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International Game Technology PLC Reports First Quarter 2020 Results
- Results affected by COVID-19-related lockdowns beginning in March
- Revenue of $940 million, down 18% as global closure of casinos and gaming halls and widespread mobility restrictions significantly hinder service revenue generation
- Net loss of $248 million includes $296 million non-cash goodwill impairment charge; achieved Adjusted EBITDA of $309 million
- $2.2 billion in liquidity, comprised of $1.5 billion in unrestricted cash and $743 million in capacity under revolving credit facilities
- Implementation of robust business continuity plans with cost reduction and capital spending avoidance initiatives to target $500 million in savings for 2020
- Withdrawing 2020 profit outlook due to COVID-19 uncertainty

LONDON, May 18, 2020 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the first quarter ended March 31, 2020. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the results; access details are provided below.

IGT (NYSE:IGT) is the global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivaled gaming experiences that engage players and drive growth. 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 approximately 12,000 employees. For more information, please visit www.igt.com.

"After a solid start in the first two months of the year, we quickly shifted our focus to the global COVID-19 health crisis in March," said Marco Sala, CEO of IGT. "The safety and well-being of our people, customers, and communities have been our highest priority since day one. We implemented robust business continuity plans and maintain service levels at our normal, high standards. I am grateful for the passion and perseverance the entire IGT team has demonstrated during these unprecedented times and I am confident IGT is well positioned to emerge from the crisis a stronger, even more competitive organization."

"We've taken swift actions across all non-essential costs and are now switching our focus to structural cost savings initiatives. At the same time, we have adopted strict measures to preserve liquidity in the current environment," said Max Chiara, CFO of IGT. "Given the uncertainty created by COVID-19, we are withdrawing our previous financial outlook for 2020, but we are confident that with $2.2 billion of liquidity, we are geared with sound financial flexibility to weather the storm caused by the COVID-19 pandemic."

Overview of Consolidated First Quarter 2020 Results

       

Constant

 

Quarter Ended

Y/Y

Currency

 

March 31,

Change

Change

 

2020

2019

(%)

(%)

         

(In $ millions, unless otherwise noted)

       

Revenue                                                      

940

1,145

-18%

-16%

Operating income/(loss)                        

(197)

178

 NM    

 NM

Net income/(loss) per diluted share 

($1.21)

$0.20

 NM    

 

Adjusted EBITDA                                             

309

417

-26%

-25%

Adjusted net income per diluted share

$0.08

$0.12

-32%

 

Net debt

7,170

7,714

-7%

 
 

Note: Adjusted EBITDA 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.

First quarter 2020 results reflect the impact of global COVID-19 restrictions. Revenue declines were evident in each business segment and across all primary revenue streams. Corresponding profits were also affected.

Financial highlights:

Consolidated revenue of $940 million, down 18% from the prior year

  • Global closures of casinos and gaming halls impact gaming service revenue
  • Lottery service revenue lower on reduced traffic to points of sale
  • Gaming product sales reflect fewer unit shipments in North America and International, partly offset by higher non-terminal revenue
  • Lottery product sales growth driven by increased non-terminal revenue

Operating loss of $197 million, down from income of $178 million in the prior year

  • Includes non-cash, non-tax-deductible goodwill impairment charge of $296 million, reducing the carrying value of the International and North America Gaming & Interactive segments
    • Driven by lower near-term forecasts as a result of COVID-19
    • No impact on the Company's operations, cash flow, ability to service debt, compliance with financial covenants, or underlying liquidity
  • Lower profit contribution due to revenue mix
    • Service revenue contribution down on COVID-19 impacts
    • High-margin, non-terminal revenue offsets lower terminal product sales
  • Benefit from initial actions taken to reduce operating costs

Interest expense, net declined 2% to $101 million

Income taxes of $3 million, down from $53 million

  • Reduced pre-tax income and associated removal of United States corporate minimum tax
  • Lower level of foreign earnings subject to United States taxation

Net loss attributable to IGT was $248 million; adjusted net income attributable to IGT of $17 million versus $24 million in the prior year

