Welcome Guest |

News Room Details

As the industry leader, IGT is committed to sharing the latest information.

INTERNATIONAL GAME TECHNOLOGY PLC REPORTS SECOND QUARTER 2022 RESULTS

  • Revenue of $1.02 billion, down 2% as reported and up 3% at constant currency, led by 23% growth in Global Gaming

  • Operating income of $228 million; operating income margin of 22% at high end of outlook on substantial increase in Global Gaming profitability and resilience in Global Lottery margin

  • Adjusted EBITDA of $409 million, in line with prior year's record level at constant currency as Global Gaming performance offsets Lottery discrete benefits in the prior year; 40% adjusted EBITDA margin remains among the highest in Company history

  • Recognized a non-operating expense of $150 million representing the probable loss associated with legal proceedings related to Double Down Interactive LLC and its social gaming business sold in 2017

  • Diluted EPS from continuing operations of $(0.02); Adjusted diluted EPS from continuing operations of $0.57, up 78% from the prior year

  • Compelling shareholder returns with $135 million deployed for cash dividends and share repurchases year-to-date

  • Tightening full-year 2022 revenue outlook to reflect currency movements and perimeter impact from previously announced divestiture; reconfirming operating income margin outlook as fundamentals remain strong

LONDON, Aug. 2, 2022 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE: IGT) today reported financial results for the second quarter ended June 30, 2022. Today, at 8:00 a.m. EDT, management will host a conference call and webcast to present the results; access details are provided below.

"Strong customer and player demand for IGT's products and solutions drove some of our strongest profit results ever in the second quarter and first half of the year," said Vince Sadusky, CEO of IGT. "Our business profile is supported by significant recurring revenue streams backed by long-term contracts and resilient end markets, providing a solid foundation on which to grow. We are laser focused on executing our strategic objectives and creating compelling value for our stakeholders."

"Our first half results set us firmly on the path to achieving our 2022 financial targets," said Max Chiara, CFO of IGT. "Rigor on costs and incremental revenue opportunities allow us to maintain our full-year operating income margin outlook despite unfavorable currency movements and macroeconomic challenges. At the same time, we are returning significant capital to shareholders via dividends and share repurchases."

Overview of Consolidated Second Quarter 2022 Results


Quarter Ended

Y/Y
Change
(%)

Constant
Currency
Change
(%)

All amounts from continuing operations

June 30,


2022


2021

($ in millions)






GAAP Financials:






Revenue






 Global Lottery 

648


725

(11) %

(4) %

 Global Gaming

330


274

21 %

23 %

 Digital & Betting

43


42

1 %

4 %

Total revenue

1,021


1,041

(2) %

3 %







Operating income (loss)






Global Lottery

230


300

(23) %

(16) %

Global Gaming

57


1

NM

NM

Digital & Betting

8


9

(11) %

(10) %

Corporate support expense

(29)


(26)

(11) %

(26) %

Other(1)

(39)


(40)

3 %

2 %

Total operating income

228


244

(7) %

1 %

Operating income margin

22 %


23 %









Net cash provided by operating activities

196


249

(21) %








Cash and cash equivalents

673


639

5 %








Earnings per share - diluted

$(0.02)


$(0.48)

96 %








Non-GAAP Financial Measures:






Adjusted EBITDA






Global Lottery

330


414

(20) %

(13) %

Global Gaming

87


35

145 %

150 %

Digital & Betting

12


13

(7) %

(6) %

Corporate support expense

(20)


(21)

4 %

(14) %

Total Adjusted EBITDA

409


442

(7) %

(1) %

Adjusted EBITDA margin

40 %


4 %









Adjusted earnings per share - diluted

$0.57


$0.32

78 %








Free cash flow

117


176

(34) %








Net debt

5,722


6,312

(9) %








(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

Key Highlights:

