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INTERNATIONAL GAME TECHNOLOGY PLC REPORTS SECOND QUARTER 2022 RESULTS
- Revenue of $1.02 billion, down 2% as reported and up 3% at constant currency, led by 23% growth in Global Gaming
- Operating income of $228 million; operating income margin of 22% at high end of outlook on substantial increase in Global Gaming profitability and resilience in Global Lottery margin
- Adjusted EBITDA of $409 million, in line with prior year’s record level at constant currency as Global Gaming performance offsets Lottery discrete benefits in the prior year; 40% adjusted EBITDA margin remains among the highest in Company history
- Recognized a non-operating expense of $150 million representing the probable loss associated with legal proceedings related to Double Down Interactive LLC and its social gaming business sold in 2017
- Diluted EPS from continuing operations of $(0.02); Adjusted diluted EPS from continuing operations of $0.57, up 78% from the prior year
- Compelling shareholder returns with $135 million deployed for cash dividends and share repurchases year-to-date
- Tightening full-year 2022 revenue outlook to reflect currency movements and perimeter impact from previously announced divestiture; reconfirming operating income margin outlook as fundamentals remain strong
International Game Technology PLC reported financial results for the second quarter ended June 30, 2022. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the results; access details are provided below.
“Strong customer and player demand for IGT’s products and solutions drove some of our strongest profit results ever in the second quarter and first half of the year,” said Vince Sadusky, CEO of IGT. “Our business profile is supported by significant recurring revenue streams backed by long-term contracts and resilient end markets, providing a solid foundation on which to grow. We are laser focused on executing our strategic objectives and creating compelling value for our stakeholders.”
“Our first half results set us firmly on the path to achieving our 2022 financial targets,” said Max Chiara, CFO of IGT. “Rigor on costs and incremental revenue opportunities allow us to maintain our full-year operating income margin outlook despite unfavorable currency movements and macroeconomic challenges. At the same time, we are returning significant capital to shareholders via dividends and share repurchases.”
Overview of Consolidated Second Quarter 2022 Results
|
Quarter Ended |
Y/Y |
Constant |
|||
|
All amounts from continuing operations |
June 30, |
||||
|
2022 |
2021 |
||||
|
($ in millions) |
|||||
|
GAAP Financials: |
|||||
|
Revenue |
|||||
|
Global Lottery |
648 |
725 |
(11) % |
(4) % |
|
|
Global Gaming |
330 |
274 |
21 % |
23 % |
|
|
Digital & Betting |
43 |
42 |
1 % |
4 % |
|
|
Total revenue |
1,021 |
1,041 |
(2) % |
3 % |
|
|
Operating income (loss) |
|||||
|
Global Lottery |
230 |
300 |
(23) % |
(16) % |
|
|
Global Gaming |
57 |
1 |
NM |
NM |
|
|
Digital & Betting |
8 |
9 |
(11) % |
(10) % |
|
|
Corporate support expense |
(29) |
(26) |
(11) % |
(26) % |
|
|
Other(1) |
(39) |
(40) |
3 % |
2 % |
|
|
Total operating income |
228 |
244 |
(7) % |
1 % |
|
|
Operating income margin |
22 % |
23 % |
|||
|
Net cash provided by operating activities |
196 |
249 |
(21) % |
||
|
Cash and cash equivalents |
673 |
639 |
5 % |
||
|
Earnings per share – diluted |
$(0.02) |
$(0.48) |
96 % |
||
|
Non-GAAP Financial Measures: |
|||||
|
Adjusted EBITDA |
|||||
|
Global Lottery |
330 |
414 |
(20) % |
(13) % |
|
|
Global Gaming |
87 |
35 |
145 % |
150 % |
|
|
Digital & Betting |
12 |
13 |
(7) % |
(6) % |
|
|
Corporate support expense |
(20) |
(21) |
4 % |
(14) % |
|
|
Total Adjusted EBITDA |
409 |
442 |
(7) % |
(1) % |
|
|
Adjusted EBITDA margin |
40 % |
4 % |
|||
|
Adjusted earnings per share – diluted |
$0.57 |
$0.32 |
78 % |
||
|
Free cash flow |
117 |
176 |
(34) % |
||
|
Net debt |
5,722 |
6,312 |
(9) % |
||
|
(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 |
Key Highlights:
- Recently completed acquisition of iSoftBet, a leading iGaming content provider and third-party aggregator, greatly expanding the Company’s proprietary content library and providing a world-class game aggregation platform
- Won “Lottery Supplier of the Year” at 2022 SBC Awards North America in July
- Introduced high-performing Money Mania wide area progressive game to commercial gaming jurisdictions following a successful launch in tribal casinos
- Signed agreement with NUSTAR Resort & Casino to deploy IGT ADVANTAGE™ casino management system and a variety of leading games and cabinets
