International Game Technology PLC Reports Third Quarter 2020 Results

LONDON, Nov. 11, 2020 /PRNewswire/ — International Game Technology PLC (“IGT”) (NYSE: IGT) today reported financial results for the third quarter ended September 30, 2020. Tomorrow, at 8:00 a.m. EST, management will host a conference call and webcast to present the results; access details are provided below.

“The resilience of our portfolio, particularly in lottery, and benefits from our swift cost reduction initiatives are on full display in our third quarter results,” said Marco Sala, CEO of IGT. “Strong player demand and a host of compelling new games, systems, and digital solutions led to a sharp, sequential improvement in our most important markets. We continue to monitor the evolution and impact of the pandemic around the world. With a simplified organization firmly in place, we are creating a leaner, stronger IGT.”

“Robust cash flow generation during the quarter and year-to-date periods have enabled us to improve our liquidity and reduce net debt,” said Max Chiara, CFO of IGT. “We are on track to achieve our 2020 temporary cost-reduction targets and have identified a number of initiatives that will enable us to deliver over $200 million of structural savings over the next two years. As a result, the improvement in our profitability should support our continued focus on reducing debt.”

Overview of Consolidated Third Quarter 2020 Results


Quarter Ended

Y/Y

Constant 


September 30,

Change

Currency


2020


2019

(%)

Change (%)

(In $ millions, unless otherwise noted)






GAAP Financials:






Revenue






    Global Lottery

570


552

3%

0%

    Global Gaming

412


601

(31)%

(34)%

Total revenue

982


1,153

(15)%

(17)%







Operating income (loss)






    Global Lottery

196


161

22%

17%

    Global Gaming

(8)


68

NA

NA

    Corporate support expense

(18)


(26)

33%

37%

    Other(1)

(42)


(49)

13%

13%

Total operating income

129


154

(16)%

(22)%







Net (loss) income attributable to IGT PLC

(128)


104

NA








Non-GAAP Financial Measures:






Adjusted net income attributable to IGT PLC

54


43

25%








Adjusted EBITDA






    Global Lottery

309


270

14%

10%

    Global Gaming

58


156

(63)%

(65)%

    Corporate support expense

(13)


(20)

32%

36%

Total Adjusted EBITDA

354


407

(13)%

(17)%







Net debt

7,243


7,354

(2)%








(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:

  • Delivered $220 million in positive free cash flow in the quarter; generated $610 million in cash from operations and $384 million in free cash flow year-to-date
  • Robust player demand drives highest Global Lottery same-store sales growth and Adjusted EBITDA in seven quarters
  • Signed 2-year contract extension with New York Lottery
  • Recently awarded 7-year contracts with Poland and Nebraska Lotteries following competitive bid processes
  • Sharp, sequential improvement in Global Gaming revenue and profit following acute impact of the pandemic in the second quarter
  • 41% increase in Digital & Betting revenue; launched full-service, in-house U.S. sports betting trading team in the third quarter and recently established new partnerships with Boyd Gaming and the National Basketball Association (NBA)
  • Awarded three spots on Casino Journal’s esteemed “Top 20 Most Innovative Gaming Technology Products Awards,” the most of any gaming supplier
  • Cashless solutions gaining traction as Resort Wallet™ launched at Resorts World Catskills

Financial highlights:

Third quarter 2020 results reflect the continued, global impact of the COVID-19 pandemic, but at a lower level compared to the second quarter

Resilient consolidated revenue of $982 million, down 15% from the prior year

  • Global Lottery revenue of $570 million, up 3%, driven by double-digit growth in North America same-store sales
  • Global Gaming revenue totals $412 million, down 31% on pandemic-related closures and restrictions; positive sequential trends as casinos re-open and installed base is gradually reactivated

Operating income of $129 million, compared to $154 million in the prior year

  • Benefit of disciplined cost-saving actions
  • Global Lottery same-store sales growth translates into high profit flow-through
  • Contribution from Global Gaming impacted by $36 million higher bad debt and obsolescence charges, primarily due to the protracted pandemic slow-down in business activities

Net interest expense of $101 million compared to $103 million in the prior year

Benefit from income taxes of $27 million, compared to a provision for income taxes of $45 million, driven by lower pre-tax income and the tax impact of significant foreign exchange losses in the third quarter of 2020 versus significant foreign exchange gains in the prior-year period   

