International Game Technology PLC Reports First Quarter 2021 Results

 
 

International Game Technology PLC ("IGT") (NYSE: IGT) today reported financial results for the first quarter ended March 31, 2021. 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 11,000 employees. For more information, please visit www.igt.com. 

 
 

"We delivered some of our strongest profit results ever during the first quarter, fueled by robust player demand and significant, structural cost savings," said Marco Sala , CEO of IGT . "Our Global Lottery segment achieved record same-store sales levels on impressive increases around the world. The Global Gaming segment is demonstrating swift, progressive recovery, including accelerated momentum for Digital & Betting activities. We expect to return to 2019 levels for key financial metrics this year."

 

"With the recovery in our business in full swing, we are delivering strong operating leverage which, when coupled with invested capital discipline, drove strong cash flows in the quarter," said Max Chiara , CFO of IGT . "This enabled us to accelerate our debt retirement strategy and gives us confidence in a return to pre-pandemic leverage levels by the end of the current year."

 

   Overview of Consolidated First Quarter 2021 Results   

 
 
                                                                                                                                                                                      
 

   All amounts from continuing operations   

 
 

  Quarter Ended  

 
 

  Y/Y
Change
(%)
 

 
 

  Constant
Currency
Change
(%)
 

 
 

  March 31,  

 
 

  2021  

 
 
 

  2020  

 
 

   (In $ millions, unless otherwise noted)   

 
 
 
 
 
 
 

    GAAP Financials:    

 
 
 
 
 
 
 

  Revenue  

 
 
 
 
 
 
 

  Global Lottery  

 
 

  749  

 
 
 

  505  

 
 

  48%  

 
 

  42%  

 
 

  Global Gaming  

 
 

  266  

 
 
 

  310  

 
 

  (14)%  

 
 

  (16)%  

 
 

   Total revenue   

 
 

   1,015   

 
 
 

   814   

 
 

   25%   

 
 

   20%   

 
 
 
 
 
 
 
 

  Operating income/(loss)  

 
 
 
 
 
 
 

  Global Lottery  

 
 

  337  

 
 
 

  144  

 
 

  133%  

 
 

  121%  

 
 

  Global Gaming  

 
 

  (19)  

 
 
 

  (6)  

 
 

  (208)%  

 
 

  (177)%  

 
 

  Corporate support expense  

 
 

  (19)  

 
 
 

  (13)  

 
 

  (50)%  

 
 

  (32)%  

 
 

  Other (1)  

 
 

  (39)  

 
 
 

  (343)  

 
 

  89%  

 
 

  89%  

 
 

   Total operating income/(loss)   

 
 

   260   

 
 
 

   (218)   

 
 

   NA   

 
 

   NA   

 
 
 
 
 
 
 
 

   Net cash provided by operating activities   

 
 

   251   

 
 
 

   26   

 
 

   NM   

 
 
 
 
 
 
 
 
 

   Cash and cash equivalents   

 
 

   748   

 
 
 

   1,449   

 
 

   (48)%   

 
 
 
 
 
 
 
 
 

    Non-GAAP Financial Measures:    

 
 
 
 
 
 
 

  Adjusted EBITDA  

 
 
 
 
 
 
 

  Global Lottery  

 
 

  447  

 
 
 

  243  

 
 

  84%  

 
 

  74%  

 
 

  Global Gaming  

 
 

  19  

 
 
 

  31  

 
 

  (39)%  

 
 

  (35)%  

 
 

  Corporate support expense  

 
 

  (16)  

 
 
 

  (13)  

 
 

  (26)%  

 
 

  (10)%  

 
 

   Total Adjusted EBITDA   

 
 

   450   

 
 
 

   261   

 
 

   72%   

 
 

   64%   

 
 
 
 
 
 
 
 

   Free cash flow   

 
 

   204   

 
 
 

   (60)   

 
 
 
 
 
 
 
 
 
 

   Net debt   

 
 

   7,069   

 
 
 

   7,170   

 
 

   (1)%   

 
 
 
 
 
 
 
 
 
 
 
   
 
 

   (1) Primarily includes purchase price amortization and goodwill impairment  

 
 

  Note: Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release  

 
 
 

  Key Highlights:  

 
  • Achieved among highest revenue and profit levels in Company history, fueled by Global Lottery
  •  
  • Delivered strong cash flow driven by performance and invested capital discipline; return to pre-pandemic leverage expected by end of the year
  •  
  • Achieved ~1/3 of $200M+ 2021 OPtiMa savings targets during the first quarter
  •  
  • Sequential improvement in Global Gaming as industry recovers from pandemic-driven restrictions; growth in Digital & Betting continues with 85% year-over-year increase in revenue in the quarter
  •  
  • Successfully refinanced ~$1.0 billion in 6.25% Notes due 2022 with $750 million 4.125% Notes due 2026 and draws on revolving credit facilities
  •  
  • Signed seven-year contract extension with Jamaica Lottery; four-year iLottery contract extension with Kentucky Lottery; two-year contract extension with Mexico Lottery
  •  

  Financial highlights:  

 

Consolidated revenue of $1,015 million , up 25% from the prior year

 
  • Global Lottery revenue of $749 million , up 48%, driven by 32.4% growth in same-store sales
  •  
  • Global Gaming revenue totals $266 million , versus $310 million in the prior year; up sequentially from $255 million in Q4'20 as U.S. gaming markets continue to recover
  •  

Operating income of $260 million , compared to operating loss of $218 million in the prior year

 
  • Global Lottery same-store sales growth translates into high profit flow-through
  •  
  • Benefits from OPtiMa structural cost-savings
  •  
  • Goodwill impairment of $296 million in prior-year period
  •  

Net interest expense of $94 million compared to $100 million in the prior year

 

Provision for income taxes of $148 million , compared to a benefit from income taxes of $1 million in the prior year

 
  • Higher valuation allowances on deferred tax assets in the current period
  •  
  • Income taxes paid of $4 million versus $11 million in the prior year
  •  

Net income attributable to IGT was $92 million versus a net loss attributable to IGT of $248 million in the prior-year period

 
  • After-tax goodwill impairment of $296 million in prior-year period
  •  
  • Higher non-cash foreign exchange gains, primarily on Euro-denominated debt instruments, in the current period
  •  

Net income per diluted share of $0.38 compared to a net loss per diluted share of $1.28 in the prior year

 

Adjusted EBITDA of $450 million compared to $261 million in the prior-year period; Global Lottery achieves among the highest segment-level Adjusted EBITDA

 

Net debt of $7.07 billion compared to $7.32 billion at December 31, 2020; Net debt to LTM Adjusted EBITDA of 5.40x, down from 6.39x at December 31, 2020, driven by strong financial results and cash flow generation

 

  Cash and Liquidity Update  

 
  • Total liquidity of $2.1 billion as of March 31, 2021 ; $748 million in unrestricted cash and $1.4 billion in additional borrowing capacity
  •  

  Other Developments  

 
  • As previously announced, completed sale of Italy B2C gaming businesses on May 10, 2021 ; net proceeds to partially fund full redemption, by make-whole call, of €850 million 4.75% Senior Secured Euro Notes due February 2023  
  •  
  • In March 2021 , issued $750 million 4.125% Notes due 2026, as previously announced
  •  
    • Net proceeds used to fund redemption of 6.25% Notes due 2022
    •  
    • Lowest USD-denominated coupon ever issued by the Company
    •  

Recast historical financial information for Q2'20 and Q3'20 included at the end of this release

 

  Conference Call and Webcast:  

 

May 11, 2021, 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: 6783961
  •  
  • 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: 6783961
    •  
 
 
 

  Note: Certain totals in the tables included in this press release may not add due to rounding  

 
 
 

   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 2021 are calculated using the same foreign exchange rates as the corresponding 2020 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 11,000 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, 2020 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 of 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.

 

  Non-GAAP Financial Measures
Management supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

 

Adjusted EBITDA represents net income (loss) from continuing operations (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), other non-operating expenses, depreciation, impairment losses, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income) and certain other non-recurring items. Management believes that the non-GAAP measures just mentioned are useful in providing period-to-period comparisons of the results of the Company's ongoing operational performance.

 

Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash and equivalents. Cash and cash equivalents are subtracted from the GAAP measure because they could be used to reduce the Company's debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet.

 

Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing  IGT's  ability to fund its activities, including debt service and distribution of earnings to shareholders.

 

Constant currency is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the exchange rates used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates.

 

A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.

