INTERNATIONAL GAME TECHNOLOGY PLC REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS
INTERNATIONAL GAME TECHNOLOGY PLC REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS

Fourth Quarter 2023 Financial Performance Achieves Outlook:

  • Revenue of $1.1 billion driven by 7% Global Lottery growth
  • Operating income rose 11% to $256 million, with strength across Global Lottery, Global Gaming, and PlayDigital; operating income margin expanded 160 basis points to 22.7%

Full Year 2023 Financial Performance Delivers Record Profit on Continued Momentum Across Segments:

  • Revenue of $4.3 billion, up 2% year-over-year and 7% net of Italy commercial services sale, driven by Global Lottery same-store sales growth and a 9% increase in both Global Gaming and PlayDigital
  • Operating income rose 9% to a record $1.0 billion with growth across segments; operating income margin improved 140 basis points to 23.2%
  • Record Adjusted EBITDA of $1.8 billion and Adjusted EBITDA margin of 41.3%
  • Net debt leverage improves to 2.9x, the lowest in Company history
  • Expect full year 2024 revenue of $4.3 billion$4.4 billion with operating margin of 20% – 21%, including 300 basis point negative impact from separation and divestiture costs

LONDON, March 12, 2024 /PRNewswire/ — International Game Technology PLC (“IGT”) (NYSE:IGT) today reported financial results for the fourth quarter and full year ended December 31, 2023. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the results; access details are provided below.

“We delivered a strong finish to the year in the fourth quarter, propelling full year 2023 profits to record levels,” said Vince Sadusky, CEO of IGT. “A compelling array of products and solutions fueled broad-based momentum in key performance indicators, driving margin improvement across our Global Lottery, Global Gaming, and PlayDigital segments. We believe the recent determination to split the business and create separate lottery and gaming pure play companies, each with experienced management teams and simplified business models, better positions each company to service customers and create significant value for stakeholders.”

“We achieved all of our financial goals in 2023,” said Max Chiara, CFO of IGT. “Robust cash generation funded incremental investments in the business and shareholder returns, while driving leverage to historically low levels, putting IGT in a strong financial position as we enter 2024. This gives us confidence in further expanding our investment in the business to fund future growth.”

Overview of Consolidated Fourth Quarter and Full Year 2023 Results


Quarter Ended

Y/Y
Change

Constant
Currency
Change

Year Ended

Y/Y
Change

Constant
Currency
Change


December 31,

December 31,


2023


2022

2023


2022

($ in millions)











GAAP Financials:











Revenue











Global Lottery

681


639

7 %

4 %

2,530


2,593

(2) %

(4) %

Global Gaming

390


389

— %

1 %

1,552


1,423

9 %

10 %

PlayDigital

59


65

(10) %

(10) %

228


209

9 %

10 %

Total revenue

1,130


1,093

3 %

2 %

4,310


4,225

2 %

2 %












Operating income (loss)











Global Lottery

238


216

10 %

7 %

913


909

— %

(1) %

Global Gaming

80


68

17 %

17 %

313


242

29 %

29 %

PlayDigital

17


17

3 %

4 %

65


50

32 %

36 %

    Corporate support expense

(42)


(30)

(36) %

(36) %

(135)


(121)

(12) %

(12) %

    Other(1)

(38)


(41)

7 %

8 %

(155)


(158)

2 %

2 %

Total operating income

256


230

11 %

8 %

1,001


922

9 %

7 %

Operating Income margin

22.7 %


21.1 %



23.2 %


21.8 %














Earnings per share – diluted

$(0.04)


$(0.32)

NA


$0.77


$1.35

(43) %













Net cash provided by operating activities

400


278

44 %


1,040


899

16 %













Cash and cash equivalents

572


590

(3) %


572


590

(3) %













Non-GAAP Financial Measures:











Adjusted EBITDA











Global Lottery

343


318

8 %

5 %

1,320


1,314

— %

(1) %

Global Gaming

124


101

23 %

23 %

482


365

32 %

33 %

PlayDigital

20


22

(11) %

(11) %

78


68

15 %

18 %

    Corporate support expense

(32)


(23)

(41) %

(41) %

(101)


(83)

(22) %

(22) %

Total Adjusted EBITDA

454


419

9 %

6 %

1,779


1,664

7 %

6 %

Adjusted EBITDA margin

40.2 %


38.3 %



41.3 %


39.4 %














Adjusted earnings per share – diluted

$0.56


$0.40

40 %


$2.02


$1.99

2 %













Free cash flow

295


187

57 %


619


582

6 %













Adjusted free cash flow

295


237

24 %


803


632

27 %













Net debt

5,099


5,150

(1) %


5,099


5,150

(1) %














(1) Primarily includes purchase price amortization

Note: Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release

Fourth Quarter and Full Year 2023 Key Highlights:

  • Live with new facilities management contract in Connecticut and instants & passive lottery games in Minas Gerais (Brazil)
  • Awarded 8-year iLottery contract in Connecticut and deployed cloud-based iLottery system for Totalizator Sportowy in Poland
  • Executed Lottery facilities management contract extensions in multiple jurisdictions including California, Costa Rica, Kentucky, South Dakota, Sweden, the U.K., and recently in Virginia
  • Secured 10-year brand licensing extension with Sony Pictures Television granting IGT exclusive rights to the legendary Wheel of Fortune® brand across Gaming, Lottery, iGaming, and iLottery
  • Recognized with four top honors at EKG slot awards including “Most Improved Supplier – Premium” and “Top Performing New Mechanical Reel Cabinet”
  • Launched first-ever omnichannel Wheel of Fortune® jackpot game in the U.S. and bespoke games for key customers such as CAESARS CLEOPATRA® for Caesars Palace Online Casino and Blackjack Surrender for FanDuel Casino
  • Debuted award-winning PeakBarTop cabinet with sports betting, providing players with the market’s most advanced sports betting interface for land-based casinos
  • Upgraded to Ba1 from Ba2 by Moody’s Investors Service with stable outlook; received BB+ Long-Term Issuer rating from Fitch with stable outlook and an investment grade senior secured debt rating of BBB-
  • Continued progress on ESG initiatives including improved scores from FTSE Russell and S&P Global Corporate Sustainability Assessment; recognized for Diversity, Equality, and Inclusion excellence in the All-In Diversity Project 2023 All-Index Report; earned top score in Human Rights Campaign Foundation’s 2023-2024 Corporate Equality Index

Fourth Quarter 2023 Financial Highlights:

Consolidated revenue of $1.1 billion increased 3% compared to $1.1 billion in the prior-year period

  • Global Lottery revenue of $681 million, up 7% from $639 million in the prior year, driven by strong product sales and Italy same-store sales growth
  • Global Gaming revenue of $390 million, in line with the prior year, as higher terminal product sales revenue and increased intellectual property revenue were offset by lower systems sales
  • PlayDigital revenue of $59 million compared to $65 million in the prior year, due to a one-time benefit related to jackpot expense in the prior year and lower sports betting volumes and hold rates in Rhode Island in the current year

Operating income of $256 million, up 11% from $230 million in the prior year; operating income margin increased 160 basis points to 22.7% with growth across business segments

  • Global Lottery operating income of $238 million increased 10% from $216 million in the prior-year period; operating income margin up 110 basis points to 35.0% on strong Italy same-store sales, increased high-margin product sales, and despite lower jackpot benefits
  • Global Gaming operating income of $80 million, up 17% from $68 million in the prior year; operating income margin expanded 290 basis points to 20.5% on easing of supply chain costs and research and development process improvements, partially offset by higher jackpot expense
  • PlayDigital operating income of $17 million, in line with the prior year; operating income margin up 360 basis points to 29.1%, primarily on cost discipline and reduced variable compensation costs due to lower-than-expected revenue
  • Corporate support and other expense of $79 million compared to $71 million in the prior year, primarily driven by higher Separation and divestiture costs related to the exploration of strategic alternatives for the Global Gaming and PlayDigital segments in addition to higher restructuring costs

Adjusted EBITDA of $454 million, up 9% compared to $419 million in the prior year, primarily driven by higher operating income and amortization, partially offset by Separation and divestiture costs; Adjusted EBITDA margin expanded 190 basis points to 40.2%

Net interest expense of $71 million compared to $66 million in the prior year due to higher interest rates on variable rate debt and retirement of lower-coupon senior-secured notes

Foreign exchange loss of $66 million versus $95 million in the prior year, primarily reflecting the impact of fluctuations in the EUR/USD exchange rate on debt

Other non-operating expense of $8 million compared to other non-operating income of $1 million in the prior year, primarily related to the purchase and sale of a blue-chip swap used to transfer funds out of Argentina in the current year

Provision for income taxes of $83 million, compared to $101 million in the prior year, primarily driven by lower non-deductible foreign exchange losses

Net income of $27 million versus net loss of $31 million in the prior-year period

Diluted loss per share of $0.04, versus $0.32 in the prior year, primarily reflects higher operating income and lower non-cash foreign exchange loss; Adjusted earnings per share up 40% to $0.56 versus $0.40 in the prior year, primarily due to higher operating income

Full Year 2023 Financial Highlights:

Consolidated revenue of $4.3 billion increased 2%, or 7% net of Italy commercial services sale, from $4.2 billion in the prior-year period

  • Global Lottery revenue of $2.5 billion, down 2% from $2.6 billion; net of Italy commercial services sale, revenue rose 6% on 2.3% global same-store sales driven by strong Italy performance and higher product sales
  • Global Gaming revenue up 9% to $1.6 billion on broad-based strength in key performance indicators
  • PlayDigital revenue rose to a record $228 million, up 9% from $209 million in the prior-year period, on iGaming growth across geographies