Net loss attributable to IGT was $128 million; adjusted net income attributable to IGT of $54 million compared to adjusted net income of $43 million in the prior year

  • Net loss includes $149 million in non-cash foreign exchange loss, primarily on Euro-denominated debt instruments

Net loss per diluted share of $0.62; adjusted net income per diluted share of $0.26 compared to adjusted net income per diluted share of $0.21 in the prior year

Adjusted EBITDA of $354 million compared to $407 million in the prior-year period

  • Benefit from previously mentioned cost-saving actions
  • Global Lottery achieves highest segment-level Adjusted EBITDA in seven quarters

Net debt of $7.24 billion compared to $7.38 billion at December 31, 2019; Net debt to LTM adjusted EBITDA of 5.72x up from 4.31x at December 31, 2019, due to pandemic’s impact on EBITDA in the first nine months of 2020

Cash and Liquidity Update

  • At September 30, 2020, liquidity totaled $2.55 billion, an improvement from the second quarter level on strong cash flow generation; comprised of $943 million in unrestricted cash and $1.61 billion available under revolving credit facilities

Conference Call and Webcast:

November 12, 2020, at 8:00 a.m. EST

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: 9189642
  • 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: 9189642

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 2020 are calculated using the same foreign exchange rates as the corresponding 2019 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate the Company’s financial performance. Management believes these non-GAAP financial measures reflect the Company’s ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with U.S. GAAP.

About IGT
IGT (NYSE:IGT) is the global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivalled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 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, 2019 and other documents filed from time to time with the SEC, which are available on the SEC’s website at www.sec.gov and on the investor relations section of the Company’s website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company’s business. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance or International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.

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.

Consolidated Adjusted EBITDA represents net income (loss) (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, and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of on-going 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, and certain other non-recurring items. Adjusted net (loss) income attributable to IGT PLC represents Net (loss) income attributable to IGT PLC before foreign exchange, purchase accounting depreciation and amortization, restructuring expenses, loss on extinguishment of debt and certain other non-recurring items. Adjusted Diluted EPS represents Adjusted net (loss) income attributable to IGT PLC per weighted-average number of common shares outstanding during the period that takes into consideration potential common shares outstanding deriving from the IGT PLC share-based payment awards, when inclusion is not antidilutive. Other non-recurring items are discrete, infrequent in nature and are not reflective of on-going operational activities. 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 cash and equivalents. Cash and cash equivalent 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.

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)



Q3’20


Q3’19


% Change

As Reported


% Change

GLOBAL LOTTERY



At Constant FX

Revenue









Service









   Operating and facilities management contracts


525


502


5%


1%

   Upfront license fee amortization


(52)


(48)


(7)%


0%

   Operating and facilities management contracts, net


474


454


4%


2%

   Other


76


66


15%


9%

Total service revenue


549


520


6%


3%










Product sales


20


33


(38)%


(38)%

Total revenue


570


552


3%


0%










Operating income


196


161


22%


17%

Adjusted EBITDA


309


270


14%


10%










Global same-store sales growth (%)









Instant ticket & draw games








10.6%

Multi-jurisdiction jackpots








(14.3)%

Total








8.7%










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









Instant ticket & draw games








15.0%

Multi-jurisdiction jackpots








(14.3)%

Total








12.1%










Italy same-store sales growth (%)









Instant ticket & draw games








(3.5)%














Q3’20


Q3’19


% Change

As Reported


% Change

GLOBAL GAMING



At Constant FX

Revenue









Service









   Terminal


193


276


(30)%


(33)%

   Systems, software, and other


138


126


10%


6%

Total service revenue


331


402


(18)%


(21)%










Product sales









   Terminal


49


139


(64)%


(65)%

   Other


32


60


(47)%


(48)%

Total product sales revenue


81


199


(59)%


(60)%

Total revenue


412


601


(31)%


(34)%










Operating (loss) income


(8)


68


NA


NA

Adjusted EBITDA


58


156


(63)%


(65)%










Installed base units









Casino


48,280


51,592


(6)%



Casino – L/T lease (1)


1,102



NA



Italy VLT – Operator (B2C)


10,845


10,984


(1)%



Italy VLT – Supplier (B2B)


