INTERNATIONAL GAME TECHNOLOGY PLC REPORTS FIRST QUARTER 2024 RESULTS
International Game Technology (IGT) reported a Q1 2024 revenue of $1.07 billion, up 1% YoY, driven by strong Global Lottery performance. Operating income was $256 million, in line with the previous year, but rose to $273 million excluding separation costs. Adjusted EBITDA was $461 million, up 3% when excluding separation costs.
Global Lottery revenue increased by 6% to $661 million, while Gaming & Digital revenue decreased by 7% to $406 million. Net income more than doubled to $128 million, and diluted EPS rose to $0.40 from $0.11. Despite lower cash flow and liquidity, IGT upgraded its 2024 outlook, projecting full-year revenue of $4.4 billion.
Key highlights include a spinoff transaction with Everi Holdings, awards at ICE London 2024, and a new licensing agreement with the Maryland Lottery.
- Quarterly revenue increased by 1% to $1.07 billion.
- Global Lottery revenue up 6% to $661 million driven by higher product sales.
- Operating income excluding separation costs increased by 7% to $273 million.
- Adjusted EBITDA excluding separation costs increased by 3% to $461 million.
- Net income more than doubled to $128 million.
- Diluted EPS significantly improved to $0.40 from $0.11.
- Upgraded FY 2024 outlook with projected revenue of $4.4 billion.
- Achieved AAA MSCI ESG rating and gold medal sustainability rating from EcoVadis.
- Announced spinoff transaction with Everi Holdings, expected to close late 2024/early 2025.
- Received awards at ICE London 2024 for 'Lottery Product of the Year' and 'Best Diversity and Inclusion Employer'.
- Gaming & Digital revenue declined by 7% to $406 million.
- Corporate support expenses increased by 85%, negatively impacting operating income.
- Net cash provided by operating activities fell sharply by 61% to $120 million.
- Cash and cash equivalents decreased by 44% to $377 million.
- Free cash flow plummeted by 86% to $29 million.
- Adjusted earnings per share dropped by 6% to $0.46.
- Net debt slightly increased to $5.2 billion from $5.1 billion.
- Higher corporate support and other expenses totaled $83 million, up from $68 million.
Insights
IGT’s reported revenue of $1.07 billion, reflecting a
Moreover, the Adjusted EBITDA margin of
The 6% increase in Global Lottery revenue indicates a strong market demand for lottery products, supported by new product launches like the GameTouch™ 28 terminals. However, the Gaming & Digital division's performance, notably the
On the strategic front, the planned spin-off of the Gaming & Digital business to combine with Everi Holdings highlights a significant restructuring effort aimed at unlocking shareholder value. This move could result in a more focused business model for IGT, potentially driving better performance metrics. Additionally, the company’s recognition in sustainability and diversity enhances its corporate image, which could positively affect investor sentiment.
IGT’s technological advancements, particularly in the iGaming space, have shown progress with a
However, the lower product sales in the Gaming & Digital segment suggest a slowdown in hardware demand or market saturation. Continued investment in technology and innovation will be important for sustaining growth in this highly competitive sector. The upcoming spin-off could also enable more targeted technological advancements within the distinct business units.
- Revenue of
$1.07 billion 1% from the prior year, driven by strong Global Lottery growth, partially offset by timing of Gaming & Digital product sales - Operating income of
$256 million 24.0% exceeded expectations by approximately 400 basis points; excluding Separation & divestiture costs, operating income increased7% to a record$273 million - Adjusted EBITDA of
$443 million 41.5% ; excluding Separation & divestiture costs, Adjusted EBITDA was$461 million 43.1% - Upgrading FY'24 outlook on strong Q1'24 results
"Innovative game, hardware, and systems solutions drove better-than-expected Global Lottery and Gaming & Digital performance in the first quarter," said Vince Sadusky, CEO of IGT. "As a result, we are upgrading our full-year 2024 revenue and profit goals, which reflect broad-based momentum across key performance indicators in the balance of the year. We continue to make progress on separating Global Lottery from Gaming & Digital and preparing for the proposed transaction with Everi."
