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International Game Technology PLC Reports Second Quarter 2019 Results

- Revenue increased 5% at constant currency on significant growth in global gaming product sales and continued strength in global lottery same-store revenue

- Operating income of $224 million; adjusted operating income of $274 million, up 6% at constant currency

- Adjusted EBITDA of $454 million, up 5% at constant currency, driven by higher North America Gaming and Italy profits

- Year-to-date operating cash flow of $592 million and free cash flow of $361 million, record first-half levels

- Cash dividend declared of $0.20 per ordinary share


LONDON, Aug. 1, 2019 /PRNewswire/ -- International Game Technology PLC ("IGT") (IGT) today reported financial results for the second quarter ended June 30, 2019. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the results; access details are provided below.

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...

"We had a strong second quarter, with top-line growth driven by a sharp increase in gaming product sales and impressive gains in global lottery same-store revenues. Profits were up nicely in our North America Gaming and Italy segments," said Marco Sala, CEO of IGT. "I am pleased with the broad-based improvement in key performance indicators for our main businesses."

"EBITDA in the quarter was the highest we achieved in three years and translated into substantial free cash flow for the first half," said Alberto Fornaro, CFO of IGT. "Recent capital markets activity strengthens our financial structure, enhances flexibility, and positions us well for the coming years."

Overview of Consolidated Second Quarter 2019 Results






Constant


Quarter Ended  

Y/Y

Currency


June 30,

Change

Change


2019

2018

(%)

(%)

(In $ millions, unless otherwise noted)





Revenue

1,234

1,202

3%

5%

Operating income 

224

209

7%

10%

Net income/(loss) per diluted share 

$0.02

$0.79

NM 


Adjusted EBITDA 

454

442

3%

5%

Adjusted operating income 

274

264

4%

6%

Adjusted net income per diluted share 

$0.44

$0.28

57%


Net debt 

7,637

7,530

1%



Note: Adjusted EBITDA, adjusted operating income, and adjusted net income per diluted share are non-GAAP financial measures. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release.

Consolidated revenue of $1.23 billion, up 5% at constant currency

  • Significant growth in global gaming product sales
  • Sustained momentum in lottery same-store revenue
  • More than offset increased machine gaming taxes in Italy

At constant currency, operating income rose 10% to $224 million; adjusted operating income up 6% to $274 million

Adjusted EBITDA increased 5% at constant currency to $454 million

  • Growth in North America Gaming & Interactive and Italy profits
  • Solid North America Lottery results
  • Net impact of discrete items in North America Gaming & Interactive segment

Interest expense, net was $104 million, in line with the prior-year quarter 

Income taxes of $63 million and adjusted taxes of $79 million on increased pre-tax income; adjusted tax rate improved due to higher income in lower-tax jurisdictions

Net income attributable to IGT was $5 million in the quarter; adjusted net income attributable to IGT was $91 million, up from $57 million in the prior year on growth in profit before taxes and a lower adjusted tax rate

Net income per diluted share of $0.02; adjusted net income per diluted share of $0.44 versus $0.28 in the prior year

Net debt of $7.64 billion, down from $7.76 billion at December 31, 2018

Operating Segment Review

North America Gaming & Interactive

Select Financial Data



Constant


Key Performance Indicators



%

Period Ended June 30

Q2 '19

Q2 '18

FX


Period Ended June 30

Q2 '19

Q2 '18

Change 

Gaming


Total revenue

268

254

6%


Installed base units (end of period) 





Gaming services

165

169

-3%


    Casino

21,073

23,351

-9.8%



Terminal 

106

108

-2%








Other

59

61

-3%


Machine units shipped





Product sales

104

85

22%


   New/expansion

438

1,803

-75.7%



Terminal 

73

62

18%


   Replacement 

4,223

2,747

53.7%



Other

30

23

34%


   Total machines shipped

4,661

4,550

2.4%













Other


Total revenue

6

0

NM







Service revenue

6

0

NM


Note:  Oklahoma agreement reduces installed base by 2,076 units; no impact to units shipped













Total


Revenue

274

254

8%







Operating income

85

66

27%






Revenue of $274 million, up 8% at constant currency

  • Gaming service revenue of $165 million, compared to $169 million in the prior- year period
  • Product sales revenue of $104 million, up 22% over the prior year
  • Other service revenue includes contributions from sports betting and interactive

