluted share of $0.28
Cash from operations was $120 million in the first half of the year and capital expenditures were $259 million
Cash and cash equivalents were $568 million as of June 30, 2018, compared to $1,057 million as of December 31, 2017
Net debt was $7,530 million as of June 30, 2018, compared to $7,319 million as of December 31, 2017
Operating Segment Review
North America Gaming & Interactive
Select Financial Data |
Constant |
Key Performance Indicators |
% | ||||||||
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
FX |
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
Change | ||||
Gaming |
Total Revenue |
254 |
310 |
-18% |
Installed base (end of period) |
||||||
Gaming Services |
169 |
208 |
-19% |
Casino |
23,351 |
23,649 |
-1.3% | ||||
Terminal |
108 |
122 |
-11% |
||||||||
Social (DDI) |
0 |
43 |
NM |
Machine units shipped |
|||||||
Other |
61 |
43 |
41% |
New/Expansion |
1,803 |
1,408 |
28.1% | ||||
Product Sales |
85 |
102 |
-17% |
Replacement |
2,747 |
3,885 |
-29.3% | ||||
Terminal |
62 |
74 |
-16% |
Total machines shipped |
4,550 |
5,293 |
-14.0% | ||||
Other |
23 |
28 |
-19% |
||||||||
Total |
Revenue |
254 |
310 |
-18% |
|||||||
Operating Income |
66 |
76 |
-13% |
Revenue of $254 million compared to $310 million in the prior-year quarter, which included DoubleDown
Operating income of $66 million compared to $76 million in the prior-year quarter
North America Lottery
Select Financial Data |
Constant |
Key Performance Indicators |
% | ||||||||
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
FX |
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
Change | ||||
Gaming |
Total Revenue |
38 |
37 |
4% |
Installed base (end of period) |
||||||
Gaming Services |
38 |
37 |
4% |
VLT - Government Sponsored |
15,176 |
15,267 |
-0.6% | ||||
Terminal |
25 |
25 |
0% |
||||||||
Other |
13 |
11 |
13% |
Lottery same-store revenue growth |
|||||||
Product Sales |
0 |
0 |
0% |
Instants & draw games |
5.3% | ||||||
Multistate Jackpots |
-4.8% | ||||||||||
Lottery |
Total Revenue |
270 |
256 |
5% |
Total lottery same-store revenue growth |
4.2% | |||||
Lottery Services |
236 |
242 |
-2% |
||||||||
FM/Concessions |
164 |
158 |
4% |
||||||||
LMA |
39 |
55 |
-30% |
||||||||
Other Services |
33 |
28 |
18% |
||||||||
Product Sales |
34 |
15 |
131% |
||||||||
Terminal |
20 |
1 |
NM |
||||||||
Systems/Other |
14 |
14 |
5% |
||||||||
Total |
Revenue |
309 |
293 |
5% |
|||||||
Operating Income |
80 |
79 |
1% |
Revenue up 5% to $309 million
Operating income of $80 million up modestly from the prior year
International
Select Financial Data |
Constant |
Key Performance Indicators |
% | ||||||||
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
FX |
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
Change | ||||
Gaming |
Total Revenue |
101 |
117 |
-14% |
Installed base (end of period) |
||||||
Gaming Services |
34 |
43 |
-19% |
Casino |
13,034 |
11,204 |
16.3% | ||||
Terminal |
13 |
13 |
9% |
VLT - Government Sponsored |
3,306 |
925 |
257.4% | ||||
Other |
21 |
30 |
-31% |
Total installed base |
16,340 |
12,129 |
34.7% | ||||
Product Sales |
67 |
74 |
-10% |
||||||||
Terminal |
52 |
58 |
-11% |
Machine units shipped |
|||||||
Other |
15 |
16 |
-8% |
New/Expansion |
732 |
441 |
66.0% | ||||
Replacement |
2,388 |
3,150 |
-24.2% | ||||||||
Lottery |
Total Revenue |
78 |
75 |
4% |
Total machines shipped |
3,120 |
3,591 |
-13.1% | |||
Lottery Services |
70 |
72 |
-3% |
||||||||
FM/Concessions |
54 |
51 |
6% |
Lottery same-store revenue growth |
|||||||
Other Services |
16 |
21 |
-25% |
Instants & draw games |
3.0% | ||||||
Product Sales |
8 |
3 |
185% |
Multistate Jackpots |
-20.4% | ||||||
Systems/Other |
8 |
3 |
185% |
Total lottery same-store revenue growth |
1.4% | ||||||
Other |
Total Revenue |
19 |
20 |
-2% |
|||||||
Service Revenue |
19 |
18 |
3% |
||||||||
Product Sales |
1 |
2 |
-54% |
||||||||
Total |
Revenue |
199 |
211 |
-6% |
|||||||
Operating Income |
36 |
45 |
-21% |
Revenue down 6% to $199 million
Operating income down to $36 million from $45 million
Italy
Select Financial Data |
Constant |
Key Performance Indicators |
% | ||||||||
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
FX |
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
Change | ||||
Gaming |
Total Revenue |
177 |
165 |
1% |
(In ? millions, except machines) |
