LONDON, May 13, 2015 /PRNewswire/ -- International Game
Technology PLC ("IGT") (NYSE: IGT) today reported results for GTECH
S.p.A.'s ("GTECH") first quarter of 2015 and for International Game
Technology's ("Legacy IGT") second quarter of 2015, ended
March 31, 2015. The combination of
GTECH and Legacy IGT was completed on April
7, 2015. As such, results presented in this news release are
for periods predating the combination and during which each company
was under separate management. The respective reporting formats of
the legacy companies have been maintained in this release for ease
of comparison. The results in this news release relating to GTECH
are presented in Euros under International Financial Reporting
Standards ("IFRS") and results relating to Legacy IGT are presented
in U.S. Dollars under U.S. generally accepted accounting principles
("GAAP"). IGT will begin reporting as a combined entity with its
second quarter of 2015 results under GAAP.
Commenting on the first quarter performance, Marco Sala, CEO of IGT, noted: "We
had a solid first quarter for GTECH operations, continuing to run
the underlying business efficiently and profitably, at the same
time as we were completing a transformative merger. We were ready
to launch the integration from day one, focusing on revitalizing
our R&D capabilities. Exciting content delivered across the
whole range of platforms is the key to consolidating our leadership
of the global gaming industry."
"We achieved near-record GTECH EBITDA during the first
quarter on top of challenging, multi-year comparisons. We also
improved our net financial position excluding one-off items linked
to the transaction. We have confirmed our $280 million target for cost and
revenue synergies and are on track to deliver them on
schedule," said Alberto
Fornaro, CFO of IGT.
GTECH S.p.A. First Quarter 2015 Results Comparison
Consolidated
Income Statement (€/M)
|
Q1
2015
|
Q1
2014
|
%
chg
|
Revenues
|
807.7
|
781.3
|
+3.4
|
EBITDA
|
295.6
|
296.0
|
--
|
Operating
Income
|
149.3
|
180.8
|
-17.5
|
Net Income (Loss)
Attributable to Owners
|
(26.9)
|
75.0
|
nm
|
Diluted Earnings
(Loss) Per Share
|
(0.16)
|
0.43
|
nm
|
EBITDA is principally comprised of operating income plus
depreciation, amortization, and impairment. EBITDA is considered an
alternative performance measure that is not a defined measure under
IFRS and may not take into account the recognition, measurement and
presentation requirements associated with IFRS. We believe that
EBITDA assists in explaining trends in our operating performance,
provides useful information about our ability to incur and service
indebtedness and is a commonly used measure of performance by
securities analysts and investors in the gaming industry. EBITDA
should not be considered as an alternative to operating income as
an indicator of our performance or to cash flows as a measure of
our liquidity. As we define it, EBITDA may not be comparable to
other similarly titled measures used by other companies.
Consolidated Revenues grew 3% to €808 million from
€781 million in the first quarter of 2014. This increase was
principally driven by higher service revenues, which rose 4% to
€755 million from €729 million in the prior year, reflecting net
favorable foreign currency effects and lottery growth in
Italy and the Americas. Product
sales of €52 million were in line with the prior year as lower
lottery product sales in the Americas and International machine
gaming revenues were offset by favorable currency translation.
EBITDA of €296 million was in line with the first quarter
of last year and near all-time peak levels, reflecting growth in
the Americas and stability in the International segment, in
addition to net favorable foreign currency effects, which offset
the impact of a higher sports betting payout in Italy.
Operating Income was €149 million compared to €181
million in the first quarter of 2014. Operating Income was €170
million excluding one-off items, primarily transaction and
restructuring costs associated with the acquisition of Legacy
IGT.
Interest Expense was €81 million compared to €41 million
last year, the increase being principally due to financing
associated with the acquisition of Legacy IGT.
Net Loss Attributable to the Owners was €27 million
compared to net income of €75 million in the first quarter of 2014.
The Net Loss Attributable to the Owners primarily reflects higher
Interest Expense and other charges associated with the acquisition
of Legacy IGT. Diluted Loss-Per-Share was €0.16 compared to
Diluted Earnings-Per-Share of €0.43 in the comparable prior year
period, again reflecting acquisition-related items.
Cash from Operations was €158 million compared to €163
million in the prior year. Capital Expenditures in the first
quarter were €65 million.
At March 31, 2015, Consolidated
Shareholders' Equity totaled €2.59 billion. GTECH had a Net
Financial Position (NFP) of €3.16 billion versus €2.59 billion
as of December 31, 2014. Excluding
one-off items primarily related to the acquisition of Legacy IGT,
NFP was €2.56 billion at the end of the first quarter of 2015.
First Quarter Results by Segment
Americas
Revenues in the Americas segment grew 23% to
€300 million in the quarter. In constant currency and excluding
pass-through reimbursements, Revenues were up 4%. Service revenues
increased 26%, supported by favorable foreign currency effects;
strong instant ticket sales and multistate jackpot activity; and
substantial growth for machine gaming operations. Product sales of
€34 million in the quarter were modestly above the prior year
period, as a significant increase in machine gaming revenues and
favorable foreign currency effects were partially offset by lower
lottery product sales.
Operating Income from the Americas segment of €46 million was
51% greater than the prior year period, reflecting favorable
foreign currency effects, strong lottery same-store revenue growth,
and higher machine gaming profits from both product sales and the
contribution from a larger installed base of gaming machines.
International
Revenues in the International segment
were €77 million, €1 million greater than the prior year, driven by
favorable foreign currency effects and increased lottery revenues
that were partially offset by lower machine gaming product
sales.
International lottery same-store revenues were up approximately
11% compared to the same period in 2014, reflecting continued
strength in instant ticket sales in the United Kingdom and robust jackpot growth in
Eastern Europe.
Operating Income in the International segment was €13 million
versus €15 million in the first quarter of last year, as higher
lottery profits were more than offset by lower product sales and a
broad mix of items.
Italy
Revenues in
Italy were €430 million compared
to €461 million in the first quarter of 2014, principally due to
higher sports betting payout. While sports betting wagers were up
2% in the first quarter, sports betting revenues were €39 million
compared to €62 million last year due to a 10 percentage point
increase in payout.
Total Lotto wagers for the quarter were up 16% to €1.82 billion
compared to €1.57 billion last year, driven by strong performance
in 10eLotto and late-numbers. Instant-ticket wagers declined 7% to
€2.30 billion versus €2.48 billion last year, partially due to the
cadence of new product introductions.
Machine gaming revenues were €135 million versus €145 million
last year, reflecting the impact of the new Italian Stability
Law.
Operating Income of €140 million compared to €158 million last
year primarily reflects the impact of the higher sports betting
payout.
Other News
Pursuant to the Agreement and Plan of Merger, as amended,
providing for the combination of GTECH and Legacy IGT, Philip G. Satre was appointed as Chairman of the
Board of Directors and each of Patti S.
Hart and Lorenzo Pellicioli was appointed as Vice Chairman
of the Board of Directors.
Conference call and webcast
Today, at 8:00 a.m. EDT /
1:00 p.m. BST / 2:00 p.m. CEST, management will host a conference
call to present the first quarter 2015 results. Listeners may
access a live webcast of the conference call along with
accompanying slides under "News and Presentations" on IGT's
Investor Relations website at www.merger.igt.com/investors. A
replay of the webcast will be available on the website following
the live event.
To listen by telephone, the dial in number is +44 (0) 20 3450
9571 for participants in the United
Kingdom and +1 646 254-3387 for listeners outside the
United Kingdom. The conference
ID/confirmation code is 2660253. A telephone replay of the call
will be available for one week at +44 (0) 20 3427 0598 or +1 347
366-9565 using the conference ID/confirmation code 2660253.
About IGT
IGT (NYSE:IGT) is the global leader in
gaming. We enable players to experience their favorite games across
all channels and regulated segments, from Gaming Machines and
Lotteries to Interactive and Social Gaming. Leveraging a wealth of
premium content, substantial investment in innovation, in-depth
customer intelligence, operational expertise and leading-edge
technology, our gaming solutions anticipate the demands of
consumers wherever they decide to play. 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 generated approximately $6 billion in revenues in 2014 and has more than
13,000 employees. For more information, please visit
www.merger.igt.com.
Cautionary Statement Regarding Forward-Looking
Statements
This communication may contain forward-looking
statements (including within the meaning of the Private Securities
Litigation Reform Act of 1995) concerning IGT and other matters.
These statements may discuss goals, intentions, projections and
expectations as to future plans, strategies, strengths, trends,
events, results of operations or financial condition, revenue,
income, earnings (or loss) per share, capital expenditures,
dividends, capital structure or other financial items, or
otherwise, based on current beliefs of the management of IGT 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 are
subject to various risks and uncertainties, many of which are
outside IGT'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) risks
that the businesses of Legacy IGT and GTECH S.p.A. will not be
integrated successfully, following the recent completion of their
business combination, or that the combined companies will not
realize estimated cost savings, value of certain tax assets,
synergies, growth or other anticipated benefits or that such
benefits may take longer to realize than expected; risks relating
to unanticipated costs of integration of the two companies;
reductions in customer spending; a slowdown in customer payments
and changes in customer demand for products and services;
unanticipated changes relating to competitive factors in the
industries in which the company operates; ability to hire and
retain key personnel; the potential impact of the consummation of
the business combination on relationships with third parties,
including customers, employees and competitors; ability to attract
new customers and retain existing customers in the manner
anticipated; reliance on and integration of information technology
systems; changes in legislation or governmental regulations
affecting the company; international, national or local economic,
social or political conditions that could adversely affect the
company or its customers; conditions in the credit markets; risks
associated with assumptions the company makes in connection with
its critical accounting estimates; the resolution of pending legal
proceedings and investigations; and the company's international
operations, which are subject to the risks of currency fluctuations
and foreign exchange controls. The foregoing list of factors is not
exhaustive. You should carefully consider the foregoing factors and
the other risks and uncertainties that affect the company's
business, including those described in IGT's registration statement
on Form F-4 and other documents filed from time to time with the
Securities and Exchange Commission (the "SEC"). Forward-looking
statements speak only as of the date on which such statements are
made, Except as required under applicable law, the company does not
assume any obligation to update these forward-looking statements.