- Announced expanded sports betting partnership with SuperBook® Sports to Tennessee, the fourth state where IGT’s PlaySports platform is powering the SuperBook Sports mobile betting app
- Awarded a gold medal sustainability rating from EcoVadis, a leading sustainability rating agency
- Recently released 2021 Sustainability Report which outlines the Company’s demonstrated environmental, social, and governance (ESG) performance
Financial Highlights:
Consolidated revenue of $1.02 billion, down 2% as reported, or up 3% at constant currency, from $1.04 billion in the prior year
- Global Lottery revenue of $648 million compared to $725 million in the prior-year period, which included $70 million in prior-year benefits primarily from the closure of gaming halls in Italy
- Global Gaming revenue increases 21%, or 23% at constant currency, to $330 million, driven by strong U.S. & Canada replacement unit demand, higher average selling prices, and increased installed base yields
- Digital & Betting revenue of $43 million, stable with the prior year, as iCasino growth in the U.S. is partially offset by softness in other markets; North America sports betting market gross gaming revenue impacted by lower hold levels
Operating income of $228 million, down 7% as reported, or up 1% at constant currency, from $244 million in the prior-year period
- Global Lottery operating income down, primarily due to about $60 million related to prior-year benefits referenced above
- Global Gaming rises on higher revenue and profit flow through, partially offset by increased supply chain costs
- Digital & Betting operating income of $8 million was relatively stable with the prior year
Adjusted EBITDA of $409 million matches prior year’s record level at constant currency; Adjusted EBITDA margin of 40% remains among the highest in Company history
Net interest expense of $75 million compared to $91 million in the prior year, driven by lower average debt balances and interest rates
During the second quarter, the Company recognized a pre-tax non-operating expense of $150 million ($114 million after tax) representing the probable loss associated with ongoing litigation (Benson v. Double Down Interactive LLC, No. 2:18-cv-00525 (W.D. Wash.)) and associated claims related to Double Down Interactive LLC and its social gaming business sold in 2017 by International Game Technology, a wholly-owned subsidiary of the Company
Income tax benefit of $11 million compared to a provision of $32 million in the prior year, primarily driven by recognition of the non-operating expense mentioned above and foreign exchange losses in the prior year with no tax benefit
Income from continuing operations of $34 million versus a loss from continuing operations of $39 million in the prior-year period, driven by income tax benefit, gains in foreign exchange, and lower debt retirement costs
Net loss attributable to IGT PLC of $4 million compared to net income of $306 million in the prior year due to gain on sale and income from discontinued operations in the prior-year period
Net loss from continuing operations attributable to IGT PLC per diluted share of $0.02 compared to a net loss from continuing operations attributable to IGT per diluted share of $0.48 in the prior year, on higher net income; adjusted net income per diluted share increased 78% to $0.57
Net debt of $5.7 billion compared to $5.9 billion at December 31, 2021; Net debt leverage of 3.5x was stable compared to December 31, 2021
Cash and Liquidity Update
- Total liquidity of $2.1 billion as of June 30, 2022; $0.7 billion in unrestricted cash and $1.5 billion in additional borrowing capacity
- Executed amendment and extension of revolving credit facilities in July 2022
- Increased liquidity by $150 million to $1.83 billion and rebalanced EUR/USD mix to match operational exposure
- Extended maturities to July 2027
- Lowered interest margin and added ESG provision to allow for further potential reductions
- Raised annual permitted restricted payments basket from $300 million to $400 million at current credit rating; potential to increase to $550 million
Other Developments
The Company’s Board of Directors declared a quarterly cash dividend of $0.20 per common share
- Ex-dividend date of August 15, 2022
- Record date of August 16, 2022
- Payment date of August 30, 2022
Repurchased 750,000 shares for $15 million in the second quarter at an average price of $20.48 per share; 2.2 million shares repurchased for $54 million on a year-to-date basis at an average price of $24.89 per share
The Company expects to close on the sale of its Italian proximity payments/commercial services business in mid-to-late September