Operating income up 27% at constant currency on net impact of discrete items

North America Lottery

Select Financial Data



Constant


Key Performance Indicators



%

Period Ended June 30

Q2 '19

Q2 '18

FX


Period Ended June 30

Q2 '19

Q2 '18

Change 

Gaming


Total revenue

37

38

-2%


Installed base units (end of period)





Gaming services

37

38

-4%


    VLT - Government sponsored

14,215

15,176

-6.3%



Terminal 

25

25

-3%








Other

12

13

-5%


Lottery same-store revenue growth





Product sales

1

0

NM


   Instant ticket & draw games



5.4%









   Multistate jackpots



23.8%

Lottery


Total revenue

270

270

0%


   Total lottery same-store revenue growth


7.2%


Lottery services

238

236

1%








FMC

202

197

3%








  Instant ticket & draw games

168

164

3%








  Other services

34

33

1%








LMA

36

39

-8%







Product sales

32

34

-5%


















Other


Total revenue

1

0

NM







Service revenue

1

0

NM


















Total


Revenue

309

309

0%







Operating income

78

80

-3%






Revenue of $309 million, stable with the high level achieved in the prior year

  • Lottery service revenue of $238 million, essentially in line with the prior year
  • Lottery product sales revenue of $32 million

Operating income of $78 million, down 3% at constant currency on higher depreciation

International

Select Financial Data



Constant


Key Performance Indicators



%

Period Ended June 30

Q2 '19

Q2 '18

FX


Period Ended June 30

Q2 '19

Q2 '18

Change 

Gaming


Total revenue

142

101

46%


Installed base units (end of period)





Gaming services

28

34

-11%


    Casino

10,039

13,034

-23.0%



Terminal 

12

13

3%


    VLT - Government sponsored

4,436

3,306

34.2%



Other

16

21

-20%


   Total installed base units

14,475

16,340

-11.4%


Product sales

114

67

76%








Terminal 

82

52

61%


Machine units shipped






Other

33

15

130%


   New/expansion

700

732

-4.4%









   Replacement 

5,863

2,388

145.5%

Lottery


Total revenue

70

78

-7%


   Total machines shipped

6,563

3,120

110.4%


Lottery services

67

70

-1%








FMC

67

70

-1%


Lottery same-store revenue growth






  Instant ticket & draw games

53

54

1%


   Instant ticket & draw games



2.4%



  Other services

14

16

-10%


   Multistate jackpots



11.0%


Product sales

3

8

-59%


   Total lottery same-store revenue growth


2.8%













Other


Total revenue

17

19

-8%







Service revenue

16

19

-5%







Product sales

0

1

NM


















Total


Revenue

229

199

20%







Operating income

30

36

-11%






Revenue of $229 million, up 20% at constant currency

  • Gaming product sales revenue of $114 million, up 76% at constant currency
  • Lottery service revenue of $67 million, essentially stable at constant currency
  • Gaming service revenue was $28 million

Operating income of $30 million compared to $36 million in the prior year, down $4 million at constant currency

  • Lower profit flow-through on service and product revenue
  • Higher SG&A

Italy

Select Financial Data



Constant


Key Performance Indicators



%

Period Ended June 30

Q2 '19

Q2 '18

FX


Period Ended June 30

Q2 '19

Q2 '18

Change 

Gaming


Total revenue

153

177

-9%


(In € millions, except machines)





Gaming services

153

176

-9%


Lottery






Terminal 

136

160

-11%


Lotto wagers

2,064

1,981

4.2%



Other

17

16

10%


   10eLotto

1,507

1,422

6.0%


Product sales

0

0

0%


   Core

479

471

1.6%









   Late numbers

31

33

-5.6%

Lottery


Total revenue

190

193

4%


   MillionDAY

47

54

-14.0%


Lottery services

190

193

4%








FMC

190

193

4%


Scratch & Win wagers

2,257

2,237

0.9%



  Instant ticket & draw games

238

243

3%








  Other services

(48)

(50)

0%


Italy lottery revenue growth



3.5%


Product sales

0

0

0%














Gaming




Other


Total revenue

79

71

16%


Installed base (end of period)