Record operating income of $1.0 billion, up 9% from $922 million in the prior-year period, with increases across business segments; operating income margin expanded 140 basis points to 23.2% with improvement across segments

  • Global Lottery operating income of $913 million, in line with the prior year, despite sale of Italy commercial services business (Italy commercial services contributed $34 million in the prior year); operating income margin up 100 basis points to 36.1%
  • Global Gaming operating income increased 29% to $313 million; operating income margin improved 320 basis points to 20.2% on easing of supply chain costs and research and development process improvements
  • Record PlayDigital operating income of $65 million, up 32% versus $50 million in the prior year on strong operating leverage; operating income margin expanded 490 basis points to 28.6%
  • Corporate support and other expense of $290 million, up from $279 million in the prior year, primarily driven by Separation and divestiture costs, partially offset by lower transaction costs due to acquisition and divestiture activity in the prior year

Record Adjusted EBITDA of $1.8 billion, up 7% from $1.7 billion in the prior-year period, primarily driven by higher operating income and amortization, partially offset by higher Separation and divestiture costs; Adjusted EBITDA margin expanded 190 basis points to 41.3%

Net interest expense of $285 million compared to $289 million in the prior-year period

Foreign exchange loss of $75 million, versus $36 million in the prior-year period, primarily reflecting the impact of fluctuations in the EUR/USD exchange rate on debt

Other non-operating expense of $12 million versus $7 million in the prior-year period

  • $5 million loss on extinguishment of debt and $5 million loss on the purchase and sale of a blue-chip swap used to transfer funds out of Argentina in current year
  • $278 million gain on sale of Italian commercial services business offset by $270 million accrual associated with the DDI/Benson matter and $13 million loss on extinguishment of debt in prior year

Provision for income taxes of $322 million versus $175 million in the prior year, primarily driven by higher incremental valuation allowances on deferred tax assets and negative impact from settlement of a tax audit in Italy in the current year, partially offset by the benefit arising from the DDI/Benson matter in the prior year

Net income of $307 million compared to $414 million in the prior-year period

Diluted income per share of $0.77, versus $1.35 in the prior year, primarily reflects higher operating income partially offset by higher non-cash foreign exchange loss and provision for income taxes; Adjusted earnings per share of $2.02 compared to $1.99 primarily reflects higher operating income

Record cash from operations of $1.0 billion, compared to $899 million in the prior-year period, despite a $220 million, $184 million net of tax, payment in final settlement of DDI/Benson matter

Net debt of $5.1 billion, down $0.1 billion from $5.2 billion at December 31, 2022; Net debt leverage improved to 2.9x, the lowest level in Company history, compared to 3.1x at December 31, 2022

Cash and Liquidity Update
Total liquidity of $1.8 billion as of December 31, 2023; $572 million in unrestricted cash and $1.2 billion in additional borrowing capacity

Other Developments
Conclusion of strategic review communicated on 2/29/24; Global Gaming and PlayDigital businesses to be spun off and combined with Everi Holdings, Inc., creating a comprehensive global gaming and fintech enterprise; at closing, IGT shareholders are expected to own approximately 54% of the combined company

S&P Global Ratings recently placed IGT on CreditWatch Positive and Fitch Ratings recently moved IGT to Rating Watch Positive

The Company’s Board of Directors declared a quarterly cash dividend of $0.20 per common share

  • Ex-dividend date of March 25, 2024
  • Record date of March 26, 2024
  • Payment date of April 9, 2024

Introducing First Quarter and Full Year 2024 Expectations(1)
First quarter

  • Revenue of ~$1.0 billion
  • Operating income margin of ~20%; includes ~300 basis point negative impact from pre-closing Separation and divestiture costs

Full Year

  • Revenue of $4.3 billion$4.4 billion
  • Operating income margin of 20% – 21%; includes ~300 basis point negative impact from pre-closing Separation and divestiture costs
  • Cash from operations of ≥$1.0 billion
  • Capital expenditures of ~$500 million

(1) Assumes spin and merger transaction closes in early 2025

Earnings Conference Call and Webcast:
March 12, 2024, at 8:00 a.m. EDT

To register to participate in the conference call, or to listen to the live audio webcast, please visit the “Events Calendar” on IGT’s Investor Relations website at www.IGT.com. A replay will be available on the website following the live event.

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 2023 are calculated using the same foreign exchange rates as the corresponding 2022 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. Amounts reported in millions are computed based on amounts in thousands. As a result, the sum of the components may not equal the total amount reported in millions due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages and earnings per share amounts presented are calculated from the underlying unrounded amounts.