7,112


7,514


(5)%



Italy AWP


36,279


41,129


(12)%



Total installed base units


103,618


111,219


(7)%












Installed base units (by geography)









US & Canada


34,584


37,260


(7)%



Rest of world


14,798


14,332


3%



  Subtotal


49,382


51,592


(4)%



Italy


54,236


59,627


(9)%



Total installed base units


103,618


111,219


(7)%












Yields (by geography)(2), in absolute $









US & Canada


$26.79


$41.31


(35)%



Rest of world (ex-Italy)


$4.31


$8.04


(46)%



Total yields (ex-Italy)


$19.88


$32.06


(38)%












Global machine units sold









New/expansion


818


1,001


(18)%



Replacement


2,853


9,190


(69)%



Total machine units sold


3,671


10,191


(64)%












US & Canada machine units sold









New/expansion


667


791


(16)%



Replacement


2,007


4,150


(52)%



Total machine units sold


2,674


4,941


(46)%












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

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



Q3’20


Q3’19


% Change

As Reported


% Change

GLOBAL GAMING (Continued)



At Constant FX

Rest of world machine units sold









New/expansion


151


210


(28)%



Replacement


846


5,040


(83)%



Total machine units sold


997


5,250


(81)%












Average Selling Price (ASP), in absolute $









US & Canada


13,800


14,800


(7)%



Rest of world


12,100


11,800


3%



Total ASP


13,300


13,300


0%












Gaming Systems Revenue


32


53


(41)%












Italy Wagers (€)









VLT (B2C)


940


1,324




(29)%

AWP


711


877




(19)%










Italy sports betting wagers (€)


237


227




5%

Italy sports betting payout (%)


83.0%


83.4%




0%
















































Q3’20


Q3’19


% Change

As Reported


% Change

CONSOLIDATED



At Constant FX

Revenue (by geography)









US & Canada


443


538


(18)%


(18)%

Italy


416


402


3%


(4)%

Rest of world


123


213


(42)%


(43)%

Total revenue


982


1,153


(15)%


(17)%










Digital & Betting Revenue (1)


104


74


41%


35%










(1) Included within consolidated revenue









International Game Technology PLC

Consolidated Statements of Operations

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

Unaudited










For the three months ended


For the nine months ended


September 30,


September 30,


2020


2019


2020


2019

Service revenue

880,133



921,712



2,223,772



2,892,774


Product sales

101,377



231,535



335,417



639,642


Total revenue

981,510



1,153,247



2,559,189



3,532,416










Cost of services

541,118



575,594



1,479,605



1,765,519


Cost of product sales

81,516



136,246



239,822



397,217


Selling, general and administrative

180,315



201,416



515,858



616,516


Research and development

48,039



68,804



140,111



200,305


Restructuring

(98)



16,152



46,955



21,853


Goodwill impairment





296,000




Other operating expense (income), net

2,118



1,153



3,721



(24,743)


Total operating expenses

853,008



999,365



2,722,072



2,976,667










Operating income (loss)

128,502



153,882



(162,883)



555,749










Interest expense, net

(101,023)



(102,551)



(297,284)



(309,480)


Foreign exchange (loss) gain, net

(149,403)



124,068



(153,427)



141,609


Other (expense) income, net

(7,031)



(308)



(39,791)



22,687


Total non-operating (expenses) income

(257,457)



21,209



(490,502)



(145,184)










(Loss) income before (benefit from) provision for income taxes

(128,955)



175,091



(653,385)



410,565










(Benefit from) provision for income taxes

(26,617)



44,530



(34,806)



160,522










Net (loss) income

(102,338)



130,561



(618,579)



250,043










Less: Net income attributable to non-controlling interests

25,652



26,998



37,315



101,370










Net (loss) income attributable to IGT PLC

(127,990)



103,563



(655,894)



148,673










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

(0.62)



0.51



(3.20)



0.73


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

(0.62)



0.51



(3.20)



0.73










Weighted-average shares – basic

204,857



204,435



204,680



204,352


Weighted-average shares – diluted

204,857



204,528



204,680



204,532


International Game Technology PLC

Consolidated Balance Sheets

($ thousands)

Unaudited






September 30,


December 31,


2020


2019

Assets




Current assets:




Cash and cash equivalents

943,346



662,934


Restricted cash and cash equivalents

196,252



231,317


Trade and other receivables, net

828,459



1,006,127


Inventories

183,220



161,790


Other current assets

556,607



571,869


Total current assets

2,707,884



2,634,037


Systems, equipment and other assets related to contracts, net

1,180,511



1,307,940


Property, plant and equipment, net

129,636



146,055


Operating lease right-of-use assets

332,121



341,538


Goodwill

5,188,657



5,451,494


Intangible assets, net

1,672,750



1,836,002


Other non-current assets

1,779,807



1,927,524


Total non-current assets

10,283,482



11,010,553


Total assets

12,991,366



13,644,590






Liabilities and shareholders’ equity




Current liabilities:




Accounts payable

1,116,854



1,120,922


Current portion of long-term debt

374,656



462,155


Short-term borrowings

4



3,193


Other current liabilities

1,006,658



882,081


Total current liabilities

2,498,172



2,468,351


Long-term debt, less current portion

7,821,723



7,600,169


Deferred income taxes

272,555



366,822


Operating lease liabilities

305,805



310,721


Other non-current liabilities

372,428



413,549


Total non-current liabilities

8,772,511



8,691,261


Total liabilities

11,270,683



11,159,612


Commitments and contingencies




Shareholders’ equity

1,720,683



2,484,978


Total liabilities and shareholders’ equity

12,991,366



13,644,590


International Game Technology PLC

Consolidated Statements of Cash Flows

($ thousands)

Unaudited










For the three months ended


For the nine months ended


September 30,


September 30,


2020


2019


2020


2019

Cash flows from operating activities








Net (loss) income

(102,338)


130,561


(618,579)


250,043

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








Depreciation

102,578


106,020


300,826


315,291

Goodwill impairment



296,000


Amortization

65,624


69,960


201,581


207,161

Amortization of upfront license fees

54,229


50,695


155,576


154,630

Foreign exchange loss (gain), net

149,403


(124,068)


153,427


(141,609)

(Gain) loss on extinguishment of debt

(10)


2,336


28,267


11,964

Debt issuance cost amortization

5,451


5,481


15,748


17,004

Loss (gain) on sale of assets

389


(2,085)


455


(65,324)

Stock-based compensation

1,103


7,544


(10,703)


20,046

Deferred income taxes

(69,815)


(3,925)


(106,520)


2,590

Other non-cash items, net

2,621


17,339


5,125


48,731

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








Trade and other receivables

58,553


(32,513)


198,131


16,546

Inventories

(3,457)


23,073


(9,435)


23,875

Accounts payable

(17,984)


57,928


(23,646)


611

Other assets and liabilities

38,867


(111,362)


24,060


(72,854)

Net cash provided by operating activities

285,214


196,984


610,313


788,705









Cash flows from investing activities








Capital expenditures

(65,668)


(101,713)


(225,847)


(332,716)

Proceeds from sale of assets

1,272


35,314


6,457


100,743

Other

1,540


3,581


12,437


6,126

Net cash used in investing activities

(62,856)


(62,818)


(206,953)


(225,847)









Cash flows from financing activities








Principal payments on long-term debt

(579,175)


(431,518)


(959,275)


(1,264,647)

Payments in connection with extinguishment of debt



(25,000)


(8,598)

Payments of debt issuance costs

(1,863)


(18,853)


(21,479)


(24,787)

Net payments of short-term borrowings

(82,537)


(54,092)


(7,610)


(34,519)

Proceeds from long-term debt


550,050


895,896


1,397,025

Net receipts from financial liabilities

59,230


12,148


95,698


753

Dividends paid


(40,887)


(40,887)


(122,616)

Dividends paid – non-controlling interests

(44,516)


(6,290)


(135,892)


(135,684)

Return of capital – non-controlling interests


(9,985)



(80,384)

Capital increase – non-controlling interests

1,304


294


3,334


1,369

Other

(2,540)


(1,065)


(8,598)


(7,798)

Net cash used in financing activities

(650,097)


(198)


(203,813)


(279,886)









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

(427,739)


133,968


199,547


282,972

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

37,575


(27,343)


45,800


(31,091)

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

1,529,762


657,033


894,251


511,777

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

1,139,598


763,658


1,139,598


763,658









Supplemental Cash Flow Information








Interest paid

(141,263)