Nothing in this announcement is intended, or is to be construed, as
a profit forecast or to be interpreted to mean that earnings per
IGT share for the current or any future financial years will
necessarily match or exceed the historical published earnings per
IGT share, as applicable. All forward-looking statements contained
in this communication are qualified in their entirety by this
cautionary statement. All subsequent written or oral
forward-looking statements attributable to IGT, or persons acting
on its behalf, are expressly qualified in its entirety by the
cautionary statements contained throughout this communication.
Contact:
Robert K.
Vincent, Corporate Communications, +1 (401) 392-7452
James Hurley, Investor Relations, +1
(401) 392-7190
Simone Cantagallo, Italian Media
Relations, +39 06 51899030
GTECH S.P.A. AND
SUBSIDIARIES
|
|
|
|
CONSOLIDATED
INCOME STATEMENTS
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
March 31,
|
|
2015
|
|
2014
|
(€
thousands)
|
Unaudited
|
Service
revenue
|
755,435
|
|
729,475
|
Product
sales
|
52,254
|
|
51,778
|
Total
revenue
|
807,689
|
|
781,253
|
|
|
|
|
Raw materials,
services and other costs
|
387,915
|
|
374,405
|
Personnel
|
170,416
|
|
134,868
|
Depreciation
|
66,324
|
|
61,970
|
Amortization
|
53,623
|
|
49,022
|
Capitalization of
internal construction costs - labor and overhead
|
(29,941)
|
|
(19,855)
|
Unusual expense,
net
|
10,080
|
|
-
|
|
658,417
|
|
600,410
|
|
|
|
|
Operating
income
|
149,272
|
|
180,843
|
|
|
|
|
Interest
income
|
556
|
|
794
|
Equity income (loss),
net
|
(203)
|
|
66
|
Other
income
|
490
|
|
453
|
Other
expense
|
(121,530)
|
|
(2,234)
|
Foreign exchange gain
(loss), net
|
8,542
|
|
(1,162)
|
Interest
expense
|
(81,256)
|
|
(40,597)
|
|
(193,401)
|
|
(42,680)
|
|
|
|
|
Income (loss)
before income tax expense
|
(44,129)
|
|
138,163
|
|
|
|
|
Income tax expense
(benefit)
|
(20,560)
|
|
56,648
|
|
|
|
|
Net income
(loss)
|
(23,569)
|
|
81,515
|
|
|
|
|
Attributable
to:
|
|
|
|
Owners of the
parent
|
(26,930)
|
|
75,029
|
Non-controlling
interests
|
3,361
|
|
6,486
|
|
(23,569)
|
|
81,515
|
|
|
|
|
Earnings (loss)
per share/ADRs
|
|
|
|
Basic - net income
(loss) attributable to owners of the parent
|
€
(0.16)
|
|
€
0.43
|
Diluted - net income
(loss) attributable to owners of the parent
|
€
(0.16)
|
|
€
0.43
|
GTECH S.P.A. AND
SUBSIDIARIES
|
|
|
|
CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
2015
|
|
2014
|
(€
thousands)
|
Unaudited
|
|
Audited
|
ASSETS
|
|
|
|
Non-current
assets
|
|
|
|
Systems, equipment
and other assets related to contracts, net
|
980,232
|
|
910,095
|
Property, plant and
equipment, net
|
83,468
|
|
77,394
|
Goodwill
|
3,731,622
|
|
3,402,201
|
Intangible assets,
net
|
1,165,976
|
|
1,151,472
|
Investments in
associates and joint ventures
|
24,670
|
|
24,474
|
Other non-current
assets
|
82,206
|
|
75,495
|
Non-current financial
assets
|
23,470
|
|
21,557
|
Deferred income
taxes
|
9,275
|
|
22,026
|
Total non-current
assets
|
6,100,919
|
|
5,684,714
|
|
|
|
|
Current
assets
|
|
|
|
Inventories
|
178,298
|
|
152,042
|
Trade and other
receivables, net
|
776,647
|
|
757,444
|
Other current
assets
|
292,814
|
|
255,288
|
Current financial
assets
|
40,496
|
|
10,386
|
Income taxes
receivable
|
5,247
|
|
5,459
|
Cash and cash
equivalents
|
254,620
|
|
261,184
|
Total current
assets
|
1,548,122
|
|
1,441,803
|
|
|
|
|
TOTAL
ASSETS
|
7,649,041
|
|
7,126,517
|
|
|
|
|
EQUITY AND
LIABILITIES
|
|
|
|
Equity
attributable to owners of the parent
|
|
|
|
Issued
capital
|
175,122
|
|
174,976
|
Share
premium
|
1,653,307
|
|
1,651,498
|
Treasury
shares
|
(418,596)
|
|
(40,211)
|
Retained
earnings
|
158,936
|
|
171,065
|
Other
reserves
|
774,530
|
|
378,947
|
|
2,343,299
|
|
2,336,275
|
Non-controlling
interests
|
242,811
|
|
281,814
|
Total
equity
|
2,586,110
|
|
2,618,089
|
|
|
|
|
Non-current
liabilities
|
|
|
|
Long-term debt, less
current portion
|
2,847,954
|
|
1,725,738
|
Deferred income
taxes
|
143,841
|
|
177,296
|
Long-term
provisions
|
10,377
|
|
13,038
|
Other non-current
liabilities
|
58,990
|
|
57,728
|
Non-current financial
liabilities
|
62,280
|
|
60,518
|
Total non-current
liabilities
|
3,123,442
|
|
2,034,318
|
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
922,427
|
|
1,022,194
|
Short-term
borrowings
|
2
|
|
8,895
|
Other current
liabilities
|
435,226
|
|
356,414
|
Current financial
liabilities
|
501,828
|
|
275,019
|
Current portion of
long-term debt
|
41,486
|
|
786,878
|
Short-term
provisions
|
1,120
|
|
991
|
Income taxes
payable
|
37,400
|
|
23,719
|
Total current
liabilities
|
1,939,489
|
|
2,474,110
|
|
|
|
|
TOTAL EQUITY AND
LIABILITIES
|
7,649,041
|
|
7,126,517
|
|
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
|
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
For the three
months ended
|
|
March
31,
|
|
2015
|
|
2014
|
(€
thousands)
|
Unaudited
|
Cash flows from
operating activities
|
|
|
|
Income (loss) before
income tax expense
|
(44,129)
|
|
138,163
|
Adjustments
for:
|
|
|
|
Interest
expense
|
81,256
|
|
40,597
|
Tender premium paid
in connection with the early extinguishment of debt
|
66,834
|
|
-
|
Depreciation
|
66,324
|
|
61,970
|
Intangibles
amortization
|
53,649
|
|
49,044
|
Write-off of bridge
facility costs
|
45,279
|
|
-
|
Provisions
|
919
|
|
955
|
Share-based payment
expense
|
305
|
|
1,618
|
Interest
income
|
(556)
|
|
(794)
|
Non-cash foreign
exchange (gain) loss, net
|
(10,686)
|
|
781
|
Other non-cash
items
|
8,407
|
|
2,251
|
Cash foreign exchange
loss, net
|
2,144
|
|
381
|
Income tax
paid
|
(12,160)
|
|
(17,946)
|
Cash flows before
changes in operating assets and liabilities
|
257,586
|
|
277,020
|
Changes in operating
assets and liabilities:
|
|
|
|
Inventories
|
(15,043)
|
|
5,826
|
Trade and other
receivables
|
(29,936)
|
|
49,798
|
Accounts
payable
|
(73,300)
|
|
(117,410)
|
Other assets and
liabilities
|
18,396
|
|
(51,739)
|
Net cash flows
from operating activities
|
157,703
|
|
163,495
|
|
|
|
|
Cash flows from
investing activities
|
|
|
|
Purchases of systems,
equipment and other assets related to contracts
|
(58,787)
|
|
(40,529)
|
Purchases of
intangible assets
|
(4,437)
|
|
(3,755)
|
Purchases of
property, plant and equipment
|
(1,518)
|
|
(980)
|
Interest
received
|
1,240
|
|
416
|
Escrow
deposit
|
-
|
|
(21,858)
|
Other
|
873
|
|
(3,989)
|
Net cash flows
used in investing activities
|
(62,629)
|
|
(70,695)
|
|
|
|
|
Cash flows from