About IGT
IGT (NYSE:IGT) is a global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Lotteries and Gaming Machines to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivaled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 jurisdictions around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 10,500 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 and strategies, transactions, trends, events, dividends, results of operations, and/or financial condition or measures, including our expectations regarding revenue, operating income, cash, and capital expenditures for the first quarter and full year 2024, 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,” “outlook,” “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, 2022 and other documents filed or furnished 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 may affect the Company’s business, including management’s discussion and analysis of potential or actual impacts to operations and financial performance. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance of International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.

Non-GAAP Financial Measures
Management supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Adjusted EBITDA represents net income (loss) (a GAAP measure) before income taxes, interest expense, net, foreign exchange gain (loss), net, other non-operating expenses (e.g., DDI/Benson Matter, gains/losses on extinguishment and modifications of debt, etc.), net, depreciation, impairment losses, amortization (service revenue, purchase accounting, and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting, and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Management believes that Adjusted EBITDA is useful in providing period-to-period comparisons of the results of the Company’s ongoing operational performance.

Adjusted EPS represents diluted earnings per share (a GAAP measure), excluding the effects of foreign exchange, impairments, amortization from purchase accounting, discrete tax items, and other significant non-recurring adjustments that are not reflective of on-going operational activities (e.g., DDI / Benson Matter provision, gains/losses on sale of business, gains/losses on extinguishment and modifications of debt, etc.). Adjusted EPS is calculated using diluted weighted-average number of shares outstanding, including the impact of any potentially dilutive common stock equivalents that are anti-dilutive to GAAP net income (loss) per share but dilutive to Adjusted EPS. Management believes that Adjusted EPS is useful in providing period-to-period comparisons of the results of the Company’s ongoing operational performance.

Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash equivalents, including cash and cash equivalents classified as held for sale, are subtracted from the GAAP measure because they could be used to reduce the Company’s debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet.

Net debt leverage is a non-GAAP financial measure that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months (“LTM”) prior to such date. Management believes that Net debt leverage is a useful measure to assess IGT’s financial strength and ability to incur incremental indebtedness when making key investment decisions.

Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures (a component of investing cash flows) and payments on license obligations (a component of financing cash flows). Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing IGT’s ability to fund its activities, including debt service and distribution of earnings to shareholders.

Adjusted free cash flow is a non-GAAP financial measure that represents free cash flow excluding the net of tax cash payments in connection with material litigation (e.g. DDI / Benson Matter). To enhance investor understanding of the Company’s performance in comparison with the prior year, the Company excluded the net of cash impacts related to the settlement of the DDI / Benson Matter. Management believes adjusted free cash flow is a useful measure of liquidity and an additional basis for assessing IGT’s performance.

Constant currency is a non-GAAP financial measure that expresses current financial data using the prior-year/period exchange rate (i.e., the exchange rate used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates.

A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.

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 06 5189 9184; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190 

Select Performance and KPI data: (In $ millions, unless otherwise noted) 


GLOBAL LOTTERY


Q4’23


Q4’22


Y/Y
Change


Constant
Currency
Change(1)


FY’23


FY’22


Y/Y
Change


Constant
Currency
Change(1)

Revenue

















Service

















Operating and facilities management contracts


624


622


— %


(2) %


2,495


2,364


6 %


4 %

Upfront license fee amortization


(47)


(45)


(5) %


— %


(189)


(183)


(3) %


— %

Operating and facilities management contracts, net


577


577


— %


(2) %


2,306


2,181


6 %


4 %

Other


15


16


(6) %


(4) %


53


255


(79) %


(79) %

Total service revenue


592


593


— %


(2) %


2,359


2,436


(3) %


(4) %


















Product sales


89


46


94 %


90 %


171


157


9 %


7 %

Total revenue


681


639


7 %


4 %


2,530


2,593


(2) %


(4) %


















Operating income


238


216


10 %


7 %


913


909


— %


(1) %

Adjusted EBITDA(1)


343


318


8 %


5 %


1,320


1,314


— %


(1) %



































Global same-store sales growth (%)

















Instant ticket & draw games


— %


1.0 %






1.9 %


(3.9 %)





Multi-jurisdiction jackpots


(25.0 %)


66.0 %






5.8 %


15.3 %





Total


(3.5 %)


6.7 %






2.3 %


(2.2 %)






















 North America & Rest of world same-store sales growth (%)

















Instant ticket & draw games


(0.9 %)


0.4 %






0.6 %


(2.4 %)





Multi-jurisdiction jackpots


(25.0 %)


66.0 %






5.8 %


15.3 %





Total


(5.0 %)


7.7 %






1.2 %


(0.4 %)






















Italy same-store sales growth (%)

















Instant ticket & draw games


2.9 %


3.1 %






6.6 %


(8.5 %)






