 

  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

 
 
                                                                                                                                                                                                                                                                  
 

    Select Performance and KPI data:     ($ in millions, unless otherwise noted)  

 
 
 
 
 
 
 
 
 

   Constant   

 
 
 
 

   Q1'21   

 
 
 

   Q1'20   

 
 
 

   Y/Y Change   

 
 
 

   Currency   

 
 

   GLOBAL LOTTERY   

 
 
 
 

   (%)   

 
 
 

   Change (%) (1)   

 
 

   Revenue   

 
 
 
 
 
 
 
 
 
 

   Service   

 
 
 
 
 
 
 
 
 
 

  Operating and facilities management contracts  

 
 
 

  695  

 
 
 

  454  

 
 
 

  53%  

 
 
 

  47%  

 
 

  Upfront license fee amortization  

 
 
 

  (52)  

 
 
 

  (48)  

 
 
 

  (9)%  

 
 
 

  —%  

 
 

  Operating and facilities management contracts, net  

 
 
 

  643  

 
 
 

  406  

 
 
 

  58%  

 
 
 

  52%  

 
 

  Other  

 
 
 

  83  

 
 
 

  66  

 
 
 

  24%  

 
 
 

  15%  

 
 

   Total service revenue   

 
 
 

   725   

 
 
 

   472   

 
 
 

   54%   

 
 
 

   47%   

 
 
 
 
 
 
 
 
 
 
 

   Product sales   

 
 
 

   23   

 
 
 

   32   

 
 
 

   (28)%   

 
 
 

   (30)%   

 
 

   Total revenue   

 
 
 

   749   

 
 
 

   505   

 
 
 

   48%   

 
 
 

   42%   

 
 
 
 
 
 
 
 
 
 
 

   Operating income   

 
 
 

   337   

 
 
 

   144   

 
 
 

   133%   

 
 
 

   121%   

 
 

   Adjusted EBITDA (1)   

 
 
 

   447   

 
 
 

   243   

 
 
 

   84%   

 
 
 

   74%   

 
 
 
 
 
 
 
 
 
 
 

   Global same-store sales growth (%)   

 
 
 
 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 

  27.4%  

 
 
 

  (4.8)%  

 
 
 
 
 
 

  Multi-jurisdiction jackpots  

 
 
 

  94.7%  

 
 
 

  (30.0)%  

 
 
 
 
 
 

   Total   

 
 
 

   32.4%   

 
 
 

   (7.2)%   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

   North America & Rest of world same-store sales growth (%)   

 
 
 
 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 

  20.9%  

 
 
 

  0.3%  

 
 
 
 
 
 

  Multi-jurisdiction jackpots  

 
 
 

  94.7%  

 
 
 

  (30.0)%  

 
 
 
 
 
 

   Total   

 
 
 

   27.8%   

 
 
 

   (3.5)%   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

   Italy same-store sales growth (%)   

 
 
 
 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 

   52.2%   

 
 
 

   (19.8)%   

 
 
 
 
 
 
 
 
  
 
 

    (1)   Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein   

 
 
 

 

 
 
                                                                                                                                                                                                                                                                                                                                                                                        
 
 
 
 
 
 
 
 
 

   Constant   

 
 
 
 

   Q1'21   

 
 
 

   Q1'20   

 
 
 

   Y/Y Change   

 
 
 

   Currency   

 
 

   GLOBAL GAMING   

 
 
 
 
 

   (%)   

 
 
 

   Change (%) (1)   

 
 

   Revenue   

 
 
 
 
 
 
 
 
 
 

   Service   

 
 
 
 
 
 
 
 
 
 

  Terminal  

 
 
 

  90  

 
 
 

  106  

 
 
 

  (16)%  

 
 
 

  (16)%  

 
 

  Systems, software, and other  

 
 
 

  86  

 
 
 

  77  

 
 
 

  11%  

 
 
 

  8%  

 
 

   Total service revenue   

 
 
 

   175   

 
 
 

   184   

 
 
 

   (5)%   

 
 
 

   (6)%   

 
 
 
 
 
 
 
 
 
 
 

   Product sales   

 
 
 
 
 
 
 
 
 
 

  Terminal  

 
 
 

  62  

 
 
 

  53  

 
 
 

  17%  

 
 
 

  14%  

 
 

  Other  

 
 
 

  29  

 
 
 

  73  

 
 
 

  (61)%  

 
 
 

  (62)%  

 
 

   Total product sales revenue   

 
 
 

   91   

 
 
 

   126   

 
 
 

   (28)%   

 
 
 

   (30)%   

 
 

   Total revenue   

 
 
 

   266   

 
 
 

   310   

 
 
 

   (14)%   

 
 
 

   (16)%   

 
 
 
 
 
 
 
 
 
 
 

   Operating loss   

 
 
 

   (19)   

 
 
 

   (6)   

 
 
 

   (208)%   

 
 
 

   (177)%   

 
 

   Adjusted EBITDA (1)   

 
 
 

   19   

 
 
 

   31   

 
 
 

   (39)%   

 
 
 

   (35)%   

 
 
 
 
 
 
 
 
 
 
 

   Installed base units   

 
 
 
 
 
 
 
 
 
 

  Casino  

 
 
 

  48,230  

 
 
 

  48,911  

 
 
 

  (1)%  

 
 
 
 

  Casino - L/T lease (2)  

 
 
 

  1,135  

 
 
 

  917  

 
 
 

  24%  

 
 
 
 

   Total installed base units   

 
 
 

   49,365   

 
 
 

   49,828   

 
 
 

   (1)%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   Installed base units (by geography)   

 
 
 
 
 
 
 
 
 
 

  US & Canada  

 
 
 

  34,138  

 
 
 

  35,065  

 
 
 

  (3)%  

 
 
 
 

  Rest of world  

 
 
 

  15,227  

 
 
 

  14,763  

 
 
 

  3%  

 
 
 
 

   Total installed base units   

 
 
 

   49,365   

 
 
 

   49,828   

 
 
 

   (1)%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   Yields (by geography) (3) , in absolute $   

 
 
 
 
 
 
 
 
 
 

  US & Canada  

 
 
 

  $32.27  

 
 
 

  $33.72  

 
 
 

  (4)%  

 
 
 
 

  Rest of world (ex-Italy)  

 
 
 

  $2.58  

 
 
 

  $6.55  

 
 
 

  (61)%  

 
 
 
 

   Total yields (ex-Italy)   

 
 
 

   $22.93   

 
 
 

   $25.67   

 
 
 

   (11)%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   Global machine units sold   

 
 
 
 
 
 
 
 
 
 

  New/expansion  

 
 
 

  884  

 
 
 

  119  

 
 
 

  NM  

 
 
 
 

  Replacement  

 
 
 

  3,521  

 
 
 

  3,563  

 
 
 

  (1)%  

 
 
 
 

   Total machine units sold   

 
 
 

   4,405   

 
 
 

   3,682   

 
 
 

   20%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   US & Canada machine units sold   

 
 
 
 
 
 
 
 
 
 

  New/expansion  

 
 
 

  620  

 
 
 

  36  

 
 
 

  NM  

 
 
 
 

  Replacement  

 
 
 

  2,276  

 
 
 

  2,036  

 
 
 

  12%  

 
 
 
 

   Total machine units sold   

 
 
 

   2,896   

 
 
 

   2,072   

 
 
 

   40%   

 
 
 
 
 
 
    
 
 

    (1)   Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein   

 
 

    (2)   Excluded from yield calculations due to treatment as sales-type leases   

 
 

    (3)   Excludes Casino L/T lease units due to treatment as sales-type leases   

 
 
 

 

 
 
                                                                                                                                                                                                                               
 
 
 
 
 
 
 
 
 

   Constant   

 
 
 
 

   Q1'21   

 
 
 

   Q1'20   

 
 
 

   Y/Y Change   

 
 
 

   Currency   

 
 

   GLOBAL GAMING (Continued)   

 
 
 
 
 

   (%)   

 
 
 

   Change (%) (1)   

 
 

   Rest of world machine units sold   

 
 
 
 
 
 
 
 
 
 

  New/expansion  

 
 
 

  264  

 
 
 

  83  

 
 
 

  218%  

 
 
 
 

  Replacement  

 
 
 

  1,245  

 
 
 

  1,527  

 
 
 

  (18)%  

 
 
 
 

   Total  machine units sold   

 
 
 

   1,509   

 
 
 

   1,610   

 
 
 

   (6)%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   Average Selling Price (ASP), in absolute $   

 
 
 
 
 
 
 
 
 
 

  US & Canada  

 
 
 

  $13,900  

 
 
 

  $14,300  

 
 
 

  (3)%  

 
 
 
 

  Rest of world  

 
 
 

  $13,700  

 
 
 

  $13,600  

 
 
 

  1%  

 
 
 
 

   Total ASP   

 
 
 

   $13,800   

 
 
 

   $14,000   

 
 
 

   (1)%   

 
 
 
 
 
 
 
 
 
 
 
 
 

   Gaming Systems Revenue   

 
 
 

   30   

 
 
 

   44   

 
 
 

   (32)%   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

   CONSOLIDATED   

 
 
 
 
 
 
 
 
 
 

   Revenue (by geography)   

 
 
 
 
 
 
 
 
 
 

  US & Canada  

 
 
 

  542  

 
 
 

  447  

 
 
 

  21%  

 
 
 

  21%  

 
 

  Italy  

 
 
 

  348  

 
 
 

  202  

 
 
 

  72%  

 
 
 

  58%  

 
 

  Rest of world  

 
 
 

  124  

 
 
 

  166  

 
 
 

  (25)%  

 
 
 

  (29)%  

 
 

   Total revenue   

 
 
 

   1,015   

 
 
 

   814   

 
 
 

   25%   

 
 
 

   20%   

 
 
 
 
 
 
 
 
 
 
 

   Digital & Betting Revenue (2)   

 
 
 

   58   

 
 
 