  • Recently completed acquisition of iSoftBet, a leading iGaming content provider and third-party aggregator, greatly expanding the Company's proprietary content library and providing a world-class game aggregation platform
  • Won "Lottery Supplier of the Year" at 2022 SBC Awards North America in July
  • Introduced high-performing Money Mania wide area progressive game to commercial gaming jurisdictions following a successful launch in tribal casinos
  • Signed agreement with NUSTAR Resort & Casino to deploy IGT ADVANTAGE™ casino management system and a variety of leading games and cabinets
  • Announced expanded sports betting partnership with SuperBook® Sports to Tennessee, the fourth state where IGT's PlaySports platform is powering the SuperBook Sports mobile betting app
  • Awarded a gold medal sustainability rating from EcoVadis, a leading sustainability rating agency
  • Recently released 2021 Sustainability Report which outlines the Company's demonstrated environmental, social, and governance (ESG) performance

Financial Highlights:
Consolidated revenue of $1.02 billion, down 2% as reported, or up 3% at constant currency, from $1.04 billion in the prior year

  • Global Lottery revenue of $648 million compared to $725 million in the prior-year period, which included $70 million in prior-year benefits primarily from the closure of gaming halls in Italy
  • Global Gaming revenue increases 21%, or 23% at constant currency, to $330 million, driven by strong U.S. & Canada replacement unit demand, higher average selling prices, and increased installed base yields
  • Digital & Betting revenue of $43 million, stable with the prior year, as iCasino growth in the U.S. is partially offset by softness in other markets; North America sports betting market gross gaming revenue impacted by lower hold levels

Operating income of $228 million, down 7% as reported, or up 1% at constant currency, from $244 million in the prior-year period

  • Global Lottery operating income down, primarily due to about $60 million related to prior-year benefits referenced above
  • Global Gaming rises on higher revenue and profit flow through, partially offset by increased supply chain costs
  • Digital & Betting operating income of $8 million was relatively stable with the prior year

Adjusted EBITDA of $409 million matches prior year's record level at constant currency; Adjusted EBITDA margin of 40% remains among the highest in Company history

Net interest expense of $75 million compared to $91 million in the prior year, driven by lower average debt balances and interest rates

During the second quarter, the Company recognized a pre-tax non-operating expense of $150 million ($114 million after tax) representing the probable loss associated with ongoing litigation (Benson v. Double Down Interactive LLC, No. 2:18-cv-00525 (W.D. Wash.)) and associated claims related to Double Down Interactive LLC and its social gaming business sold in 2017 by International Game Technology, a wholly-owned subsidiary of the Company

Income tax benefit of $11 million compared to a provision of $32 million in the prior year, primarily driven by recognition of the non-operating expense mentioned above and foreign exchange losses in the prior year with no tax benefit

Income from continuing operations of $34 million versus a loss from continuing operations of $39 million in the prior-year period, driven by income tax benefit, gains in foreign exchange, and lower debt retirement costs

Net loss attributable to IGT PLC of $4 million compared to net income of $306 million in the prior year due to gain on sale and income from discontinued operations in the prior-year period

Net loss from continuing operations attributable to IGT PLC per diluted share of $0.02 compared to a net loss from continuing operations attributable to IGT per diluted share of $0.48 in the prior year, on higher net income; adjusted net income per diluted share increased 78% to $0.57

Net debt of $5.7 billion compared to $5.9 billion at December 31, 2021; Net debt leverage of 3.5x was stable compared to December 31, 2021

Cash and Liquidity Update

  • Total liquidity of $2.1 billion as of June 30, 2022; $0.7 billion in unrestricted cash and $1.5 billion in additional borrowing capacity
  • Executed amendment and extension of revolving credit facilities in July 2022
    • Increased liquidity by $150 million to $1.83 billion and rebalanced EUR/USD mix to match operational exposure
    • Extended maturities to July 2027
    • Lowered interest margin and added ESG provision to allow for further potential reductions
    • Raised annual permitted restricted payments basket from $300 million to $400 million at current credit rating; potential to increase to $550 million

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

  • Ex-dividend date of August 15, 2022
  • Record date of August 16, 2022
  • Payment date of August 30, 2022