(160,256)


(372,127)


(371,847)

Income taxes paid

(41,637)


(88,232)


(59,432)


(138,009)

International Game Technology PLC

Net Debt

($ thousands)

Unaudited






September 30,


December 31,


2020


2019

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

1,004,662



1,491,328


4.750% Senior Secured Euro Notes due February 2023

989,909



948,382


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

60,811



60,885


3.500% Senior Secured Euro Notes due July 2024

581,534



557,331


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

1,091,210



1,089,959


3.500% Senior Secured Euro Notes due June 2026

871,151



835,105


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

743,958



743,387


2.375% Senior Secured Euro Notes due April 2028

580,333



556,403


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

743,004




Senior Secured Notes

6,666,572



6,282,780






Euro Term Loan Facility due January 2023

994,835



1,317,389


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

160,316




Long-term debt, less current portion

7,821,723



7,600,169






4.750% Senior Secured Euro Notes due March 2020



434,789


5.500% Senior Secured U.S. Dollar Notes due June 2020



27,366


Euro Term Loan Facility due January 2023

374,656




Current portion of long-term debt

374,656



462,155






Short-term borrowings

4



3,193


Total debt

8,196,383



8,065,517






Less: Cash and cash equivalents

943,346



662,934


Less: Debt issuance costs, net – Euro Revolving Credit Facility B due July 2024

10,422



20,464






Net debt

7,242,615



7,382,119






Note: Net debt is a non-GAAP financial measure




International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

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

Unaudited












For the three months ended September 30, 2020






Operating






Global


Global


Segment


Corporate


Total


Lottery


Gaming


Total


and Other


IGT PLC

Net loss









(102,338)


Benefit from income taxes









(26,617)


Interest expense, net









101,023


Foreign exchange loss, net









149,403


Other non-operating expense, net









7,031


Operating income (loss)

195,766



(7,550)



188,216



(59,714)



128,502


Depreciation

51,248



51,007



102,255



323



102,578


Amortization – service revenue (1)

54,229





54,229





54,229


Amortization – non-purchase accounting

7,926



15,178



23,104



762



23,866


Amortization – purchase accounting







41,758



41,758


Restructuring

(52)



(428)



(480)



382



(98)


Stock-based compensation

81



71



152



951



1,103


Other (2)







2,118



2,118


Adjusted EBITDA

309,198



58,278



367,476



(13,420)



354,056












Cash flows from operating activities









285,214


Capital expenditures









(65,668)


Free Cash Flow









219,546












Net loss attributable to IGT PLC









(127,990)


Foreign exchange loss, net









149,403



Depreciation and amortization – purchase accounting









42,069


Restructuring









(98)


Gain on extinguishment of debt









(10)


Other (2)









2,118


Income tax impact on adjustments (3)









(11,167)


Adjusted net income attributable to IGT PLC









54,325


Weighted-average shares – diluted









204,857


Adjusted weighted-average shares – diluted (4)









205,013


Net loss attributable to IGT PLC per common share – diluted









(0.62)


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









0.26












(1) Includes amortization of upfront license fees







(2) Primarily includes transaction-related costs







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

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

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

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

Unaudited












For the three months ended September 30, 2019






Operating






Global


Global


Segment


Corporate


Total


Lottery


Gaming


Total


and Other


IGT PLC

Net income









130,561


Provision for income taxes









44,530


Interest expense, net









102,551


Foreign exchange gain, net









(124,068)


Other non-operating expense, net









308


Operating income (loss)

160,820



68,025



228,845



(74,963)



153,882


Depreciation

50,099



55,160



105,259



761



106,020


Amortization – service revenue (1)

50,695





50,695





50,695


Amortization – non-purchase accounting

6,843



14,415



21,258



754



22,012


Amortization – purchase accounting







47,948



47,948


Restructuring

211



16,283



16,494



(342)



16,152


Stock-based compensation

1,582



2,126



3,708



3,836



7,544


Other (2)



432



432



2,391



2,823


Adjusted EBITDA

270,250



156,441



426,691



(19,615)



407,076












Cash flows from operating activities









196,984


Capital expenditures









(101,713)


Free Cash Flow









95,271












Net income attributable to IGT PLC









103,563


Foreign exchange gain, net









(124,068)



