Scientific Games reveals Q2 growth, debt refinance plans

24 July 2017

Scientific Games has reported a year-on-year increase across key financials during the three months to June 30, 2017, and also revealed plans to refinance a portion of its debt.

Revenue in the second quarter amounted to $766.3m (€567.5m), which is up 5% on the $729.2m posted at the end of the corresponding period last year.

Operating income almost doubled from $59.1m in Q2 of 2016 to $117.3m in the most recent three-month period, while attributable earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 13% year-on-year to $314.8m.

In addition, net cash flow from operating activities increased from $90.8m to $168.5m.

As a result, revenue for the first six months of the current year stands at $1.49bn, up from $1.41bn at the same point in 2016.

Operating income for the first half amounted to $205.3m compared to $109.4m in the previous year, while net loss improved from $144m to $139.9m.

Kevin Sheehan, chief executive of Scientific Games, said: “Second quarter results represent our seventh quarter of consecutive year-over-year growth, including $169m of cash flow from operating activities, as a result of ongoing improvements in our gaming, lottery and interactive operations.

“We achieved year-over-year revenue growth in global gaming machine sales, gaming systems, table products and interactive; as well as in US instant games revenue.

“Across the company, we are maintaining a laser focus on executing our strategies and capitalising on our many opportunities.”

Meanwhile, Scientific Games has announced plans to take advantage of what it has described as “favourable market conditions” to refinance a portion of its debt to lower cash interest costs, extend debt maturities and generally lower its cost of capital.

Michael Quartieri, chief financial officer of Scientific Games, added: “Our focus on innovative new products, continuous process improvement and fiscal discipline have enabled us to grow operating income and cash flow, leading to a reduction in our net debt; this has resulted in our net debt leverage ratio at June 30, 2017, declining to 6.8 times 12-month adjusted EBITDA.

“With our strengthened performance, we are well positioned to further improve our capital structure and lower our cost of capital.”

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