Service revenue

79

71

16%


   VLT - Operator (B2C)

10,929

10,991

-0.6%


Product sales

0

0

0%


   VLT - Supplier (B2B)

7,524

8,251

-8.8%









   AWP

40,268

43,657

-7.8%

Total


Revenue

422

441

1%


   Total installed base

58,721

62,899

-6.6%


Operating income

133

131

8%














Wagers












   VLT - Operator (B2C)

1,427

1,407

1.4%









   AWP

916

885

3.5%









   Interactive wagers (gaming)

508

459

10.7%





















Other












   Sports betting wagers (1)

252

244

3.1%









   Sports betting payout (%) (1)

82.2%

82.9%

-0.6 pp





















(1) Includes virtual wagers and pools & horses

Revenue of $422 million, relatively stable at constant currency

  • Lottery service revenue of $190 million, up 4% at constant currency
  • Gaming service revenue of $153 million compared to $176 million in the prior year
  • Other service revenue of $79 million, up 16% at constant currency

Operating income of $133 million, up 8% at constant currency

  • Strong profit flow-through from lotteries, sports betting, and interactive
  • Beneficial shift in expense timing
  • More than offsets increased gaming machine taxes

Other Developments

The Company's Board of Directors declared a quarterly cash dividend of $0.20 per ordinary share

  • Record date of August 15, 2019
  • Payment date of August 29, 2019

Issuance of €750 million 3.5% Notes due 2026, as previously announced

  • Net proceeds used to redeem ~ €438 million 4.125% Notes due 2020
  • Balance used to partially repay utilizations under revolving credit facilities

Revolving credit facility amendment and extension in July 2019, as previously announced

  • Maturity extended to July 31, 2024
  • Aggregate commitments reduced to ~ 1.75 billion
  • Modifications to certain provisions that increase flexibility

Board appointment, as previously announced

  • The Company's Board of Directors appointed Dr. Samantha Ravich as an independent director, effective July 30, 2019

Outlook

Outlook updated for currency; no change to operating assumptions

  • 2019 adjusted EBITDA of $1.675 - $1.735 billion
  • Capital expenditures of $450 - $550 million
  • Full-year EUR/USD exchange rate of 1.12 vs. prior 1.15 estimate

Conference Call and Webcast

August 1, 2019, at 8:00 a.m. EDT

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 is +1 844 842 7999
  • Outside the US/Canada toll-free number is +1 612 979 9887
  • Conference ID/confirmation code is 1990309
  • A telephone replay of the call will be available for one week

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 2019 are calculated using the same foreign exchange rates as the corresponding 2018 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 (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 Digital 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 has over 12,000 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, 2018 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. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement.

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

International Game Technology PLC

Consolidated Statements of Operations

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

Unaudited






 For the three months ended 


 June 30, 


2019


2018





Service revenue

980,031


1,007,067

Product sales

254,222


195,271

Total revenue

1,234,253


1,202,338





Cost of services

594,598


607,684

Cost of product sales

160,786


122,403

Selling, general and administrative

213,263


196,088

Research and development

65,383


63,957

Other operating (income) expense, net

(23,492)


3,129

Total operating expenses

1,010,538


993,261





Operating income

223,715


209,077





Interest expense, net

(103,860)


(102,888)

Foreign exchange (loss) gain, net

(41,061)


172,546

Other income (expense), net

23,493


(31,304)

Total non-operating (expenses) income

(121,428)


38,354





Income before provision for income taxes

102,287


247,431





Provision for income taxes

63,300


52,232





Net income

38,987


195,199





Less: Net income attributable to non-controlling interests

34,131


33,703





Net income attributable to IGT PLC

4,856


161,496









Net income attributable to IGT PLC per common share - basic

0.02


0.79

Net income attributable to IGT PLC per common share - diluted

0.02


0.79





Weighted-average shares - basic

204,407


204,118

Weighted-average shares - diluted

204,412


204,516

 

International Game Technology PLC

Consolidated Statements of Operations

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

Unaudited






 For the six months ended 


 June 30, 


2019


2018





Service revenue

1,971,062


2,054,018

Product sales

408,107


355,276

Total revenue

2,379,169


2,409,294





Cost of services

1,189,925


1,225,742

Cost of product sales

260,971


225,754

Selling, general and administrative

415,100


411,306

Research and development

131,501


135,220

Other operating (income) expense, net

(20,195)