  • Net loss reflects goodwill impairment charge
  • Adjusted net income includes higher foreign currency gains in the current year

Adjusted EBITDA of $309 million, down 26% from the prior-year period

Net loss per diluted share of $1.21; adjusted net income per diluted share of $0.08 compared to $0.12 in the prior year

Net debt of $7.17 billion improved 3% from $7.38 billion at December 31, 2019; Net debt leverage of 4.47x, up from 4.31x at December 31, 2019, primarily due to lower EBITDA in the first quarter of 2020

Cash and Liquidity Update

  • Preserving cash and liquidity is the top financial priority
  • At March 31, 2020, liquidity totalled $2.2 billion, comprised of $1.5 billion in unrestricted cash and $743 million available under revolving credit facilities
  • During the quarter and at maturity, the Company redeemed in full its €388 million, 4.750% Senior Secured Euro Notes
  • As announced on May 13, 2020, the terms of the Company's revolving credit facilities and term loan were amended, providing increased flexibility to navigate through the uncertainty caused by the COVID-19 pandemic

COVID-19 Update: Withdrawing 2020 outlook

  • The Company is withdrawing its previous 2020 outlook due to COVID-19 uncertainty
  • IGT's highest priority remains the safety and well-being of its employees, customers, and communities during this challenging time
  • 2020: about $500 million in cost savings / capital spending avoidance have been identified to help mitigate the impact of COVID-19; actions taken include:
    • Temporary, company-wide salary reductions; cancellation of 2020 salary increases and short-term incentive compensation programs; furloughs and hiring freeze
    • Significant reductions in discretionary costs such as marketing, travel, and outside services
    • Over one-third reduction in planned maintenance capital expenditures for the balance of the year

Conference Call and Webcast

May 18, 2020, 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

  • US/Canada toll-free dial-in number: +1 844 842 7999
  • Outside the US/Canada toll-free number: +1 612 979 9887
  • Conference ID/confirmation code: 5782965
  • A telephone replay of the call will be available for one week
    • US/Canada replay number: +1 855 859 2056
    • Outside the US/Canada replay number: +1 404 537 3406
    • ID/Confirmation code: 5782965

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 2020 are calculated using the same foreign exchange rates as the corresponding 2019 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 deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivalled gaming experiences that engage players and drive growth. 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 approximately 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 uncertainty of the duration, extent, and effects of the COVID-19 pandemic and the response of governments, including government-mandated property closures and travel restrictions, and other third parties on the Company's business, results of operations, cash flows, liquidity and development prospects and the factors and risks described in the Company's annual report on Form 20-F for the financial year ended December 31, 2019 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. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance or International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.

Contact:
Phil O'Shaughnessy, Global Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
Francesco Luti, +39 3485475493; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190

First Quarter Operating Segment Review

North America Gaming & Interactive

Select Financial Data

   

As

Constant

 

Key Performance Indicators

   

%

Period Ended March 31

Q1 '20

Q1 '19

Reported

FX

 

Period Ended March 31

Q1 '20

Q1 '19

Change 

Gaming

 

Total revenue

191

239

-20%

-20%

 

Installed base units (end of period) 

     
 

Gaming services

117

155

-24%

-24%

 

    Casino

18,676

22,713

 
   

Terminal

76

100

-24%

-24%

 

    Casino - L/T lease (1)

917

-

 
   

Other

42

55

-24%

-24%

 

   Total Installed base units

19,593

22,713

-13.7%

 

Product sales

74

84

-12%

-12%

 

(1) Yield calculations should exclude these units due to accounting treatment as sales-type leases

   

Terminal

30

63

-53%

-53%

         
   

Other

44

21

112%

112%

         
                 

Machine units shipped

     

Other

 

Total revenue

4

1

NM

NM

 

   New/expansion

36

1,482

-97.6%

 

Service revenue

4

1

NM

NM

 

   Replacement 

2,036

2,544

-20.0%

 

Product revenue

0

0

0%

0%

 

   Total machines shipped

2,072

4,026

-48.5%

                         

Total

 

Revenue

196

240

-18%

-18%

         
 

Operating income

27

49

-45%

-49%

         

