International Game Technology PLC has released its financial results for the second quarter ending June 30, 2024.
The company achieved record operating income and Adjusted EBITDA for the first half of 2024, excluding separation and divestiture costs. For the second quarter of 2024, IGT reported revenues of US$1.05 bn (£820 million/€970 million) and an operating income of US$230 million, consistent with its outlook. Adjusted EBITDA for the period was US$420 million. The company’s technology and solutions continue to enhance its Global Lottery portfolio while driving Gaming & Digital performance. Additionally, IGT generated over US$460 million in cash from operations and over US$260 million in free cash flow in the first half of the year.
Recent highlights for IGT include securing a seven-year facilities management contract with the Colorado Lottery and a three-year contract extension with the Mississippi Lottery Corporation. The company also signed a five-year iLottery content contract with Atlantic Lottery Corporation and launched iLottery in Connecticut. IGT continues to succeed in instant ticket contract wins and extensions, including a five-year agreement with ONCE in Spain and a three-year extension in Mississippi.
In terms of product innovation, IGT launched Tiger and Dragon on the PeakCurve49 cabinet, which ranks as the top new premium leased and WAP game in industry performance reports, and introduced Whitney Houston on the new SkyRise™ cabinet. The award-winning Prosperity Link™ game was also launched in digital format in the U.S. Internationally, IGT deployed Diamond Mania MLP in the Spain AWP market, sold 500 PeakBar Top™ Video Poker cabinets to Holland Casino, and expanded its HHR footprint to Malta.
IGT recently published its 17th annual Sustainability Report, highlighting its Environmental, Social, and Governance accomplishments. The company won the “Diversity and Inclusion” category at the 2024 Women in Gaming Diversity Awards and was recognized as the “Best Place to Work for Disability Inclusion.”
Financial highlights for the second quarter include consolidated revenue of US$1.05 billion, in line with the prior-year period. Global Lottery revenue was US$613 million, a 2% decrease year-over-year, primarily due to a multi-year software license sale in the prior year. Gaming & Digital revenue increased by 1% to US$436 million, driven by growth in the installed base with resilient yields and elevated intellectual property and software license sales, despite lower terminal unit shipments.
Operating income was US$230 million, down from US$251 million in the prior-year period. Excluding US$26 million in separation and divestiture costs, operating income rose to US$256 million. Global Lottery operating income was US$212 million compared to US$229 million in the prior year, and Gaming & Digital operating income increased to US$103 million from US$89 million. Corporate support and other expenses amounted to US$86 million, driven by US$26 million in separation and divestiture costs. Adjusted EBITDA was US$420 million, compared to US$443 million in the prior-year period. Excluding separation and divestiture costs, Adjusted EBITDA remained stable at US$446 million, with an expanded Adjusted EBITDA margin of 30 basis points.
Net interest expense was US$73 million, compared to US$71 million in the previous year. There was no foreign exchange gain or loss, compared to a US$5 million loss in the prior year, mainly due to non-cash impacts of EUR/USD exchange rate fluctuations on debt and reduced losses related to the devaluation of the Argentine peso. Other non-operating expenses were US$1 million, compared to other non-operating income of US$2 million in the previous year. The income tax provision was US$71 million, down from US$86 million in the prior year, driven by lower valuation allowances on deferred tax assets and lower pre-tax income.
Net income was US$85 million, compared to US$90 million in the prior-year period. Diluted earnings per share were US$0.20, compared to US$0.23 in the prior year, with Adjusted diluted earnings per share of US$0.36, down from US$0.45, primarily due to lower net income and reduced foreign currency and discrete tax items. Net debt remained at US$5.1 billion, with a net debt leverage of 2.9x, consistent with the level at December 31, 2023.
As of June 30, 2024, IGT’s total liquidity was US$1.7 billion, with US$0.4 billion in unrestricted cash and US$1.3 billion in additional borrowing capacity from undrawn credit facilities.
“IGT delivered strong first half results, including record operating income and Adjusted EBITDA net of Separation and divestiture costs,” said Vince Sadusky, CEO of IGT. “Consistent investments in technology, game content, and other innovative solutions provide us a solid foundation to build from as we execute on our growth objectives. The recently announced sale of our Gaming & Digital business for $4.05 billion in cash is an important step in unlocking the intrinsic value of IGT’s best-in-class businesses.”
“We generated over $460 million in cash from operations in the first half of the year and our balance sheet is as strong as ever,” said Max Chiara, CFO of IGT. “Our ample liquidity and manageable nearterm debt maturities provide us significant flexibility in light of upcoming investments to extend and secure our long-term lottery contract portfolio for the coming years.”