||||||
Gaming Services |
176 |
165 |
1% |
Lottery |
|||||||
Terminal |
160 |
150 |
1% |
Lotto wagers |
1,981 |
1,842 |
7.5% | ||||
Other |
16 |
14 |
5% |
10eLotto |
1,422 |
1,269 |
12.0% | ||||
Product Sales |
0 |
1 |
NM |
Core |
471 |
484 |
-2.7% | ||||
Late Numbers |
33 |
88 |
-62.4% | ||||||||
Lottery |
Total Revenue |
193 |
171 |
7% |
MillionDAY |
54 |
- |
NM | |||
Lottery Services |
193 |
171 |
7% |
||||||||
FM/Concessions |
243 |
219 |
5% |
Scratch & Win Wagers |
2,237 |
2,183 |
2.4% | ||||
Other Services |
(50) |
(48) |
0% |
||||||||
Product Sales |
0 |
0 |
0% |
Italy lottery revenue growth |
6.8% | ||||||
Other |
Total Revenue |
71 |
67 |
1% |
Gaming |
||||||
Service Revenue |
71 |
67 |
1% |
Installed base (end of period) |
|||||||
Product Sales |
0 |
0 |
0% |
VLT - Operator (B2C) |
10,991 |
10,907 |
0.8% | ||||
VLT - Supplier (B2B) |
8,251 |
8,819 |
-6.4% | ||||||||
Total |
Revenue |
441 |
404 |
3% |
AWP |
43,657 |
59,070 |
-26.1% | |||
Operating Income |
131 |
114 |
8% |
Total Installed Base |
62,899 |
78,796 |
-20.2% | ||||
Wagers |
|||||||||||
VLT - Operator (B2C) |
1,407 |
1,370 |
2.7% | ||||||||
AWP |
885 |
960 |
-7.8% | ||||||||
Interactive Wagers (Gaming) |
459 |
413 |
11.1% | ||||||||
Other |
|||||||||||
Sports Betting Wagers1 |
244 |
226 |
8.4% | ||||||||
Sports Betting Payout (%)1 |
82.9% |
82.3% |
0.6 pp | ||||||||
1 Includes Virtual Wagers and Pools & Horses |
Revenue up 9% to $441 million on a reported basis; up 3% at constant currency
Operating income increased 15% to $131 million; up 8% at constant currency
Other Developments
The Company's board of directors declared a quarterly cash dividend of $0.20 per ordinary share
Recent Capital Markets Activity
Investor Day
IGT will host an Investor Day on August 2, 2018 in New York City
Outlook
Conference Call and Webcast
July 31, 2018, at 8:00 a.m. EDT
Live webcast available under "News, Events & Presentations" on IGT's Investor Relations website at www.IGT.com; replay available on the website following the live event
Dial-In Numbers
Comparability of Results
All figures presented in this news release are prepared under U.S. GAAP, unless noted otherwise. Adjusted figures exclude the impact of items such as purchase accounting, impairment charges, restructuring expense, foreign exchange, and certain one-time, primarily transaction-related items. Reconciliations to the most directly comparable U.S. GAAP measures are included in the tables in this news release. Constant currency changes for 2018 are calculated using the same foreign exchange rates as the corresponding 2017 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate the Company's financial performance. Management believes these non-GAAP financial measures reflect the Company's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with U.S. GAAP.
About IGT
IGT (NYSE:IGT) is the global leader in gaming. We enable players to experience their favorite games across all channels and regulated segments, from Gaming Machines and Lotteries to Interactive and Social Gaming. Leveraging a wealth of premium content, substantial investment in innovation, in-depth customer intelligence, operational expertise and leading-edge technology, our gaming solutions anticipate the demands of consumers wherever they decide to play. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has over 12,000 employees. For more information, please visit www.IGT.com.
Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the "Company") and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as "aim," "anticipate," "believe," "plan," "could," "would," "should," "shall", "continue," "estimate," "expect," "forecast," "future," "guidance," "intend," "may," "will," "possible," "potential," "predict," "project" or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company's control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the factors and risks described in the Company's annual report on Form 20-F for the financial year ended December 31, 2017 and other documents filed from time to time with the SEC, which are available on the SEC's website at www.sec.gov and on the investor relations section of the Company's website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company's business. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement.