financing activities
|
|
|
|
Principal payments on
long-term debt
|
(704,505)
|
|
-
|
Dividends
paid
|
(114,746)
|
|
-
|
Interest
paid
|
(109,190)
|
|
(108,486)
|
Tender premium paid
in connection with the early extinguishment of debt
|
(64,905)
|
|
-
|
Debt issuance costs
paid
|
(64,863)
|
|
-
|
Payments on bridge
facility
|
(45,737)
|
|
-
|
Net payments on
financial liabilities
|
(21,452)
|
|
-
|
Escrow payment
related to dividend on rescission shares
|
(14,850)
|
|
-
|
Repayments of
short-term borrowings
|
(9,562)
|
|
(836)
|
Dividends paid -
non-controlling interest
|
(566)
|
|
(32,059)
|
Proceeds from
issuance of long-term debt
|
1,034,470
|
|
-
|
Return of capital -
non-controlling interest
|
-
|
|
(42,145)
|
Acquisition of
non-controlling interest
|
-
|
|
(72,328)
|
Other
|
(431)
|
|
4,328
|
Net cash flows
used in financing activities
|
(116,337)
|
|
(251,526)
|
|
|
|
|
Net decrease in cash
and cash equivalents
|
(21,263)
|
|
(158,726)
|
Effect of exchange
rate changes on cash
|
14,699
|
|
(4,092)
|
Cash and cash
equivalents at the beginning of the period
|
261,184
|
|
419,118
|
Cash and cash
equivalents at the end of the period
|
254,620
|
|
256,300
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
KEY FINANCIAL INDICATOR
COMPARISONS
|
|
|
For the three months
ended
|
|
March 31,
|
|
Change
|
(€ thousands,
except per share data)
|
2015
|
|
2014
|
|
€
|
|
%
|
Revenue
|
807,689
|
|
781,253
|
|
26,436
|
|
3.4
|
EBITDA
|
295,598
|
|
296,037
|
|
(439)
|
|
(0.1)
|
Operating
income
|
149,272
|
|
180,843
|
|
(31,571)
|
|
(17.5)
|
Net income (loss)
attributable to owners of the parent
|
(26,930)
|
|
75,029
|
|
(101,959)
|
|
(135.9)
|
Diluted earnings
(loss) per share
|
(0.16)
|
|
0.43
|
|
(0.59)
|
|
(137.2)
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
December
31,
|
|
Change
|
|
2015
|
|
2014
|
|
€
|
|
%
|
Net financial
position
|
3,158,433
|
|
2,585,478
|
|
572,955
|
|
22.2
|
|
|
|
|
|
|
|
|
Reconciliations of
IFRS to Non-IFRS Financial Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
149,272
|
|
180,843
|
|
(31,571)
|
|
(17.5)
|
Depreciation
|
66,324
|
|
61,970
|
|
4,354
|
|
7.0
|
Amortization
|
53,623
|
|
49,022
|
|
4,601
|
|
9.4
|
Restructuring
costs
|
13,349
|
|
3,033
|
|
10,316
|
|
>200.0
|
Unusual expense,
net
|
10,080
|
|
-
|
|
10,080
|
|
-
|
Other
|
2,950
|
|
1,169
|
|
1,781
|
|
152.4
|
EBITDA
|
295,598
|
|
296,037
|
|
(439)
|
|
(0.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
149,272
|
|
180,843
|
|
(31,571)
|
|
(17.5)
|
IGT Acquisition
related items:
|
|
|
|
|
|
|
|
Transaction
costs
|
10,080
|
|
-
|
|
10,080
|
|
-
|
Transaction related
restructuring costs
|
10,621
|
|
-
|
|
10,621
|
|
-
|
Operating income
as adjusted
|
169,973
|
|
180,843
|
|
(10,870)
|
|
(6.0)
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
OPERATING SEGMENT
RESULTS
|
|
|
|
For the three
months ended
|
|
|
March 31,
2015
|
|
March 31,
2014
|
|
Change
|
(€
thousands)
|
|
Italy
|
|
Americas
|
|
International
|
|
Total
|
|
Italy
|
|
Americas
|
|
International
|
|
Total
|
|
Italy
|
|
Americas
|
|
International
|
|
Total
|
Service
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lottery
|
|
208,855
|
|
192,766
|
|
42,821
|
|
444,442
|
|
200,267
|
|
151,521
|
|
41,092
|
|
392,880
|
|
8,588
|
|
41,245
|
|
1,729
|
|
51,562
|
Lottery Management
Services
|
-
|
|
33,546
|
|
-
|
|
33,546
|
|
-
|
|
31,663
|
|
-
|
|
31,663
|
|
-
|
|
1,883
|
|
-
|
|
1,883
|
Total
Lottery
|
|
208,855
|
|
226,312
|
|
42,821
|
|
477,988
|
|
200,267
|
|
183,184
|
|
41,092
|
|
424,543
|
|
8,588
|
|
43,128
|
|
1,729
|
|
53,445
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Machine
Gaming
|
|
134,219
|
|
25,959
|
|
5,991
|
|
166,169
|
|
144,587
|
|
17,903
|
|
5,691
|
|
168,181
|
|
(10,368)
|
|
8,056
|
|
300
|
|
(2,012)
|
Sports
Betting
|
|
38,745
|
|
1,112
|
|
1,798
|
|
41,655
|
|
62,267
|
|
547
|
|
1,475
|
|
64,289
|
|
(23,522)
|
|
565
|
|
323
|
|
(22,634)
|
Commercial
Services
|
|
29,126
|
|
8,947
|
|
4,686
|
|
42,759
|
|
34,167
|
|
8,649
|
|
4,627
|
|
47,443
|
|
(5,041)
|
|
298
|
|
59
|
|
(4,684)
|
Interactive
Gaming
|
|
18,810
|
|
3,205
|
|
4,688
|
|
26,703
|
|
19,211
|
|
935
|
|
4,743
|
|
24,889
|
|
(401)
|
|
2,270
|
|
(55)
|
|
1,814
|
Total service
revenue
|
|
429,755
|
|
265,535
|
|
59,984
|
|
755,274
|
|
460,499
|
|
211,218
|
|
57,628
|
|
729,345
|
|
(30,744)
|
|
54,317
|
|
2,356
|
|
25,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lottery
|
|
-
|
|
10,971
|
|
7,406
|
|
18,377
|
|
-
|
|
17,525
|
|
3,185
|
|
20,710
|
|
-
|
|
(6,554)
|
|
4,221
|
|
(2,333)
|
Machine
Gaming
|
|
636
|
|
23,516
|
|
8,806
|
|
32,958
|
|
622
|
|
15,628
|
|
13,868
|
|
30,118
|
|
14
|
|
7,888
|
|
(5,062)
|
|
2,840
|
Sports
Betting
|
|
-
|
|
-
|
|
790
|
|
790
|
|
-
|
|
-
|
|
910
|
|
910
|
|
-
|
|
-
|
|
(120)
|
|
(120)
|
Interactive
Gaming
|
|
-
|
|
-
|
|
129
|
|
129
|
|
-
|
|
-
|
|
40
|
|
40
|
|
-
|
|
-
|
|
89
|
|
89
|
Total product
sales
|
|
636
|
|
34,487
|
|
17,131
|
|
52,254
|
|
622
|
|
33,153
|
|
18,003
|
|
51,778
|
|
14
|
|
1,334
|
|
(872)
|
|
476
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total segment
revenue
|
|
430,391
|
|
300,022
|
|
77,115
|
|
807,528
|
|
461,121
|
|
244,371
|
|
75,631
|
|
781,123
|
|
(30,730)
|
|
55,651
|
|
1,484
|
|
26,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
accounting
|
|
|
|
|
|
|
|
161
|
|
|
|
|
|
|
|
130
|
|
|
|
|
|
|
|
31
|
Total
revenue
|
|
|
|
|
|
|
|
807,689
|
|
|
|
|
|
|
|
781,253
|
|
|
|
|
|
|
|
26,436
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
income
|
|
139,626
|
|
45,991
|
|
12,542
|
|
198,159
|
|
157,768
|
|
30,492
|
|
15,330
|
|
203,590
|
|
(18,142)
|
|
15,499
|
|
(2,788)
|
|
(5,431)
|
Corporate support
(1)
|
|
|
|
|
|
|
|
(34,270)
|
|
|
|
|
|
|
|
(9,996)
|
|
|
|
|
|
|
|
(24,274)
|
Purchase
accounting
|
|
|
|
|
|
|
|
(14,617)
|
|
|
|
|
|
|
|
(12,751)
|
|
|
|
|
|
|
|
(1,866)
|
Operating
income
|
|
|
|
|
|
|
|
149,272
|
|
|
|
|
|
|
|
180,843
|
|
|
|
|
|
|
|
(31,571)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment operating
margin
|
|
32.4%
|
|
15.3%
|
|
16.3%
|
|
24.5%
|
|
34.2%
|
|
12.5%
|
|
20.3%
|
|
26.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
margin
|
|
|
|
|
|
|
|
18.5%
|
|
|
|
|
|
|
|
23.1%
|
|
|
|
|
|
|
|
|
|
(1) Corporate support expenses are principally
comprised of general and administrative expenses and other expenses
that are managed at the corporate level, including Restructuring, Corporate Headquarters and
Board of Directors expenses.