Revenue of $196 million, down from $240 million in the prior-year period

  • Gaming service revenue of $117 million
    • Casino closures impact terminal revenue
    • Other revenue reflects multi-year poker license in the prior year
  • Gaming product sales revenue of $74 million
    • New/expansion shipments to Encore Boston in the prior year
    • Significant non-terminal revenue related to a multi-year strategic agreement
    • Systems revenue in-line with prior year on Advantage install at Isleta Resort & Casino and strong add-on sales

Operating income of $27 million, down from $49 million in the prior year

  • Impact of casino closures
  • Partly offset by benefit from initial actions to reduce operating costs

North America Lottery

Select Financial Data

   

As

Constant

 

Key Performance Indicators

   

%

Period Ended March 31

Q1 '20

Q1 '19

Reported

FX

 

Period Ended March 31

Q1 '20

Q1 '19

Change 

Gaming

 

Total revenue

34

41

-17%

-16%

 

Installed base units (end of period)

     
 

Gaming services

33

41

-19%

-18%

 

    VLT - Government sponsored

13,559

14,799

-8.4%

   

Terminal 

19

25

-26%

-26%

         
   

Other

15

16

-7%

-5%

 

Lottery same-store revenue growth

 
 

Product sales

1

0

NM

NM

 

   Instant ticket & draw games

1.6%

                 

   Multistate jackpots

-33.3%

Lottery

 

Total revenue

214

254

-16%

-16%

 

   Total lottery same-store revenue growth

-3.0%

 

Lottery services

201

240

-16%

-16%

         
   

FMC

204

208

-2%

-2%

         
   

  Instant ticket & draw games

171

170

1%

1%

         
   

  Other services

34

38

-13%

-13%

         
   

LMA

(3)

32

NM

NM

         
 

Product sales

13

14

-9%

-9%

         
                         

Other

 

Total revenue

2

0

NM

NM

         
 

Service revenue

2

0

NM

NM

         
                         

Total

 

Revenue

251

296

-15%

-15%

         
 

Operating income

44

76

-41%

-41%

         

 

Revenue of $251 million compared to $296 million in the prior-year period

  • Lottery service revenue of $201 million
    • Solid mid-single-digit same-store revenue growth in January/February period was offset by mobility restrictions implemented in March
    • LMA revenue reflects accrual for penalties due to lower jackpot activity during the lotteries' fiscal year (ending June 30) and lower overall activity due to COVID-19
  • Gaming service revenue impacted by closure of VLT venues

Operating income of $44 million compared to $76 million in the prior year

  • LMA dynamics and closure of VLT venues
  • Partly offset by modest benefit from initial actions to reduce operating costs

International

Select Financial Data

   

As

Constant

 

Key Performance Indicators

   

%

Period Ended March 31

Q1 '20

Q1 '19

Reported

FX

 

Period Ended March 31

Q1 '20

Q1 '19

Change 

Gaming

 

Total revenue

72

81

-11%

-8%

 

Installed base units (end of period)

     
 

Gaming services

23

30

-25%

-20%

 

    Casino

9,653

10,666

-9.5%

   

Terminal 

9

12

-28%

-21%

 

    VLT - Government sponsored

5,110

4,419

15.6%

   

Other

14

18

-23%

-20%

 

   Total installed base units

14,763

15,085

-2.1%

 

Product sales

49

51

-3%

0%

         
   

Terminal 

23

35

-36%

-34%

 

Machine units shipped

     
   

Other

27

15

73%

78%

 

   New/expansion

83

382

-78.3%

                 

   Replacement 

1,525

2,593

-41.2%

Lottery

 

Total revenue

82

74

11%

14%

 

   Total machines shipped

1,608

2,975

-45.9%

 

Lottery services

62

70

-10%

-7%

         
   

FMC

62

70

-10%

-7%

 

Lottery same-store revenue growth

 
   

  Instant ticket & draw games

47

56

-15%

-12%

 

   Instant ticket & draw games

-3.8%

   

  Other services

15

14

9%

15%

 

   Multistate jackpots

-15.7%

 

Product sales

20

4

344%

344%

 