   32   

 
 
 

   85%   

 
 
 

   78%   

 
 
 
 
   
 
 

    (1)   Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein   

 
 

    (2)   Included within consolidated revenue   

 
 
 

 

 
 
                                                                                                                                                  
 

   International Game Technology PLC   

 
 

   Consolidated Statements of Operations   

 
 

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

 
 

    Unaudited    

 
 
 
 
 

  For the three months ended  

 
 
 

  March 31,  

 
 
 

  2021  

 
 
 

  2020  

 
 

  Service revenue  

 
 

  901  

 
 
 

  656  

 
 

  Product sales  

 
 

  114  

 
 
 

  158  

 
 

   Total revenue   

 
 

  1,015  

 
 
 

  814  

 
 
 
 
 
 

  Cost of services  

 
 

  441  

 
 
 

  415  

 
 

  Cost of product sales  

 
 

  73  

 
 
 

  92  

 
 

  Selling, general and administrative  

 
 

  186  

 
 
 

  164  

 
 

  Research and development  

 
 

  55  

 
 
 

  61  

 
 

  Goodwill impairment  

 
 

  

 
 
 

  296  

 
 

  Restructuring  

 
 

  

 
 
 

  4  

 
 

   Total operating expenses   

 
 

  755  

 
 
 

  1,032  

 
 
 
 
 
 

   Operating income (loss)   

 
 

  260  

 
 
 

  (218)  

 
 
 
 
 
 

  Interest expense, net  

 
 

  94  

 
 
 

  100  

 
 

  Foreign exchange gain, net  

 
 

  (145)  

 
 
 

  (70)  

 
 

  Other expense, net  

 
 

  25  

 
 
 

  

 
 

   Total non-operating (income) expenses   

 
 

  (27)  

 
 
 

  30  

 
 

  Income (loss) from continuing operations before provision for (benefit from) income
taxes
 

 
 

  287  

 
 
 

  (248)  

 
 

  Provision for (benefit from) income taxes  

 
 

  148  

 
 
 

  (1)  

 
 

  Income (loss) from continuing operations  

 
 

  138  

 
 
 

  (247)  

 
 

  Income from discontinued operations, net of tax  

 
 

  11  

 
 
 

  13  

 
 

   Net income (loss)   

 
 

  149  

 
 
 

  (234)  

 
 

  Less: Net income attributable to non-controlling interests from continuing operations  

 
 

  59  

 
 
 

  15  

 
 

  Less: Net loss attributable to non-controlling interests from discontinued operations  

 
 

  (2)  

 
 
 

  (1)  

 
 

   Net income (loss) attributable to IGT PLC   

 
 

  92  

 
 
 

  (248)  

 
 
 
 
 
 

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

 
 

  0.39  

 
 
 

  (1.28)  

 
 

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

 
 

  0.38  

 
 
 

  (1.28)  

 
 

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

 
 

  0.45  

 
 
 

  (1.21)  

 
 

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

 
 

  0.44  

 
 
 

  (1.21)  

 
 

   Weighted-average shares - basic   

 
 

  204,857  

 
 
 

  204,435  

 
 

   Weighted-average shares - diluted   

 
 

  206,504  

 
 
 

  204,435  

 
 
 

 

 
 
                                                                                                                                                                                                      
 

   International Game Technology PLC   

 
 

   Consolidated Balance Sheets   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 

  March 31,  

 
 
 

  December 31,  

 
 
 
 

  2021  

 
 
 

  2020  

 
 

   Assets   

 
 
 
 
 
 

  Current assets:  

 
 
 
 
 
 

  Cash and cash equivalents  

 
 
 

  748  

 
 
 

  907  

 
 

  Restricted cash and cash equivalents  

 
 
 

  184  

 
 
 

  199  

 
 

  Trade and other receivables, net  

 
 
 

  912  

 
 
 

  846  

 
 

  Inventories  

 
 
 

  167  

 
 
 

  169  

 
 

  Other current assets  

 
 
 

  489  

 
 
 

  480  

 
 

  Assets held for sale  

 
 
 

  808  

 
 
 

  839  

 
 

   Total current assets   

 
 
 

  3,308  

 
 
 

  3,440  

 
 

  Systems, equipment and other assets related to contracts, net  

 
 
 

  1,018  

 
 
 

  1,068  

 
 

  Property, plant and equipment, net  

 
 
 

  128  

 
 
 

  132  

 
 

  Operating lease right-of-use assets  

 
 
 

  274  

 
 
 

  288  

 
 

  Goodwill  

 
 
 

  4,679  

 
 
 

  4,713  

 
 

  Intangible assets, net  

 
 
 

  1,531  

 
 
 

  1,577  

 
 

  Other non-current assets  

 
 
 

  1,622  

 
 
 

  1,774  

 
 

   Total non-current assets   

 
 
 

  9,252  

 
 
 

  9,552  

 
 

   Total assets   

 
 
 

  12,560  

 
 
 

  12,992  

 
 
 
 
 
 
 

   Liabilities and shareholders' equity   

 
 
 
 
 
 

  Current liabilities:  

 
 
 
 
 
 

  Accounts payable  

 
 
 

  1,201  

 
 
 

  1,126  

 
 

  Current portion of long-term debt  

 
 
 

  375  

 
 
 

  393  

 
 

  Other current liabilities  

 
 
 

  804  

 
 
 

  847  

 
 

  Liabilities held for sale  

 
 
 

  174  

 
 
 

  250  

 
 

   Total current liabilities   

 
 
 

  2,554  

 
 
 

  2,615  

 
 

  Long-term debt, less current portion  

 
 
 

  7,441  

 
 
 

  7,857  

 
 

  Deferred income taxes  

 
 
 

  430  

 
 
 

  333  

 
 

  Operating lease liabilities  

 
 
 

  256  

 
 
 

  266  

 
 

  Other non-current liabilities  

 
 
 

  330  

 
 
 

  360  

 
 

   Total non-current liabilities   

 
 
 

  8,458  

 
 
 

  8,816  

 
 

   Total liabilities   

 
 
 

  11,012  

 
 
 

  11,431  

 
 

   Commitments and contingencies   

 
 
 
 
 
 

  IGT PLC's shareholders' equity  

 
 
 

  835  

 
 
 

  777  

 
 

  Non-controlling interests  

 
 
 

  714  

 
 
 

  784  

 
 

   Shareholders' equity   

 
 
 

  1,548  

 
 
 

  1,561  

 
 

   Total liabilities and shareholders' equity   

 
 
 

  12,560  

 
 
 

  12,992  

 
 
 

 

 
 
                                                                                                                                                                                                                                            
 

   International Game Technology PLC   

 
 

   Consolidated Statements of Cash Flows   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 

  For the three months ended  

 
 
 

  March 31,  

 
 
 

  2021  

 
 
 

  2020  

 
 

   Cash flows from operating activities   

 
 
 
 
 

  Net income (loss)  

 
 

  149  

 
 
 

  (234)  

 
 

  Less: Income from discontinued operations, net of tax  

 
 

  11  

 
 
 

  13  

 
 

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

 
 
 
 
 

  Deferred income taxes  

 
 

  100  

 
 
 

  (23)  

 
 

  Depreciation  

 
 

  82  

 
 
 

  86  

 
 

  Amortization of upfront license fees  

 
 

  55  

 
 
 

  50  

 
 

  Amortization  

 
 

  49  

 
 
 

  56  

 
 

  Loss on extinguishment of debt  

 
 

  24  

 
 
 

  

 
 

  Debt issuance cost amortization  

 
 

  6  

 
 
 

  5  

 
 

  Stock-based compensation  

 
 

  4  

 
 
 

  (13)  

 
 

  Goodwill impairment  

 
 

  

 
 
 

  296  

 
 

  Foreign exchange gain, net  

 
 

  (145)  

 
 
 

  (70)  

 
 

  Other non-cash items, net  

 
 

  

 
 
 

  (5)  

 
 

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

 
 
 
 
 

  Trade and other receivables  

 
 

  (86)  

 
 
 

  279  

 
 

  Inventories  

 
 

  4  

 
 
 

  (15)  

 
 

  Accounts payable  

 
 

  115  

 
 
 

  (195)  

 
 

  Other assets and liabilities  

 
 

  (95)  

 
 
 

  (178)  

 
 

   Net cash provided by operating activities from continuing operations   

 
 

  251  

 
 
 

  26  

 
 

   Net cash (used in) provided by operating activities from discontinued operations   

 
 

  (36)  

 
 
 

  132  

 
 

   Net cash provided by operating activities   

 
 

  215  

 
 
 

  157  

 
 
 
 
 
 

   Cash flows from investing activities   

 
 
 
 
 

  Capital expenditures  

 
 

  (48)  

 
 
 

  (85)  

 
 

  Proceeds from sale of assets  

 
 

  6  

 
 
 

  6  

 
 

  Other  

 
 

  

 
 
 

  11  

 
 

   Net cash used in investing activities from continuing operations   

 
 

  (42)  

 
 
 

  (69)  

 
 

   Net cash used in investing activities from discontinued operations   

 
 

  (10)  

 
 
 

  (14)  

 
 

   Net cash used in investing activities   

 
 

  (51)  

