Everi Holdings Inc. (NYSE: EVRI) (“Everi” or the “Company”), a
premier provider of gaming products and financial technology and
loyalty solutions in the gaming industry, today announced a range
of actions that management and the Board of Directors have
implemented to maintain balance sheet flexibility and preserve
liquidity given the business disruption caused by the rapid
nationwide spread of the novel COVID-19 virus and the actions by
state and tribal governments and businesses to contain the virus.
Since mid-March, the Company has drawn down $35
million on its revolving credit facility to provide additional
near-term liquidity and cancelled or delayed material capital
expenditures. Most recently, the Company implemented targeted
furloughs and Company-wide salary reductions. The CEO elected to
cut his salary to zero and the executive team elected to reduce
their salaries by 70%, amongst those actions. The effect of these
actions has lowered the Company’s future cash payroll expense to
less than $2 million per month.
“As we face the challenges presented by
COVID-19, the health and welfare of our teams, our customers, their
guests, and people everywhere are of our utmost concern,” said
Michael Rumbolz, President and Chief Executive Officer. “While
revenue for the first two months of the year increased in line with
our forecast compared to the same two-month period a year ago, our
customers’ ability to operate has been severely impacted by the
nearly universal directives to close facilities across North
America to protect the public. With essentially all revenue
and the associated workload having been reduced to near zero and
limited visibility as to when our customers may reopen for
business, we have taken decisive actions appropriate for the
current level of business and to prepare our Company to withstand a
potentially prolonged period of minimal industry activity.
Consequently, we believe these actions are the appropriate steps to
preserve our liquidity and manage our business in the current
environment. We expect these to be temporary but prudent steps
designed to ensure that Everi is best positioned to withstand this
disruption and will be prepared to support our customers once they
begin to reopen their facilities. We are also reviewing options to
obtain additional capital resources on acceptable terms to provide
additional financial flexibility.”
“Our hope is that the directions given by our
elected officials have the desired outcomes regarding the
containment of COVID‐19, so that our economy and way of life can
get back to normal as quickly as possible,” added Rumbolz. “We are
monitoring developments on a daily, and sometimes on an
hour-to-hour basis, in order to be prepared to respond to our
customer needs. We believe the pre-COVID-19 strengths Everi was
well known for will align with the needs of our customers as they
return to normalized operations. These strengths include our
FinTech segment’s ability to drive labor productivity and cost
efficiencies for our customers while also helping them generate
revenue; and our Games segment’s offering of high-performing
differentiated games that support customers’ focus on providing the
best performing games for their loyal patrons. We’re looking
forward to resuming normal operations as soon as conditions permit
and regaining our pre‐pandemic momentum to get back on track for a
bright and successful future.
“The changes we have had to make across our
operations are not easy for those impacted. I, the senior
management team and our Board of Directors are committed to doing
whatever is necessary to ensure Everi comes out in a solid position
on the other side of this crisis. I also look forward to
seeing a recovery in the gaming industry, so that we can start
returning our employees back to work and regain some normalcy in
each of our team members’ lives.”
Given the current operating environment and the
uncertain timeline and impact related to the Company’s operations
as a result of widespread casino closures across North America,
Everi is also withdrawing the 2020 guidance it provided on March 2,
2020.
About Everi Everi is a leading
supplier of imaginative entertainment and trusted technology
solutions for the casino, interactive, and gaming industry. With a
focus on both customers and players, the Company develops
entertaining games and gaming machines, gaming systems and
services, and is the preeminent and most comprehensive provider of
core financial products and services, player loyalty tools and
applications, and intelligence and regulatory compliance solutions.
Everi’s mission is to provide casino operators with games that
facilitate memorable player experiences, offer seamless and secure
financial transactions for casinos and their patrons, and deliver
software tools and applications to improve casino operations
efficiencies and fulfill regulatory compliance requirements. Everi
provides these products and services in its effort to help make its
customers even more successful. For more information, please visit
www.everi.com, which is updated regularly with financial and other
information about the Company.