Repurchased 750,000 shares for $15 million in the second quarter at an average price of $20.48 per share; 2.2 million shares repurchased for $54 million on a year-to-date basis at an average price of $24.89 per share

The Company expects to close on the sale of its Italian proximity payments/commercial services business in mid-to-late September

Tightening Full-year Revenue Outlook for Currency Rates and Business Disposition; Introducing Third Quarter 2022 Outlook
Full Year

  • Revenue of $4.1 billion - $4.2 billion
    • Lowered high end of range by $100 million
    • Reflecting changes in currency rates and impact from sale of Italian proximity payments/commercial services business in Q3'22
  • Operating income margin of 20% - 22% remains unchanged
  • Cash from operations of $850 - $950 million
    • Lowered high end of range by $50 million
    • Primarily driven by a working capital investment in higher inventory levels to proactively manage supply chain disruptions
  • Capital expenditures of approximately $350 million, lowered by $50 million to adjust for updated timing of spending
  • Free cash flow outlook remains unchanged

Third Quarter

  • Revenue of approximately $1.0 billion - $1.1 billion
  • Operating income margin of 18% - 20% includes approximately 150 - 200 basis point impact from project-related expenses

Outlook assumptions

  • EUR/USD exchange rate of 1.00 in the second half of 2022
  • Impact from sale of Italian proximity payments/commercial services business in mid-to-late September 2022
  • Operating income margin includes approximately 150 - 200 basis point impact from project-related and restructuring expenses expected in the second half of 2022

Earnings Conference Call and Webcast  
August 2, 2022, 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 2022 are calculated using the same foreign exchange rates as the corresponding 2021 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. Certain amounts in columns and rows within tables may not foot due to rounding. 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 countries 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, 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, 2021 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. 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) from continuing operations (a GAAP measure) before income taxes, interest expense, net, foreign exchange gain (loss), net, other non-operating expenses (e.g., DDI / Benson Matter provision, 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 from continuing operations (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 extinguishment and modifications of debt, etc.). Adjusted EPS is calculated using our 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 held for sale. 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. 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.

Constant currency or constant FX is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the month end exchange rates 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)












Sequential









Constant



Change as



Q2'22


Q2'21


Y/Y Change


Currency



Reported

GLOBAL LOTTERY




( %)


Change (%)(1)


Q1'22

( %)

Revenue












Service












Operating and facilities management contracts


581


675


(14) %


(8) %


599

(3) %

Upfront license fee amortization


(46)


(53)


13 %


— %


(49)

5 %

Operating and facilities management contracts, net


535


623


(14) %


(8) %


551

(3) %

Other


85


79


7 %


22 %


84

1 %

Total service revenue


621


702


(12) %


(5) %


635

(2) %













Product sales


27


23


19 %


27 %


45

(39) %

Total revenue


648


725


(11) %


(4) %


680

(5) %













Operating income


230


300


(23) %


(16) %


252

(9) %

Adjusted EBITDA(1)


330


414


(20) %


(13) %


356

(7) %













Global same-store sales growth (%)












Instant ticket & draw games


(8.6 %)


34.9 %






(6.7 %)


Multi-jurisdiction jackpots


10.8 %


28.8 %






(40.0 %)


Total


(7.4 %)


34.5 %






(10.3 %)














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












Instant ticket & draw games


(5.6 %)


20.5 %






(3.9 %)


Multi-jurisdiction jackpots


10.8 %


28.8 %






(40.0 %)


Total


(4.2 %)


21.1 %






(9.0 %)














Italy same-store sales growth (%)












Instant ticket & draw games


(17.5 %)


115.2 %






(14.5 %)














(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein















Sequential









Constant



Change as



Q2'22


Q2'21


Y/Y Change


Currency



Reported

GLOBAL GAMING




( %)


Change (%)(1)


Q1'22

( %)