5,200

Total operating expenses

1,977,302


2,003,222





Operating income

401,867


406,072





Interest expense, net

(206,929)


(210,168)

Foreign exchange gain, net

17,541


75,851

Other income (expense), net

22,995


(28,323)

Total non-operating expenses

(166,393)


(162,640)





Income before provision for income taxes

235,474


243,432





Provision for income taxes

115,992


112,737





Net income

119,482


130,695





Less: Net income attributable to non-controlling interests

74,372


72,345





Net income attributable to IGT PLC

45,110


58,350









Net income attributable to IGT PLC per common share - basic

0.22


0.29

Net income attributable to IGT PLC per common share - diluted

0.22


0.29





Weighted-average shares - basic

204,309


203,859

Weighted-average shares - diluted

204,532


204,345

 

International Game Technology PLC

Consolidated Balance Sheets

($ thousands)

Unaudited






June 30,


December 31,


2019


2018

Assets




Current assets:




Cash and cash equivalents

400,928


250,669

Restricted cash and cash equivalents

256,105


261,108

Trade and other receivables, net

948,520


949,085

Inventories

264,911


282,698

Other current assets

489,440


504,061

Income taxes receivable

45,576


39,075

Total current assets

2,405,480


2,286,696

Systems, equipment and other assets related to contracts, net

1,350,575


1,404,426

Property, plant and equipment, net

140,033


185,349

Operating lease right-of-use-assets

360,021


-

Goodwill

5,572,217


5,580,227

Intangible assets, net

1,940,656


2,044,723

Other non-current assets

2,030,137


2,108,964

Deferred income taxes

37,738


38,117

Total non-current assets

11,431,377


11,361,806

Total assets

13,836,857


13,648,502





Liabilities and shareholders' equity




Current liabilities:




Accounts payable

1,063,886


1,142,371

Other current liabilities

867,639


816,722

Current portion of long-term debt

829,601


-

Short-term borrowings

55,349


34,822

Income taxes payable

74,001


8,209

Total current liabilities

2,890,476


2,002,124

Long-term debt, less current portion

7,152,523


7,977,267

Deferred income taxes

450,003


446,083

Income taxes payable

25,654


25,654

Operating lease liabilities

325,477


-

Other non-current liabilities

386,584


445,445

Total non-current liabilities

8,340,241


8,894,449

Total liabilities

11,230,717


10,896,573

Commitments and contingencies




Shareholders' equity

2,606,140


2,751,929

Total liabilities and shareholders' equity

13,836,857


13,648,502

 

International Game Technology PLC

Consolidated Statements of Cash Flows

($ thousands)

Unaudited






 For the six months ended 



 June 30,



2019


2018

Cash flows from operating activities





Net income


119,482


130,695

Adjustments to reconcile net income to net cash provided by operating activities:





Depreciation 


209,271


202,448

Amortization 


137,201


136,450

Service revenue amortization


103,935


111,115

Stock-based compensation expense


12,502


17,119

Debt issuance cost amortization


11,523


11,534

Loss on extinguishment of debt


9,628


29,584

Deferred income taxes


6,515


(9,817)

Foreign exchange gain, net


(17,541)


(75,851)

Gain on sale of assets


(63,239)


(1,129)

Other non-cash costs, net


31,392


1,610

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




Trade and other receivables


49,059


49,832

Inventories


802


(20,787)

Upfront Italian license fee


-


(366,270)

Accounts payable


(57,317)


(56,732)

Other assets and liabilities


38,508


(39,651)

Net cash provided by operating activities


591,721


120,150






Cash flows from investing activities





Capital expenditures


(231,003)


(258,967)

Proceeds from sale of assets


65,429


6,065

Other


2,545


1,458

Net cash used in investing activities


(163,029)


(251,444)






Cash flows from financing activities





Principal payments on long-term debt


(833,129)


(1,058,753)

Dividends paid - non-controlling interests


(129,394)


(125,808)

Dividends paid


(81,729)


(81,553)

Return of capital - non-controlling interests


(70,399)


(53,600)

Net payments of financial liabilities


(11,395)


(36,586)