(1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details

GLOBAL GAMING


Q4’23


Q4’22


Y/Y
Change


Constant
Currency
Change(1)


FY’23


FY’22


Y/Y
Change


Constant
Currency
Change(1)

Revenue

















Service

















Terminal


127


126


1 %


3 %


520


483


8 %


10 %

Systems, software, and other


62


60


2 %


2 %


242


232


4 %


5 %

Total service revenue


188


186


1 %


2 %


762


714


7 %


8 %


















Product sales

















Terminal


153


149


2 %


2 %


571


501


14 %


14 %

Other


49


54


(9) %


(9) %


220


208


6 %


6 %

Total product sales revenue


202


203


(1) %


(1) %


791


709


12 %


12 %

Total revenue


390


389


— %


1 %


1,552


1,423


9 %


10 %


















Operating income


80


68


17 %


17 %


313


242


29 %


29 %

Adjusted EBITDA(1)


124


101


23 %


23 %


482


365


32 %


33 %


















Installed base units

















Casino


53,190


48,578


9 %




53,190


48,578


9 %



Casino – L/T lease (2)


716


1,008


(29 %)




716


1,008


(29 %)



Total installed base units


53,906


49,586


9 %




53,906


49,586


9 %




















Installed base units (by geography)

















US & Canada


34,221


32,335


6 %




34,221


32,335


6 %



Rest of world


19,685


17,251


14 %




19,685


17,251


14 %



Total installed base units


53,906


49,586


9 %




53,906


49,586


9 %




















Yields (by geography)(3), in absolute $

















US & Canada


$41.28


$42.08


(2 %)




$42.19


$41.87


1 %



Rest of world


$7.02


$6.53


8 %




$7.40


$6.22


19 %



Total yields


$28.71


$29.72


(3 %)




$29.68


$29.89


(1 %)




















Global machine units sold

















New/expansion


425


728


(42 %)




3,084


2,879


7 %



Replacement


8,966


8,755


2 %




32,006


29,941


7 %



Total machine units sold


9,391


9,483


(1 %)




35,090


32,820


7 %




















US & Canada machine units sold

















New/expansion


248


574


(57 %)




2,397


2,020


19 %



Replacement


6,481


6,875


(6 %)




23,811


22,202


7 %



Total machine units sold


6,729


7,449


(10 %)




26,208


24,222


8 %





































(1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details

(2) Excluded from yield calculations due to treatment as sales-type leases

(3) Excludes Casino L/T lease units due to treatment as sales-type leases, comparability on a Y/Y basis hindered due to fewer active units


















GLOBAL GAMING (Continued)


Q4’23


Q4’22


Y/Y
Change


Constant
Currency
Change(1)


FY’23


FY’22


Y/Y
Change


Constant
Currency
Change(1)

Rest of world machine units sold

















New/expansion


177


154


15 %




687


859


(20) %



Replacement


2,485


1,880


32 %




8,195


7,739


6 %



Total  machine units sold


2,662


2,034


31 %




8,882


8,598


3 %





































Average selling price (ASP), in absolute $

















US & Canada


16,300


15,600


4 %




16,100


15,400


5 %



Rest of world


15,000


15,300


(2 %)




15,100


13,700


10 %



Total ASP


15,900


15,500


3 %




15,800


15,000


5 %



PLAYDIGITAL


Q4’23


Q4’22


Y/Y
Change


Constant
Currency
Change(1)


FY’23


FY’22


Y/Y
Change


Constant
Currency
Change(1)

Revenue

















Service


59


65


(9) %


(10) %


227


209


9 %


10 %

Product sales




NM  


NM  


1


1


21 %


21 %

Total revenue


59


65


(10) %


(10) %


228


209


9 %


10 %


















Operating income


17


17


3 %


4 %


65


50


32 %


36 %

Adjusted EBITDA(1)


20


22


(11) %


(11) %


78


68


15 %


18 %



































CONSOLIDATED

















Revenue (by geography)

















US & Canada


707


714


(1) %


(1) %


2,701


2,549


6 %


6 %

Italy


244


226


8 %


3 %


949


1,059


(10) %


(13) %

Rest of world


178


153


17 %


16 %


661


618


7 %


8 %

Total revenue


1,130


1,093


3 %


2 %


4,310


4,225


2 %


2 %


















(1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details

International Game Technology PLC

Consolidated Statements of Operations

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

Unaudited










For the three months ended


For the year ended


December 31,


December 31,


2023


2022


2023


2022

Service revenue

839


845


3,347


3,359

Product sales

291


249


963


866

Total revenue

1,130


1,093


4,310


4,225









Cost of services

423


408


1,630


1,671

Cost of product sales

169


166


573


554

Selling, general and administrative

201


219


834


814

Research and development

56


70


234


255

Separation and divestiture costs

13



24


Restructuring

12


6


13


6

Other operating expense (income), net


(5)