"We delivered a record organic profit performance in the first quarter, if we exclude Separation & divestiture costs," said Max Chiara, CFO of IGT. "The Company is operating from a position of strength with historically low net debt leverage, ample liquidity, and manageable near-term debt maturities."
Overview of Consolidated First Quarter 2024 Results
Quarter Ended | Y/Y | Constant | |||
March 31, | |||||
2024 | 2023 | ||||
($ in millions) | |||||
GAAP Financials: | |||||
Revenue | |||||
Global Lottery | 661 | 624 | 6 % | 6 % | |
Gaming & Digital | 406 | 436 | (7) % | (7) % | |
Total revenue | 1,067 | 1,060 | 1 % | 1 % | |
Operating income (loss) | |||||
Global Lottery | 258 | 240 | 8 % | 7 % | |
Gaming & Digital | 81 | 83 | (3) % | (2) % | |
Corporate support expense | (47) | (26) | (85) % | (83) % | |
Other(1) | (35) | (42) | 16 % | 16 % | |
Total operating income | 256 | 255 | — % | — % | |
Operating income margin | 24.0 % | 24.1 % | |||
Operating income excluding Separation & divestiture costs | 273 | 255 | 7 % | 7 % | |
Operating income margin excluding Separation & divestiture costs | 25.6 % | 24.1 % | |||
Earnings per share - diluted | 264 % | ||||
Net cash provided by operating activities | 120 | 311 | (61) % | ||
Cash and cash equivalents | 377 | 669 | (44) % | ||
Non-GAAP Financial Measures: | |||||
Adjusted EBITDA | |||||
Global Lottery | 355 | 339 | 5 % | 4 % | |
Gaming & Digital | 127 | 129 | (1) % | (1) % | |
Corporate support expense | (39) | (19) | (108) % | (106) % | |
Total Adjusted EBITDA | 443 | 449 | (1) % | (1) % | |
Adjusted EBITDA margin | 41.5 % | 42.3 % | |||
Adjusted EBITDA excluding Separation & divestiture costs | 461 | 449 | 3 % | 2 % | |
Adjusted EBITDA margin excluding Separation & divestiture costs | 43.1 % | 42.3 % | |||
Adjusted earnings per share - diluted | (6) % | ||||
Free cash flow | 29 | 216 | (86) % | ||
Net debt | 5,161 | 5,118 | 1 % | ||
(1) Primarily includes purchase price amortization | |
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:
- Announced Gaming & Digital business to be spun off and combined with Everi Holdings, Inc.; transaction expected to close in late 2024/early 2025
- Recognized with top honors at ICE London 2024 awards programs including "Lottery Product of the Year" and "Best Diversity and Inclusion Employer"
- Received a supply contract extension from the
UK National Lottery - Executed licensing agreement with the Maryland Lottery for IGT's patented Cash Pop™ draw-based game
- Mystery of the Lamp™ named "Top Performing New Premium Game" at 2024 EKG Slot Awards Show
- Awarded contract to provide PeakDual™ 27 video lottery terminals across
Quebec - Launched iGaming content in
Rhode Island - Achieved AAA MSCI ESG rating, the highest rating possible, and earned a gold medal sustainability rating from EcoVadis
Financial Highlights:
Consolidated revenue of
- Global Lottery revenue of
$661 million 6% year-over-year on significantly higher product sales, driven by delivery of GameTouch™ 28 self-service terminals inCanada and software upgrades inSingapore andGermany , and continued same-store sales strength inItaly - Gaming & Digital revenue of
$406 million $436 million 10% increase in iGaming revenue
Operating income of
- Global Lottery operating income of
$258 million 8% compared to$240 million Italy same-store sales and higher product sales margin - Gaming & Digital operating income of
$81 million $83 million 20% - Corporate support and other expense of
$83 million $68 million $18 million
Adjusted EBITDA of
Net interest expense of
Foreign exchange gain of
Other non-operating expense, net of
Income tax provision of
Net income of
Diluted earnings per share of
Net debt of
Cash and Liquidity Update
Total liquidity of
Other Developments
Marco Drago to step down from his role as non-executive director of the IGT Board of Directors following the Annual General Meeting on May 14, 2024; Enrico Drago appointed as a non-executive director
IGT Lottery S.p.A., IGT's operating holding company in
The Company's Board of Directors declared a quarterly cash dividend of
- Record date of May 30, 2024
- Payment date of June 13, 2024
Introducing Second Quarter 2024 Expectations; Upgrading Full Year 2024 Outlook
Second Quarter
- Revenue of
~ $1.05 billion - Operating income margin of ~
22% ; ~24.5% excluding Separation & divestiture costs
Full Year
- Revenue of
~ $4.4 billion - Operating income margin of ~
21% ; ~24% excluding Separation & divestiture costs - Cash from operations of ≥
$1.0 billion - Capital expenditures of
~ $500 million
Earnings Conference Call and Webcast
May 14, 2024, at 8:00 a.m. EDT
To register to participate in the conference call, or to listen to the live audio webcast, please visit the "Events Calendar" on IGT's Investor Relations website at www.IGT.com. A replay will be available on the website following the live event.