Payments in connection with extinguishment of debt


(8,598)


(24,281)

Debt issuance costs paid


(5,934)


(4,047)

Capital increase - non-controlling interests


1,075


134,536

Net proceeds from short-term borrowings


19,573


28,400

Proceeds from long-term debt


846,975


863,911

Other


(6,733)


(17,696)

Net cash used in financing activities


(279,688)


(375,477)






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


149,004


(506,771)

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


(3,748)


22,352

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


511,777


1,305,430

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


657,033


821,011











Supplemental Cash Flow Information:





Interest paid


(211,591)


(262,886)

Income taxes (paid) refunded


(49,777)


13,313

 

International Game Technology PLC

Net Debt

($ thousands)

Unaudited








June 30,


December 31,



2019


2018






4.125% Senior Secured Notes due February 2020(2)


-


499,167

4.750% Senior Secured Notes due March 2020 (2)


-


438,252

5.500% Senior Secured Notes due June 2020 (1)


-


27,519

6.250% Senior Secured Notes due February 2022 (1)


1,488,631


1,469,609

4.750% Senior Secured Notes due February 2023 (2)


959,758


964,730

5.350% Senior Secured Notes due October 2023(1)


60,936


60,983

3.500% Senior Secured Notes due July 2024 (2)


564,139


567,179

6.500% Senior Secured Notes due February 2025 (1)


1,089,159


1,088,385

3.500% Senior Secured Notes due June 2026 (2)


845,482


-

6.250% Senior Secured Notes due January 2027(1)


743,021


742,667

Senior Secured Notes, long-term


5,751,126


5,858,491






Revolving Credit Facilities due July 2021 (1) (2)


69,114


413,381

Term Loan Facilities due January 2023 (2)


1,332,283


1,705,395

Long-term debt, less current portion


7,152,523


7,977,267






4.750% Senior Secured Notes due March 2020 (2)


437,997


-

5.500% Senior Secured Notes due June 2020 (1)


27,444


-

Term Loan Facilities due January 2023 (2)


364,160


-

Current portion of long-term debt 


829,601


-






Short-term borrowings


55,349


34,822

Total debt


8,037,473


8,012,089






Less: Cash and cash equivalents


400,928


250,669






Net debt


7,636,545


7,761,420






(1) U.S. dollar-denominated debt





(2) Euro-denominated debt










Note: Net debt is a non-GAAP financial measure





 

International Game Technology PLC

Adjusted EBITDA and Free Cash Flow

Reconciliations of Non-GAAP Financial Measures

($ thousands)

Unaudited













For the three months ended



June 30,



2019


2018






Net income


38,987


195,199

Provision for income taxes


63,300


52,232

Non-operating expenses (income)


121,428


(38,354)

Depreciation 


103,940


104,361

Amortization


69,117


68,058

Service revenue amortization


51,646


54,465

Stock-based compensation expense


2,912


2,941

Other


2,379


2,913

Adjusted EBITDA


453,709


441,815
















Cash flows from operating activities


445,107


42,940

Capital expenditures


(111,818)


(124,306)

Free Cash Flow


333,289


(81,366)

 

International Game Technology PLC

Adjusted EBITDA and Free Cash Flow

Reconciliations of Non-GAAP Financial Measures

($ thousands)

Unaudited













For the six months ended



June 30,



2019


2018






Net income


119,482


130,695

Provision for income taxes


115,992


112,737

Non-operating expenses


166,393


162,640

Depreciation 


209,271


202,448

Amortization


137,201


136,450

Service revenue amortization


103,935


111,115

Stock-based compensation expense


12,502


17,119

Other


5,606


4,767

Adjusted EBITDA


870,382


877,971
















Cash flows from operating activities


591,721


120,150

Capital expenditures


(231,003)


(258,967)

Free Cash Flow


360,718


(138,817)

 

 International Game Technology PLC 

 Consolidated Statement of Operations 

 Reconciliation of Non-GAAP Financial Measures 

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

 Unaudited 

























Quarter to date








Quarter to date



June 2019


Adjustments


June 2019



As


Purchase


Foreign


Refinancing and


As



Reported


Accounting


Exchange


Other


Adjusted












 Total revenue 


1,234,253


(181)


-


-


1,234,072












 Cost of services 


594,598


(17,769)