   Total lottery same-store revenue growth

-4.6%

                         

Other

 

Total revenue

10

17

-40%

-31%

         
 

Service revenue

10

17

-41%

-31%

         
 

Product sales

0

0

0%

0%

         
                         

Total

 

Revenue

164

172

-5%

-1%

         
 

Operating income

28

14

107%

121%

         

Revenue of $164 million, down from $172 million in the prior-year period

  • Gaming product sales down 3%; stable at constant currency
    • Fewer unit shipments impact terminal revenue
    • Other product sales higher on Italy AWP upgrades
  • Lottery product sales includes non-terminal revenue related to Czech Republic contract extension
  • Lottery service revenue of $62 million
    • Low-single-digit same-store revenue growth in January/February was more than offset by impact of mobility restrictions implemented in March
  • Gaming service revenue reflects casino closures
  • Other service revenue down on sale of Poland commercial services in prior year

Operating income of $28 million, up from $14 million in the prior year

  • High-margin software license
  • Modest benefit from initial actions to reduce operating costs

Italy

Select Financial Data

   

As

Constant

 

Key Performance Indicators

   

%

Period Ended March 31

Q1 '20

Q1 '19

Reported

FX

 

Period Ended March 31

Q1 '20

Q1 '19

Change 

Gaming

 

Total revenue

95

153

-38%

-36%

 

(In € millions, except machines)

     
 

Gaming services

95

153

-38%

-36%

 

Lottery

     
   

Terminal 

78

137

-43%

-41%

 

Lotto wagers

1,713

2,142

-20.0%

   

Other

17

16

7%

10%

 

   10eLotto

1,189

1,544

-23.0%

 

Product sales

0

0

0%

0%

 

   Core

420

501

-16.2%

                 

   Late numbers

61

47

29.9%

Lottery

 

Total revenue

148

204

-27%

-25%

 

   MillionDAY

44

50

-12.5%

 

Lottery services

148

204

-27%

-25%

         
   

FMC

148

204

-27%

-25%

 

Scratch & Win wagers

1,908

2,386

-20.0%

   

  Instant ticket & draw games

195

252

-23%

-20%

         
   

  Other services

(47)

(49)

-3%

0%

 

Italy lottery revenue growth

   

-24.8%

 

Product sales

0

0

0%

0%

         
                 

Gaming

     

Other

 

Total revenue

86

80

8%

12%

 

Installed base (end of period)

     
 

Service revenue

86

80

8%

12%

 

   VLT - Operator (B2C)

10,863

10,995

-1.2%

 

Product sales

0

0

0%

0%

 

   VLT - Supplier (B2B)

7,458

7,847

-5.0%

                 

   AWP

38,426

40,746

-5.7%

Total

 

Revenue

329

437

-25%

-22%

 

   Total installed base

56,747

59,588

-4.8%

 

Operating income

85

147

-42%

-39%

         
                 

Wagers

     
                 

   VLT - Operator (B2C)

745

1,503

-50.5%

                 

   AWP

686

939

-27.0%

                 

   Interactive wagers (gaming)

589

489

20.4%

                         
                 

Other

     
                 

   Sports betting wagers (1)

218

274

-20.5%

                 

   Sports betting payout (%) (1)

79.2%

83.3%

-4.1 pp

                         
                 

(1) Includes virtual wagers and pools & horses

Revenue of $329 million, down from $437 million in the prior-year period

  • Lottery service revenue reflects strict COVID-19 mobility restrictions
  • Gaming service revenue reflects closure of gaming halls, higher taxes, and age-verification regulations; Interactive wagers rise 20%
  • Commercial services revenue higher

Operating income of $85 million compared to $147 million

  • Impact of COVID-19 restrictions
  • Partly offset by modest benefit from initial actions to reduce operating costs

 

International Game Technology PLC

Consolidated Statements of Operations

($ and shares in thousands, except per share amounts)

Unaudited

       
 

 For the three months ended 

 

 March 31, 

 

2020

 

2019

       

Service revenue

783,301

 

991,031

Product sales

156,894

 

153,885

Total revenue

940,195

 

1,144,916

       