Comparability of Results
All figures presented in this news release are prepared under
About IGT
IGT (NYSE:IGT) is a global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Lotteries and Gaming Machines 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 jurisdictions 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 and strategies, transactions, including the Separation and divestiture, trends, events, dividends, results of operations, and/or financial condition or measures, including our expectations regarding revenue, operating income, cash, and capital expenditures for the second quarter and full year 2024, 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," "outlook," "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, 2023 and other documents filed or furnished 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 may affect the Company's business, including management's discussion and analysis of potential or actual impacts to operations and financial performance. 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) (a GAAP measure) before income taxes, interest expense, net, foreign exchange gain (loss), net, other non-operating expenses (e.g., DDI/Benson Matter provision, gains/losses on extinguishment and modifications of debt, etc.), net, 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 Adjusted EBITDA is useful in providing period-to-period comparisons of the results of the Company's ongoing operational performance.
Adjusted EBITDA margin represents Adjusted EBITDA divided by revenue
Adjusted EPS represents diluted earnings per share (a GAAP measure), excluding the effects of foreign exchange, impairments, amortization from purchase accounting, discrete tax items, and other significant non-recurring adjustments that are not reflective of on-going operational activities (e.g., gains/losses on sale of business, gains/losses on extinguishment and modifications of debt, etc.). Adjusted EPS is calculated using diluted weighted-average number of shares outstanding, including the impact of any potentially dilutive common stock equivalents that are anti-dilutive to GAAP net income (loss) per share but dilutive to Adjusted EPS. Management believes that Adjusted EPS is 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 equivalents, including cash and cash equivalents classified as held for sale. Cash and cash equivalents, including cash and cash equivalents held for sale, 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.
Net debt leverage is a non-GAAP financial measure that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months ("LTM") prior to such date. Management believes that Net debt leverage is a useful measure to assess IGT's financial strength and ability to incur incremental indebtedness when making key investment decisions.
Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures (a component of investing cash flows) and payments on license obligations (a component of financing cash flows). 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 current financial data using the prior-year/period exchange rate (i.e., the exchange rate 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
Francesco Luti, +39 06 5189 9184; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190
Select Performance and KPI data: ($ in millions, unless otherwise noted) | |||||||||||
Constant | Sequential | ||||||||||
Q1'24 | Q1'23 | Currency | Change as | ||||||||
GLOBAL LOTTERY | Y/Y Change | Change(1) | Q4'23 | Reported | |||||||
Revenue | |||||||||||
Service | |||||||||||