-


-


576,829

 Cost of product sales 


160,786


(3,912)


-


-


156,874

 Selling, general and administrative 


213,263


(26,502)


-


-


186,761

 Research and development 


65,383


(72)


-


-


65,311

 Other operating income, net 


(23,492)


-


-


(2,454)


(25,946)

 Total operating expenses 


1,010,538


(48,255)


-


(2,454)


959,829












 Operating income 


223,715


48,074


-


2,454


274,243












 Interest expense, net 


(103,860)


26


-


-


(103,834)

 Foreign exchange loss, net 


(41,061)


-


41,061


-


-

 Other income, net 


23,493


-


-


9,628


33,121

 Total non-operating expenses 


(121,428)


26


41,061


9,628


(70,713)












 Income before provision for income taxes 


102,287


48,100


41,061


12,082


203,530












 Provision for income taxes (a) 


63,300


11,552


3,264


558


78,674












 Net income 


38,987


36,548


37,797


11,524


124,856












 Less: Net income attributable to non-controlling interests 


34,131


26


-


-


34,157












 Net income attributable to IGT PLC 


4,856


36,522


37,797


11,524


90,699












 Net income per common share - diluted 


0.02








0.44

 Weighted-average shares - diluted 


204,412








204,412
























 (a) 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 

 Consolidated Statement of Operations 

 Reconciliation of Non-GAAP Financial Measures 

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

 Unaudited 

























Year to date








Year to date



June 2019


Adjustments


June 2019



As


Purchase


Foreign


Refinancing and


As



Reported


Accounting


Exchange


Other


Adjusted












 Total revenue 


2,379,169


(359)


-


-


2,378,810












 Cost of services 


1,189,925


(36,544)


-


-


1,153,381

 Cost of product sales 


260,971


(7,781)


-


-


253,190

 Selling, general and administrative 


415,100


(52,580)


-


-


362,520

 Research and development 


131,501


(292)


-


-


131,209

 Other operating income, net 


(20,195)


-


-


(5,751)


(25,946)

 Total operating expenses 


1,977,302


(97,197)


-


(5,751)


1,874,354












 Operating income 


401,867


96,838


-


5,751


504,456












 Interest expense, net 


(206,929)


51


-


-


(206,878)

 Foreign exchange gain, net 


17,541


-


(17,541)


-


-

 Other income, net 


22,995


-


-


9,628


32,623

 Total non-operating expenses 


(166,393)


51


(17,541)


9,628


(174,255)












 Income before provision for income taxes 


235,474


96,889


(17,541)


15,379


330,201












 Provision for income taxes (a) 


115,992


23,242


174


1,362


140,770












 Net income 


119,482


73,647


(17,715)


14,017


189,431












 Less: Net income attributable to non-controlling interests 


74,372


51


-


-


74,423












 Net income attributable to IGT PLC 


45,110


73,596


(17,715)


14,017


115,008












 Net income per common share - diluted 


0.22








0.56

 Weighted-average shares - diluted 


204,532








204,532
























 (a) 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 

 Consolidated Statement of Operations 

 Reconciliation of Non-GAAP Financial Measures 

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

 Unaudited 

























Quarter to date








Quarter to date



June 2018


Adjustments


June 2018



As


Purchase


Foreign


Refinancing and


As



Reported


Accounting


Exchange


Other


Adjusted












 Total revenue 


1,202,338


(182)


-


-


1,202,156












 Cost of services 


607,684


(21,061)


-


-


586,623

 Cost of product sales 


122,403


(3,912)


-


-


118,491

 Selling, general and administrative 


196,088


(26,736)


-


-


169,352

 Research and development 


63,957


(219)


-


-


63,738

 Other operating expense, net 


3,129


-


-


(3,129)


-

 Total operating expenses 


993,261


(51,928)


-


(3,129)


938,204












 Operating income 


209,077


51,746


-


3,129


263,952












 Interest expense, net 


(102,888)


508


-


-


(102,380)

 Foreign exchange gain, net 


172,546


-


(172,546)


-


-

 Other expense, net 


(31,304)


1


-


29,584


(1,719)

 Total non-operating income (expenses) 


38,354


509


(172,546)


29,584


(104,099)