Contact:
Robert K. Vincent, Corporate Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
James Hurley, Investor Relations, +1 (401) 392-7190
Simone Cantagallo, +39 06 51899030; for Italian media inquiries
International Game Technology PLC | |||
Condensed Consolidated Statements of Operations | |||
($ and shares in thousands, except per share data) | |||
Unaudited | |||
For the three months ended | |||
June 30, | |||
2018 |
2017 | ||
Service revenue |
1,007,067 |
1,023,478 | |
Product sales |
195,271 |
196,026 | |
Total revenue |
1,202,338 |
1,219,504 | |
Cost of services |
607,684 |
616,740 | |
Cost of product sales |
122,403 |
138,362 | |
Selling, general and administrative |
196,088 |
210,185 | |
Research and development |
63,957 |
80,512 | |
Restructuring expense |
3,140 |
11,463 | |
Transaction income, net |
(11) |
(29,630) | |
Total operating expenses |
993,261 |
1,027,632 | |
Operating income |
209,077 |
191,872 | |
Interest income |
3,351 |
2,460 | |
Interest expense |
(106,239) |
(115,984) | |
Foreign exchange gain (loss), net |
172,546 |
(220,386) | |
Other expense, net |
(31,304) |
(26,112) | |
Total non-operating income (expenses) |
38,354 |
(360,022) | |
Income (loss) before provision for income taxes |
247,431 |
(168,150) | |
Provision for income taxes |
52,232 |
84,086 | |
Net income (loss) |
195,199 |
(252,236) | |
Less: Net income attributable to non-controlling interests |
33,703 |
37,665 | |
Net income (loss) attributable to IGT PLC |
161,496 |
(289,901) | |
Net income (loss) attributable to IGT PLC per common share - basic |
0.79 |
(1.43) | |
Net income (loss) attributable to IGT PLC per common share - diluted |
0.79 |
(1.43) | |
Weighted-average shares - basic |
204,118 |
202,946 | |
Weighted-average shares - diluted |
204,516 |
202,946 |
International Game Technology PLC | |||
Condensed Consolidated Statements of Operations | |||
($ and shares in thousands, except per share data) | |||
Unaudited | |||
For the six months ended | |||
June 30, | |||
2018 |
2017 | ||
Service revenue |
2,054,018 |
2,050,423 | |
Product sales |
355,276 |
321,665 | |
Total revenue |
2,409,294 |
2,372,088 | |
Cost of services |
1,225,742 |
1,241,034 | |
Cost of product sales |
225,754 |
252,698 | |
Selling, general and administrative |
411,306 |
410,709 | |
Research and development |
135,220 |
163,133 | |
Restructuring expense |
5,156 |
20,730 | |
Transaction expense (income), net |
44 |
(27,309) | |
Total operating expenses |
2,003,222 |
2,060,995 | |
Operating income |
406,072 |
311,093 | |
Interest income |
6,350 |
5,086 | |
Interest expense |
(216,518) |
(230,783) | |
Foreign exchange gain (loss), net |
75,851 |
(267,223) | |
Other expense, net |
(28,323) |
(23,445) | |
Total non-operating expenses |
(162,640) |
(516,365) | |
Income (loss) before provision for income taxes |
243,432 |
(205,272) | |
Provision for income taxes |
112,737 |
73,756 | |
Net income (loss) |
130,695 |
(279,028) | |
Less: Net income attributable to non-controlling interests |
72,345 |
65,663 | |
Net income (loss) attributable to IGT PLC |
58,350 |
(344,691) | |
Net income (loss) attributable to IGT PLC per common share - basic |
0.29 |
(1.70) | |
Net income (loss) attributable to IGT PLC per common share - diluted |
0.29 |
(1.70) | |
Weighted-average shares - basic |
203,859 |
202,714 | |
Weighted-average shares - diluted |
204,345 |
202,714 |
International Game Technology PLC | |||
Condensed Consolidated Balance Sheets | |||
($ thousands) | |||
Unaudited | |||
June 30, |
December 31, | ||
2018 |
2017 | ||
Assets |
|||
Current assets: |
|||
Cash and cash equivalents |
568,197 |
1,057,418 | |
Restricted cash |
252,814 |
248,012 | |
Trade and other receivables, net |
869,851 |
937,854 | |
Inventories, net |
324,684 |
319,545 | |
Other current assets |
471,449 |
407,520 | |
Income taxes receivable |
49,544 |
94,168 | |
Total current assets |
2,536,539 |
3,064,517 | |
Systems, equipment and other assets related to contracts, net |