Revenue












Service












Terminal


123


108


14 %


15 %


108

14 %

Systems, software, and other


56


48


16 %


18 %


58

(3) %

Total service revenue


179


156


14 %


16 %


165

8 %













Product sales












Terminal


108


86


25 %


28 %


104

3 %

Other


44


31


39 %


43 %


55

(21) %

Total product sales revenue


151


118


29 %


32 %


160

(5) %

Total revenue


330


274


21 %


23 %


325

2 %













Operating income


57


1


NM


NM


52

10 %

Adjusted EBITDA(1)


87


35


145 %


150 %


81

7 %













Installed base units












Casino


46,765


47,964


(2) %




47,237


Casino - L/T lease(2)


1,133


1,136





1,142


Total installed base units


47,898


49,100


(2) %




48,379














Installed base units (by geography)












US & Canada


32,270


33,820


(5) %




32,772


Rest of world


15,628


15,280


2 %




15,607


Total installed base units


47,898


49,100


(2) %




48,379














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












US & Canada


$42.64


$38.41


11 %




$39.05


Rest of world


$6.20


$4.03


54 %




$5.77


Total yields


$30.55


$27.49


11 %




$28.19














Global machine units sold












New/expansion


818


1,167


(30) %




328


Replacement


6,378


5,168


23 %




6,848


Total machine units sold


7,196


6,335


14 %




7,176














US & Canada machine units sold












New/expansion


469


643


(27) %




18


Replacement


4,580


3,485


31 %




5,299


Total machine units sold


5,049


4,128


22 %




5,317














(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein




(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 lower active units in the prior year














Sequential









Constant



Change as



Q2'22


Q2'21


Y/Y Change


Currency



Reported

GLOBAL GAMING (Continued)




( %)


Change (%)(1)


Q1'22

( %)

Rest of world machine units sold












New/expansion


349


524


(33) %




310


Replacement


1,798


1,683


7 %




1,549


Total machine units sold


2,147


2,207


(3) %




1,859














Average Selling Price (ASP), in absolute $












US & Canada


$15,200


$13,900


9 %




$14,800


Rest of world


$13,400


$12,700


6 %




$12,300


Total ASP


$14,600


$13,400


9 %




$14,200













Sequential









Constant



Change as



Q2'22


Q2'21


Y/Y Change


Currency



Reported

DIGITAL & BETTING




( %)


Change (%)(1)


Q1'22

( %)

Revenue












Service


43


43


— %


3 %


47

(9) %

Product sales



(0)


NA


NA


0

(55) %

Total revenue


43


42


1 %


4 %


47

(9) %













Operating income


8


9


(11) %


(10) %


13

(38) %

Adjusted EBITDA(1)


12


13


(7) %


(6) %


17

(28) %

























CONSOLIDATED












Revenue (by geography)












US & Canada


585


561


4 %


5 %


598

(2) %

Italy


288


353


(18) %


(7) %


298

(3) %

Rest of world


148


127


16 %


26 %


155

(5 %

Total revenue


1,021


1,041


(2) %


3 %


1,051

(3) %

























(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein




International Game Technology PLC

Consolidated Statements of Operations

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

Unaudited










For the three months ended


For the six months ended


June 30,


June 30,


2022


2021


2022


2021

Service revenue

842


901


1,688


1,802

Product sales

179


140


384


254

Total revenue

1,021


1,041


2,072


2,055









Cost of services

420


438


848


880

Cost of product sales

117


88


239


160

Selling, general and administrative

195


207


388


393

Research and development

60


61


117


116

Other operating expense

1


1


1


1

Total operating expenses

793


796


1,592


1,551









Operating income

228


244


480


504









Interest expense, net

75


91


151


185

Foreign exchange (gain) loss, net

(19)


90


(22)


(55)

Other non-operating expense, net

150


70


147


94

Total non-operating expenses

205


251


276


224

Income (loss) from continuing operations before
(benefit from) provision for income taxes

22


(7)


204


280

(Benefit from) provision for income taxes

(11)


32


53


181

Income (loss) from continuing operations

34


(39)


151


100

Income from discontinued operations, net of tax


13



24

Gain on sale of discontinued operations, net of tax


391



391

Income from discontinued operations


404



415

Net income

34


365


151


514

Less: Net income attributable to non-controlling
interests from continuing operations