 Income before provision for income taxes 


247,431


52,255


(172,546)


32,713


159,853












 Provision for income taxes (a) 


52,232


12,345


3,683


589


68,849












 Net income 


195,199


39,910


(176,229)


32,124


91,004












 Less: Net income attributable to non-controlling interests 


33,703


25


-


-


33,728












 Net income attributable to IGT PLC 


161,496


39,885


(176,229)


32,124


57,276












 Net income per common share - diluted 


0.79








0.28

 Weighted-average shares - diluted 


204,516








204,516
























 (a) 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 

 Consolidated Statement of Operations 

 Reconciliation of Non-GAAP Financial Measures 

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

 Unaudited 

























Year to date








Year to date



June 2018


Adjustments


June 2018



As


Purchase


Foreign


Refinancing and


As



Reported


Accounting


Exchange


Other


Adjusted












 Total revenue 


2,409,294


(359)


-


-


2,408,935












 Cost of services 


1,225,742


(42,216)


-


-


1,183,526

 Cost of product sales 


225,754


(7,781)


-


-


217,973

 Selling, general and administrative 


411,306


(53,585)


-


-


357,721

 Research and development 


135,220


(454)


-


-


134,766

 Other operating expense, net 


5,200


-


-


(5,200)


-

 Total operating expenses 


2,003,222


(104,036)


-


(5,200)


1,893,986












 Operating income 


406,072


103,677


-


5,200


514,949












 Interest expense, net 


(210,168)


1,012


-


-


(209,156)

 Foreign exchange gain, net 


75,851


-


(75,851)


-


-

 Other expense, net 


(28,323)


(2,184)


-


29,584


(923)

 Total non-operating expenses 


(162,640)


(1,172)


(75,851)


29,584


(210,079)












 Income before provision for income taxes 


243,432


102,505


(75,851)


34,784


304,870












 Provision for income taxes (a) 


112,737


24,255


6,329


1,141


144,462












 Net income 


130,695


78,250


(82,180)


33,643


160,408












 Less: Net income attributable to non-controlling interests 


72,345


50


-


-


72,395












 Net income attributable to IGT PLC 


58,350


78,200


(82,180)


33,643


88,013












 Net income per common share - diluted 


0.29








0.43

 Weighted-average shares - diluted 


204,345








204,345
























 (a) 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







Select Financial Data



Constant


Key Performance Indicators



%

Period Ended June 30

Q2 '19

Q2 '18

FX


Period Ended June 30

Q2 '19

Q2 '18

Change 

Gaming


Total revenue

601

570

8%


Installed base units (end of period)





Gaming services

382

418

-6%


   Casino

31,112

36,385

-14.5%



Terminal 

279

307

-7%


   VLT - Government sponsored (ex-Italy)

18,651

18,482

0.9%



Other

103

111

-5%


   VLT - Italy supplier (B2B)

7,524

8,251

-8.8%


Product sales

219

152

46%


   Total installed base units

57,287

63,118

-9.2%



Terminal 

155

114

37%


   Yield (average gross revenue per unit per day)

$ 27.96

$ 27.74

0.8%



Other

64

38

72%














   Additional Italian network details:




Lottery


Total revenue

531

542

0%


   VLT - Operator (B2C)

10,929

10,991

-0.6%


Lottery services

495

499

2%


   AWP

40,268

43,657

-7.8%



FMC

460

460

2%








  Instant ticket & draw games

460

461

3%


Machine units shipped






  Other services

0

(1)

NM


   New/expansion

1,138

2,535

-55.1%



LMA

36

39

-8%


   Replacement 

10,086

5,135

96.4%


Product sales

35

42

-15%


   Total machines shipped

11,224

7,670

46.3%













Other


Total revenue

102

91

19%


Global lottery same-store revenue growth




Service revenue

102

90

20%


   Instant ticket & draw games


4.6%


Product sales

0

1

NM


   Multistate jackpots


22.2%









   Total lottery same-store revenue growth (ex-Italy)


6.1%

Consolidated


Revenue

1,234

1,202

5%


   Italy lottery revenue growth


3.5%


Operating Income:











Segment total

327

313

7%








Purchase accounting

(48)

(52)

7%








Corporate support

(55)

(52)

-9%








Total

224

209

10%






 

Cision

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