Tightening Full-year Revenue Outlook for Currency Rates and Business Disposition; Introducing Third Quarter 2022 Outlook
Full Year
- Revenue of $4.1 billion – $4.2 billion
- Lowered high end of range by $100 million
- Reflecting changes in currency rates and impact from sale of Italian proximity payments/commercial services business in Q3’22
- Operating income margin of 20% – 22% remains unchanged
- Cash from operations of $850 – $950 million
- Lowered high end of range by $50 million
- Primarily driven by a working capital investment in higher inventory levels to proactively manage supply chain disruptions
- Capital expenditures of approximately $350 million, lowered by $50 million to adjust for updated timing of spending
- Free cash flow outlook remains unchanged
Third Quarter
- Revenue of approximately $1.0 billion – $1.1 billion
- Operating income margin of 18% – 20% includes approximately 150 – 200 basis point impact from project-related expenses
Outlook assumptions
- EUR/USD exchange rate of 1.00 in the second half of 2022
- Impact from sale of Italian proximity payments/commercial services business in mid-to-late September 2022
- Operating income margin includes approximately 150 – 200 basis point impact from project-related and restructuring expenses expected in the second half of 2022
Latest News
Atlas-IAC’s CEO Maxim Slobodyanyuk Talks Winning Strategies & Vision for Future Growth in the iGaming Sector
Atlas-IAC, a Next-Generation iGaming platform, has been recognized as the Best Sports Betting Provider Of The Year and Rising Star In Sports Betting Technology at the Prague Gaming & Tech Awards 2024. The GamingTECH Awards annually determine industry excellence in Central and Eastern Europe. Maxim Slobodyanyuk, CEO of Atlas-IAC, tells about insights into Atlas-IAC’s innovative solutions that are reshaping the iGaming landscape and the core principles of partnership driving mutual evolution for both Atlas-IAC and its esteemed operators.
Congratulations on winning “Best Sports Betting Provider Of The Year” and “Rising Star In Sports Betting Technology” at the GamingTECH CEE Awards 2024! How does Atlas-IAC feel about receiving such prestigious recognition?
We take pride in being acknowledged as the best sports betting provider and the rising star in sports betting technology across Central and Eastern Europe. At the heart of our success lies a team of exceptional visionaries, developers, and business analytics striving to elevate the industry to new heights of technological innovation and responsible gaming practices.
I’d like to thank our great partners for choosing Atlas-IAC as their technology provider, and for subscribing to our core business principle — to evolve and grow together. Our win is our partners’ win as well.
To be the best sports betting provider entails a weighty responsibility, one we approach with unwavering dedication. These awards serve as a validation of our unwavering commitment to excellence and as a catalyst for renewed determination to shape the future of sports betting technology. We are grateful for recognition and remain resolutely committed to charting new horizons of success alongside our valued partners.
Could you provide insights into the strategies that drove Atlas-IAC’s success in the iGaming industry?
At Atlas-IAC, our success strategy revolves around building strong partnerships and establishing a notable presence in the competitive global entertainment technology market. We prioritize automation, which gives us an edge in emerging markets and allows us to onboard partners quickly and streamline operations.
Continuously improving our platform to offer a seamless Sportsbook API experience is a priority. Our aim is to deliver fast performance, smooth betting experiences, real-time risk management, advanced anti-fraud measures, and scalable solutions for partners worldwide.
Staying up-to-date, enhancing our product, analyzing market and partner needs, and proactively responding to them are essential. Being the top technological partner is a strategy that consistently works for us.
How does Atlas-IAC’s in-house developed Sportsbook differentiate itself from competitors?
Atlas-IAC’s in-house developed Sportsbook sets us apart because we have full control over its features and can make rapid improvements. Features like Personal Odds Boost and Clever Margin allow for customized experiences tailored to our partners’ needs. We focus on personalization, ensuring the product aligns perfectly with each operator’s requirements. With a skilled team dedicated to our partners’ needs, we can promptly address requests and deliver effective solutions.