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
AMERICAS
SEGMENT
|
|
The following tables
set forth changes in revenue on a constant currency
basis:
|
|
|
Service Revenue
Change
|
|
For the three months
ended March 31, 2015
|
|
compared to March 31,
2014
|
|
Constant
|
|
Foreign
|
|
|
(€
thousands)
|
Currency
|
|
Currency
|
|
Change
|
|
|
Lottery
|
5,933
|
|
35,312
|
|
41,245
|
Machine
Gaming
|
3,524
|
|
4,532
|
|
8,056
|
Interactive
Gaming
|
2,198
|
|
72
|
|
2,270
|
Sports
Betting
|
475
|
|
90
|
|
565
|
Commercial
Services
|
(196)
|
|
494
|
|
298
|
Lottery Management
Services
|
(4,827)
|
|
6,710
|
|
1,883
|
|
7,107
|
|
47,210
|
|
54,317
|
|
Service Revenue
Change
|
|
For the three months
ended
|
|
March 31,
|
|
Change
|
(€
thousands)
|
2015
|
|
2014
|
|
€
|
|
%
|
|
|
Lottery Same-Store
Revenues
|
140,200
|
|
133,637
|
|
6,563
|
|
4.9
|
Wins
|
3,241
|
|
-
|
|
3,241
|
|
-
|
Gaming &
Other
|
48,048
|
|
45,918
|
|
2,130
|
|
4.6
|
Lottery Management
Services
|
26,836
|
|
31,663
|
|
(4,827)
|
|
(15.2)
|
Foreign Exchange
Impact
|
47,210
|
|
-
|
|
47,210
|
|
-
|
Total Service
Revenue
|
265,535
|
|
211,218
|
|
54,317
|
|
25.7
|
|
Product Sales
Change
|
|
For the three months
ended March 31, 2015
|
|
compared to March 31,
2014
|
|
Constant
|
|
Foreign
|
|
|
(€
thousands)
|
Currency
|
|
Currency
|
|
Change
|
|
|
|
|
|
|
Lottery
|
(8,452)
|
|
1,898
|
|
(6,554)
|
Machine
Gaming
|
6,014
|
|
1,874
|
|
7,888
|
|
(2,438)
|
|
3,772
|
|
1,334
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
INTERNATIONAL SEGMENT
|
|
The following tables
set forth changes in revenue on a constant currency basis:
|
|
|
|
Service Revenue
Change
|
|
For the three months
ended March 31, 2015
|
|
compared to March 31,
2014
|
|
Constant
|
|
Foreign
|
|
|
(€
thousands)
|
Currency
|
|
Currency
|
|
Change
|
|
|
Lottery
|
(1,279)
|
|
3,008
|
|
1,729
|
Interactive
Games
|
(253)
|
|
198
|
|
(55)
|
Commercial
Services
|
(6)
|
|
65
|
|
59
|
Sports
Betting
|
163
|
|
160
|
|
323
|
Machine
Gaming
|
452
|
|
(152)
|
|
300
|
|
(923)
|
|
3,279
|
|
2,356
|
|
Service Revenue
Change
|
|
For the three months
ended
|
|
March 31,
|
|
Change
|
(€
thousands)
|
2015
|
|
2014
|
|
€
|
|
%
|
|
|
Lottery Same Store
Revenue
|
24,891
|
|
22,343
|
|
2,548
|
|
11.4
|
Gaming &
Other
|
31,814
|
|
35,285
|
|
(3,471)
|
|
(9.8)
|
Foreign Exchange
Impact
|
3,279
|
|
-
|
|
3,279
|
|
-
|
Total Service
Revenue
|
59,984
|
|
57,628
|
|
2,356
|
|
4.1
|
|
Product Sales
Change
|
|
For the three months
ended March 31, 2015
|
|
compared to March 31,
2014
|
|
Constant
|
|
Foreign
|
|
|
(€
thousands)
|
Currency
|
|
Currency
|
|
Change
|
|
|
|
|
|
|
Machine
Gaming
|
(5,191)
|
|
129
|
|
(5,062)
|
Sports
Betting
|
(220)
|
|
100
|
|
(120)
|
Interactive
Games
|
89
|
|
-
|
|
89
|
Lottery
|
3,242
|
|
979
|
|
4,221
|
|
(2,080)
|
|
1,208
|
|
(872)
|
|
GTECH S.P.A. AND
SUBSIDIARIES
ITALY SEGMENT
|
|
|
For the three months
ended
|
|
March 31,
|
|
Change
|
(€
thousands)
|
2015
|
|
2014
|
|
€
|
|
%
|
Service
revenue
|
|
|
|
|
|
|
|
Lotto
|
118,929
|
|
103,461
|
|
15,468
|
|
15.0
|
Instant
tickets
|
89,926
|
|
96,806
|
|
(6,880)
|
|
(7.1)
|
Lottery
|
208,855
|
|
200,267
|
|
8,588
|
|
4.3
|
|
|
Lotto (€
millions)
|
|
Core
wagers
|
1,712.2
|
|
1,509.3
|
|
202.9
|
|
13.4
|
Wagers for late
numbers
|
104.6
|
|
59.5
|
|
45.1
|
|
75.8
|
|
1,816.8
|
|
1,568.8
|
|
248.0
|
|
15.8
|
|
|
|
|
|
|
|
|
Instant
Tickets
|
|
|
|
|
|
|
|
Total sales (in
millions)
|
€ 2,302.1
|
|
€ 2,475.9
|
|
(€ 173.8)
|
|
(7.0)
|
Total tickets sold
(in millions)
|
455.7
|
|
500.9
|
|
(45.2)
|
|
(9.0)
|
Average price
point
|
€ 5.05
|
|
€ 4.94
|
|
€ 0.11
|
|
2.2
|
|
|
|
|
|
|
|
|
Machine Gaming
(€ millions)
|
|
|
|
|
|
|
|
VLT
wagers
|
1,372.5
|
|
1,497.1
|
|
(124.6)
|
|
(8.3)
|
AWP
wagers
|
1,130.6
|
|
1,140.5
|
|
(9.9)
|
|
(0.9)
|
Total
wagers
|
2,503.1
|
|
2,637.6
|
|
(134.5)
|
|
(5.1)
|
|
|
|
|
|
|
|
|
(Installed at the
end of March)
|
|
|
|
|
|
|
|
VLT's
installed
|
10,938
|
|
10,675
|
|
263
|
|
2.5
|
AWP machines
installed
|
63,840
|
|
69,385
|
|
(5,545)
|
|
(8.0)
|
Total machines
installed
|
74,778
|
|
80,060
|
|
(5,282)
|
|
(6.6)
|
|
|
|
|
|
|
|
|
Sports Betting
(€ millions)
|
|
|
|
|
|
|
|
Fixed odds sports
betting and other wagers
|
256.5
|
|
251.4
|
|
5.1
|
|
2.0
|
|
|
|
|
|
|
|
|
Interactive
Gaming (€ millions)
|
|
|
|
|
|
|
|
Interactive gaming
wagers
|
473.7
|
|
478.6
|
|
(4.9)
|
|
(1.0)
|
|
GTECH S.P.A. AND
SUBSIDIARIES
NET FINANCIAL POSITION
|
|
|
March
31,
|
|
December
31,
|
|
|
(€
thousands)
|
2015
|
|
2014
|
|
Change
|
|
|
|
|
|
|
Cash at
bank
|
251,064
|
|
256,757
|
|
(5,693)
|
Cash on
hand
|
3,556
|
|
4,427
|
|
(871)
|
Cash and cash
equivalents
|
254,620
|
|
261,184
|
|
(6,564)
|
|
|
|
|
|
|
Current financial
receivables
|
40,496
|
|
10,386
|
|
30,110
|
|
|
|
|
|
|
Cash exit
rights
|
378,384
|
|
-
|
|
378,384
|
Dividends
payable
|
42,519
|
|
129,594
|
|
(87,075)
|
Capital
Securities
|
-
|
|
747,585
|
|
(747,585)
|
Other
|
122,412
|
|
193,613
|
|
(71,201)
|
Current financial
debt
|
543,315
|
|
1,070,792
|
|
(527,477)
|
|
|
|
|
|
|
Net current
financial debt
|
248,199
|
|
799,222
|
|
(551,023)
|
|
|
|
|
|
|
Revolving Credit
Facilities
|
1,046,555
|
|
721,938
|
|
324,617
|
Term Loan
|
795,332
|
|
-
|
|
795,332
|
2010 Notes (due
2018)
|
485,916
|
|
484,837
|
|
1,079
|
2012 Notes (due
2020)
|
473,373
|
|
472,229
|
|
1,144
|
Capital
Securities
|
45,320
|
|
45,280
|
|
40
|
Other
|
63,738
|
|
61,972
|
|
1,766
|
Non current
financial debt
|
2,910,234
|
|
1,786,256
|
|
1,123,978
|
|
|
|
|
|
|
Net financial
position
|
3,158,433
|
|
2,585,478
|
|
572,955
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
DEBT
|
|
|
March 31,
|
|
December
31,
|
(€
thousands)
|
2015
|
|
2014
|
Long-term debt,
less current portion
|
|
|
|
Revolving Credit
Facilities
|
1,046,555
|
|
721,938
|
Term Loan
|
795,332
|
|
-
|
2010 Notes (due
2018)
|
485,916
|
|
484,837
|
2012 Notes (due
2020)
|
473,373
|
|
472,229
|
Capital
Securities
|
45,320
|
|
45,280
|
Other
|
1,458
|
|
1,454
|
|
2,847,954
|
|
1,725,738
|
|
|
|
|
Short-term
borrowings
|
|
|
|
Short-term
borrowings
|
2
|
|
8,895
|
|
2
|
|
8,895
|
|
|
|
|
Current portion of
long-term debt
|
|
|
|
Senior
Notes
|
31,776
|
|
-
|
2010 Notes (due
2018)
|
5,337
|
|
24,549
|
2012 Notes (due
2020)
|
1,692
|
|
14,408
|
Revolving Credit
Facilities
|
414
|
|
189
|
Capital
Securities
|
-
|
|
747,585
|
Other
|
2,267
|
|
147
|
|
41,486
|
|
786,878
|
|
|
|
|
Total
debt
|
2,889,442
|
|
2,521,511
|
|
|
GTECH S.P.A. AND
SUBSIDIARIES
INTEREST EXPENSE
|
|
|
For the three months
ended
|
|
March 31,
|
(€
thousands)
|
2015
|
|
2014
|
|
|
|
|
Senior
Notes
|
(32,305)
|
|
-
|
Bridge
facility
|
(16,690)
|
|
-
|
2010 Notes (due
2018)
|
(8,793)
|
|
(6,932)
|
Revolving Credit
Facilities
|
(8,732)
|
|
-
|
2012 Notes (due
2020)
|
(5,980)
|
|
(4,633)
|
Capital
Securities
|
(4,840)
|
|
(16,133)
|
Term Loan
|
(2,428)
|
|
-
|
2009 Notes (due
2016)
|
-
|
|
(9,235)
|
Facilities
|
-
|
|
(2,421)
|
Other
|
(1,488)
|
|
(1,243)
|
|
(81,256)
|
|
(40,597)
|
|
|
OPERATING SEGMENT
INFORMATION
|
|
|
Third-party
revenue
|
|
Operating
income
|
|
For the three months
ended March 31,
|
(€
thousands)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Operating
Segments
|
|
|
|
|
|
|
|
Italy
|
430,391
|
|
461,121
|
|
139,626
|
|
157,768
|
Americas
|
300,022
|
|
244,371
|
|
45,991
|
|
30,492
|
International
|
77,115
|
|
75,631
|
|
12,542
|
|
15,330
|
|
807,528
|
|
781,123
|
|
198,159
|
|
203,590
|
|
|
|
|
|
|
|
|
Corporate
support
|
-
|
|
-
|
|
(34,270)
|
|
(9,996)
|
Purchase
accounting
|
161
|
|
130
|
|
(14,617)
|
|
(12,751)
|
|
807,689
|
|
781,253
|
|
149,272
|
|
180,843
|
|
|
Depreciation
|
|
Amortization
|
|
For the three months
ended March 31,
|
(€
thousands)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Operating
Segments
|
|
|
|
|
|
|
|
Italy
|
18,772
|
|
20,211
|
|
37,257
|
|
35,962
|
Americas
|
37,893
|
|
32,474
|
|
1,789
|
|
1,456
|
International
|
5,200
|
|
4,270
|
|
212
|
|
-
|
|
61,865
|
|
56,955
|
|
39,258
|
|
37,418
|
|
|
|
|
|
|
|
|
Corporate
support
|
3,595
|
|
3,641
|
|
451
|
|
97
|
Purchase
accounting
|
864
|
|
1,374
|
|
13,914
|
|
11,507
|
|
66,324
|
|
61,970
|
|
53,623
|
|
49,022
|
|
|
Legacy IGT Second Quarter Fiscal Year 2015
Results
Second quarter results for Legacy IGT (compared to last year's
second quarter)
- Total revenue decreased 22% to $399
million
- Adjusted earnings per share decreased to $0.09 from $0.20
- GAAP earnings per share decreased to ($0.05) from $0.10
- Social gaming revenue increased 17% to $81 million and average bookings per daily active
user grew 9% to $0.47
- Returned $27 million to
shareholders in the form of dividends
|
Consolidated
Results
|
|
|
|
Second
Quarter
|
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
(In millions,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
399.4
|
|
|
$
|
512.8
|
|
|
|
-22
|
%
|
|
|
$
|
850.0
|
|
|
$
|
1,054.0
|
|
|
|
-19
|
%
|
Operating
income
|
|
|
(7.2)
|
|
|
|
72.1
|
|
|
|
-110
|
%
|
|
|
|
56.3
|
|
|
|
175.7
|
|
|
|
-68
|
%
|
Net income
(loss)
|
|
|
(13.1)
|
|
|
|
25.7
|
|
|
|
-151
|
%
|
|
|
|
21.9
|
|
|
|
105.0
|
|
|
|
-79
|
%
|
Earnings (loss) per
share
|
|
$
|
(0.05)
|
|
|
$
|
0.10
|
|
|
|
-150
|
%
|
|
|
$
|
0.09
|
|
|
$
|
0.42
|
|
|
|
-79
|
%
|
Net operating cash
flows
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
185.6
|
|
|
$
|
(65.2)
|
|
|
|
385
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Measures (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income
|
|
$
|
47.5
|
|
|
$
|
107.5
|
|
|
|
-56
|
%
|
|
|
$
|
133.0
|
|
|
$
|
231.2
|
|
|
|
-42
|
%
|
Adjusted net
income
|
|
|
23.4
|
|
|
|
49.4
|
|
|
|
-53
|
%
|
|
|
|
71.0
|
|
|
|
112.4
|
|
|
|
-37
|
%
|
Adjusted earnings per
share
|
|
$
|
0.09
|
|
|
$
|
0.20
|
|
|
|
-55
|
%
|
|
|
$
|
0.28
|
|
|
$
|
0.45
|
|
|
|
-38
|
%
|
Free cash flow
(before dividends)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
135.0
|
|
|
$
|
(111.4)
|
|
|
|
221
|
%
|
|
|
(1) Adjusted
operating income, adjusted net income, adjusted earnings per share
and free cash flow are non-GAAP financial
measures. Reconciliations between GAAP and non-GAAP
measures are provided at the end of this
release.