 
 
 

  (83)  

 
 
 
 
 
 

   Cash flows from financing activities   

 
 
 
 
 

  Principal payments on long-term debt  

 
 

  (1,387)  

 
 
 

  (432)  

 
 

  Payments in connection with the extinguishment of debt  

 
 

  (22)  

 
 
 

  

 
 

  Payments of debt issuance costs  

 
 

  (6)  

 
 
 

  

 
 

  Net proceeds from short-term borrowings  

 
 

  

 
 
 

  110  

 
 

  Net receipts from financial liabilities  

 
 

  9  

 
 
 

  51  

 
 

  Net proceeds from Revolving Credit Facilities  

 
 

  432  

 
 
 

  988  

 
 

  Proceeds from long-term debt  

 
 

  750  

 
 
 

  

 
 

  Dividends paid  

 
 

  

 
 
 

  (41)  

 
 

  Dividends paid - non-controlling interests  

 
 

  (69)  

 
 
 

  (16)  

 
 

  Return of capital - non-controlling interests  

 
 

  (11)  

 
 
 

  

 
 

  Capital increase - non-controlling interests  

 
 

  10  

 
 
 

  2  

 
 

  Other  

 
 

  (5)  

 
 
 

  (2)  

 
 

   Net cash (used in) provided by financing activities   

 
 

  (301)  

 
 
 

  660  

 
 
 
 
 
 

  Net (decrease) increase in cash and cash equivalents and restricted cash and cash equivalents  

 
 

  (137)  

 
 
 

  734  

 
 

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

 
 

  (36)  

 
 
 

  (10)  

 
 

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

 
 

  1,129  

 
 
 

  894  

 
 

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

 
 

  956  

 
 
 

  1,618  

 
 

  Less: Cash and cash equivalents and restricted cash and cash equivalents of discontinued operations  

 
 

  24  

 
 
 

  18  

 
 

  Cash and cash equivalents and restricted cash and cash equivalents at the end of the period of continuing
operations
 

 
 

  932  

 
 
 

  1,600  

 
 
 
 
 
 

   Supplemental Cash Flow Information   

 
 
 
 
 

  Interest paid  

 
 

  166  

 
 
 

  182  

 
 

  Income taxes paid  

 
 

  4  

 
 
 

  11  

 
 
 

 

 
 
                                                                                                                                                          
 

   International Game Technology PLC   

 
 

   Net Debt   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 
 

  March 31,  

 
 
 

  December 31,  

 
 
 
 

  2021  

 
 
 

  2020  

 
 

  6.250% Senior Secured U.S. Dollar Notes due February 2022  

 
 
 

  

 
 
 

  1,004  

 
 

  4.750% Senior Secured Euro Notes due February 2023  

 
 
 

  992  

 
 
 

  1,038  

 
 

  5.350% Senior Secured U.S. Dollar Notes due October 2023  

 
 
 

  61  

 
 
 

  61  

 
 

  3.500% Senior Secured Euro Notes due July 2024  

 
 
 

  583  

 
 
 

  610  

 
 

  6.500% Senior Secured U.S. Dollar Notes due February 2025  

 
 
 

  1,092  

 
 
 

  1,092  

 
 

  4.125% Senior Secured U.S. Dollar Notes due April 2026  

 
 
 

  743  

 
 
 

  

 
 

  3.500% Senior Secured Euro Notes due June 2026  

 
 
 

  873  

 
 
 

  913  

 
 

  6.250% Senior Secured U.S. Dollar Notes due January 2027  

 
 
 

  744  

 
 
 

  744  

 
 

  2.375% Senior Secured Euro Notes due April 2028  

 
 
 

  581  

 
 
 

  608  

 
 

  5.250% Senior Secured U.S. Dollar Notes due January 2029  

 
 
 

  743  

 
 
 

  743  

 
 

   Senior Secured Notes   

 
 
 

  6,413  

 
 
 

  6,813  

 
 
 
 
 
 
 

  Euro Term Loan Facility due January 2023  

 
 
 

  624  

 
 
 

  1,044  

 
 

  Euro Revolving Credit Facility B due July 2024  

 
 
 

  137  

 
 
 

  

 
 

  U.S. Dollar Revolving Credit Facility A due July 2024  

 
 
 

  267  

 
 
 

  

 
 

   Long-term debt, less current portion   

 
 
 

  7,441  

 
 
 

  7,857  

 
 
 
 
 
 
 

  Euro Term Loan Facility due January 2023  

 
 
 

  375  

 
 
 

  393  

 
 

   Current portion of long-term debt   

 
 
 

  375  

 
 
 

  393  

 
 
 
 
 
 
 

   Total debt   

 
 
 

  7,817  

 
 
 

  8,250  

 
 
 
 
 
 
 

  Less: Cash and cash equivalents  

 
 
 

  748  

 
 
 

  907  

 
 

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

 
 
 

  

 
 
 

  24  

 
 

   Net debt   

 
 
 

  7,069  

 
 
 

  7,319  

 
 
 
 
 
 
 

  Note: Net debt is a non-GAAP financial measure  

 
 
 
 
 
 
 

 

 
 
                                                                                                                                                                                                                                           
 

   International Game Technology PLC   

 
 

   Reconciliation of Non-GAAP Financial Measures   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

  For the three months ended March 31, 2021  

 
 
 
 
 
 
 
 

  Business  

 
 
 
 
 
 
 
 

  Global  

 
 
 

  Global  

 
 
 

  Segment  

 
 
 

  Corporate  

 
 
 

  Total IGT  

 
 
 
 

  Lottery  

 
 
 

  Gaming  

 
 
 

  Total  

 
 
 

  and Other  

 
 
 

  PLC  

 
 

  Income from continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  138  

 
 

  Provision for income taxes  

 
 
 
 
 
 
 
 
 
 
 

  148  

 
 

  Interest expense, net  

 
 
 
 
 
 
 
 
 
 
 

  94  

 
 

  Foreign exchange gain, net  

 
 
 
 
 
 
 
 
 
 
 

  (145)  

 
 

  Other non-operating expense, net  

 
 
 
 
 
 
 
 
 
 
 

  25  

 
 

  Operating income (loss)  

 
 
 

  337  

 
 
 

  (19)  

 
 
 

  318  

 
 
 

  (58)  

 
 
 

  260  

 
 

  Depreciation  

 
 
 

  47  

 
 
 

  35  

 
 
 

  83  

 
 
 

  (1)  

 
 
 

  82  

 
 

  Amortization - service revenue (1)  

 
 
 

  55  

 
 
 

  

 
 
 

  55  

 
 
 

  

 
 
 

  55  

 
 

  Amortization - non-purchase accounting  

 
 

  8  

 
 
 

  1  

 
 
 

  9  

 
 
 

  1  

 
 
 

  10  

 
 

  Amortization - purchase accounting  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  39  

 
 
 

  39  

 
 

  Stock-based compensation  

 
 
 

  1  

 
 
 

  1  

 
 
 

  2  

 
 
 

  2  

 
 
 

  4  

 
 

   Adjusted EBITDA   

 
 
 

   447   

 
 
 

   19   

 
 
 

   466   

 
 
 

   (16)   

 
 
 

   450   

 
 
 
 
 
 
 
 
 
 
 
 
 

  Cash flows from operating activities - continuing operations  

 
 
 
 
 
 
 
 
 

  251  

 
 

  Capital expenditures  

 
 
 
 
 
 
 
 
 
 
 

  (48)  

 
 

   Free Cash Flow   

 
 
 
 
 
 
 
 
 
 
 

   204   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 

   (1) Includes amortization of upfront license fees  

 
 
 

 

 
 
                                                                                                                                                                                                                                            
 

   International Game Technology PLC   

 
 

   Reconciliation of Non-GAAP Financial Measures   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

  For the three months ended March 31, 2020  

 
 
 
 
 
 
 
 

  Business  

 
 
 
 
 
 
 
 

  Global  

 
 
 

  Global  

 
 
 

  Segment  

 
 
 

  Corporate  

 
 
 

  Total IGT  

 
 
 
 

  Lottery  

 
 
 

  Gaming  

 
 
 

  Total  

 
 
 

  and Other  

 
 
 

  PLC  

 
 

  Loss from continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  (247)  

 
 

  Benefit from income taxes  

 
 
 
 
 
 
 
 
 
 
 

  (1)  

 
 

  Interest expense, net  

 
 
 
 
 
 
 
 
 
 
 

  100  

 
 

  Foreign exchange gain, net  

 
 
 
 
 
 
 
 
 
 
 

  (70)  

 
 

  Operating income (loss)  

 
 
 

  144  

 
 
 

  (6)  

 
 
 

  138  

 
 
 

  (356)  

 
 
 

  (218)  

 
 

  Goodwill impairment  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  296  

 
 
 

  296  

 
 

  Depreciation  

 
 
 

  46  

 
 
 

  40  

 
 
 

  85  

 
 
 

  

 
 
 

  86  

 
 

  Amortization - service revenue (1)  

 
 
 

  50  

 
 
 

  

 
 
 

  50  

 
 
 

  

 
 
 

  50  

 
 

  Amortization - non-purchase accounting  

 
 
 

  7  

 
 
 

  1  

 
 
 

  8  

 
 
 

  1  

 
 
 

  9  

 
 

  Amortization - purchase accounting  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  47  

 
 
 

  47  

 
 

  Restructuring  

 
 
 

  

 
 
 

  1  

 
 
 

  1  

 
 
 

  3  

 
 
 

  4  

 
 

  Stock-based compensation  

 
 
 

  (4)  

 
 
 

  (5)  

 
 
 

  (9)  

 
 
 

  (4)  

 
 
 

  (13)  

 
 

   Adjusted EBITDA   

 
 
 

   243   

 
 
 

   31   

 
 
 

   274   

 
 
 

   (13)   

 
 
 

   261   

 
 
 
 
 
 
 
 
 
 
 
 
 

  Cash flows from operating activities - continuing operations  

 
 
 
 
 
 
 
 
 

  26  

 
 

  Capital expenditures  

 
 
 
 
 
 
 
 
 
 
 

  (85)  

 
 

   Free Cash Flow   

 
 
 
 
 
 
 
 
 
 
 

   (60)   

 
 
 
 
  
 
 

   (1) Includes amortization of upfront license fees  

 
 
 

   Recast Historical Financial Information   

 

Recast data reflects the treatment of IGT's Italian B2C gaming machine, sports betting, and digital gaming businesses as discontinued operations.