Depreciation and amortization – purchase accounting









48,580


Restructuring









16,152


Loss on extinguishment of debt









2,336


Other (2)









2,823


Income tax impact on adjustments (3)









(6,041)


Adjusted net income attributable to IGT PLC









43,345


Weighted-average shares – diluted









204,528


Adjusted weighted-average shares – diluted 









204,528


Net income attributable to IGT PLC per common share – diluted









0.51


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









0.21












(1) Includes amortization of upfront license fees







(2) Primarily includes transaction-related costs







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

International Game Technology PLC


Reconciliation of Non-GAAP Financial Measures


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


Unaudited














For the nine months ended September 30, 2020







Operating







Global


Global


Segment


Corporate


Total



Lottery


Gaming


Total


and Other


IGT PLC


Net loss









(618,579)



Benefit from income taxes









(34,806)



Interest expense, net









297,284



Foreign exchange loss, net









153,427



Other non-operating expense, net









39,791



Operating income (loss)

446,965



(124,787)



322,178



(485,061)



(162,883)



Goodwill impairment







296,000



296,000



Depreciation

147,055



152,670



299,725



1,101



300,826



Amortization – service revenue (1)

155,576





155,576





155,576



Amortization – non-purchase accounting

22,006



46,726



68,732



2,341



71,073



Amortization – purchase accounting







130,508



130,508



Restructuring

5,332



35,430



40,762



6,193



46,955



Stock-based compensation

(3,713)



(5,063)



(8,776)



(1,927)



(10,703)



Other (2)







3,623



3,623



Adjusted EBITDA

773,221



104,976



878,197



(47,222)



830,975














Cash flows from operating activities









610,313



Capital expenditures









(225,847)



Free Cash Flow









384,466














Net loss attributable to IGT PLC









(655,894)



Foreign exchange loss, net









153,427



Goodwill impairment









296,000




Depreciation and amortization – purchase accounting









131,442



Restructuring









46,955



Loss on extinguishment of debt









23,250



Other (2)









3,623



Income tax impact on adjustments (3)









(49,430)



Adjusted net loss attributable to IGT PLC









(50,627)



Weighted-average shares – diluted









204,680



Adjusted weighted-average shares – diluted









204,680



Net loss attributable to IGT PLC per common share – diluted









(3.20)



Adjusted net loss attributable to IGT PLC per common share – diluted









(0.25)














(1) Includes amortization of upfront license fees








(2) Primarily includes transaction-related costs








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




International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

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

Unaudited












For the nine months ended September 30, 2019






Operating






Global


Global


Segment


Corporate


Total


Lottery


Gaming


Total


and Other


IGT PLC

Net income









250,043


Provision for income taxes









160,522


Interest expense, net









309,480


Foreign exchange gain, net









(141,609)


Other non-operating income, net









(22,687)


Operating income (loss)

542,913



239,940



782,853



(227,104)



555,749


Depreciation

147,461



165,490



312,951



2,340



315,291


Amortization – service revenue (1)

154,629





154,629





154,629


Amortization – non-purchase accounting

18,175



43,090



61,265



2,231



63,496


Amortization – purchase accounting







143,666



143,666


Restructuring

1,003



16,959



17,962



3,891



21,853


Stock-based compensation

3,854



5,088



8,942



11,104



20,046


Other (2)



432



432



2,296



2,728


Adjusted EBITDA

868,035



470,999



1,339,034



(61,576)



1,277,458












Cash flows from operating activities









788,705


Capital expenditures









(332,716)


Free Cash Flow









455,989












Net income attributable to IGT PLC









148,673


Foreign exchange gain, net









(141,609)



Depreciation and amortization – purchase accounting









145,562


Restructuring









21,853


Loss on extinguishment of debt









11,964


Other (2)









2,728


Income tax impact on adjustments (3)









(30,819)


Adjusted net income attributable to IGT PLC









158,352


Weighted-average shares – diluted









204,532


Adjusted weighted-average shares – diluted









204,532


Net income attributable to IGT PLC per common share – diluted









0.73


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









0.77












(1) Includes amortization of upfront license fees







(2) Primarily includes transaction-related costs







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


SOURCE International Game Technology PLC

Related Links

https://www.IGT.com

Source

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