4

Total operating expenses

873


863


3,309


3,303









Operating income

256


230


1,001


922









Interest expense, net

71


66


285


289

Foreign exchange loss, net

66


95


75


36

Other non-operating expense (income), net

8


(1)


12


7

Total non-operating expenses

146


161


372


333

Income before provision for income taxes

110


70


629


589

Provision for income taxes

83


101


322


175

Net income (loss)

27


(31)


307


414

Less: Net income attributable to non-controlling interests

35


34


151


139

Net (loss) income attributable to IGT PLC

(7)


(64)


156


275









Net (loss) income attributable to IGT PLC per
common share – basic

(0.04)


(0.32)


0.78


1.36

Net (loss) income attributable to IGT PLC per
common share – diluted

(0.04)


(0.32)


0.77


1.35

Weighted-average shares – basic

200


199


200


202

Weighted-average shares – diluted

200


199


203


203


Full-year 2022 results include Italy commercial services business that was sold in September 2022.

International Game Technology PLC


Consolidated Balance Sheets


($ in millions)


Unaudited








December 31,



2023


2022


Assets





Current assets:





Cash and cash equivalents

572


590


Restricted cash and cash equivalents

167


150


Trade and other receivables, net

685


670


Inventories, net

317


254


Other current assets

382


467


Total current assets

2,123


2,131


Systems, equipment and other assets related to contracts, net

928


899


Property, plant and equipment, net

119


118


Operating lease right-of-use assets

230


254


Goodwill

4,507


4,482


Intangible assets, net

1,555


1,375


Other non-current assets

1,004


1,174


Total non-current assets

8,342


8,302


Total assets

10,465


10,433







Liabilities and shareholders’ equity





Current liabilities:





Accounts payable

797


731


Current portion of long-term debt


61


Short-term borrowings

16



DDI / Benson Matter provision


220


Other current liabilities

879


837


Total current liabilities

1,691


1,848


Long-term debt, less current portion

5,655


5,690


Deferred income taxes

344


305


Operating lease liabilities

214


239


Other non-current liabilities

609


372


Total non-current liabilities

6,821


6,607


Total liabilities

8,513


8,454


Commitments and contingencies





IGT PLC’s shareholders’ equity

1,443


1,429


Non-controlling interests

510


550


Total shareholders’ equity

1,952


1,979


Total liabilities and shareholders’ equity

10,465


10,433


International Game Technology PLC

Consolidated Statements of Cash Flows

($ in millions)

Unaudited










For the three
months ended


For the year
ended


December 31,


December 31,


2023


2022


2023


2022

Cash flows from operating activities








Net income (loss)

27


(31)


307


414

Adjustments to reconcile net income (loss) to net cash provided by operating activities:








Depreciation

74


78


301


301

Foreign exchange loss, net

66


95


75


36

Amortization

57


49


222


191

Amortization of upfront license fees

50


48


200


193

Stock-based compensation

6


7


41


41

DDI / Benson Matter provision




270

Gain on sale of business




(278)

Deferred income taxes

(40)


14


21


(77)

Other non-cash items, net

10


(5)


20


14

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








Trade and other receivables

(25)


16


(5)


45

Inventories

8


8


(59)


(65)

Accounts payable

68


8


48


(22)

DDI / Benson Matter provision


(50)


(220)


(50)

Accrued interest payable

20


26


4


(11)

Accrued income taxes

45


(20)


96


(83)

Other assets and liabilities

34


33


(12)


(20)

Net cash provided by operating activities

400


278


1,040


899









Cash flows from investing activities








Capital expenditures

(98)


(91)


(399)


(317)

Proceeds from sale of business, net of cash and restricted cash transferred


(21)



476

Business acquisitions, net of cash acquired




(142)

Proceeds from sale of assets

2


8


16


22

Other

(8)


2


(9)


3

Net cash (used in) provided by investing activities from continuing operations

(104)


(102)


(393)


42

Net cash provided by investing activities from discontinued operations




126

Net cash (used in) provided by investing activities

(104)


(102)


(393)


168









Cash flows from financing activities








Principal payments on long-term debt

(339)



(801)


(597)

Net (payments of) proceeds from short-term borrowings

(43)



13


(51)

Payments on license obligations

(7)



(22)


Net receipts from financial liabilities

67


77


1


75

Net proceeds from Revolving Credit Facilities

131


30


609


72

Repurchases of common stock


(22)



(115)

Dividends paid

(40)


(40)


(160)


(161)

Dividends paid – non-controlling interests

(3)



(158)


(178)

Return of capital – non-controlling interests

(18)


(17)


(74)


(75)

Other

(15)


(9)


(45)


(35)

Net cash (used in) provided by financing activities

(267)


19


(638)


(1,065)