Atlas-IAC offers one of the most automated Sportsbook available in the market. How does automation enhance the experience for both operators and users?
Our fully automated Sportsbook API is efficient and user-friendly, enhancing engagement and retention. It’s equipped to handle high demand periods effectively and offers tools for precise betting management and reliable results. We can swiftly develop and integrate custom modules for partners, giving us a competitive edge. We prioritize meeting partners’ needs while delivering enjoyable experiences for players, fostering mutual benefit for all involved.
What specific features or tools have been well-received by operators in the iGaming industry?
In the realm of iGaming, Atlas-IAC has garnered recognition for its remarkable adaptability and keen responsiveness to the requirements of our partners. Understanding the distinctive needs of each operator, we have crafted a tailored approach to ensure effective solutions.
One specific example of our successful tools is our Cashback feature, which serves as a versatile tool for promoting sporting events and enhancing player entertainment. This feature offers customizable settings based on specific sports, events, odds criteria, and frequency. With such flexibility, operators can effectively incentivize participation and elevate excitement levels among players.
In essence, the suite of features and tools offered by Atlas-IAC not only addresses the diverse needs of operators but also fuels engagement and growth within the iGaming industry.
What are Atlas-IAC’s goals for continued innovation and growth in the iGaming sector?
Looking ahead, our primary aim is to continually push the boundaries of innovation while delivering outstanding value to our partners. We remain steadfast in our commitment to leading the charge in the iGaming sector, fostering sustainable growth, and championing responsible gaming practices. Our strategy revolves around staying agile, adapting to emerging trends, and catering to the unique needs of operators worldwide.
The evolving sports betting landscape of 2024 underscores the critical importance of adaptability and innovation. Operators must navigate this dynamic environment marked by technological advancements and regulatory shifts, and Atlas-IAC stands ready to assist them in this endeavor.
In terms of market focus, we are meticulously evaluating opportunities in LATAM, Eastern Europe, South-East Asia, and Africa. These regions offer significant growth potential, and our tailored strategy is geared towards effectively meeting the unique demands of these diverse markets.
The post Atlas-IAC’s CEO Maxim Slobodyanyuk Talks Winning Strategies & Vision for Future Growth in the iGaming Sector appeared first on European Gaming Industry News.
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The evolving landscape of affiliate marketing within the iGaming ecosystem presents both opportunities and challenges due to regulatory shifts. Adapting to these changes is crucial to navigate the dynamic environment effectively. Slotegrator experts exploring strategies to avoid pitfalls globally and adopting adaptable approaches can optimize affiliate marketing amidst evolving regulations.
The iGaming industry has had to focus on a number of changes in the area of affiliate marketing – as a result of regulatory and advertising changes.
Beyond that, it’s important to keep in mind another important key initiatives that include key components of a successful affiliate program:
- The quality of the content the affiliate creates.
- Regulations the affiliate or affiliate program might be subject to.
- This is especially important if the affiliate expects a commission for every sign-up. If the affiliate is getting paid for every player they send your way, the players need to stay for a while for it to be worth it.
- An ongoing analysis of the size and quality of traffic the affiliate is delivering you.
To know more about these points you can read an instruction from the Slotegrator Academy by link.
The changes have not only affected the regulatory environment of the iGaming industry, but also affiliate marketing as a result of the general changes. What is important to look out for?
Slotegrator shares some regional specifics of affiliate marketing:
- Asia is a diverse and dynamic region for affiliate marketing in the iGaming industry. Affiliates operating in Asia have to navigate complex regulatory conditions and varying cultural attitudes. Marketing managers have to employ strategies that prioritize mobile channelization, collaboration with opinion leaders, and compliance with local laws — all of which are essential to success.
- Affiliate marketing in Africa is still in its early stages but is already showing significant potential. With the increasing availability of the internet and the spread of smartphones, the continent is opening up opportunities for affiliates to reach a fast-growing market. However, factors such as regulatory uncertainty, payment processing difficulties, and the cultural diversity of the region need to be taken into account.
- In Latin America working with local affiliates who have a deep understanding of the regional market helps to better customize marketing campaigns and achieve higher conversion rates. Given the strict regulation of gambling in some Latin American countries, it is important to comply with local laws and advertising restrictions to avoid negative consequences.