1,391,662 |
1,434,194 | |
Property, plant and equipment, net |
188,549 |
193,723 | |
Goodwill |
5,700,992 |
5,723,815 | |
Intangible assets, net |
2,152,036 |
2,273,460 | |
Other non-current assets |
2,270,086 |
2,427,953 | |
Deferred income taxes |
37,810 |
41,546 | |
Total non-current assets |
11,741,135 |
12,094,691 | |
Total assets |
14,277,674 |
15,159,208 | |
Liabilities, redeemable non-controlling interests, and shareholders' equity |
|||
Current liabilities: |
|||
Accounts payable |
1,131,717 |
1,240,753 | |
Other current liabilities |
1,217,519 |
1,780,875 | |
Current portion of long-term debt |
- |
599,114 | |
Short-term borrowings |
28,400 |
- | |
Income taxes payable |
138,770 |
55,935 | |
Total current liabilities |
2,516,406 |
3,676,677 | |
Long-term debt, less current portion |
8,069,984 |
7,777,445 | |
Deferred income taxes |
471,073 |
491,460 | |
Income taxes payable |
55,665 |
55,665 | |
Other non-current liabilities |
448,273 |
446,113 | |
Total non-current liabilities |
9,044,995 |
8,770,683 | |
Total liabilities |
11,561,401 |
12,447,360 | |
Commitments and contingencies |
|||
Redeemable non-controlling interests and shareholders' equity |
2,716,273 |
2,711,848 | |
Total liabilities, redeemable non-controlling interests, and shareholders' equity |
14,277,674 |
15,159,208 |
International Game Technology PLC | ||||
Condensed Consolidated Statements of Cash Flows | ||||
($ thousands) | ||||
Unaudited | ||||
For the six months ended | ||||
June 30 | ||||
2018 |
2017 | |||
Restated | ||||
Cash flows from operating activities |
||||
Net income (loss) |
130,695 |
(279,028) | ||
Adjustments to reconcile net loss to net cash provided by operating activities: |
||||
Depreciation |
202,448 |
185,906 | ||
Amortization |
136,450 |
218,427 | ||
Service revenue amortization |
111,115 |
101,039 | ||
Loss on extinguishment of debt |
29,584 |
25,725 | ||
Stock-based compensation expense |
17,119 |
3,273 | ||
Debt issuance cost amortization |
11,534 |
10,042 | ||
Deferred income tax provision |
(9,817) |
(112,404) | ||
Foreign exchange (gain) loss, net |
(75,851) |
267,223 | ||
Gain on sale of Double Down Interactive LLC |
- |
(51,233) | ||
Other non-cash costs, net |
481 |
4,051 | ||
Changes in operating assets and liabilities: |
||||
Trade and other receivables |
49,832 |
146,763 | ||
Inventories |
(20,787) |
1,819 | ||
Upfront Italian license fees |
(366,270) |
(185,368) | ||
Accounts payable |
(56,732) |
(105,477) | ||
Other assets and liabilities |
(39,651) |
93,166 | ||
Net cash provided by operating activities |
120,150 |
323,924 | ||
Cash flows from investing activities |
||||
Capital expenditures |
(258,967) |
(370,590) | ||
Proceeds from sale of assets |
6,065 |
162,758 | ||
Proceeds from sale of Double Down Interactive LLC, net of cash divested |
- |
823,662 | ||
Other |
1,458 |
1,679 | ||
Net cash (used in) provided by investing activities |
(251,444) |
617,509 | ||
Cash flows from financing activities |
||||
Principal payments on long-term debt |
(1,058,753) |
(671,615) | ||
Dividends paid - non-controlling interests |
(125,808) |
(50,464) | ||
Dividends paid |
(81,553) |
(81,162) | ||
Return of capital - non-controlling interests |
(53,600) |
(35,907) | ||
Net payments of financial liabilities |
(36,586) |
(28,092) | ||
Payments in connection with the extinguishment of debt |
(24,281) |
(38,824) | ||
Debt issuance costs paid |
(4,047) |
- | ||
Net proceeds from short-term borrowings |
28,400 |
- | ||
Capital increase - non-controlling interests |
134,536 |
127,211 | ||
Proceeds from long-term debt |
863,911 |
- | ||
Other |
(17,696) |
(19,352) | ||
Net cash used in financing activities |
(375,477) |
(798,205) | ||
Net (decrease) increase in cash and cash equivalents, and restricted cash |
(506,771) |
143,228 | ||
Effect of exchange rate changes on cash and cash equivalents, and restricted cash |
22,352 |
39,995 | ||