Cautionary Note Regarding
Forward-Looking Statements
This press release contains “forward-looking
statements” as defined in the U.S. Private Securities Litigation
Reform Act of 1995, as amended. In this context, forward-looking
statements often address our expected future business and financial
performance, and often contain words such as “goal,” “target,”
“future,” “estimate,” “expect,” “anticipate,” “intend,” “plan,”
“believe,” “seek,” “project,” “may,” “should,” “designed to,” “in
an effort to,” “look forward to,” or “will” and similar expressions
to identify forward-looking statements. These statements are based
upon management’s current expectations, assumptions and estimates
and are not guarantees of timing, future events or performance.
Actual results may differ materially from those contemplated in
these statements, due to risks and uncertainties.
Forward-looking statements are neither
historical facts nor assurances of future performance. Instead,
they are based only on our current beliefs, expectations and
assumptions regarding the future of our business, future plans and
strategies, projections, anticipated events and trends, the economy
and other future conditions. Because forward-looking statements
relate to the future, they are subject to inherent risks,
uncertainties and changes in circumstances that are often difficult
to predict and many of which are beyond our control. Our actual
results and financial condition may differ materially from those
indicated in forward-looking statements. Important factors that
could cause our actual results and financial condition to differ
materially from those indicated in the forward-looking statements
include, without limitation, our history of net losses and our
ability to generate profits in the future; our substantial leverage
and the related covenants that restrict our operations; our ability
to generate sufficient cash to service all of our indebtedness,
fund working capital, and capital expenditures; our ability to
withstand unanticipated impacts of a pandemic outbreak of uncertain
duration; our ability to withstand the loss of revenue during the
closure of our customers’ facilities; our ability to maintain our
current customers; our ability to compete in the gaming industry;
our ability to execute on mergers, acquisitions and/or strategic
alliances, including the timing and closing of acquisitions and our
ability to integrate and operate such acquisitions consistent with
our forecasts; our ability to access the capital markets to raise
funds; expectations regarding our existing and future installed
base and win per day; expectations regarding development and
placement fee arrangements; inaccuracies in underlying operating
assumptions; expectations regarding customers’ preferences and
demands for future gaming offerings; expectations regarding our
product portfolio; the overall growth of the gaming industry, if
any; our ability to replace revenue associated with terminated
contracts; margin degradation from contract renewals; technological
obsolescence; our ability to comply with the Europay, MasterCard
and Visa global standard for cards equipped with security chip
technology; our ability to introduce new products and
services, including third-party licensed content; gaming
establishment and patron preferences; our ability to prevent,
mitigate or timely recover from cybersecurity breaches, attacks and
compromises; the level of our capital expenditures and product
development; anticipated sales performance; employee turnover;
national and international economic conditions; changes in global
market, business and regulatory conditions arising as a result of
the novel COVID-19 outbreak; changes in gaming regulatory, card
association and statutory requirements; regulatory and licensing
difficulties that we may face; competitive pressures in the gaming
and financial technology sectors; the impact of changes to tax
laws; uncertainty of litigation outcomes; interest rate
fluctuations; unanticipated expenses or capital needs and those
other risks and uncertainties discussed in our most recent Annual
Report on Form 10-K filed with the U.S. Securities and Exchange
Commission on March 2, 2020. Given these risks and uncertainties,
there can be no assurance that the forward-looking information
contained in this presentation will in fact transpire or prove to
be accurate. Readers are cautioned not to place undue reliance on
the forward-looking statements contained herein, which are based
only on information currently available to us and speak only as of
the date hereof.
This press release should be read in conjunction
with our Annual Report on Form 10-K for the year ended December 31,
2019, and with the information included in our other press
releases, reports and other filings with the SEC. Understanding the
information contained in these filings is important in order to
fully understand our reported financial results and our business
outlook for future periods.
Contacts: Investor
RelationsEveri Holdings Inc.William PfundVP, Investor
Relations(702) 676-9513 or william.pfund@everi.com
JCIRRichard Land, James Leahy(212) 835-8500 or
evri@jcir.com
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