 

  Select Performance and KPI data:    ($ in millions, unless otherwise noted)

 
 
                                                                                                                                                                        
 

   GLOBAL LOTTERY   

 
 
 
 

   Q2'20   

 
 
 

   Q3'20   

 
 

   Revenue   

 
 
 
 
 
 
 

   Service   

 
 
 
 
 
 
 

  Operating and facilities management contracts  

 
 
 
 

  416  

 
 
 

  525  

 
 

   Upfront license fee amortization   

 
 
 
 

  (48)  

 
 
 

  (52)  

 
 

  Operating and facilities management contracts, net  

 
 
 
 

  367  

 
 
 

  474  

 
 

  Other  

 
 
 
 

  70  

 
 
 

  76  

 
 

   Total service revenue   

 
 
 
 

   438   

 
 
 

   549   

 
 
 
 
 
 
 
 

   Product sales   

 
 
 
 

   22   

 
 
 

   20   

 
 

   Total revenue   

 
 
 
 

   460   

 
 
 

   570   

 
 
 
 
 
 
 
 

   Operating income   

 
 
 
 

   107   

 
 
 

   196   

 
 

   Adjusted EBITDA (1)   

 
 
 
 

   221   

 
 
 

   309   

 
 
 
 
 
 
 
 

   Global same-store sales growth (%)   

 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 
 

  (7.1)%  

 
 
 

  10.6%  

 
 

  Multi-jurisdiction jackpots  

 
 
 
 

  (24.2)%  

 
 
 

  (14.3)%  

 
 

   Total   

 
 
 
 

   (8.5)%   

 
 
 

   8.7%   

 
 
 
 
 
 
 
 

   North America and Rest of world same-store sales growth (%)   

 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 
 

  3.5%  

 
 
 

  15.0%  

 
 

  Multi-jurisdiction jackpots  

 
 
 
 

  (24.2)%  

 
 
 

  (14.3)%  

 
 

   Total   

 
 
 
 

   0.6%   

 
 
 

   12.1%   

 
 
 
 
 
 
 
 

   Italy same-store sales growth (%)   

 
 
 
 
 
 
 

  Instant ticket & draw games  

 
 
 
 

   (40.5)%   

 
 
 

   (3.5)%   

 
 
 
 
 
 
 
 
 
 
  
 
 

    (1)   Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein   

 
 
 

 

 
 
                                                                                                                                                                                                                                                                                                                        
 

   GLOBAL GAMING   

 
 
 
 

   Q2'20   

 
 
 

   Q3'20   

 
 

   Revenue   

 
 
 
 
 
 
 

   Service   

 
 
 
 
 
 
 

  Terminal  

 
 
 
 

  25  

 
 
 

  81  

 
 

  Systems, software, and other  

 
 
 
 

  59  

 
 
 

  82  

 
 

   Total service revenue   

 
 
 
 

   84   

 
 
 

   163   

 
 
 
 
 
 
 
 

   Product sales   

 
 
 
 
 
 
 

  Terminal  

 
 
 
 

  44  

 
 
 

  49  

 
 

  Other  

 
 
 
 

  12  

 
 
 

  34  

 
 

   Total product sales revenue   

 
 
 
 

   56   

 
 
 

   83   

 
 

   Total revenue   

 
 
 
 

   140   

 
 
 

   247   

 
 
 
 
 
 
 
 

   Operating loss   

 
 
 
 

   (111)   

 
 
 

   (50)   

 
 

   Adjusted EBITDA (1)   

 
 
 
 

   (36)   

 
 
 

   (8)   

 
 
 
 
 
 
 
 

   Installed base units   

 
 
 
 
 
 
 

  Casino  

 
 
 
 

  48,704  

 
 
 

  48,280  

 
 

  Casino - L/T lease (2)  

 
 
 
 

  930  

 
 
 

  1,102  

 
 

   Total installed base units   

 
 
 
 

   49,634   

 
 
 

   49,382   

 
 
 
 
 
 
 
 

   Installed base units (by geography)   

 
 
 
 
 
 
 

  US & Canada  

 
 
 
 

  34,800  

 
 
 

  34,584  

 
 

  Rest of world  

 
 
 
 

  14,834  

 
 
 

  14,798  

 
 

   Total installed base units   

 
 
 
 

   49,634   

 
 
 

   49,382   

 
 
 
 
 
 
 
 

   Yields (by geography) (3) , in absolute $   

 
 
 
 
 
 
 

  US & Canada  

 
 
 
 

  $8.69  

 
 
 

  $26.79  

 
 

  Rest of world  

 
 
 
 

  $0.49  

 
 
 

  $4.31  

 
 

   Total yields   

 
 
 
 

   $6.21   

 
 
 

   $19.88   

 
 
 
 
 
 
 
 

   Global machine units sold   

 
 
 
 
 
 
 

  New/expansion  

 
 
 
 

  1,443  

 
 
 

  818  

 
 

  Replacement  

 
 
 
 

  1,538  

 
 
 

  2,853  

 
 

   Total machine units sold   

 
 
 
 

   2,981   

 
 
 

   3,671   

 
 
 
 
 
 
 
 

   US & Canada machine units sold   

 
 
 
 
 
 
 

  New/expansion  

 
 
 
 

  1,382  

 
 
 

  667  

 
 

  Replacement  

 
 
 
 

  1,330  

 
 
 

  2,007  

 
 

   Total machine units sold   

 
 
 
 

   2,712   

 
 
 

   2,674   

 
 
 
 
 
 
 
 

   Rest of world machine units sold   

 
 
 
 
 
 
 

  New/expansion  

 
 
 
 

  61  

 
 
 

  151  

 
 

  Replacement  

 
 
 
 

  208  

 
 
 

  846  

 
 

   Total machine units sold   

 
 
 
 

   269   

 
 
 

   997   

 
 
 
 
 
 
 
 

   Average selling price (ASP), in absolute $   

 
 
 
 
 
 
 

  US & Canada  

 
 
 
 

  $14,700  

 
 
 

  $13,800  

 
 

  Rest of world  

 
 
 
 

  $14,000  

 
 
 

  $12,100  

 
 

   Total ASP   

 
 
 
 

   $14,600   

 
 
 

   $13,300   

 
 
 
 
 
 
 
 

   Gaming systems revenue   

 
 
 
 

   23   

 
 
 

   31   

 
 
 
 
    
 
 

    (1)   Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein   

 
 

    (2)   Excluded from yield calculations due to treatment as sales-type leases   

 
 

    (3)   Excludes Casino L/T lease units due to treatment as sales-type leases   

 
 
 

 

 
 
                                                      
 

   CONSOLIDATED   

 
 
 
 

   Q2'20   

 
 
 

   Q3'20   

 
 

   Revenue (by geography)   

 
 
 
 
 
 
 

  US & Canada  

 
 
 
 

  369  

 
 
 

  443  

 
 

  Italy  

 
 
 
 

  150  

 
 
 

  246  

 
 

  Rest of world  

 
 
 
 

  80  

 
 
 

  127  

 
 

   Total revenue   

 
 
 
 

   600   

 
 
 

   816   

 
 
 
 
 
 
 
 

   Digital & Betting Revenue (1)   

 
 
 
 

   43   

 
 
 

   48   

 
 
 
 
 
 
 
 
 
 
  
 
 

    (1)   Included within consolidated revenue   

 
 
 

 

 
 
                                                                                                                                                                                 
 

   International Game Technology PLC   

 
 

   Consolidated Statements of Operations   

 
 

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

 
 

    Unaudited    

 
 
 
 
 
 
 
 
 

  For the three months ended  

 
 
 
 

  June 30,  

 

  2020  

 
 
 

  September 30,  

 

  2020  

 
 

  Service revenue  

 
 
 

  522  

 
 
 

  713  

 
 

  Product sales  

 
 
 

  78  

 
 
 

  104  

 
 

   Total revenue   

 
 
 