- Affiliate marketing in Europe is a dynamic and competitive landscape where effective strategies and a professional approach can ensure significant business success and growth in the iGaming sector. One of the important parts of affiliate marketing in Europe is the use of a variety of channels to build audiences. It helps to diversify and increase the flow of traffic to the partner’s site, which helps to increase conversion rates. Careful research of each country’s rules and restrictions is needed regarding the advertising and promotion of gambling.
Alyce Fabel from CasinoRIX, Slotegrator’s media partner, summarizes key aspects for affiliate companies to concentrate on.“As each year passes, affiliates must strive to improve and keep pace with the market. Competition is growing, regulations are evolving, and that brings changes to many regions. We can highlight five key points for affiliate companies to focus on:
- Continuously search for and acquire new traffic channels. It’s crucial not to focus only on one channel; diversification is necessary. This has been particularly evident in the past year, with significant changes and updates in SEO and mobile traffic (iOS/Android applications).
- Ensure content quality. As AI tools continue to advance, it’s essential not only to learn to apply them in work but also to differentiate content written by humans from AI-generated content (especially crucial for SEO projects).
- Configure deep analytics. Constantly work on improving traffic quality and understand where to make enhancements. The standards for traffic quality are rising.
- Provide added value. It’s time to start developing the product aspect as well, thinking not only as an affiliate but also about providing customers with additional value. This will also help in achieving higher-quality marketing.”
Cultivate relationships with partners. Build strong and lasting relationships, stay informed about all industry changes and news, and keep up with technologies and innovations. This is crucial for achieving high results.
And some words about the affiliate marketing trends as a compass to guide development efforts in this area in the right direction. Khoren Ispiryan, sales manager at Slotegrator, and the speaker of the latest Prague Gaming & TECH Summit ‘24, shares some insights:
- “The best thing is to include real people in the affiliate marketing. To create an environment where bloggers, streamers and influencers will make a bigger impact on the end user behavior.
- In 2024, gambling companies will continue to partner with influencers and other internet celebrities. These partnerships will be increasingly effective methods of attracting new audiences, promoting products, and increasing brand awareness.
- Loyalty programs and other ways of enhancing the user experience will also be essential for the promotion of gambling websites.
- The development of partner relationship management software will be a major priority. It will help improve usability for affiliate partners and enable better communication between companies and affiliates. For instance, Partnergrator from Slotegrator offers a solution for online gambling platform operators who face difficulties in tracking their affiliate program data. This innovative solution provides the ability to manage and analyze affiliate programs in real-time, using analytics to simplify the decision-making process.”
The post How to avoid failing at affiliate marketing in 2024? appeared first on European Gaming Industry News.
GiG Media, a subsidiary of Gaming Innovation Group (GiG), today proudly announces it has secured 3rd position in the prestigious EGR Power Affiliate Ranking for the second year running.
This achievement underscores the business’ unwavering dedication to strategic innovation, expanding its market reach and delivering unparalleled value to its partners and shareholders.
GiG Media’s portfolio of high-quality traffic websites, including WSN.com, Time2play.com, Askgamblers.com and Casinotopsonline.com, has been instrumental in driving its success. With operations spanning across Malta, Denmark, Serbia, and Spain, GiG Media continues to set the benchmark for lead generation in online sportsbooks and casinos.
Commenting on the achievement, Jonas Warrer, CEO of GiG Media, stated:
“We are delighted to receive this acknowledgement yet again in the EGR Power Affiliate Ranking and this is nothing short of a testament to the hard work and dedication of our team. This superb accomplishment reflects our relentless pursuit of excellence, internal talent, and continuous growth in the iGaming affiliate landscape. As we continue to grow the business in 2024, we remain steadfast in our commitment to players, partners and the industry alike.”
GiG Media’s portfolio expansion and strategic diversification have been pivotal in propelling its growth trajectory. Its ongoing product development and recent acquisition of Time2Play Media emphasise the company’s proactive approach to seizing emerging opportunities and reinforcing its market leadership position.
The post GiG Media Secures 3rd Place in EGR Power Affiliate Ranking for Consecutive Year appeared first on European Gaming Industry News.
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