Cost of services

521,827

 

595,327

Cost of product sales

91,099

 

100,185

Selling, general and administrative

163,593

 

201,837

Research and development

60,737

 

66,118

Goodwill impairment (1)

296,000

 

-

Other operating expense, net

4,218

 

3,297

Total operating expenses

1,137,474

 

966,764

       

Operating (loss) income

(197,279)

 

178,152

       

Interest expense, net

(100,662)

 

(103,069)

Foreign exchange gain, net

70,360

 

58,602

Other expense, net

(3,386)

 

(498)

Total non-operating expenses

(33,688)

 

(44,965)

       

(Loss) income before provision for income taxes

(230,967)

 

133,187

       

Provision for income taxes

3,132

 

52,692

       

Net (loss) income

(234,099)

 

80,495

       

Less: Net income attributable to non-controlling interests

14,189

 

40,241

       

Net (loss) income attributable to IGT PLC

(248,288)

 

40,254

       
       

Net (loss) income attributable to IGT PLC per common share - basic

(1.21)

 

0.20

Net (loss) income attributable to IGT PLC per common share - diluted

(1.21)

 

0.20

       

Weighted-average shares - basic

204,435

 

204,300

Weighted-average shares - diluted

204,435

 

204,742

 

(1) Reduces the carrying value of the International and North America Gaming & Interactive segments by $193 million and $103 million, respectively

 

International Game Technology PLC

Consolidated Balance Sheets

($ thousands)

Unaudited

       
 

March 31,

 

December 31,

 

2020

 

2019

Assets

     

Current assets:

     

Cash and cash equivalents

1,457,524

 

662,934

Restricted cash and cash equivalents

160,677

 

231,317

Trade and other receivables, net

630,695

 

1,006,127

Inventories

181,959

 

161,790

Other current assets

614,690

 

571,869

Total current assets

3,045,545

 

2,634,037

Systems, equipment and other assets related to contracts, net

1,252,439

 

1,307,940

Property, plant and equipment, net

144,991

 

146,055

Operating lease right-of-use-assets

345,759

 

341,538

Goodwill

5,131,178

 

5,451,494

Intangible assets, net

1,773,134

 

1,836,002

Other non-current assets

1,827,339

 

1,927,524

Total non-current assets

10,474,840

 

11,010,553

Total assets

13,520,385

 

13,644,590

       

Liabilities and shareholders' equity

     

Current liabilities:

     

Accounts payable

897,328

 

1,120,922

Current portion of long-term debt

377,917

 

462,155

Short-term borrowings

113,088

 

3,193

Other current liabilities

842,833

 

882,081

Total current liabilities

2,231,166

 

2,468,351

Long-term debt, less current portion

8,136,080

 

7,600,169

Deferred income taxes

339,314

 

366,822

Operating lease liabilities

317,754

 

310,721

Other non-current liabilities

387,699

 

413,549

Total non-current liabilities

9,180,847

 

8,691,261

Total liabilities

11,412,013

 

11,159,612

Commitments and contingencies

     

Shareholders' equity

2,108,372

 

2,484,978

Total liabilities and shareholders' equity

13,520,385

 

13,644,590

 

International Game Technology PLC

Consolidated Statements of Cash Flows

($ thousands)

Unaudited

   
 

 For the three months ended 

 

 March 31, 

 

2020

 

2019

Cash flows from operating activities

     

Net (loss) income

(234,099)

 

80,495

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

     

Goodwill impairment

296,000

 

-

Depreciation 

98,020

 

105,331

Amortization 

70,126

 

68,084

Amortization of upfront license fees

50,496

 

52,289

Debt issuance cost amortization

5,210

 

5,783

Stock-based compensation

(12,968)

 

9,590

Deferred income taxes

(23,214)

 

267

Foreign exchange gain, net

(70,360)

 

(58,602)

Other non-cash items, net

(1,159)

 

8,192

Changes in operating assets and liabilities, excluding the effects of acquisitions:

     

Trade and other receivables

344,189

 

24,145

Inventories

(15,478)

 

(20,448)

Accounts payable

(189,544)

 

(27,817)