Operating and facilities management contracts | 653 | 637 | 2 % | 2 % | 624 | 5 % | |||||
Upfront license fee amortization | (47) | (47) | (1) % | — % | (47) | — % | |||||
Operating and facilities management contracts, net | 605 | 590 | 3 % | 2 % | 577 | 5 % | |||||
Other | 13 | 12 | 10 % | 13 % | 15 | (11) % | |||||
Total service revenue | 619 | 602 | 3 % | 2 % | 592 | 5 % | |||||
Product sales | 42 | 22 | 92 % | 92 % | 89 | (52) % | |||||
Total revenue | 661 | 624 | 6 % | 6 % | 681 | (3) % | |||||
Operating income | 258 | 240 | 8 % | 7 % | 238 | 8 % | |||||
Adjusted EBITDA(1) | 355 | 339 | 5 % | 4 % | 343 | 4 % | |||||
Global same-store sales growth (%) | |||||||||||
Instant ticket & draw games | (0.2 %) | 4.8 % | — % | ||||||||
Multi-jurisdiction jackpots | (1.0 %) | 48.2 % | (25.0 %) | ||||||||
Total | (0.3 %) | 8.0 % | (3.5 %) | ||||||||
Instant ticket & draw games | (1.6 %) | 3.2 % | (0.9 %) | ||||||||
Multi-jurisdiction jackpots | (1.0 %) | 48.2 % | (25.0 %) | ||||||||
Total | (1.5 %) | 7.4 % | (5.0 %) | ||||||||
Instant ticket & draw games | 4.4 % | 10.3 % | 2.9 % | ||||||||
(1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | |||||||||||
Constant | Sequential | ||||||||||
Q1'24 | Q1'23 | Currency | Change as | ||||||||
GAMING & DIGITAL | Y/Y Change | Change(1) | Q4'23 | Reported | |||||||
Revenue | |||||||||||
Service | |||||||||||
Terminal | 131 | 129 | 2 % | 2 % | 127 | 4 % | |||||
iGaming | 48 | 43 | 10 % | 10 % | 47 | 1 % | |||||
Systems, software, and other | 75 | 71 | 5 % | 5 % | 73 | 2 % | |||||
Total service revenue | 253 | 243 | 4 % | 4 % | 247 | 2 % | |||||
Product sales | |||||||||||
Terminal | 110 | 135 | (19) % | (18) % | 153 | (28) % | |||||
Systems, software, and other | 43 | 57 | (25) % | (25) % | 49 | (13) % | |||||
Total product sales revenue | 153 | 193 | (21) % | (20) % | 202 | (24) % | |||||
Total revenue | 406 | 436 | (7) % | (7) % | 449 | (10) % | |||||
Operating income | 81 | 83 | (3) % | (2) % | 97 | (17) % | |||||
Adjusted EBITDA(1) | 127 | 129 | (1) % | (1) % | 144 | (11) % | |||||
Installed base units | |||||||||||
Casino | 53,368 | 50,030 | 7 % | 53,190 | |||||||
Casino - L/T lease(2) | 701 | 872 | (20) % | 716 | |||||||
Total installed base units | 54,069 | 50,902 | 6 % | 53,906 | |||||||
Installed base units (by geography) | |||||||||||
US & | 34,146 | 33,175 | 3 % | 34,221 | |||||||
Rest of world | 19,923 | 17,727 | 12 % | 19,685 | |||||||
Total installed base units | 54,069 | 50,902 | 6 % | 53,906 | |||||||
Yields (by geography)(3), in absolute $ | |||||||||||
US & | (3) % | ||||||||||
Rest of world | (4) % | ||||||||||
Total yields | (5) % | ||||||||||
Global machine units sold | |||||||||||
New/expansion | 203 | 1,012 | (80) % | 425 | |||||||
Replacement | 6,424 | 7,260 | (12) % | 8,966 | |||||||
Total machine units sold | 6,627 | 8,272 | (20) % | 9,391 | |||||||
US & | |||||||||||
New/expansion | 46 | 892 | (95) % | 248 | |||||||
Replacement | 5,014 | 5,642 | (11) % | 6,481 | |||||||
Total machine units sold | 5,060 | 6,534 | (23) % | 6,729 | |||||||
(1) Non-GAAP measures; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | |||||||||||
(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 | Sequential | ||||||||||
Q1'24 | Q1'23 | Currency | Change as | ||||||||
GAMING & DIGITAL (Continued) | Y/Y Change | Change(1) | Q4'23 | Reported | |||||||
Rest of world machine units sold | |||||||||||
New/expansion | 157 | 120 | 31 % | 177 | |||||||
Replacement | 1,410 | 1,618 | (13) % | 2,485 | |||||||
Total machine units sold | 1,567 | 1,738 | (10) % | 2,662 | |||||||
Average Selling Price (ASP), in absolute $ | |||||||||||