  600  

 
 
 

  816  

 
 
 
 
 
 
 

  Cost of services  

 
 
 

  361  

 
 
 

  418  

 
 

  Cost of product sales  

 
 
 

  67  

 
 
 

  83  

 
 

  Selling, general and administrative  

 
 
 

  168  

 
 
 

  179  

 
 

  Research and development  

 
 
 

  31  

 
 
 

  48  

 
 

  Restructuring  

 
 
 

  43  

 
 
 

  

 
 

  Other operating expense, net  

 
 
 

  1  

 
 
 

  1  

 
 

   Total operating expenses   

 
 
 

  672  

 
 
 

  730  

 
 
 
 
 
 
 

   Operating (loss) income   

 
 
 

  (72)  

 
 
 

  87  

 
 
 
 
 
 
 

  Interest expense, net  

 
 
 

  96  

 
 
 

  101  

 
 

  Foreign exchange loss, net  

 
 
 

  74  

 
 
 

  149  

 
 

  Other expense, net  

 
 
 

  28  

 
 
 

  6  

 
 

   Total non-operating expenses   

 
 
 

  198  

 
 
 

  256  

 
 
 
 
 
 
 

  Loss from continuing operations before benefit from income taxes  

 
 
 

  (271)  

 
 
 

  (170)  

 
 

  Benefit from income taxes  

 
 
 

  (3)  

 
 
 

  (41)  

 
 

  Loss from continuing operations  

 
 
 

  (268)  

 
 
 

  (129)  

 
 

  (Loss) income from discontinued operations, net of tax  

 
 
 

  (15)  

 
 
 

  26  

 
 

   Net loss   

 
 
 

  (282)  

 
 
 

  (102)  

 
 

  Less: Net income attributable to non-controlling interests from continuing operations  

 
 
 

  

 
 
 

  25  

 
 

  Less: Net (loss) income attributable to non-controlling interests from discontinued
operations
 

 
 
 

  (3)  

 
 
 

  1  

 
 

   Net loss attributable to IGT PLC   

 
 
 

  (280)  

 
 
 

  (128)  

 
 
 
 
 
 
 

   Net loss from continuing operations attributable to IGT PLC per common share -
basic and diluted
 
 

 
 
 

  (1.31)  

 
 
 

  (0.75)  

 
 

   Net loss attributable to IGT PLC per common share - basic and diluted   

 
 
 

  (1.37)  

 
 
 

  (0.62)  

 
 

   Weighted-average shares - basic and diluted   

 
 
 

  204,748  

 
 
 

  204,857  

 
 
 
 
 
 
 
 

 

 
 
                                                                                                                                                                                                                                                                                    
 

   International Game Technology PLC   

 
 

   Consolidated Statements of Cash Flows   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 

  For the three months ended  

 
 
 
 

  June 30,  

 

  2020  

 
 
 

  September 30,  

 

  2020  

 
 

   Cash flows from operating activities   

 
 
 
 
 
 

  Net loss  

 
 
 

  (282)  

 
 
 

  (102)  

 
 

  Less: (Loss) income from discontinued operations, net of tax  

 
 
 

  (15)  

 
 
 

  26  

 
 

  Adjustments to reconcile net loss from continuing operations to net cash provided by operating activities from
continuing operations:
 

 
 
 
 
 
 

  Depreciation  

 
 
 

  88  

 
 
 

  91  

 
 

  Foreign exchange loss, net  

 
 
 

  74  

 
 
 

  149  

 
 

  Amortization  

 
 
 

  52  

 
 
 

  53  

 
 

  Amortization of upfront license fees  

 
 
 

  51  

 
 
 

  54  

 
 

  Loss on extinguishment of debt  

 
 
 

  28  

 
 
 

  

 
 

  Debt issuance cost amortization  

 
 
 

  5  

 
 
 

  5  

 
 

  Stock-based compensation  

 
 
 

  1  

 
 
 

  1  

 
 

  Deferred income taxes  

 
 
 

  (13)  

 
 
 

  (70)  

 
 

  Other non-cash items, net  

 
 
 

  4  

 
 
 

  1  

 
 

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

 
 
 
 
 
 

  Trade and other receivables  

 
 
 

  (192)  

 
 
 

  81  

 
 

  Inventories  

 
 
 

  10  

 
 
 

  (3)  

 
 

  Accounts payable  

 
 
 

  175  

 
 
 

  (25)  

 
 

  Other assets and liabilities  

 
 
 

  111  

 
 
 

  (18)  

 
 

   Net cash provided by operating activities from continuing operations   

 
 
 

  127  

 
 
 

  191  

 
 

   Net cash provided by operating activities from discontinued operations   

 
 
 

  40  

 
 
 

  95  

 
 

   Net cash provided by operating activities   

 
 
 

  168  

 
 
 

  285  

 
 
 
 
 
 
 

   Cash flows from investing activities   

 
 
 
 
 
 

  Capital expenditures  

 
 
 

  (54)  

 
 
 

  (65)  

 
 

  Proceeds from sale of assets  

 
 
 

  (1)  

 
 
 

  1  

 
 

  Other  

 
 
 

  

 
 
 

  2  

 
 

   Net cash used in investing activities from continuing operations   

 
 
 

  (55)  

 
 
 

  (62)  

 
 

   Net cash used in investing activities from discontinued operations   

 
 
 

  (6)  

 
 
 

  (1)  

 
 

   Net cash used in investing activities   

 
 
 

  (61)  

 
 
 

  (63)  

 
 
 
 
 
 
 

   Cash flows from financing activities   

 
 
 
 
 
 

  Principal payments on long-term debt  

 
 
 

  (790)  

 
 
 

  (579)  

 
 

  Net payments of short-term borrowings  

 
 
 

  (35)  

 
 
 

  (83)  

 
 

  Payments in connection with the extinguishment of debt  

 
 
 

  (25)  

 
 
 

  

 
 

  Payments of debt issuance costs  

 
 
 

  (20)  

 
 
 

  (2)  

 
 

  Net (payments of) receipts from financial liabilities  

 
 
 

  (14)  

 
 
 

  59  

 
 

  Proceeds from long-term debt  

 
 
 

  750  

 
 
 

  

 
 

  Dividends paid - non-controlling interests  

 
 
 

  (76)  

 
 
 

  (45)  

 
 

  Capital increase - non-controlling interests  

 
 
 

  

 
 
 

  1  

 
 

  Other  

 
 
 

  (4)  

 
 
 

  (3)  

 
 

   Net cash used in financing activities   

 
 
 

  (213)  

 
 
 

  (650)  

 
 
 
 
 
 
 

  Net decrease in cash and cash equivalents and restricted cash and cash equivalents  

 
 
 

  (106)  

 
 
 

  (428)  

 
 

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

 
 
 

  18  

 
 
 

  38  

 
 

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

 
 
 

  1,618  

 
 
 

  1,530  

 
 

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

 
 
 

  1,530  

 
 
 

  1,140  

 
 

  Less: Cash and cash equivalents and restricted cash and cash equivalents of discontinued operations  

 
 
 

  19  

 
 
 

  19  

 
 

  Cash and cash equivalents and restricted cash and cash equivalents at the end of the period of continuing operations  

 
 
 

  1,511  

 
 
 

  1,121  

 
 
 
 
 
 
 

   Supplemental Cash Flow Information:   

 
 
 
 
 
 

  Interest paid  

 
 
 

  49  

 
 
 

  141  

 
 

  Income taxes paid  

 
 
 

  7  

 
 
 

  20  

 
 
 

 

 
 
                                                                                                                                                                                                                                              
 

   International Game Technology PLC   

 
 

   Reconciliation of Non-GAAP Financial Measures   

 
 

    ($ in millions)    

 
 

    Unaudited    

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

  For the three months ended June 30, 2020  

 
 
 
 

  Global
Lottery
 

 
 
 

  Global
Gaming
 

 
 
 

  Business
Segment
Total
 

 
 
 

  Corporate
and Other
 

 
 
 

  Total IGT
PLC
 

 
 

  Loss from continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  (268)  

 
 

  Benefit from income taxes  

 
 
 
 
 
 
 
 
 
 
 

  (3)  

 
 

  Interest expense, net  

 
 
 
 
 
 
 
 
 
 
 

  96  

 
 

  Foreign exchange loss, net  

 
 
 
 
 
 
 
 
 
 
 

  74  

 
 

  Other non-operating expense, net  

 
 
 
 
 
 
 
 
 
 
 

  28  

 
 

  Operating income (loss)  

 
 
 

  107  

 
 
 

  (111)  

 
 
 

  (4)  

 
 
 

  (69)  

 
 
 

  (72)  

 
 

  Depreciation  

 
 
 

  50  

 
 
 

  37  

 
 
 

  87  

 
 
 

  

 
 
 

  88  

 
 

  Amortization - service revenue (1)  

 
 
 

  51  

 
 
 

  

 
 
 

  51  

 
 
 

  

 
 
 

  51  

 
 

  Amortization - non-purchase accounting  

 
 
 

  7  

 
 
 

  2  

 
 
 

  9  

 
 
 

  1  

 
 
 

  10  

 
 

  Amortization - purchase accounting  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  42  

 
 