|
- Revenue decreased 22% to $399
million in the quarter primarily due to declines in product
sales and gaming operations, partially offset by an increase in
interactive revenue.
- Non-GAAP adjusted financial measures for the quarter excluded
$24 million in bad debt provision and
$19 million in merger-related
costs.
- Operating cash flow for the first six months increased by
$251 million, primarily due to the
prior year investment of $185 million
to extend land-based licensing rights for Wheel of
Fortune® and Jeopardy!® through 2024, as well
as expand rights to include social gaming and online real-money
wagering in the U.S.
|
Gaming
Operations
|
|
|
Second
Quarter
|
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
2015
|
|
2014
|
|
%
Change
|
|
|
|
2015
|
|
2014
|
|
%
Change
|
|
(In millions,
unless otherwise noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
190.7
|
|
|
$
|
230.4
|
|
|
|
-17
|
%
|
|
|
|
$
|
401.8
|
|
|
$
|
453.4
|
|
|
|
-11
|
%
|
Gross
profit
|
|
|
116.0
|
|
|
|
140.4
|
|
|
|
-17
|
%
|
|
|
|
|
247.3
|
|
|
|
276.6
|
|
|
|
-11
|
%
|
Gross
margin
|
|
|
61
|
%
|
|
|
61
|
%
|
|
|
-
|
pp
|
|
|
|
|
62
|
%
|
|
|
61
|
%
|
|
|
1
|
pp
|
Installed base
('000)
|
|
|
43.6
|
|
|
|
53.4
|
|
|
|
-18
|
%
|
|
|
|
|
43.6
|
|
|
|
53.4
|
|
|
|
-18
|
%
|
Yield (average
revenue per unit per day - $0.00)
|
|
$
|
47.06
|
|
|
$
|
47.00
|
|
|
|
-
|
%
|
|
|
|
$
|
46.62
|
|
|
$
|
46.11
|
|
|
|
1
|
%
|
- Revenue decreased 17% to $191
million in the quarter primarily due to installed base
declines.
- Gross margin for the quarter was consistent with prior-year
results.
- Installed base decreased 18% driven largely by declines in
International lease units converted to sales in the prior year, as
well as declines in North America MegaJackpots®
most significantly in the standalone category.
- Average revenue per unit per day in the quarter was
$47.06, slightly above the prior-year
quarter.
|
Product
Sales
|
|
|
Second
Quarter
|
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
2015
|
|
2014
|
|
%
Change
|
|
|
|
2015
|
|
2014
|
|
%
Change
|
|
(In millions,
unless otherwise noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
114.6
|
|
|
$
|
202.6
|
|
|
|
-43
|
%
|
|
|
|
$
|
262.5
|
|
|
$
|
446.2
|
|
|
|
-41
|
%
|
Gross
profit
|
|
|
44.2
|
|
|
|
104.0
|
|
|
|
-58
|
%
|
|
|
|
|
115.2
|
|
|
|
230.9
|
|
|
|
-50
|
%
|
Gross
margin
|
|
|
39
|
%
|
|
|
51
|
%
|
|
|
(12)
|
pp
|
|
|
|
|
44
|
%
|
|
|
52
|
%
|
|
|
(8)
|
pp
|
Machine units
recognized ('000)
|
|
|
5.1
|
|
|
|
7.9
|
|
|
|
-35
|
%
|
|
|
|
|
10.9
|
|
|
|
20.7
|
|
|
|
-47
|
%
|
Machine average sales
price ('000)
|
|
$
|
12.0
|
|
|
$
|
14.7
|
|
|
|
-18
|
%
|
|
|
|
$
|
13.0
|
|
|
$
|
13.7
|
|
|
|
-5
|
%
|
- Revenue decreased 43% to $115
million in the quarter, primarily due to lower new unit
sales, as well as lower non-machine sales
- North America replacement
sales increased 400 units to 3,800 units in the quarter compared to
3,400 units in the prior-year quarter primarily due to lease units
converted to sales.
- Gross margin decreased to 39% from 51% primarily due to lower
manufacturing productivity and inventory charges associated with
reduced volume.
- Average machine sales price decreased 18% to $12,000 in the quarter primarily due to product
mix, mostly due to lower-priced lease units converted to
sales.
|
Interactive
|
|
|
|
Second
Quarter
|
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
(In millions,
unless otherwise noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
94.1
|
|
|
$
|
79.8
|
|
|
|
18
|
%
|
|
|
$
|
185.7
|
|
|
$
|
154.4
|
|
|
|
20
|
%
|
Social
gaming
|
|
|
80.6
|
|
|
|
68.8
|
|
|
|
17
|
%
|
|
|
|
160.0
|
|
|
|
133.6
|
|
|
|
20
|
%
|
IGTi
|
|
|
13.5
|
|
|
|
11.0
|
|
|
|
23
|
%
|
|
|
|
25.7
|
|
|
|
20.8
|
|
|
|
24
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Margin
|
|
|
63
|
%
|
|
|
61
|
%
|
|
|
2
|
pp
|
|
|
|
62
|
%
|
|
|
62
|
%
|
|
|
-
|
pp
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DoubleDown average
user statistics (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DAU (Daily active
users) ('000)
|
|
|
1,929
|
|
|
|
1,775
|
|
|
|
9
|
%
|
|
|
|
1,919
|
|
|
|
1,745
|
|
|
|
10
|
%
|
MAU (Monthly active
users) ('000)
|
|
|
4,734
|
|
|
|
6,218
|
|
|
|
-24
|
%
|
|
|
|
4,973
|
|
|
|
6,208
|
|
|
|
-20
|
%
|
Bookings per DAU
($0.00)
|
|
$
|
0.47
|
|
|
$
|
0.43
|
|
|
|
9
|
%
|
|
|
$
|
0.45
|
|
|
$
|
0.42
|
|
|
|
6
|
%
|
|
(1) as a single
application with multiple games, active users equal unique
users
|
- Social gaming revenue increased 17% to $81 million compared to the prior year quarter,
driven by increases in both average DAU and bookings per DAU.
Mobile revenue comprised 41% of total bookings in the quarter and
increased 52% compared to the prior year quarter.
- Average DAU were 1.9 million, an increase of 9% over the prior
year quarter due to improved content and enhanced player retention
and engagement strategies.
- Average MAU were 4.7 million, a decrease of 24% compared to the
prior year quarter, primarily due to increased marketing efforts to
procure higher-quality players.
- Average bookings per DAU in the first quarter were $0.47, an increase of 9% over the same quarter
last year.
|
Operating
Expenses
|
|
|
|
Second
Quarter
|
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
|
|
2015
|
|
|
2014
|
|
|
%
Change
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general
& administrative
|
|
$
|
101.4
|
|
|
$
|
116.7
|
|
|
|
-13
|
%
|
|
|
$
|
206.4
|
|
|
$
|
229.2
|
|
|
|
-10
|
%
|
Bad debt
provision
|
|
|
27.1
|
|
|
|
7.4
|
|
|
|
266
|
%
|
|
|
|
30.5
|
|
|
|
12.9
|
|
|
|
136
|
%
|
Research &
development
|
|
|
59.5
|
|
|
|
58.5
|
|
|
|
2
|
%
|
|
|
|
116.9
|
|
|
|
118.8
|
|
|
|
-2
|
%
|
Depreciation &
amortization
|
|
|
13.2
|
|
|
|
16.6
|
|
|
|
-20
|
%
|
|
|
|
26.9
|
|
|
|
33.2
|
|
|
|
-19
|
%
|
Contingent
acquisition-related costs
|
|
|
0.4
|
|
|
|
3.7
|
|
|
|
-89
|
%
|
|
|
|
2.9
|
|
|
|
15.0
|
|
|
|
-81
|
%
|
Impairment,
restructuring, and merger-related costs
|
|
|
25.0
|
|
|
|
17.8
|
|
|
|
*
|
|
|
|
|
37.9
|
|
|
|
17.8
|
|
|
|
*
|
|
Total operating
expenses
|
|
$
|
226.6
|
|
|
$
|
220.7
|
|
|
|
3
|
%
|
|
|
$
|
421.5
|
|
|
$
|
426.9
|
|
|
|
-1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating
Expenses (1)
|
|
$
|
174.7
|
|
|
$
|
188.0
|
|
|
|
-7
|
%
|
|
|
$
|
351.1
|
|
|
$
|
377.4
|
|
|
|
-7
|
%
|
|
(1) Adjusted operating
expenses is a non-GAAP financial measure. Reconciliations
between GAAP and non-GAAP measures are provided at the end of this
release.
|
- GAAP operating expenses increased 3% to $227 million, primarily due to an increase of
$20 million in bad debt provision and
an increase of $7 million in
impairment, restructuring, and merger-related costs.