US & | 6 % | ||||||||||
Rest of world | (4) % | ||||||||||
Total ASP | 3 % | ||||||||||
Constant | Sequential | ||||||||||
Q1'24 | Q1'23 | Currency | Change as | ||||||||
CONSOLIDATED | Y/Y Change | Change(1) | Q4'23 | Reported | |||||||
Revenue (by geography) | |||||||||||
US & | 660 | 666 | (1) % | (1) % | 707 | (7) % | |||||
258 | 243 | 6 % | 6 % | 244 | 5 % | ||||||
Rest of world | 150 | 151 | (1) % | (1) % | 178 | (16) % | |||||
Total revenue | 1,067 | 1,060 | 1 % | 1 % | 1,130 | (6) % | |||||
(1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | |||||||||||
International Game Technology PLC | ||||
Consolidated Statements of Operations | ||||
($ and shares in millions, except per share amounts) | ||||
Unaudited | ||||
For the three months ended | ||||
March 31, | ||||
2024 | 2023 | |||
Service revenue | 872 | 846 | ||
Product sales | 195 | 215 | ||
Total revenue | 1,067 | 1,060 | ||
Cost of services | 412 | 398 | ||
Cost of product sales | 118 | 127 | ||
Selling, general and administrative | 208 | 217 | ||
Research and development | 55 | 62 | ||
Separation and divestiture costs | 18 | — | ||
Total operating expenses | 812 | 805 | ||
Operating income | 256 | 255 | ||
Interest expense, net | 72 | 70 | ||
Foreign exchange (gain) loss, net | (15) | 26 | ||
Other non-operating expense, net | 1 | 4 | ||
Total non-operating expenses | 58 | 101 | ||
Income before provision for income taxes | 198 | 155 | ||
Provision for income taxes | 69 | 87 | ||
Net income | 128 | 67 | ||
Less: Net income attributable to non-controlling interests | 47 | 44 | ||
Net income attributable to IGT PLC | 82 | 23 | ||
Net income attributable to IGT PLC per common share - basic | 0.41 | 0.12 | ||
Net income attributable to IGT PLC per common share - diluted | 0.40 | 0.11 | ||
Weighted-average shares - basic | 200 | 200 | ||
Weighted-average shares - diluted | 203 | 202 | ||
International Game Technology PLC | ||||
Consolidated Balance Sheets | ||||
($ in millions) | ||||
Unaudited | ||||
March 31, | December 31, | |||
2024 | 2023 | |||
Assets | ||||
Current assets: | ||||
Cash and cash equivalents | 377 | 572 | ||
Restricted cash and cash equivalents | 119 | 167 | ||
Trade and other receivables, net | 723 | 685 | ||
Inventories, net | 321 | 317 | ||
Other current assets | 404 | 382 | ||
Total current assets | 1,944 | 2,123 | ||
Systems, equipment and other assets related to contracts, net | 908 | 928 | ||
Property, plant and equipment, net | 118 | 119 | ||
Operating lease right-of-use assets | 222 | 230 | ||
Goodwill | 4,491 | 4,507 | ||
Intangible assets, net | 1,522 | 1,555 | ||
Other non-current assets | 923 | 1,004 | ||
Total non-current assets | 8,184 | 8,342 | ||
Total assets | 10,128 | 10,465 | ||
Liabilities and shareholders' equity | ||||
Current liabilities: | ||||
Accounts payable | 733 | 797 | ||
Current portion of long-term debt | 715 | — | ||
Short-term borrowings | 6 | 16 | ||
Other current liabilities | 982 | 879 | ||
Total current liabilities | 2,436 | 1,691 | ||
Long-term debt, less current portion | 4,817 | 5,655 | ||
Deferred income taxes | 337 | 344 | ||
Operating lease liabilities | 206 | 214 | ||
Other non-current liabilities | 475 | 609 | ||
Total non-current liabilities | 5,834 | 6,821 | ||
Total liabilities | 8,270 | 8,513 | ||
Commitments and contingencies | ||||
IGT PLC's shareholders' equity | 1,504 | 1,443 | ||
Non-controlling interests | 354 | 510 | ||
Shareholders' equity | 1,858 | 1,952 | ||
Total liabilities and shareholders' equity | 10,128 | 10,465 | ||
International Game Technology PLC | |||
Consolidated Statements of Cash Flows | |||