38


60


76


119

Less: Net loss attributable to non-controlling interests
from discontinued operations




(2)

Net (loss) income attributable to IGT PLC

(4)


306


75


397









Net (loss) income from continuing operations
attributable to IGT PLC per common share - basic

(0.02)


(0.48)


0.37


(0.09)

Net (loss) income from continuing operations
attributable to IGT PLC per common share - diluted

(0.02)


(0.48)


0.37


(0.09)

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

(0.02)


1.49


0.37


1.94

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

(0.02)


1.49


0.37


1.94

Weighted-average shares - basic

202,696


205,096


203,217


204,977

Weighted-average shares - diluted

202,696


205,096


204,613


204,977

International Game Technology PLC

Consolidated Balance Sheets

($ in millions)

Unaudited








June 30,


December 31,



2022


2021

Assets





Current assets:





Cash and cash equivalents


673


591

Restricted cash and cash equivalents


70


218

Trade and other receivables, net


602


903

Inventories


235


183

Other current assets


614


589

Assets held for sale


647


4

Total current assets


2,841


2,487

Systems, equipment and other assets related to contracts, net


882


937

Property, plant and equipment, net


118


119

Operating lease right-of-use assets


257


283

Goodwill


4,318


4,656

Intangible assets, net


1,316


1,413

Other non-current assets


1,247


1,429

Total non-current assets


8,139


8,836

Total assets


10,979


11,322






Liabilities and shareholders' equity





Current liabilities:





Accounts payable


594


1,035

Short term borrowings



52

Other current liabilities


953


828

Liabilities held for sale


269


Total current liabilities


1,816


1,914

Long-term debt, less current portion


6,453


6,477

Deferred income taxes


330


368

Operating lease liabilities


242


269

Other non-current liabilities


310


323

Total non-current liabilities


7,336


7,437

Total liabilities


9,152


9,351

Commitments and contingencies





IGT PLC's shareholders' equity


1,323


1,282

Non-controlling interests


504


689

Shareholders' equity


1,827


1,971

Total liabilities and shareholders' equity


10,979


11,322

International Game Technology PLC

Consolidated Statements of Cash Flows

($ in millions)

Unaudited


For the three months ended


For the six months ended


June 30,


June 30,


2022


2021


2022


2021

Cash flows from operating activities








Net income

34


365


151


514

Less: Income from discontinued operations, net of tax


404



415

Adjustments to reconcile net income from continuing operations to net cash provided by
operating activities from continuing operations:








DDI / Benson Matter provision

150



150


Depreciation

74


83


148


165

Amortization of upfront license fees

48


55


100


110

Amortization

46


50


94


100

Stock-based compensation

12


7


22


11

Debt issuance cost amortization

4


5


8


11

Loss on extinguishment of debt


67



91

Deferred income taxes

(40)


(18)


(31)


82

Foreign exchange (gain) loss, net

(19)


90


(22)


(55)

Other non-cash items, net

(2)


4


(10)


5

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








Trade and other receivables

102


(48)


67


(134)

Inventories

(28)


1


(53)


5

Accounts payable

(154)


(91)


(136)


24

Other assets and liabilities

(31)


81


(102)


(14)

Net cash provided by operating activities from continuing operations

196


249


385


500

Net cash provided by (used in) operating activities from discontinued operations


5



(31)

Net cash provided by operating activities

196


254


385


469









Cash flows from investing activities








Capital expenditures

(79)


(73)


(153)


(121)

Proceeds from sale of assets

2


5


13


11

Other


2



1

Net cash used in investing activities from continuing operations

(78)


(66)


(139)


(108)

Net cash provided by investing activities from discontinued operations


743



734

Net cash (used in) provided by investing activities

(78)


677


(139)


626









Cash flows from financing activities








Net (repayments of) proceeds from short-term borrowings

(40)


4


(52)


3

Net (repayments of) receipts from financial liabilities

(6)


(6)


36


3

Principal payments on long-term debt


(1,035)



(2,422)

Payments in connection with the extinguishment of debt


(63)