- Adjusted operating expenses decreased 7% to $175 million, in part due to cost savings
initiatives resulting from the March
2014 business realignment.
|
Balance Sheet and
Capital Deployment
|
|
(In millions)
|
|
March 31,
2015
|
|
September 30,
2014
|
|
%
Change
|
|
Cash and equivalents
(including restricted amounts)
|
|
$
|
296.7
|
|
$
|
314.4
|
|
|
-6
|
%
|
Working
capital
|
|
|
669.4
|
|
|
676.3
|
|
|
-1
|
%
|
Contractual debt
obligations
|
|
|
1,750.0
|
|
|
1,825.0
|
|
|
-4
|
%
|
- Contractual debt obligations totaled $1.75 billion as of March
31, 2015.
- Outstanding borrowings under the company's revolving credit
facility were $450 million as of
March 31, 2015.
- The company returned $27 million
to its shareholders in the form of dividends during the
quarter.
Other
References to per share amounts in this release are based on
diluted shares of common stock, unless otherwise specified.
|
CONSOLIDATED
STATEMENTS OF INCOME (Unaudited and Condensed)
|
|
|
|
Second
Quarter
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
|
(In millions,
except per share amounts)
|
|
REVENUES
|
|
|
|
|
|
|
|
|
|
|
|
|
Gaming
operations
|
|
$
|
190.7
|
|
|
$
|
230.4
|
|
|
$
|
401.8
|
|
|
$
|
453.4
|
|
Product
sales
|
|
|
114.6
|
|
|
|
202.6
|
|
|
|
262.5
|
|
|
|
446.2
|
|
Interactive
|
|
|
94.1
|
|
|
|
79.8
|
|
|
|
185.7
|
|
|
|
154.4
|
|
Total
|
|
|
399.4
|
|
|
|
512.8
|
|
|
|
850.0
|
|
|
|
1,054.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
COSTS AND
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of gaming
operations
|
|
|
74.7
|
|
|
|
90.0
|
|
|
|
154.5
|
|
|
|
176.8
|
|
Cost of product
sales
|
|
|
70.4
|
|
|
|
98.6
|
|
|
|
147.3
|
|
|
|
215.3
|
|
Cost of
interactive
|
|
|
34.9
|
|
|
|
31.4
|
|
|
|
70.4
|
|
|
|
59.3
|
|
Selling, general and
administrative
|
|
|
101.4
|
|
|
|
116.7
|
|
|
|
206.4
|
|
|
|
229.2
|
|
Bad debt
provision
|
|
|
27.1
|
|
|
|
7.4
|
|
|
|
30.5
|
|
|
|
12.9
|
|
Research and
development
|
|
|
59.5
|
|
|
|
58.5
|
|
|
|
116.9
|
|
|
|
118.8
|
|
Depreciation and
amortization
|
|
|
13.2
|
|
|
|
16.6
|
|
|
|
26.9
|
|
|
|
33.2
|
|
Contingent
acquisition-related costs
|
|
|
0.4
|
|
|
|
3.7
|
|
|
|
2.9
|
|
|
|
15.0
|
|
Impairment,
restructuring, and merger-related costs
|
|
|
25.0
|
|
|
|
17.8
|
|
|
|
37.9
|
|
|
|
17.8
|
|
Total
|
|
|
406.6
|
|
|
|
440.7
|
|
|
|
793.7
|
|
|
|
878.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING INCOME
(LOSS)
|
|
|
(7.2)
|
|
|
|
72.1
|
|
|
|
56.3
|
|
|
|
175.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
7.6
|
|
|
|
10.7
|
|
|
|
16.9
|
|
|
|
20.9
|
|
Interest
expense
|
|
|
(20.1)
|
|
|
|
(36.9)
|
|
|
|
(41.3)
|
|
|
|
(73.3)
|
|
Other
|
|
|
2.5
|
|
|
|
(3.4)
|
|
|
|
2.6
|
|
|
|
(5.3)
|
|
Total
|
|
|
(10.0)
|
|
|
|
(29.6)
|
|
|
|
(21.8)
|
|
|
|
(57.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INCOME (LOSS)
BEFORE TAX
|
|
|
(17.2)
|
|
|
|
42.5
|
|
|
|
34.5
|
|
|
|
118.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
(benefit)
|
|
|
(4.1)
|
|
|
|
16.8
|
|
|
|
12.6
|
|
|
|
13.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
$
|
(13.1)
|
|
|
$
|
25.7
|
|
|
$
|
21.9
|
|
|
$
|
105.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS (LOSS)
PER SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.05)
|
|
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
$
|
0.42
|
|
Diluted
|
|
$
|
(0.05)
|
|
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
$
|
0.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE
SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
248.8
|
|
|
|
247.7
|
|
|
|
248.2
|
|
|
|
250.2
|
|
Diluted
|
|
|
250.2
|
|
|
|
248.6
|
|
|
|
250.1
|
|
|
|
251.9
|
|
|
|
CONSOLIDATED
BALANCE SHEET (Unaudited and Condensed)
|
|
|
|
March
31,
|
|
|
September
30,
|
|
|
|
2015
|
|
|
2014
|
|
|
|
(In
millions)
|
|
ASSETS
|
|
|
|
|
|
|
Cash and
equivalents
|
|
$
|
240.0
|
|
|
$
|
255.1
|
|
Restricted cash and
investment securities
|
|
|
56.7
|
|
|
|
59.3
|
|
Jackpot annuity
investments
|
|
|
50.6
|
|
|
|
53.0
|
|
Receivables,
net
|
|
|
388.8
|
|
|
|
530.2
|
|
Inventories
|
|
|
86.2
|
|
|
|
71.4
|
|
Other assets and
deferred costs
|
|
|
260.3
|
|
|
|
252.1
|
|
Total current
assets
|
|
|
1,082.6
|
|
|
|
1,221.1
|
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
|
391.8
|
|
|
|
412.7
|
|
Jackpot annuity
investments
|
|
|
226.3
|
|
|
|
236.7
|
|
Contracts and notes
receivable, net
|
|
|
70.7
|
|
|
|
115.5
|
|
Goodwill and other
intangible assets, net
|
|
|
1,505.9
|
|
|
|
1,542.5
|
|
Other assets and
deferred costs
|
|
|
461.5
|
|
|
|
461.0
|
|
TOTAL
ASSETS
|
|
$
|
3,738.8
|
|
|
$
|
3,989.5
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
75.8
|
|
|
$
|
77.7
|
|
Jackpot liabilities,
current portion
|
|
|
104.7
|
|
|
|
117.5
|
|
Dividends
payable
|
|
|
-
|
|
|
|
27.2
|
|
Other accrued
liabilities
|
|
|
232.7
|
|
|
|
322.4
|
|
Total current
liabilities
|
|
|
413.2
|
|
|
|
544.8
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
1,818.8
|
|
|
|
1,878.6
|
|
Jackpot
liabilities
|
|
|
251.4
|
|
|
|
261.6
|
|
Other
liabilities
|
|
|
109.0
|
|
|
|
106.9
|
|
TOTAL
LIABILITIES
|
|
|
2,592.4
|
|
|
|
2,791.9
|
|
|
|
|
|
|
|
|
|
|
TOTAL
EQUITY
|
|
|
1,146.4
|
|
|
|
1,197.6
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
$
|
3,738.8
|
|
|
$
|
3,989.5
|
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOW (Unaudited and Condensed)
|
|
Six Months Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
|
(In
millions)
|
|
OPERATING
|
|
|
|
|
|
|
Net income
|
|
$
|
21.9
|
|
|
$
|
105.0
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
76.9
|
|
|
|
99.4
|
|
Acquisition-related
contingent earn-out costs
|
|
|
2.4
|
|
|
|
6.6
|
|
Bad debt
provision
|
|
|
30.5
|
|
|
|
12.9
|
|
Other non-cash
items
|
|
|
31.8
|
|
|
|
51.9
|
|
|
|
|
|
|
|
|
|
|
Changes in operating
assets and liabilities, excluding acquisitions:
|
|
|
|
|
|
|
|
|
Receivables
|
|
|
134.3
|
|
|
|
15.5
|
|
Inventories
|
|
|
(25.6)
|
|
|
|
13.4
|
|
Accounts payable and
accrued liabilities
|
|
|
(57.8)
|
|
|
|
(50.2)
|
|
Jackpot
liabilities
|
|
|
(29.9)
|
|
|
|
(32.9)
|
|
Income taxes, net of
employee stock plans
|
|
|
0.4
|
|
|
|
(50.4)
|
|
Other assets and
deferred costs
|
|
|
0.7
|
|
|
|
(236.4)
|
|
Net operating cash
flows
|
|
|
185.6
|
|
|
|
(65.2)
|
|
|
|
|
|
|
|
|
|
|
INVESTING
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(50.6)
|
|
|
|
(46.2)
|
|
Proceeds from assets
sold
|
|
|
18.8
|
|
|
|
7.8
|
|
Investment
securities, net
|
|
|
-
|
|
|
|
13.9
|
|
Jackpot annuity
investments, net
|
|
|
20.1
|
|
|
|
25.0
|
|
Changes in restricted
cash
|
|
|
2.4
|
|
|
|
5.6
|
|
Loans receivable,
net
|
|
|
-
|
|
|
|
14.9
|
|
Net investing cash
flows
|
|
|
(9.3)
|
|
|
|
21.0
|
|
|
|
|
|
|
|
|
|
|
FINANCING
|
|
|
|
|
|
|
|
|
Debt-related proceeds
(payments), net
|
|
|
(75.0)
|
|
|
|
(0.6)
|
|
Employee stock plan
proceeds
|
|
|
10.5
|
|
|
|
12.0
|
|
Share repurchases,
including net shares
|
|
|
(8.3)
|
|
|
|
(211.3)
|
|
Dividends
paid
|
|
|
(81.9)
|
|
|
|
(53.4)
|
|
Acquisition-related