Other assets and liabilities

(159,951)

 

(100,695)

Net cash provided by operating activities

157,268

 

146,614

       

Cash flows from investing activities

     

Capital expenditures

(99,698)

 

(119,185)

Proceeds from sale of assets

5,970

 

1,888

Other

10,689

 

2,208

Net cash used in investing activities

(83,039)

 

(115,089)

       

Cash flows from financing activities

     

Proceeds from long-term debt

987,711

 

35,666

Net proceeds from short-term borrowings

109,936

 

33,201

Net receipts from (payments of) financial liabilities

50,585

 

(44,662)

Dividends paid

(40,887)

 

-

Principal payments on long-term debt

(431,965)

 

-

Capital increase - non-controlling interests

2,030

 

333

Dividends paid - non-controlling interests

(15,558)

 

(13,439)

Other

(2,328)

 

(2,000)

Net cash provided by financing activities

659,524

 

9,099

       

Net increase in cash and cash equivalents, and restricted cash

733,753

 

40,624

Effect of exchange rate changes on cash and cash equivalents, and restricted cash

(9,803)

 

(16,807)

Cash and cash equivalents, and restricted cash at the beginning of the period

894,251

 

511,777

Cash and cash equivalents, and restricted cash at the end of the period

1,618,201

 

535,594

       
       

Supplemental Cash Flow Information:

     

Interest paid

(181,987)

 

(183,777)

Income taxes paid

(11,035)

 

(18,835)

 

International Game Technology PLC

Net Debt

($ thousands)

Unaudited

       
 

March 31,

 

December 31,

 

2020

 

2019

       

6.250% Senior Secured Notes due February 2022(1)

1,507,401

 

1,491,328

4.750% Senior Secured Notes due February 2023(2)

925,379

 

948,382

5.350% Senior Secured Notes due October 2023(1)

60,860

 

60,885

3.500% Senior Secured Notes due July 2024(2)

543,752

 

557,331

6.500% Senior Secured Notes due February 2025(1)

1,090,369

 

1,089,959

3.500% Senior Secured Notes due June 2026(2)

814,690

 

835,105

6.250% Senior Secured Notes due January 2027(1)

743,575

 

743,387

2.375% Senior Secured Notes due April 2028(2)

542,774

 

556,403

Senior Secured Notes, long-term

6,228,800

 

6,282,780

       

Term Loan Facilities due January 2023(2)

934,847

 

1,317,389

Revolving Credit Facilities due July 2024(1) (2)

972,433

 

-

Long-term debt, less current portion

8,136,080

 

7,600,169

       

4.750% Senior Secured Notes due March 2020(2)

-

 

434,789

5.500% Senior Secured Notes due June 2020(1)

27,325

 

27,366

Term Loan Facilities due January 2023(2)

350,592

 

-

Current portion of long-term debt 

377,917

 

462,155

       

Short-term borrowings

113,088

 

3,193

Total debt

8,627,085

 

8,065,517

       

Less: Cash and cash equivalents

1,457,524

 

662,934

Less: Debt issuance costs, net - Revolving Credit Facilities due July 2024

-

 

20,464

       

Net debt

7,169,561

 

7,382,119

 

(1) U.S. dollar-denominated debt

(2) Euro-denominated debt

Note: Net debt is a non-GAAP financial measure

 

International Game Technology PLC

Reconciliations of Non-GAAP Financial Measures

($ and shares in thousands, except per share amounts)

Unaudited

       
       
 

For the three months ended

 

March 31,

 

2020

 

2019

       

Net (loss) income

(234,099)

 

80,495

Provision for income taxes

3,132

 

52,692

Interest expense, net

100,662

 

103,069

Foreign exchange gain, net

(70,360)

 

(58,602)

Other non-operating expense, net

3,386

 

498

Operating (loss) income

(197,279)

 

178,152

Goodwill impairment

296,000

 

-

Depreciation 

98,020

 

105,331

Amortization - purchase accounting

46,670

 

48,204

Amortization - non-purchase accounting (1)

73,952

 

72,169

Stock-based compensation

(12,968)

 

9,590

Other (2)