Net increase in cash and cash equivalents and restricted cash and cash equivalents

29


195


10


2

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

13


28


(11)


(70)

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

697


517


740


808

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

739


740


739


740









Supplemental Cash Flow Information:








Interest paid

58


39


294


298

Income taxes paid

79


107


205


335

International Game Technology PLC














Net Debt














($ in millions)














Unaudited


































December 31,
















2023


2022














3.500% Senior Secured Euro Notes due July 2024



319














6.500% Senior Secured U.S. Dollar Notes due February 2025


499


697














4.125% Senior Secured U.S. Dollar Notes due April 2026


747


745














3.500% Senior Secured Euro Notes due June 2026


826


796














6.250% Senior Secured U.S. Dollar Notes due January 2027


747


746














2.375% Senior Secured Euro Notes due April 2028


550


530














5.250% Senior Secured U.S. Dollar Notes due January 2029


745


745














Senior Secured Notes


4,113


4,578
































Euro Term Loan Facilities due January 2027


876


1,058














Revolving Credit Facility A due July 2027


207


55














Revolving Credit Facility B due July 2027


458















Long-term debt, less current portion


5,655


5,690
































5.350% Senior Secured U.S. Dollar Notes due October 2023



61














Current portion of long-term debt



61
































Short-term borrowings


16















Total debt


5,671


5,750
































Less: Cash and cash equivalents


572


590














Less: Debt issuance costs, net – Revolving Credit Facility B due July 2027



9














Net debt


5,099


5,150
































Note: Net debt is a non-GAAP financial measure


















International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions, except per share amounts)

Unaudited
















For the three months ended December 31, 2023



Global
Lottery


Global
Gaming


PlayDigital


Business
Segments
Total


Corporate
and Other


Total IGT
PLC

Net income












27

Provision for income taxes












83

Interest expense, net












71

Foreign exchange loss, net












66

Other non-operating expense, net












8

Operating income (loss)


238


80


17


336


(79)


256

Depreciation


41


31


2


74


(1)


74

Amortization – service revenue (1)


50




50



50

Amortization – non-purchase accounting


5


13



18


1


19

Amortization – purchase accounting






38


38

Restructuring


8




8


4


12

Stock-based compensation


1




1


5


6

Adjusted EBITDA


343


124


20


487


(32)


454



























Cash flows from operating activities










400

Capital expenditures












(98)

Payments on license obligations












(7)

Free Cash Flow












295














Payments on DDI / Benson Matter, net of cash tax benefit








Adjusted Free Cash Flow












295






















Pre-Tax
Impact


Tax Impact
(2)(3)


Net
Impact

Reported EPS attributable to IGT PLC – diluted








(0.04)

Adjustments:













Foreign exchange loss, net








0.25


(0.04)


0.29

Currency conversion impacts of hyper-inflationary economies (4)






0.10



0.10

Amortization – purchase accounting








0.18


0.07


0.11

Discrete tax items









(0.05)


0.05

Other (non-recurring adjustments)








0.06


0.02


0.04

Net adjustments












0.60

Adjusted EPS attributable to IGT PLC – diluted (5)








0.56














(1) Includes amortization of upfront license fees

(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction

(3) The reported effective tax rate was 75.3%. Adjusted for the above items, the effective tax rate was 35.8%

(4) Includes blue-chip swap loss of $5 million

(5) Adjusted EPS was calculated using weighted average shares outstanding of 203.3 million, which includes the dilutive impact of share-based payment awards

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions, except per share amounts)

Unaudited
















For the three months ended December 31, 2022



Global
Lottery


Global
Gaming


PlayDigital


Business
Segments
Total


Corporate
and Other


Total IGT
PLC

Net loss












(31)

Provision for income taxes












101

Interest expense, net












66

Foreign exchange loss, net












95

Other non-operating income, net












(1)

Operating income (loss)


216


68


17


302


(71)


230

Depreciation


42


31


6


79



78

Amortization – service revenue (1)


48




48



48

Amortization – non-purchase accounting


6


2



8


1


9

Amortization – purchase accounting






41


41

Restructuring


5




5


1


6

Stock-based compensation


2


(1)



1


6


7

Adjusted EBITDA


318


101


22


442


(23)


419



























Cash flows from operating activities










278

Capital expenditures












(91)

Free Cash Flow












187














Payments on DDI / Benson Matter, net of cash tax benefit








50

Adjusted Free Cash Flow












237






















Pre-Tax
Impact


Tax Impact
(2)(3)


Net
Impact

Reported EPS attributable to IGT PLC – diluted








(0.32)

Adjustments:













Foreign exchange loss, net








0.46


(0.04)


0.50

Currency conversion impacts of hyper-inflationary economies






0.01



0.01

Amortization – purchase accounting








0.20


0.02


0.18

Discrete tax items









(0.01)