contingent consideration
|
|
|
(27.9)
|
|
|
|
(56.1)
|
|
Net financing cash
flows
|
|
|
(182.6)
|
|
|
|
(309.4)
|
|
|
|
|
|
|
|
|
|
|
FOREIGN EXCHANGE
RATES EFFECT ON CASH AND EQUIVALENTS
|
|
|
(8.8)
|
|
|
|
(3.9)
|
|
|
|
|
|
|
|
|
|
|
NET CHANGE IN CASH
AND EQUIVALENTS
|
|
|
(15.1)
|
|
|
|
(357.5)
|
|
|
|
|
|
|
|
|
|
|
BEGINNING CASH AND
EQUIVALENTS
|
|
|
255.1
|
|
|
|
713.3
|
|
|
|
|
|
|
|
|
|
|
ENDING CASH AND
EQUIVALENTS
|
|
$
|
240.0
|
|
|
$
|
355.8
|
|
|
|
SUPPLEMENTAL DATA
(Unaudited)
|
|
REVENUE
METRICS
|
|
Second
Quarter
|
|
|
Six
Months
|
|
Periods Ended
March 31,
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
|
(In millions,
unless otherwise noted)
|
|
GAMING
OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
190.7
|
|
|
$
|
230.4
|
|
|
$
|
401.8
|
|
|
$
|
453.4
|
|
North
America
|
|
|
169.7
|
|
|
|
200.1
|
|
|
|
357.7
|
|
|
|
391.7
|
|
International
|
|
|
21.0
|
|
|
|
30.3
|
|
|
|
44.1
|
|
|
|
61.7
|
|
Gross
margin
|
|
|
61
|
%
|
|
|
61
|
%
|
|
|
62
|
%
|
|
|
61
|
%
|
North
America
|
|
|
60
|
%
|
|
|
58
|
%
|
|
|
61
|
%
|
|
|
59
|
%
|
International
|
|
|
69
|
%
|
|
|
78
|
%
|
|
|
68
|
%
|
|
|
75
|
%
|
Installed base
(units '000)
|
|
|
43.6
|
|
|
|
53.4
|
|
|
|
43.6
|
|
|
|
53.4
|
|
North
America
|
|
|
34.8
|
|
|
|
40.4
|
|
|
|
34.8
|
|
|
|
40.4
|
|
International
|
|
|
8.8
|
|
|
|
13.0
|
|
|
|
8.8
|
|
|
|
13.0
|
|
Yield (average
revenue per unit per day - $0.00)
|
|
$
|
47.06
|
|
|
$
|
47.00
|
|
|
$
|
46.62
|
|
|
$
|
46.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PRODUCT
SALES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
114.6
|
|
|
$
|
202.6
|
|
|
$
|
262.5
|
|
|
$
|
446.2
|
|
North
America
|
|
|
77.5
|
|
|
|
143.8
|
|
|
|
171.6
|
|
|
|
313.8
|
|
International
|
|
|
37.1
|
|
|
|
58.8
|
|
|
|
90.9
|
|
|
|
132.4
|
|
Machines
|
|
$
|
61.3
|
|
|
$
|
116.0
|
|
|
$
|
141.3
|
|
|
$
|
282.9
|
|
North
America
|
|
|
42.6
|
|
|
|
79.1
|
|
|
|
94.3
|
|
|
|
197.2
|
|
International
|
|
|
18.7
|
|
|
|
36.9
|
|
|
|
47.0
|
|
|
|
85.7
|
|
Non-machine
|
|
$
|
53.3
|
|
|
$
|
86.6
|
|
|
$
|
121.2
|
|
|
$
|
163.3
|
|
North
America
|
|
|
34.9
|
|
|
|
64.7
|
|
|
|
77.3
|
|
|
|
116.6
|
|
International
|
|
|
18.4
|
|
|
|
21.9
|
|
|
|
43.9
|
|
|
|
46.7
|
|
Gross
margin
|
|
|
39
|
%
|
|
|
51
|
%
|
|
|
44
|
%
|
|
|
52
|
%
|
North
America
|
|
|
43
|
%
|
|
|
56
|
%
|
|
|
47
|
%
|
|
|
54
|
%
|
International
|
|
|
30
|
%
|
|
|
40
|
%
|
|
|
39
|
%
|
|
|
46
|
%
|
Machine units
recognized ('000)
|
|
|
5.1
|
|
|
|
7.9
|
|
|
|
10.9
|
|
|
|
20.7
|
|
North
America
|
|
|
4.0
|
|
|
|
5.7
|
|
|
|
7.9
|
|
|
|
15.3
|
|
International
|
|
|
1.1
|
|
|
|
2.2
|
|
|
|
3.0
|
|
|
|
5.4
|
|
Machine units
shipped ('000) [includes units where revenues
deferred]
|
|
|
5.1
|
|
|
|
7.6
|
|
|
|
11.0
|
|
|
|
20.6
|
|
North
America
|
|
|
4.0
|
|
|
|
5.5
|
|
|
|
8.2
|
|
|
|
15.3
|
|
New
|
|
|
0.2
|
|
|
|
2.1
|
|
|
|
0.9
|
|
|
|
5.8
|
|
Replacement
|
|
|
3.8
|
|
|
|
3.4
|
|
|
|
7.3
|
|
|
|
9.5
|
|
International
|
|
|
1.1
|
|
|
|
2.1
|
|
|
|
2.8
|
|
|
|
5.3
|
|
New
|
|
|
0.3
|
|
|
|
0.6
|
|
|
|
0.8
|
|
|
|
1.2
|
|
Replacement
|
|
|
0.8
|
|
|
|
1.5
|
|
|
|
2.0
|
|
|
|
4.1
|
|
Machine ASP
('000)
|
|
$
|
12.0
|
|
|
$
|
14.7
|
|
|
$
|
13.0
|
|
|
$
|
13.7
|
|
North
America
|
|
|
10.6
|
|
|
|
13.9
|
|
|
|
12.0
|
|
|
|
12.9
|
|
International
|
|
|
17.1
|
|
|
|
16.6
|
|
|
|
15.8
|
|
|
|
15.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INTERACTIVE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
94.1
|
|
|
$
|
79.8
|
|
|
$
|
185.7
|
|
|
$
|
154.4
|
|
North
America
|
|
|
82.9
|
|
|
|
70.3
|
|
|
|
164.4
|
|
|
|
136.1
|
|
International
|
|
|
11.2
|
|
|
|
9.5
|
|
|
|
21.3
|
|
|
|
18.3
|
|
Social
Gaming
|
|
|
80.6
|
|
|
|
68.8
|
|
|
|
160.0
|
|
|
|
133.6
|
|
North
America
|
|
|
80.6
|
|
|
|
68.8
|
|
|
|
160.0
|
|
|
|
133.6
|
|
IGTi
|
|
|
13.5
|
|
|
|
11.0
|
|
|
|
25.7
|
|
|
|
20.8
|
|
North
America
|
|
|
2.3
|
|
|
|
1.5
|
|
|
|
4.4
|
|
|
|
2.5
|
|
International
|
|
|
11.2
|
|
|
|
9.5
|
|
|
|
21.3
|
|
|
|
18.3
|
|
Gross
margin
|
|
|
63
|
%
|
|
|
61
|
%
|
|
|
62
|
%
|
|
|
62
|
%
|
North
America
|
|
|
62
|
%
|
|
|
62
|
%
|
|
|
62
|
%
|
|
|
62
|
%
|
International
|
|
|
67
|
%
|
|
|
51
|
%
|
|
|
66
|
%
|
|
|
58
|
%
|
DoubleDown
average user statistics [as a single application with
multiple games, active users equal unique users]
|
DAU (daily active
users) ('000)
|
|
|
1,929
|
|
|
|
1,775
|
|
|
|
1,919
|
|
|
|
1,745
|
|
MAU (monthly active
users) ('000)
|
|
|
4,734
|
|
|
|
6,218
|
|
|
|
4,973
|
|
|
|
6,208
|
|
Bookings per DAU
($0.00)
|
|
$
|
0.47
|
|
|
$
|
0.43
|
|
|
$
|
0.45
|
|
|
$
|
0.42
|
|
|
|
Reconciliations of
GAAP to Non-GAAP Adjusted Financial Measures
(in millions, except
EPS)
|
|
Second Quarter
Ended March 31, 2015
|
|
Cost
of
Gaming
Operations
|
|
|
Cost
of
Product
Sales
|
|
|
Cost
of
Interactive
|
|
|
Operating
Expenses
|
|
|
Operating
Income
(loss)
|
|
|
Net
Earnings
(loss)
(a)
|
|
|
Diluted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures
|
|
$
|
74.7
|
|
|
$
|
70.4
|
|
|
$
|
34.9
|
|
|
$
|
226.6
|
|
|
$
|
(7.2)
|
|
|
$
|
(13.1)
|
|
|
$
|
(0.05)
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
57
|
%
|
|
|
-2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges:
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent retention
& earn-out
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(0.4)
|
|
|
|
0.4
|
|
|
|
0.2
|
|
|
|
-
|
|
Amortization of
intangibles
|
|
|
-
|
|
|
|
(0.1)
|
|
|
|
(2.4)
|
|
|
|
(2.2)
|
|
|
|
4.7
|
|
|
|
3.2
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bad debt
provision
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(24.3)
|
|
|
|
24.3
|
|
|
|
16.2
|
|
|
|
0.06
|
|
Alabama note
impairment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(6.1)
|
|
|
|
6.1
|
|
|
|
4.1
|
|
|
|
0.02
|
|
Merger-related
costs
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(18.9)
|
|
|
|
18.9
|
|
|
|
12.6
|
|
|
|
0.05
|
|
Severance
|
|
|
(0.3)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
0.3
|
|
|
|
0.2
|
|
|
|
-
|
|
Total non-GAAP
adjustments
|
|
|
(0.3)
|
|
|
|
(0.1)
|
|
|
|
(2.4)
|
|
|
|
(51.9)
|
|
|
|
54.7
|
|
|
|
36.5
|
|
|
|
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
measures
|
|
$
|
74.4
|
|
|
$
|
70.3
|
|
|
$
|
32.5
|
|
|
$
|
174.7
|
|
|
$
|
47.5
|
|
|
$
|
23.4
|
|
|
$
|
0.09
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
44
|
%
|
|
|
12
|
%
|
|
|
|
|
|
|
|
|
|
(a) Adjustments tax
effected at 33%; (b) Primarily DoubleDown
|
|
Second Quarter
Ended March 31, 2014
|
|
Cost
of
Gaming
Operations
|
|
|
Cost
of
Product
Sales
|
|
|
Cost
of
Interactive
|
|
|
Operating
Expenses
|
|
|
Operating
Income
|
|
|
Net
Earnings
(a)
|
|
|
Diluted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures
|
|
$
|
90.0
|
|
|
$
|
98.6
|
|
|
$
|
31.4
|
|
|
$
|
220.7
|
|
|
$
|
72.1
|
|
|
$
|
25.7
|
|
|
$
|
0.10
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
43
|
%
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges:
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent retention