($ in millions) | |||
Unaudited | |||
For the three months ended | |||
March 31, | |||
2024 | 2023 | ||
Cash flows from operating activities | |||
Net income | 128 | 67 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 71 | 77 | |
Amortization | 55 | 55 | |
Amortization of upfront license fees | 50 | 50 | |
Stock-based compensation | 11 | 11 | |
Deferred income taxes | (2) | 28 | |
Foreign exchange (gain) loss, net | (15) | 26 | |
Other non-cash items, net | 3 | 6 | |
Changes in operating assets and liabilities: | |||
Trade and other receivables | (44) | (32) | |
Inventories | (7) | (38) | |
Accounts payable | (45) | 111 | |
Accrued interest payable | (26) | (20) | |
Accrued income taxes | 4 | 40 | |
Other assets and liabilities | (63) | (71) | |
Net cash provided by operating activities | 120 | 311 | |
Cash flows from investing activities | |||
Capital expenditures | (84) | (94) | |
Other | 1 | 3 | |
Net cash used in investing activities | (83) | (91) | |
Cash flows from financing activities | |||
Net (repayments of) proceeds from Revolving Credit Facilities | (72) | 392 | |
Net (payments on) receipts from financial liabilities | (63) | 8 | |
Net (payments of) proceeds from short-term borrowings | (9) | 53 | |
Payments on license obligations | (7) | (1) | |
Principal payments on long-term debt | — | (462) | |
Dividends paid | — | (40) | |
Dividends paid - non-controlling interests | (101) | (92) | |
Return of capital - non-controlling interests | (10) | (10) | |
Other | 1 | (11) | |
Net cash used in financing activities | (262) | (163) | |
Net (decrease) increase in cash and cash equivalents and restricted cash and cash equivalents | (225) | 57 | |
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents | (18) | 8 | |
Cash and cash equivalents and restricted cash and cash equivalents at the beginning of the period | 739 | 740 | |
Cash and cash equivalents and restricted cash and cash equivalents at the end of the period | 496 | 805 | |
Supplemental Cash Flow Information | |||
Interest paid | 101 | 90 | |
Income taxes paid | 67 | 20 | |
International Game Technology PLC | |||
Net Debt | |||
($ in millions) | |||
Unaudited | |||
March 31, | December 31, | ||
2024 | 2023 | ||
— | 499 | ||
747 | 747 | ||
808 | 826 | ||
747 | 747 | ||
538 | 550 | ||
746 | 745 | ||
Senior Secured Notes | 3,586 | 4,113 | |
Euro Term Loan Facilities due January 2027 | 642 | 876 | |
Revolving Credit Facility A due July 2027 | 197 | 207 | |
Revolving Credit Facility B due July 2027 | 392 | 458 | |
Long-term debt, less current portion | 4,817 | 5,655 | |
499 | — | ||
Euro Term Loan Facilities due January 2027 | 216 | — | |
Current portion of long-term debt | 715 | — | |
Short-term borrowings | 6 | 16 | |
Total debt | 5,538 | 5,671 | |
Less: Cash and cash equivalents | 377 | 572 | |
Net debt | 5,161 | 5,099 | |
Note: Net debt is a non-GAAP financial measure | |||
International Game Technology PLC | ||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||
($ in millions, except per share amounts) | ||||||||||
Unaudited | ||||||||||
For the three months ended March 31, 2024 | ||||||||||
Business | ||||||||||
Global | Gaming & | Segments | Corporate | Total | ||||||
Lottery | Digital | Total | and Other | IGT PLC | ||||||
Net income | 128 | |||||||||
Provision for income taxes | 69 | |||||||||
Interest expense, net | 72 | |||||||||
Foreign exchange gain, net | (15) | |||||||||
Other non-operating expense, net | 1 | |||||||||
Operating income (loss) | 258 | 81 | 339 | (83) | 256 | |||||
Depreciation | 40 | 31 | 71 | — | 71 | |||||