 

  42  

 
 

  Restructuring  

 
 
 

  5  

 
 
 

  35  

 
 
 

  40  

 
 
 

  3  

 
 
 

  43  

 
 

  Stock-based compensation  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  1  

 
 
 

  1  

 
 

  Other (2)  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  1  

 
 
 

  1  

 
 

   Adjusted EBITDA   

 
 
 

   221   

 
 
 

   (36)   

 
 
 

   184   

 
 
 

   (20)   

 
 
 

   164   

 
 
 
 
 
 
 
 
 
 
 
 
 

  Cash flows from operating activities - continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  127  

 
 

  Capital expenditures  

 
 
 
 
 
 
 
 
 
 
 

  (54)  

 
 

   Free Cash Flow   

 
 
 
 
 
 
 
 
 
 
 

   73   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 

   (1) Includes amortization of upfront license fees  

 
 

   (2) Primarily includes transaction-related costs  

 
 
 

 

 
 
                                                                                                                                                                                                                    
 
 
 

  For the three months ended September 30, 2020  

 
 
 
 

  Global
Lottery
 

 
 
 

  Global
Gaming
 

 
 
 

  Business
Segment
Total
 

 
 
 

  Corporate
and Other
 

 
 
 

  Total IGT
PLC
 

 
 

  Loss from continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  (129)  

 
 

  Benefit from income taxes  

 
 
 
 
 
 
 
 
 
 
 

  (41)  

 
 

  Interest expense, net  

 
 
 
 
 
 
 
 
 
 
 

  101  

 
 

  Foreign exchange loss, net  

 
 
 
 
 
 
 
 
 
 
 

  149  

 
 

  Other non-operating expense, net  

 
 
 
 
 
 
 
 
 
 
 

  6  

 
 

  Operating income (loss)  

 
 
 

  196  

 
 
 

  (50)  

 
 
 

  146  

 
 
 

  (59)  

 
 
 

  87  

 
 

  Depreciation  

 
 
 

  51  

 
 
 

  40  

 
 
 

  91  

 
 
 

  

 
 
 

  91  

 
 

  Amortization - service revenue (1)  

 
 
 

  54  

 
 
 

  

 
 
 

  54  

 
 
 

  

 
 
 

  54  

 
 

  Amortization - non-purchase accounting  

 
 
 

  8  

 
 
 

  2  

 
 
 

  10  

 
 
 

  1  

 
 
 

  11  

 
 

  Amortization - purchase accounting  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  42  

 
 
 

  42  

 
 

  Stock-based compensation  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  1  

 
 
 

  1  

 
 

  Other (2)  

 
 
 

  

 
 
 

  

 
 
 

  

 
 
 

  1  

 
 
 

  1  

 
 

   Adjusted EBITDA   

 
 
 

   309   

 
 
 

   (8)   

 
 
 

   301   

 
 
 

   (13)   

 
 
 

   287   

 
 
 
 
 
 
 
 
 
 
 
 
 

  Cash flows from operating activities - continuing operations  

 
 
 
 
 
 
 
 
 
 
 

  191  

 
 

  Capital expenditures  

 
 
 
 
 
 
 
 
 
 
 

  (65)  

 
 

   Free Cash Flow   

 
 
 
 
 
 
 
 
 
 
 

   126   

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
 
 

   (1) Includes amortization of upfront license fees  

 
 

   (2) Primarily includes transaction-related costs  

 
 
 

 

 
 
 

 Cision View original content to download multimedia: https://www.prnewswire.com/news-releases/international-game-technology-plc-reports-first-quarter-2021-results-301288342.html  

 

SOURCE International Game Technology PLC

 
 

News Provided by PR Newswire via QuoteMedia

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Annual Revenue Growth of 57%, Gross Margin up 91%

 

NorthStar Gaming Holdings Inc. (TSXV: BET) (OTCQB: NSBBF) ("NorthStar" or the "Company") today announced its financial results for the three months and year ended December 31, 2024. The Company also announced that it will discuss the results on an investor webinar to be held Thursday, May 15, 2025 at 11:00am (please see below for details). All dollar figures are quoted in Canadian dollars.

 

"We delivered strong financial results in 2024, highlighted by 57% growth in revenue and a 91% increase in gross margin. At the same time, we held marketing expense to a 10% increase and reduced G&A expense, demonstrating the continually improving operating leverage built into our business model," said Michael Moskowitz, Chair and CEO of NorthStar. "Equally important, our team rolled out innovations in both our sportsbook and casino that have further differentiated NorthStar Bets as a premium offering and helped drive the retention of, and engagement with, our loyal customers."

 

Restatement of Results

 

The comparative results for the three months and twelve months ended December 31, 2023 have been restated in the financial statements and management's discussion & analysis ("FY2024 MD&A") for the year ended December 31, 2024 to include additional merchant fees and player bonus expenses which were not captured in the previously published financial statements (note 2 of the Financial Statements for the year ended December 31, 2024). The Company's payment processor deducted the additional merchant fee from the daily remittances to the Company, and the deductions were not accounted for by the Company. These additional fees were identified as part of the year-end reconciliation of the amount due from the payment processor, and the financial statements and FY2024 MD&A have been adjusted accordingly. These restatements did not impact the cash balances reported for the years ended December 31, 2022, 2023, or 2024. However, they did result in adjustments to the reported current asset balances for those periods.

 

Financial Highlights for the Fourth Quarter Ended December 31, 2024 ("Q4 2024"):

 
  •  Total Wagers1 at Northstarbets.ca were $303.0 million in Q4 2024, a 42% increase compared to $213.3 million in Q4 2023.
  •  
  •  Gross Gaming Revenue2 at Northstarbets.ca was $10.0 million in Q4 2024, a 31.6% increase from $7.6 million in Q4 2023.
  •  
  •  Revenue2 was $9.5 million in Q4 2024, a 51% increase from $6.3 million in Q4 2023. Revenue in Q4 2024 includes $1.5 million of managed services revenue, which compares to $0.2 million in Q4 2023.
  •  
  •  Gross Margin was $3.6 million, a 71% increase from $2.1 million in Q4 2023, while the Gross Margin percentage increased to 38.1%, up from 33.6% in Q4 2023.
  •  
  •  Profit/(loss) before marketing and other expenses1 was $0.6 million in Q4 2024 compared to a loss of $2.5 million in Q4 2023, indicating that gross margin is now sufficient to cover the Company's overhead expenses.
  •  

Financial Highlights for the Year Ended December 31, 2024 ("FY 2024"):

 
  •  Total Wagers2 at Northstarbets.ca were $980.0 million in FY 2024, a 51% increase compared to $648.8 million in the year ended December 31, 2023.
  •  
  •  Gross Gaming Revenue2 at Northstarbets.ca was $34.0 million in FY 2024, a 51% increase from $22.5 million in FY 2023.
  •  
  •  Revenue2 was $29.6 million in FY 2024, a 57% increase from $18.8 million in FY 2023. Revenue in FY 2024 includes $2.3 million of managed services revenue, which compares to $0.5 million in FY 2023.3
  •  
  •  Gross Margin was $10.5 million, marking a 91% increase from $5.5 million in FY 2023, with the Gross Margin increasing to 35.7%, up from 29.3% in FY 2023.
  •  
  •  Profit/(loss) before marketing and other expenses1 was $0.1 million in FY 2024 compared to a loss of $6.7 million in YTD 2023, an improvement of $6.8 million.
  •  

"Early in 2025, we completed our most significant fund-raising to date, with a $43.4 million debt financing. This capital gives us a long runway on which to continue our trajectory of growth in wagering, gross margins and improving operating leverage. This was a milestone event for our business," added Mr. Moskowitz.

 

2024 Operating Highlights:

 
  • Completed the inaugural Blackjack Championship tournament, an innovative online competition that helped drive the acquisition of new high-value players and engagement for existing customers while increasing Blackjack wagering activity.
  •  
  • Implemented a series of enhancements to the NorthStar Bets platform, highlighted by streamlined navigation in both the Casino and Sportsbook sections, a doubling of Casino game selection since the start of 2024, personalized prop bets and intelligent parlay suggestions.
  •  
  • Introduced the "NorthStar Elite" program and branded tables to help secure the loyalty and satisfaction of our most active players and reinforcing the Company's positioning as a premium offering.
  •  
  • Launched "Sports Insights 2.0," a robust suite of enhancements to our content vertical that includes a redesigned home page, comprehensive team and player statistics, injury and player news feeds, added coverage of popular sports and strengthened casino content.
  •  
  • Gained significant traction outside the Ontario market with managed services revenue from Northstarbets.com site, owned by the Abenaki Council of Wolinak, increasing from $0.5 million in FY 2023 to $2.3 million in FY 2024.
  •  
  • Outpaced the industry growth rates reported by iGaming Ontario in 2024 in both Total Wagers (51% for NorthStar vs. 33% for the industry) and Gross Gaming Revenue (51% for NorthStar vs. 31.5% for the industry).
  •  

Outlook

 

"We expect our consistent pattern of year-over-year revenue increases to continue throughout 2025, based on our ongoing success in attracting and engaging high-value players," said Mr. Moskowitz. "We will maintain disciplined control over costs so that incremental gross margin falls primarily to the bottom line. As we continue to focus on operational excellence, we remain confident that we have the capital necessary to reach profitability based on our current business platform."