4,118

 

3,227

Adjusted EBITDA

308,513

 

416,673

       
       

Cash flows from operating activities

157,268

 

146,614

Capital expenditures

(99,698)

 

(119,185)

Free Cash Flow

57,570

 

27,429

       
       

Net (loss) income attributable to IGT PLC

(248,288)

 

40,254

Foreign exchange gain, net

(70,360)

 

(58,602)

Goodwill impairment

296,000

 

-

Depreciation and amortization - purchase accounting

46,982

 

48,836

Other (2)

4,118

 

3,227

Income tax impact on adjustments (3)

(11,924)

 

(9,404)

Adjusted net income attributable to IGT PLC

16,528

 

24,311

Weighted-average shares - diluted

204,435

 

204,742

Adjusted weighted-average shares - diluted (4)

205,068

 

204,742

Net (loss) income attributable to IGT PLC per common share - diluted

(1.21)

 

0.20

Adjusted net income attributable to IGT PLC per common share - diluted

0.08

 

0.12

 

(1) Includes amortization of upfront license fees

(2)Includes restructuring expense and transaction-related costs

(3)Adjustments for income taxes are determined based on the statutory tax rate in effect in the respective jurisdiction where the adjustment originated

(4)Adjusted weighted-average shares – diluted includes shares that were excluded from the GAAP computation, due to the net loss as reported

 

INTERNATIONAL GAME TECHNOLOGY PLC

         

Select Financial Data

   

As

Constant

 

Key Performance Indicators

   

%

Period Ended March 31

Q1 '20

Q1 '19

Reported

FX

 

Period Ended March 31

Q1 '20

Q1 '19

Change 

Gaming

 

Total revenue

393

515

-24%

-22%

 

Installed base units (end of period)

     
 

Gaming services

269

380

-29%

-28%

 

   Casino

28,329

33,379

-15.1%

   

Terminal 

181

275

-34%

-33%

 

   Casino - L/T lease (1)

917

-

NM

   

Other

88

105

-17%

-15%

 

   VLT - Government sponsored (ex-Italy)

18,669

19,218

-2.9%

 

Product sales

124

135

-8%

-7%

 

   VLT - Italy supplier (B2B)

7,458

7,847

-5.0%

   

Terminal 

53

99

-47%

-46%

 

   Total installed base units

55,373

60,444

-8.4%

   

Other

72

37

96%

99%

 

   Yield (average gross revenue per unit per day)

$ 22.69

$ 27.57

-17.7%

                 

(1) Yield calculations should exclude these units due to accounting treatment as sales-type leases

Lottery

 

Total revenue

444

532

-17%

-15%

         
 

Lottery services

412

514

-20%

-18%

         
   

FMC

415

481

-14%

-12%

 

   Additional Italian network details:

     
   

  Instant ticket & draw games

413

478

-13%

-12%

 

   VLT - Operator (B2C)

10,863

10,995

-1.2%

   

  Other services

2

4

-55%

-80%

 

   AWP

38,426

40,746

-5.7%

   

LMA

(3)

32

NM

NM

         
 

Product sales

32

18

76%

76%

 

Machine units shipped

     
                 

   New/expansion

119

1,864

-93.6%

Other

 

Total revenue

103

98

5%

10%

 

   Replacement 

3,561

5,137

-30.7%

 

Service revenue

103

98

5%

10%

 

   Total machines shipped

3,680

7,001

-47.4%

 

Product sales

0

0

0%

0%

         
                 

Global lottery same-store revenue growth

 

Consolidated

 

Revenue

940

1,145

-18%

-16%

 

   Instant ticket & draw games

-0.1%

 

Operating Income:

         

   Multistate jackpots

-31.0%

   

Segment total

185

285

-35%

-34%

 

   Total lottery same-store revenue growth (ex-Italy)

-3.7%

   

Purchase accounting

(343)

(49)

NM

NM

 

   Italy lottery revenue growth

-24.8%

   

Corporate support

(39)

(58)

-33%

30%

         
   

Total

(197)

178

-211%

-210%

         

 

 

 

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SOURCE International Game Technology PLC