Cash and cash equivalents, and restricted cash at the beginning of the period |
1,305,430 |
541,316 | ||
Cash and cash equivalents, and restricted cash at the end of the period |
821,011 |
724,539 | ||
Supplemental Cash Flow Information: |
||||
Interest paid |
(262,886) |
(245,753) | ||
Income taxes refunded (paid) |
13,313 |
(21,492) |
International Game Technology PLC | ||||
Net Debt | ||||
($ thousands) | ||||
June 30, |
December 31, | |||
2018 |
2017 | |||
7.500% Senior Secured Notes due July 2019 |
146,897 |
148,231 | ||
4.125% Senior Secured Notes due February 2020 |
507,409 |
833,655 | ||
5.625% Senior Secured Notes due February 2020 |
596,715 |
595,767 | ||
4.750% Senior Secured Notes due March 2020 |
443,808 |
585,171 | ||
5.500% Senior Secured Notes due June 2020 |
125,400 |
125,709 | ||
6.250% Senior Secured Notes due February 2022 |
1,458,333 |
1,470,075 | ||
4.750% Senior Secured Notes due February 2023 |
981,330 |
1,008,601 | ||
5.350% Senior Secured Notes due October 2023 |
61,033 |
61,082 | ||
3.500% Senior Secured Notes due July 2024 |
576,923 |
- | ||
6.500% Senior Secured Notes due February 2025 |
1,087,637 |
1,086,913 | ||
Senior Secured Notes, long-term |
5,985,485 |
5,915,204 | ||
Revolving Credit Facilities due July 2021 |
347,708 |
76,880 | ||
Term Loan Facilities due January 2023 |
1,736,791 |
1,785,361 | ||
Long-term debt, less current portion |
8,069,984 |
7,777,445 | ||
6.625% Senior Secured Notes due February 2018 |
- |
599,114 | ||
Current portion of long-term debt |
- |
599,114 | ||
Short-term borrowings |
28,400 |
- | ||
Total debt |
8,098,384 |
8,376,559 | ||
Less: Cash and cash equivalents |
568,197 |
1,057,418 | ||
Net debt |
7,530,187 |
7,319,141 |
Note: Net debt is a non-GAAP financial measure |
International Game Technology PLC | ||||
Adjusted EBITDA and Free Cash Flow | ||||
Reconciliations of Non-GAAP Financial Measures | ||||
($ thousands) | ||||
For the three months ended | ||||
June 30, | ||||
2018 |
2017 | |||
Net income (loss) |
195,199 |
(252,236) | ||
Provision for income taxes |
52,232 |
84,086 | ||
Non-operating (income) expenses |
(38,354) |
360,022 | ||
Depreciation |
104,361 |
93,985 | ||
Amortization |
68,058 |
102,186 | ||
Service revenue amortization |
54,465 |
51,640 | ||
Restructuring expense |
3,140 |
11,463 | ||
Stock-based compensation expense |
2,941 |
2,424 | ||
Transaction income, net |
(11) |
(29,630) | ||
Non-cash purchase accounting (excluding D&A) |
(216) |
(204) | ||
Bad debt expense |
- |
11 | ||
Adjusted EBITDA |
441,815 |
423,747 | ||
Cash flows from operating activities |
42,940 |
30,372 | ||
Capital expenditures |
(124,306) |
(198,538) | ||
Free Cash Flow |
(81,366) |
(168,166) |
International Game Technology PLC | ||||
Adjusted EBITDA and Free Cash Flow | ||||
Reconciliations of Non-GAAP Financial Measures | ||||
($ thousands) | ||||
For the six months ended | ||||
June 30, | ||||
2018 |
2017 | |||
Net income (loss) |
130,695 |
(279,028) | ||
Provision for income taxes |
112,737 |
73,756 | ||
Non-operating expenses |
162,640 |
516,365 | ||
Depreciation |
202,448 |
185,906 | ||
Amortization |
136,450 |
218,427 | ||
Service revenue amortization |
111,115 |
101,039 | ||
Stock-based compensation expense |
17,119 |
3,273 | ||
Restructuring expense |
5,156 |
20,730 | ||
Transaction expense (income), net |
44 |
(27,309) | ||
Non-cash purchase accounting (excluding D&A) |
(433) |
(387) | ||
Bad debt recovery |
- |
(17,862) | ||
Adjusted EBITDA |
877,971 |
794,910 | ||
Cash flows from operating activities |
120,150 |
323,924 | ||
Capital expenditures |
(258,967) |
(370,590) | ||
Free Cash Flow |
(138,817) |
(46,666) |
International Game Technology PLC | ||||||
ASC 606 - Revenue Recognition Impact | ||||||
Condensed Consolidated Statements of Operations | ||||||
($ thousands, except per share data) | ||||||
Unaudited | ||||||
Q2 2018 | ||||||
Under Prior |
Revenue |
As Adjusted | ||||
Revenue |
1,235,184 |
(32,846) |
1,202,338 | |||