0.01

DDI / Benson Matter provision









0.01


(0.01)

Other (non-recurring adjustments)








0.03


0.01


0.02

Net adjustments












0.72

Adjusted EPS attributable to IGT PLC – diluted (4)








0.40














(1) Includes amortization of upfront license fees

(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction

(3) The reported effective tax rate was 144.0%. Adjusted for the above items, the effective tax rate was 46.2%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 201.4 million, which includes the dilutive impact of share-based payment awards

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions, except per share amounts)

Unaudited
















For the year ended December 31, 2023



Global
Lottery


Global
Gaming


PlayDigital


Business
Segments
Total


Corporate
and Other


Total IGT
PLC

Net income












307

Provision for income taxes












322

Interest expense, net












285

Foreign exchange loss, net












75

Other non-operating expense, net












12

Operating income (loss)


913


313


65


1,291


(290)


1,001

Depreciation


173


118


10


301



301

Amortization – service revenue (1)


199


1



200



200

Amortization – non-purchase accounting


20


45


1


66


3


70

Amortization – purchase accounting






152


152

Restructuring


9




9


4


13

Stock-based compensation


6


5


1


12


30


41

Adjusted EBITDA


1,320


482


78


1,880


(101)


1,779



























Cash flows from operating activities










1,040

Capital expenditures












(399)

Payments on license obligations












(22)

Free Cash Flow












619














Payments on DDI / Benson Matter, net of cash tax benefit ($36 million)








184

Adjusted Free Cash Flow












803






















Pre-Tax
Impact


Tax Impact
(2)(3)


Net
Impact

Reported EPS attributable to IGT PLC – diluted








0.77

Adjustments:













Foreign exchange loss, net








0.21


(0.03)


0.24

Currency conversion impacts of hyper-inflationary economies (4)






0.18



0.18

Amortization – purchase accounting








0.75


0.21


0.54

Loss on extinguishment and modifications of debt, net






0.02



0.02

Discrete tax items









(0.22)


0.22

Other (non-recurring adjustments)








0.07


0.02


0.04

Net adjustments












1.25

Adjusted EPS attributable to IGT PLC – diluted (5)








2.02














(1) Includes amortization of upfront license fees









(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction

(3) The reported effective tax rate was 51.2%. Adjusted for the above items, the effective tax rate was 36.2%

(4) Includes blue-chip swap loss of $5 million

(5) Adjusted EPS was calculated using weighted average shares outstanding of 202.7 million, which includes the dilutive impact of share-based payment awards

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions, except per share amounts)

Unaudited
















For the year ended December 31, 2022



Global
Lottery


Global
Gaming


PlayDigital


Business
Segments
Total


Corporate
and Other


Total IGT
PLC

Net income












414

Provision for income taxes












175

Interest expense, net












289

Foreign exchange loss, net












36

Other non-operating expense, net












7

Operating income (loss)


909


242


50


1,201


(279)


922

Depreciation


173


112


17


302


(1)


301

Amortization – service revenue (1)


193




193



193

Amortization – non-purchase accounting


24


7



31


3


34

Amortization – purchase accounting






158


158

Restructuring


6


(1)



5


1


6

Stock-based compensation


9


5


1


14


27


41

Other






9


9

Adjusted EBITDA


1,314


365


68


1,746


(83)


1,664



























Cash flows from operating activities










899

Capital expenditures












(317)

Free Cash Flow












582














Payments on DDI / Benson Matter, net of cash tax benefit








50

Adjusted Free Cash Flow












632






















Pre-Tax
Impact


Tax Impact
(2)(3)


Net
Impact

Reported EPS attributable to IGT PLC – diluted








1.35

Adjustments:













Foreign exchange loss, net








0.13


0.08


0.05

Currency conversion impacts of hyper-inflationary economies






0.05



0.05

Amortization – purchase accounting








0.77


0.16


0.61

Loss on extinguishment and modifications of debt, net






0.06


0.01


0.06

Discrete tax items









(0.17)


0.17

DDI / Benson Matter provision








1.33


0.33


1.00

Gain on sale of business








(1.36)


(0.01)


(1.36)

Other (non-recurring adjustments)








0.07


0.01


0.06

Net adjustments












0.64

Adjusted EPS attributable to IGT PLC – diluted (4)








1.99












(1) Includes amortization of upfront license fees









(2) Calculated based on nature of item, including any realizable deductions, and statutory tax rate in effect for the relevant jurisdiction

(3) The reported effective tax rate was 29.7%. Adjusted for the above items, the effective tax rate was 32.2%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 203.4 million, which includes the dilutive impact of share-based payment awards

SOURCE International Game Technology PLC

Originally published at https://www.prnewswire.com/news-releases/international-game-technology-plc-reports-fourth-quarter-and-full-year-2023-results-302085965.html
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