(85)

Payments of debt issuance costs


(1)



(7)

Proceeds from long-term debt




750

Net proceeds from Revolving Credit Facilities

212


84


245


516

Repurchases of common stock

(15)



(54)


Dividends paid

(41)



(81)


Dividends paid - non-controlling interests

(76)


(20)


(173)


(89)

Return of capital - non-controlling interests

(39)


(51)


(49)


(61)

Capital increase - non-controlling interests

3


1


3


11

Other

(3)


(5)


(10)


(10)

Net cash used in financing activities

(4)


(1,091)


(134)


(1,392)









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

115


(160)


111


(297)

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

(49)


23


(62)


(13)

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

791


956


808


1,129

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

858


819


858


819

Less: Cash and cash equivalents included within assets held for sale

58



58


Less: Restricted cash and cash equivalents included within assets held for sale

57



57


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

743


819


743


819









Supplemental Cash Flow Information








Interest paid

43


53


150


219

Income taxes paid

71


35


78


39

International Game Technology PLC

Net Debt

($ in millions)

Unaudited








June 30,


December 31,



2022


2021

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


61


61

3.500% Senior Secured Euro Notes due July 2024


517


564

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


1,094


1,093

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


744


744

3.500% Senior Secured Euro Notes due June 2026


775


844

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


745


745

2.375% Senior Secured Euro Notes due April 2028


516


562

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


744


744

Senior Secured Notes


5,197


5,357






Euro Term Loan Facilities due January 2027


1,029


1,121

Euro Revolving Credit Facility B due July 2024


109


U.S. Dollar Revolving Credit Facility A due July 2024


118


Long-term debt, less current portion


6,453


6,477






Short-term borrowings



52

Total debt


6,453


6,529






Less: Cash and cash equivalents


673


591

Less: Cash and cash equivalents included within assets held for sale


58


Less: Debt issuance costs, net - Revolving Credit Facilities due July 2024



17

Net debt


5,722


5,922






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 June 30, 2022









Business







Global


Global


Digital &


Segment


Corporate


Total IGT



Lottery


Gaming


Betting


Total


and Other


PLC

Income from continuing operations












34

Benefit from income taxes












(11)

Interest expense, net












75

Foreign exchange gain, net












(19)

Other non-operating expense, net












150

Operating income (loss)


230


57


8


295


(68)


228

Depreciation


43


27


4


74



74

Amortization - service revenue (1)


48




48



48

Amortization - non-purchase accounting


6


1



7


1


8

Amortization - purchase accounting






39


39

Stock-based compensation


2


1



4


8


12

Other






1


1

Adjusted EBITDA


330


87


12


429


(20)


409



























Cash flows from operating activities - continuing operations












196

Capital expenditures












(79)

Free Cash Flow












117






















Pre-Tax
Impact


Tax Impact
(2)(3)


Net
Impact

Reported EPS from continuing operations attributable to IGT PLC - diluted








(0.02)

Adjustments:













Foreign exchange gain, net








(0.09)


0.04


(0.14)

Amortization - purchase accounting








0.19


0.05


0.14

Discrete tax items









(0.02)


0.02

DDI / Benson Matter provision








0.74


0.18


0.56

Net adjustments












0.59

Adjusted EPS from continuing operations attributable to IGT PLC - diluted (4)






0.57














(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 (50.8)%. Adjusted for the above items, the effective tax rate was 20.3%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 204.1 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 June 30, 2021









Business







Global


Global


Digital &


Segment


Corporate


Total IGT



Lottery


Gaming


Betting


Total


and Other


PLC

Loss from continuing operations












(39)

Provision for income taxes












32

Interest expense, net












91

Foreign exchange loss, net












90

Other non-operating expense, net












70

Operating income (loss)


300


1


9


310


(66)


244

Depreciation


49


31


4


83



83

Amortization - service revenue (1)


55




55



55

Amortization - non-purchase accounting


9


1



10


1


11

Amortization - purchase accounting






39


39

Stock-based compensation


2


2



3


4


7

Other






1


1

Adjusted EBITDA


414


35


13


463


(21)