Operating expenses |
(1,006,924) |
13,663 |
(993,261) | |||
Provision for income taxes |
(54,451) |
2,219 |
(52,232) | |||
Net income attributable to IGT PLC |
178,460 |
(16,964) |
161,496 | |||
Net income attributable to IGT PLC per common share - basic |
0.87 |
(0.08) |
0.79 | |||
Net income attributable to IGT PLC per common share - diluted |
0.87 |
(0.08) |
0.79 | |||
Q2 2018 YTD | ||||||
Under Prior |
Revenue |
As Adjusted | ||||
Revenue |
2,442,577 |
(33,283) |
2,409,294 | |||
Operating expenses |
(2,032,509) |
29,287 |
(2,003,222) | |||
Provision for income taxes |
(113,064) |
327 |
(112,737) | |||
Net income attributable to IGT PLC |
62,019 |
(3,669) |
58,350 | |||
Net income attributable to IGT PLC per common share - basic |
0.31 |
(0.02) |
0.29 | |||
Net income attributable to IGT PLC per common share - diluted |
0.31 |
(0.02) |
0.29 |
International Game Technology PLC | ||||||||||||
Condensed Consolidated Statement of Operations | ||||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||||
($ and shares in thousands, except per share data) | ||||||||||||
Adjustments |
||||||||||||
Q2 2018 |
Transaction |
Q2 2018 | ||||||||||
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As | |||||||
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted | |||||||
Total revenue |
1,202,338 |
(182) |
- |
- |
- |
1,202,156 | ||||||
Cost of services |
607,684 |
(21,061) |
- |
- |
- |
586,623 | ||||||
Cost of product sales |
122,403 |
(3,912) |
- |
- |
- |
118,491 | ||||||
Selling, general and administrative |
196,088 |
(26,736) |
- |
- |
- |
169,352 | ||||||
Research and development |
63,957 |
(219) |
- |
- |
- |
63,738 | ||||||
Restructuring expense |
3,140 |
- |
- |
(3,140) |
- |
- | ||||||
Transaction income, net |
(11) |
- |
- |
- |
11 |
- | ||||||
Total operating expenses |
993,261 |
(51,928) |
- |
(3,140) |
11 |
938,204 | ||||||
Operating income |
209,077 |
51,746 |
- |
3,140 |
(11) |
263,952 | ||||||
Interest expense, net |
(102,888) |
508 |
- |
- |
- |
(102,380) | ||||||
Foreign exchange gain, net |
172,546 |
- |
(172,546) |
- |
- |
- | ||||||
Other expense, net |
(31,304) |
1 |
- |
- |
29,584 |
(1,719) | ||||||
Total non-operating income (expenses) |
38,354 |
509 |
(172,546) |
- |
29,584 |
(104,099) | ||||||
Income before provision for income taxes |
247,431 |
52,255 |
(172,546) |
3,140 |
29,573 |
159,853 | ||||||
Provision for income taxes (a) |
52,232 |
12,345 |
3,683 |
589 |
- |
68,849 | ||||||
Net income |
195,199 |
39,910 |
(176,229) |
2,551 |
29,573 |
91,004 | ||||||
Less: Net income attributable to non-controlling interests |
33,703 |
25 |
- |
- |
- |
33,728 | ||||||
Net income attributable to IGT PLC |
161,496 |
39,885 |
(176,229) |
2,551 |
29,573 |
57,276 | ||||||
Net income per common share - diluted |
0.79 |
0.28 | ||||||||||
Weighted-average shares - diluted |
204,516 |
204,516 | ||||||||||
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
International Game Technology PLC | ||||||||||||
Condensed Consolidated Statement of Operations | ||||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||||
($ and shares in thousands, except per share data) | ||||||||||||
Year to date |
Adjustments |
Year to date | ||||||||||
June 2018 |
Transaction |
June 2018 | ||||||||||
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As | |||||||
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted | |||||||
Total revenue |
2,409,294 |
(359) |
- |
- |
- |
2,408,935 | ||||||
Cost of services |
1,225,742 |
(42,216) |
- |
- |
- |
1,183,526 | ||||||
Cost of product sales |
225,754 |
(7,781) |
- |
- |
- |
217,973 | ||||||
Selling, general and administrative |
411,306 |
(53,585) |
- |
- |
- |
357,721 | ||||||
Research and development |
135,220 |
(454) |
- |
- |
- |
134,766 | ||||||
Restructuring expense |
5,156 |
- |
- |
(5,156) |
- |
- | ||||||
Transaction expense, net |
44 |
- |
- |
- |
(44) |
- | ||||||
Total operating expenses |
2,003,222 |
(104,036) |
- |
(5,156) |