 

FY 2024 Corporate Update Webinar

 

On May 15, 2025, Michael Moskowitz will present an in-depth Corporate Update, including a discussion of the Company's FY 2024 Earnings, current operations and strategic priorities. All investors and other interested parties are invited to register for the webinar at the link below.

 

Date: Thursday, May 15, 2025
Time: 11:00 am EDT
Register: Webinar Registration

 

Management will be available to answer your questions following the presentation on the webinar platform. You may also submit your question(s) beforehand in the registration form linked above.

 

Extension of Strategic Marketing Agreement

 

The Company also announced that its wholly owned subsidiary, NorthStar Gaming (Ontario) Inc. ("NorthStar Ontario"), has extended its strategic partnership with Playtech Software Limited ("Playtech Software") through the renewal of their previously announced strategic marketing agreement. Under the agreement, Playtech Software contributes services designed to accelerate NorthStar Ontario's player acquisition strategy in the province. The agreement was first implemented in June 2023 and has since been renewed several times. Pursuant to the latest renewal, Playtech Software will reimburse marketing expenses valued at a total of up to $1.5 million over a 3-month period through to March 31, 2025. Playtech Software will be compensated through a share of revenue from the income generated in connection with the marketing initiatives to which it contributes. The Transaction between Playtech and NorthStar Ontario is exempted from Multilateral Instrument 61-101 Protection of Minority Securityholders in Special Transactions.

 

"We are very pleased to renew the marketing services agreement with Playtech Software," said Michael Moskowitz, Chair and CEO of NorthStar. "The agreement serves to extend our marketing budget and has contributed to our tremendous growth in Ontario. Playtech plc continues to be a valuable strategic partner and we look forward to further collaboration."

 

Continuous Disclosure

 

Further to a review by the staff of the Ontario Securities Commission (the "OSC") of the Company's continuous disclosure, the FY2024 MD&A includes enhanced disclosures with respect to:

 
  • the Company's regulatory framework, licensing regimes applicable to its business operations and the legal authorizations necessary to conduct its business operations;
  •  
  • specific risk factors relating to the Company's business operations which include risks relating to operating in a heavily regulated industry, cyber security risks and risks relating to conflicts of interest with respect to directors and officers of the Company; and
  •  
  • the relationship between the Abenaki Council of Wolinak and the Company as well as its subsidiary, Slapshot Media Inc.
  •  

Such amended disclosure is being included in the FY2024 MD&A to address comments received from the OSC on its management's discussion & analysis, for the period ended September 30, 2024, and to improve the Company's disclosure.

 

As a result of having to include such enhanced disclosure after the OSC review, the Company will be placed on the public list of Refilings and Errors in accordance with OSC Staff Notice 51-711 (Revised) - Refilings and Corrections of Errors for a period of three (3) years.

 

Additional Information

 

For additional information, please refer to the Company's condensed consolidated financial statements for the year ended December 31, 2024, and the corresponding FY2024 MD&A. These documents are available on SEDAR+ at www.sedarplus.ca, and on the Company's corporate website at www.northstargaming.ca.

 

About NorthStar

 

NorthStar proudly owns and operates NorthStar Bets, a Canadian-born casino and sportsbook platform that delivers a premium, distinctly local gaming experience. Designed with high-stakes players in mind, NorthStar Bets Casino offers a curated selection of the most popular games, ensuring an elevated user experience. Our sportsbook stands out with its exclusive Sports Insights feature, seamlessly integrating betting guidance, stats, and scores, all tailored to meet the expectations of a premium audience.

 

As a Canadian company, NorthStar is uniquely positioned to cater to customers who seek a high-quality product and an exceptional level of personalized service, setting a new standard in the industry. NorthStar is committed to operating at the highest level of responsible gaming standards.

 

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the TSX Venture Exchange ("TSXV") nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

 

Non-IFRS Financial Measures [/ Reconciliation of Non-IFRS Measures to IFRS Measures]

 

Throughout this document, management uses certain non-IFRS financial measures and supplementary financial measures to evaluate the performance of the Company. The terms "Gross Gaming Revenue" "Total Wagers" and "Profit/(Loss) before marketing and other expenses" are non-IFRS financial measures. These measures are not recognized measures under International Financial Reporting Standards ("IFRS") and do not have a standardized meaning prescribed by IFRS and are, therefore, not necessarily comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of our results of operations from management's perspective and to discuss NorthStar's financial outlook. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company's financial information reported under IFRS. We believe that securities analysts, investors and other interested parties frequently use non-IFRS measures, including industry metrics, in the evaluation of companies in our industry. Management also uses non-IFRS measures and industry metrics in order to facilitate operating performance comparisons from period to period, the preparation of annual operating budgets and forecasts and to determine components of executive compensation.

 

Total Wagers

 

Total Wagers are calculated as the total amount of money bet by customers in respect of bets that have settled in the applicable period. Total Wagers does not include free bets or other promotional incentives, nor money bet by customers in respect of bets that are open at period end. Total Wagers is used to provide investors with supplemental measures of our operating performance and thus highlight trends in our business that may not otherwise be apparent when relying solely on IFRS measures.

 

Gross Gaming Revenue

 

Gross Gaming Revenue is calculated as dollar amounts bet by customers less the dollar amounts paid out to the customers in respect of such bets which have settled in the applicable period.

 

Reconciliation of Non-IFRS Measures to IFRS Measures

 
                                
 In Q4 2024, the Company reported $10.0 million of Gross Gaming Revenue ($34.0 million in FY 2024) and has provided a reconciliation to the most comparable IFRS financial measure (Revenue) as follows:
$ Millions (unaudited)
Unaudited Three
months ended
Year ended
 Dec 31,
2024 
 Dec 31,
2023 
 Dec 31,
2024 
 Dec 31,
2023 
Gross gaming revenue from wagered games$10.0$ 7.6$ 34.0$22.5
Bonuses, promotional costs and free bets(2.0)(1.5)(6.7)(4.2)
Sub-total Gaming revenue8.06.127.318.3
Other revenue from managed services1.50.22.30.5
Revenue$ 9.5$ 6.3$ 29.6$ 18.8
 

 

 

Operating Results

 

Marketing expenses are a key driver of the business but are completely discretionary. Management considers "Profit/(Loss) before marketing and other expenses" to be a good indication of the extent to which the business' Gross Margin is in excess of its overhead costs, and therefore offsetting some portion of marketing expenses, reflecting improving economies of scale.

 
                                                    
$ Millions (unaudited) Unaudited Three 
months ended 
Year ended
 Dec 31,
2024 
 Dec 31,
2023 
 Dec 31,
2024 
 Dec 31,
2023 
Revenue$ 9,478$ 6,275$ 29,556$ 18,845
Cost of Revenues5,8684,16719,01313,317
Gross Margin3,6102,10810,5435,528
General and administrative expenses3,0334,45210,45312,277
 Profit/(Loss) before marketing and other expenses (1) 577(2,344)90(6,749)
Marketing5,2495,47215,45614,094
Loss before other expenses (1) (4,672)(7,816)(15,366)(20,843)
Other expenses(1,070)1493,6456,547
Net loss$ (3,602)$ (7,965)$ (19,011)$ (27,390)
 

 

 

(1) These measures are not defined by IFRS, do not have standard meanings and may not be comparable with other industries or companies.

 

Cautionary Note Regarding Forward-Looking Information and Statements

 

This communication contains "forward-looking information" within the meaning of applicable securities laws in Canada ("forward-looking statements"), including without limitation, statements with respect to the following: expected performance of the Company's business, the Company's growth plans being fully funded, expansion into new markets and future growth opportunities, and expected benefits of transactions. The foregoing are provided for the purpose of presenting information about management's current expectations and plans relating to the future and allowing investors and others to get a better understanding of the Company's anticipated financial position, results of operations, and operating environment. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates" or "believes", or variations of, or the negatives of, such words and phrases, or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. This forward-looking information is based on management's opinions, estimates and assumptions that, while considered by NorthStar to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, levels of activity, performance, or achievements to be materially different from those expressed or implied by such forward-looking information. Such factors include, among others, the following: risks related to the Company's business and financial position; risks associated with general economic conditions; adverse industry risks; future legislative and regulatory developments; the ability of the Company to implement its business strategies; and those factors discussed in greater detail under the "Risk Factors" section of the Company's most recent annual information form, which is available under NorthStar's profile on SEDAR+ at www.sedarplus.ca. Many of these risks are beyond the Company's control.

 

If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking statements. Although the Company has attempted to identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking statements, there may be other risk factors not presently known to the Company or that the Company presently believes are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking statements. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. No forward-looking statement is a guarantee of future results. Accordingly, you should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this press release represents NorthStar's expectations as of the date specified herein, and are subject to change after such date. However, the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

 

All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.

 
 

For further information:

 

Company Contact:

 

Corey Goodman
Chief Development Officer 647-530-2387
investorrelations@northstargaming.ca

 

Investor Relations:
RB Milestone Group LLC (RBMG)
Northstar@rbmilestone.com

 
 

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