442



























Cash flows from operating activities - continuing operations












249

Capital expenditures












(73)

Free Cash Flow












176






















Pre-Tax
Impact


Tax Impact
(2) (3)


Net
Impact

Reported EPS from continuing operations attributable to IGT PLC - diluted







(0.48)

Adjustments:













Foreign exchange loss, net








0.44


0.03


0.40

Amortization - purchase accounting








0.19


0.05


0.15

Loss on extinguishment and modifications of debt, net






0.32



0.32

Discrete tax items









0.08


(0.08)

Other (non-recurring adjustments)








0.01



0.01

Net adjustments












0.80

Adjusted EPS from continuing operations attributable to IGT PLC - diluted (4)






0.32














(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 (492.1)%. Adjusted for the above items, the effective tax rate was 34.3%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 206.8 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 six months ended June 30, 2022









Business







Global


Global


Digital &


Segment


Corporate


Total



Lottery


Gaming


Betting


Total


and Other


IGT PLC

Income from continuing operations












151

Provision for income taxes












53

Interest expense, net












151

Foreign exchange gain, net












(22)

Other non-operating expense, net












147

Operating income (loss)


482


108


21


612


(132)


480

Depreciation


87


54


8


148


(1)


148

Amortization - service revenue (1)


100




100



100

Amortization - non-purchase accounting


13


3



16


1


17

Amortization - purchase accounting






77


77

Stock-based compensation


5


3



8


14


22

Other






1


1

Adjusted EBITDA


686


168


29


883


(41)


842



























Cash flows from operating activities - continuing operations












385

Capital expenditures












(153)

Free Cash Flow












232






















Pre-Tax
Impact


Tax Impact
(2) (3)


Net
Impact

Reported EPS from continuing operations attributable to IGT PLC - diluted







0.37

Adjustments:













Foreign exchange gain, net








(0.11)


0.08


(0.19)

Amortization - purchase accounting








0.37


0.09


0.28

Discrete tax items









(0.15)


0.15

DDI / Benson Matter provision








0.73


0.18


0.56

Net adjustments












0.80

Adjusted EPS from continuing operations attributable to IGT PLC - diluted (4)






1.17














(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 26.0%. Adjusted for the above items, the effective tax rate was 22.8%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 204.6 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 six months ended June 30, 2021









Business







Global


Global


Digital &


Segment


Corporate


Total



Lottery


Gaming


Betting


Total


and Other


IGT PLC

Income from continuing operations












100

Provision for income taxes












181

Interest expense, net












185

Foreign exchange gain, net












(55)

Other non-operating expense, net












94

Operating income (loss)


637


(25)


16


628


(124)


504

Depreciation


96


63


7


166


(1)


165

Amortization - service revenue (1)


110




110



110

Amortization - non-purchase accounting


17


2



19


2


21

Amortization - purchase accounting






79


79

Stock-based compensation


2


2



5


6


11

Other






1


1

Adjusted EBITDA


862


44


24


929


(37)


892



























Cash flows from operating activities - continuing operations












500

Capital expenditures












(121)

Free Cash Flow












380






















Pre-Tax
Impact


Tax Impact
(2) (3)


Net
Impact

Reported EPS from continuing operations attributable to IGT PLC - diluted







(0.09)

Adjustments:













Foreign exchange gain, net








(0.27)


0.02


(0.29)

Amortization - purchase accounting








0.38


0.09


0.29

Loss on extinguishment and modifications of debt, net






0.42



0.42

Discrete tax items









(0.33)


0.33

Other (non-recurring adjustments)








0.01



0.01

Net adjustments












0.74

Adjusted EPS from continuing operations attributable to IGT PLC - diluted (4)






0.65














(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 64.4%. Adjusted for the above items, the effective tax rate was 35.2%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 206.6 million, which includes the dilutive impact of share-based payment awards

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/international-game-technology-plc-reports-second-quarter-2022-results-301597730.html

SOURCE International Game Technology PLC