(44) |
1,893,986 | ||||||
Operating income |
406,072 |
103,677 |
- |
5,156 |
44 |
514,949 | ||||||
Interest expense, net |
(210,168) |
1,012 |
- |
- |
- |
(209,156) | ||||||
Foreign exchange gain, net |
75,851 |
- |
(75,851) |
- |
- |
- | ||||||
Other expense, net |
(28,323) |
(2,184) |
- |
- |
29,584 |
(923) | ||||||
Total non-operating expenses |
(162,640) |
(1,172) |
(75,851) |
- |
29,584 |
(210,079) | ||||||
Income before provision for income taxes |
243,432 |
102,505 |
(75,851) |
5,156 |
29,628 |
304,870 | ||||||
Provision for income taxes (a) |
112,737 |
24,255 |
6,329 |
1,141 |
- |
144,462 | ||||||
Net income |
130,695 |
78,250 |
(82,180) |
4,015 |
29,628 |
160,408 | ||||||
Less: Net income attributable to non-controlling interests |
72,345 |
50 |
- |
- |
- |
72,395 | ||||||
Net income attributable to IGT PLC |
58,350 |
78,200 |
(82,180) |
4,015 |
29,628 |
88,013 | ||||||
Net income per common share - diluted |
0.29 |
0.43 | ||||||||||
Weighted-average shares - diluted |
204,345 |
204,345 | ||||||||||
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. |
International Game Technology PLC | ||||||||||||
Condensed Consolidated Statement of Operations | ||||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||||
($ and shares in thousands, except per share data) | ||||||||||||
Adjustments |
||||||||||||
Q2 2017 |
Transaction |
Q2 2017 | ||||||||||
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As | |||||||
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted | |||||||
Total revenue |
1,219,504 |
(180) |
- |
- |
- |
1,219,324 | ||||||
Cost of services |
616,740 |
(38,510) |
- |
- |
- |
578,230 | ||||||
Cost of product sales |
138,362 |
(23,618) |
- |
- |
- |
114,744 | ||||||
Selling, general and administrative |
210,185 |
(28,169) |
- |
- |
- |
182,016 | ||||||
Research and development |
80,512 |
(210) |
- |
- |
- |
80,302 | ||||||
Restructuring expense |
11,463 |
- |
- |
(11,463) |
- |
- | ||||||
Transaction income, net |
(29,630) |
- |
- |
- |
29,630 |
- | ||||||
Total operating expenses |
1,027,632 |
(90,507) |
- |
(11,463) |
29,630 |
955,292 | ||||||
Operating income |
191,872 |
90,327 |
- |
11,463 |
(29,630) |
264,032 | ||||||
Interest expense, net |
(113,524) |
717 |
- |
- |
- |
(112,807) | ||||||
Foreign exchange loss, net |
(220,386) |
- |
220,386 |
- |
- |
- | ||||||
Other (expense) income, net |
(26,112) |
1,617 |
- |
- |
25,725 |
1,230 | ||||||
Total non-operating expenses |
(360,022) |
2,334 |
220,386 |
- |
25,725 |
(111,577) | ||||||
(Loss) income before provision for income taxes |
(168,150) |
92,661 |
220,386 |
11,463 |
(3,905) |
152,455 | ||||||
Provision for income taxes (a) |
84,086 |
32,003 |
50,428 |
2,962 |
(85,782) |
83,697 | ||||||
Net (loss) income |
(252,236) |
60,658 |
169,958 |
8,501 |
81,877 |
68,758 | ||||||
Less: Net income attributable to non-controlling interests |
37,665 |
26 |
- |
- |
- |
37,691 | ||||||
Net (loss) income attributable to IGT PLC |
(289,901) |
60,632 |
169,958 |
8,501 |
81,877 |
31,067 | ||||||
Net (loss) income per common share - diluted |
(1.43) |
0.15 | ||||||||||
Weighted-average shares - diluted (b) |
202,946 |
203,076 | ||||||||||
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. | ||||||||||||
(b) Weighted-average shares ? diluted, as adjusted, include shares that were excluded from the as reported computation, due to the net loss as reported. |
International Game Technology PLC | ||||||||||||
Condensed Consolidated Statement of Operations | ||||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||||
($ and shares in thousands, except per share data) | ||||||||||||
Year to date |
Adjustments |
Year to date | ||||||||||
June 2017 |
Transaction |
June 2017 | ||||||||||
As |
Purchase |
Foreign |
Restructuring |
and Refinancing |
As | |||||||
Reported |
Accounting |
Exchange |
Expense |
Expense, net |
Adjusted | |||||||
Total revenue |
2,372,088 |
(358) |
- |
- |
- |
2,371,730 | ||||||
Cost of services |