& earn-out
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(3.7)
|
|
|
|
3.7
|
|
|
|
2.5
|
|
|
|
0.01
|
|
Amortization of
intangibles
|
|
|
-
|
|
|
|
-
|
|
|
|
(2.7)
|
|
|
|
(3.4)
|
|
|
|
6.1
|
|
|
|
4.1
|
|
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
realignment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(16.5)
|
|
|
|
16.5
|
|
|
|
11.0
|
|
|
|
0.05
|
|
Alabama note
impairment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1.3)
|
|
|
|
1.3
|
|
|
|
0.9
|
|
|
|
-
|
|
Legal
settlement/accrual
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(7.8)
|
|
|
|
7.8
|
|
|
|
5.2
|
|
|
|
0.02
|
|
Total non-GAAP
adjustments
|
|
|
-
|
|
|
|
-
|
|
|
|
(2.7)
|
|
|
|
(32.7)
|
|
|
|
35.4
|
|
|
|
23.7
|
|
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
measures
|
|
$
|
90.0
|
|
|
$
|
98.6
|
|
|
$
|
28.7
|
|
|
$
|
188.0
|
|
|
$
|
107.5
|
|
|
$
|
49.4
|
|
|
$
|
0.20
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37
|
%
|
|
|
21
|
%
|
|
|
|
|
|
|
|
|
|
(a) Adjustments tax
effected at 33%; (b) Primarily DoubleDown
|
|
Six Months Ended
March 31, 2015
|
|
Cost
of
Gaming
Operations
|
|
|
Cost
of
Product
Sales
|
|
|
Cost
of
Interactive
|
|
|
Operating
Expenses
|
|
|
Operating
Income
|
|
|
Net
Earnings
(a)
|
|
|
Diluted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures
|
|
$
|
154.5
|
|
|
$
|
147.3
|
|
|
$
|
70.4
|
|
|
$
|
421.5
|
|
|
$
|
56.3
|
|
|
$
|
21.9
|
|
|
$
|
0.09
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
50
|
%
|
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges:
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent retention
& earn-out
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2.9)
|
|
|
|
2.9
|
|
|
|
1.9
|
|
|
|
0.01
|
|
Amortization of
intangibles
|
|
|
-
|
|
|
|
(0.2)
|
|
|
|
(4.9)
|
|
|
|
(4.4)
|
|
|
|
9.5
|
|
|
|
6.3
|
|
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bad debt
provision
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(24.3)
|
|
|
|
24.3
|
|
|
|
16.2
|
|
|
|
0.06
|
|
Alabama note
impairment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(5.1)
|
|
|
|
5.1
|
|
|
|
3.4
|
|
|
|
0.01
|
|
Merger-related
costs
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(32.8)
|
|
|
|
32.8
|
|
|
|
21.8
|
|
|
|
0.09
|
|
Severance
|
|
|
(1.2)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(0.9)
|
|
|
|
2.1
|
|
|
|
1.4
|
|
|
|
0.01
|
|
Certain discrete tax
items (benefits)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1.9)
|
|
|
|
(0.01)
|
|
Total non-GAAP
adjustments
|
|
|
(1.2)
|
|
|
|
(0.2)
|
|
|
|
(4.9)
|
|
|
|
(70.4)
|
|
|
|
76.7
|
|
|
|
49.1
|
|
|
|
0.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
measures
|
|
$
|
153.3
|
|
|
$
|
147.1
|
|
|
$
|
65.5
|
|
|
$
|
351.1
|
|
|
$
|
133.0
|
|
|
$
|
71.0
|
|
|
$
|
0.28
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41
|
%
|
|
|
16
|
%
|
|
|
|
|
|
|
|
|
|
(a) Adjustments tax
effected at 33%; (b) Primarily DoubleDown
|
|
Six Months Ended
March 31, 2014
|
|
Cost
of
Gaming
Operations
|
|
|
Cost
of
Product
Sales
|
|
|
Cost
of
Interactive
|
|
|
Operating
Expenses
|
|
|
Operating
Income
|
|
|
Net
Earnings
(a)
|
|
|
Diluted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
measures
|
|
$
|
176.8
|
|
|
$
|
215.3
|
|
|
$
|
59.3
|
|
|
$
|
426.9
|
|
|
$
|
175.7
|
|
|
$
|
105.0
|
|
|
$
|
0.42
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
41
|
%
|
|
|
17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges:
(b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent retention
& earn-out
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(15.0)
|
|
|
|
15.0
|
|
|
|
10.0
|
|
|
|
0.04
|
|
Amortization of
intangibles
|
|
|
-
|
|
|
|
-
|
|
|
|
(5.4)
|
|
|
|
(6.8)
|
|
|
|
12.2
|
|
|
|
8.1
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Business
realignment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(16.5)
|
|
|
|
16.5
|
|
|
|
11.0
|
|
|
|
0.05
|
|
Alabama note
impairment
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1.3)
|
|
|
|
1.3
|
|
|
|
0.9
|
|
|
|
-
|
|
Legal
settlement/accrual
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(7.8)
|
|
|
|
7.8
|
|
|
|
5.2
|
|
|
|
0.02
|
|
Severance
|
|
|
(0.6)
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2.1)
|
|
|
|
2.7
|
|
|
|
1.8
|
|
|
|
0.01
|
|
Certain discrete tax
items (benefits)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(29.6)
|
|
|
|
(0.12)
|
|
Total non-GAAP
adjustments
|
|
|
(0.6)
|
|
|
|
-
|
|
|
|
(5.4)
|
|
|
|
(49.5)
|
|
|
|
55.5
|
|
|
|
7.4
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
measures
|
|
$
|
176.2
|
|
|
$
|
215.3
|
|
|
$
|
53.9
|
|
|
$
|
377.4
|
|
|
$
|
231.2
|
|
|
$
|
112.4
|
|
|
$
|
0.45
|
|
% of
revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36
|
%
|
|
|
22
|
%
|
|
|
|
|
|
|
|
|
|
(a) Adjustments tax
effected at 33%; (b) Primarily DoubleDown
|
|
|
|
Second
Quarter
|
|
|
Six
Months
|
|
Adjusted EBITDA
For The Second Quarters Ended March 31,
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Net income
(loss)
|
|
$
|
(13.1)
|
|
|
$
|
25.7
|
|
|
$
|
21.9
|
|
|
$
|
105.0
|
|
Other (income)
expense, net
|
|
|
10.0
|
|
|
|
29.6
|
|
|
|
21.8
|
|
|
|
57.7
|
|
Income tax provision
(benefit)
|
|
|
(4.1)
|
|
|
|
16.8
|
|
|
|
12.6
|
|
|
|
13.0
|
|
Depreciation and
amortization
|
|
|
38.6
|
|
|
|
48.1
|
|
|
|
76.9
|
|
|
|
99.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
|
6.0
|
|
|
|
7.6
|
|
|
|
14.7
|
|
|
|
16.5
|
|
Contingent
acquisition-related costs
|
|
|
0.4
|
|
|
|
3.7
|
|
|
|
2.9
|
|
|
|
15.0
|
|
Impairment,
restructuring, and merger-related costs
|
|
|
25.0
|
|
|
|
17.8
|
|
|
|
37.9
|
|
|
|
17.8
|
|
Adjusted
EBITDA
|
|
$
|
62.8
|
|
|
$
|
149.3
|
|
|
$
|
188.7
|
|
|
$
|
324.4
|
|
|
|
Free Cash Flow For
The Six Months Ended March 31,
|
|
2015
|
|
|
2014
|
|
|
|
|
|
|
|
|
GAAP net operating
cash flows
|
|
$
|
185.6
|
|
|
$
|
(65.2)
|
|
Investment in
property, plant and equipment
|
|
|
(15.2)
|
|
|
|
(11.8)
|
|
Investment in gaming
operations equipment
|
|
|
(35.3)
|
|
|
|
(31.6)
|
|
Investment in
intellectual property
|
|
|
(0.1)
|
|
|
|
(2.8)
|
|
Free Cash Flow
(before dividends)
|
|
|
135.0
|
|
|
|
(111.4)
|
|
Dividends
paid
|
|
|
(81.9)
|
|
|
|
(53.4)
|
|
Free Cash Flow
(after dividends)
|
|
$
|
53.1
|
|
|
$
|
(164.8)
|
|
|
Non-GAAP Financial
Information
Legacy IGT believed
that certain non-GAAP financial measures, when presented in
conjunction with comparable GAAP measures, were useful because that
information was an appropriate measure for evaluating its operating
performance. Non-GAAP information was used to evaluate business
performance and management's effectiveness. These measures should
be considered in addition to, not as a substitute for, or superior
to, measures of financial performance prepared in accordance with
GAAP. Non-GAAP financial measures may not be calculated in the same
manner by all companies and therefore may not be
comparable.
|
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SOURCE International Game Technology PLC