Amortization - service revenue (1) | 50 | — | 50 | — | 50 | |||||
Amortization - non-purchase accounting | 5 | 14 | 19 | 1 | 20 | |||||
Amortization - purchase accounting | — | — | — | 35 | 35 | |||||
Stock-based compensation | 2 | 1 | 4 | 8 | 11 | |||||
Adjusted EBITDA | 355 | 127 | 482 | (39) | 443 | |||||
Cash flows from operating activities | 120 | |||||||||
Capital expenditures | (84) | |||||||||
Payments on license obligations | (7) | |||||||||
Free Cash Flow | 29 | |||||||||
Pre-Tax | Tax Impact | Net | ||||||||
Reported EPS attributable to IGT PLC - diluted | 0.40 | |||||||||
Adjustments: | ||||||||||
Foreign exchange gain, net | (0.09) | 0.02 | (0.11) | |||||||
Currency conversion impacts of hyper-inflationary economies | 0.01 | — | 0.01 | |||||||
Amortization - purchase accounting | 0.17 | 0.04 | 0.13 | |||||||
Discrete tax items | — | (0.02) | 0.02 | |||||||
Net adjustments | 0.06 | |||||||||
Adjusted EPS attributable to IGT PLC - diluted (4) | 0.46 | |||||||||
(1) Includes amortization of upfront license fees | ||||||||||
(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction | ||||||||||
(3) The reported effective tax rate was | ||||||||||
(4) Adjusted EPS was calculated using weighted average shares outstanding of 203.5 million, which includes the dilutive impact of share-based payment awards | ||||||||||
International Game Technology PLC | ||||||||||
Reconciliation of Non-GAAP Financial Measures | ||||||||||
($ in millions, except per share amounts) | ||||||||||
Unaudited | ||||||||||
For the three months ended March 31, 2023 | ||||||||||
Business | ||||||||||
Global | Gaming & | Segments | Corporate | Total | ||||||
Lottery | Digital | Total | and Other | IGT PLC | ||||||
Net income | 67 | |||||||||
Provision for income taxes | 87 | |||||||||
Interest expense, net | 70 | |||||||||
Foreign exchange loss, net | 26 | |||||||||
Other non-operating expense, net | 4 | |||||||||
Operating income (loss) | 240 | 83 | 323 | (68) | 255 | |||||
Depreciation | 43 | 33 | 76 | 2 | 77 | |||||
Amortization - service revenue (1) | 49 | — | 50 | — | 50 | |||||
Amortization - non-purchase accounting | 5 | 10 | 15 | 1 | 16 | |||||
Amortization - purchase accounting | — | — | — | 40 | 40 | |||||
Stock-based compensation | 2 | 2 | 4 | 6 | 11 | |||||
Adjusted EBITDA | 339 | 129 | 468 | (19) | 449 | |||||
Cash flows from operating activities | 311 | |||||||||
Capital expenditures | (94) | |||||||||
Payments on license obligations | (1) | |||||||||
Free Cash Flow | 216 | |||||||||
Pre-Tax | Tax Impact | Net | ||||||||
Reported EPS attributable to IGT PLC - diluted | 0.11 | |||||||||
Adjustments: | ||||||||||
Foreign exchange loss, net | 0.12 | (0.02) | 0.14 | |||||||
Currency conversion impacts of hyper-inflationary economies | 0.02 | — | 0.02 | |||||||
Amortization - purchase accounting | 0.20 | 0.05 | 0.15 | |||||||
Loss on extinguishment and modifications of debt, net | 0.02 | — | 0.02 | |||||||
Discrete tax items | — | (0.05) | 0.05 | |||||||
Net adjustments | 0.38 | |||||||||
Adjusted EPS attributable to IGT PLC - diluted (4) | 0.49 | |||||||||
(1) Includes amortization of upfront license fees | ||||||||||
(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction | ||||||||||
(3) The reported effective tax rate was | ||||||||||
(4) Adjusted EPS was calculated using weighted average shares outstanding of 201.7 million, which includes the dilutive impact of share-based payment awards | ||||||||||
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SOURCE International Game Technology PLC
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