1,241,034 |
(80,740) |
- |
- |
- |
1,160,294 | ||||||
Cost of product sales |
252,698 |
(53,300) |
- |
- |
- |
199,398 | ||||||
Selling, general and administrative |
410,709 |
(63,097) |
- |
- |
- |
347,612 | ||||||
Research and development |
163,133 |
(411) |
- |
- |
- |
162,722 | ||||||
Restructuring expense |
20,730 |
- |
- |
(20,730) |
- |
- | ||||||
Transaction income, net |
(27,309) |
- |
- |
- |
27,309 |
- | ||||||
Total operating expenses |
2,060,995 |
(197,548) |
- |
(20,730) |
27,309 |
1,870,026 | ||||||
Operating income |
311,093 |
197,190 |
- |
20,730 |
(27,309) |
501,704 | ||||||
Interest expense, net |
(225,697) |
1,805 |
- |
- |
- |
(223,892) | ||||||
Foreign exchange loss, net |
(267,223) |
- |
267,223 |
- |
- |
- | ||||||
Other (expense) income, net |
(23,445) |
1,651 |
- |
- |
25,725 |
3,931 | ||||||
Total non-operating expenses |
(516,365) |
3,456 |
267,223 |
- |
25,725 |
(219,961) | ||||||
(Loss) income before provision for income taxes |
(205,272) |
200,646 |
267,223 |
20,730 |
(1,584) |
281,743 | ||||||
Provision for income taxes (a) |
73,756 |
70,232 |
61,096 |
6,134 |
(84,929) |
126,289 | ||||||
Net (loss) income |
(279,028) |
130,414 |
206,127 |
14,596 |
83,345 |
155,454 | ||||||
Less: Net income attributable to non-controlling interests |
65,663 |
51 |
- |
- |
- |
65,714 | ||||||
Net (loss) income attributable to IGT PLC |
(344,691) |
130,363 |
206,127 |
14,596 |
83,345 |
89,740 | ||||||
Net (loss) income per common share - diluted |
(1.70) |
0.44 | ||||||||||
Weighted-average shares - diluted (b) |
202,714 |
203,066 | ||||||||||
(a) Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated. | ||||||||||||
(b) Weighted-average shares ? diluted, as adjusted, include shares that were excluded from the as reported computation, due to the net loss as reported. |
INTERNATIONAL GAME TECHNOLOGY PLC |
|||||||||||
Select Financial Data |
Constant |
Key Performance Indicators |
% | ||||||||
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
FX |
Period Ended June 30 |
Q2 '18 |
Q2 '17 |
Change | ||||
Gaming |
Total Revenue |
570 |
630 |
-11% |
Installed base (end of period) |
||||||
Gaming Services |
418 |
454 |
-10% |
Casino |
36,385 |
34,853 |
4.4% | ||||
Terminal |
307 |
311 |
-4% |
VLT - Government Sponsored (ex-Italy) |
18,482 |
16,192 |
14.1% | ||||
Social (DDI) |
0 |
43 |
-100% |
VLT - Italy Supplier (B2B) |
8,251 |
8,819 |
-6.4% | ||||
Other |
111 |
99 |
10% |
Total installed base |
63,118 |
59,864 |
5.4% | ||||
Product Sales |
152 |
177 |
-14% |
Yield |
$ 27.89 |
$ 29.64 |
-5.9% | ||||
Terminal |
114 |
132 |
-14% |
(average revenue per unit per day) |
|||||||
Other |
38 |
45 |
-15% |
||||||||
Additional Italian Network Details: |
|||||||||||
Lottery |
Total Revenue |
542 |
502 |
6% |
VLT - Operator (B2C) |
10,991 |
10,907 |
0.8% | |||
Lottery Services |
499 |
485 |
1% |
AWP |
43,657 |
59,070 |
-26.1% | ||||
FM/Concessions |
461 |
427 |
5% |
||||||||
LMA |
39 |
55 |
-30% |
Machine units shipped |
|||||||
Other Services |
(1) |
2 |
-10% |
New/Expansion |
2,535 |
1,849 |
37.1% | ||||
Product Sales |
42 |
18 |
140% |
Replacement |
5,135 |
7,035 |
-27.0% | ||||
Terminal |
20 |
1 |
NM |
Total machines shipped |
7,670 |
8,884 |
-13.7% | ||||
Systems/Other |
22 |
16 |
32% |
||||||||
Global lottery same-store revenue growth |
|||||||||||
Other |
Total Revenue |
91 |
87 |
0% |
Instants & draw games |
4.8% | |||||
Service Revenue |
90 |
85 |
1% |
Multistate Jackpots |
-7.2% | ||||||
Product Sales |
1 |
2 |
-54% |
Total lottery same-store revenue growth (ex-Italy) |
3.5% | ||||||
Italy lottery revenue growth |
6.8% | ||||||||||
Consolidated |
Revenue |
1,202 |
1,220 |
-3% |
|||||||
Operating Income: |
|||||||||||
Segment Total |
313 |
315 |
-3% |
||||||||
Purchase Accounting |
(52) |
(90) |
43% |
||||||||
Corporate Support |
(52) |
(33) |
-57% |
||||||||
Total |
209 |
192 |
5% |
SOURCE International Game Technology PLC
These press releases may also interest you
|