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INTERNATIONAL GAME TECHNOLOGY PLC REPORTS FIRST QUARTER 2023 RESULTS

  • Generated revenue of $1.06 billion, fueled by 8% Global Lottery same-store sales growth and double-digit revenue growth in Global Gaming and PlayDigital
  • 24.1% operating income margin meets high end of outlook range on strong Global Gaming performance
  • Adjusted EBITDA of $449 million and 42.3% Adjusted EBITDA margin among highest levels in Company history
  • Net debt leverage improves to 3.0x, the lowest level in Company history
  • Reaffirming full-year 2023 revenue and profit outlook

LONDON, May 9, 2023 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the first quarter ended March 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.

"Our first quarter results exceeded expectations and put us firmly on track to achieve our full-year outlook," said Vince Sadusky, CEO of IGT. "Compelling innovation and sustained strength in customer and player demand are fueling momentum across our Global Lottery, Global Gaming, and PlayDigital segments. This is clear in the excellent key performance indicators achieved in the quarter. We believe the focused execution of our strategy to Grow, Innovate, and Optimize should create significant value as we progress toward our 2025 goals."

"The strong start to the year includes significant cash flow generation and further improvement in our credit profile," said Max Chiara, CFO of IGT. "The continued improvement in net debt leverage reinforces our conviction in accomplishing the lower end of the 2.5x - 3.5x target range by 2025. We are focused on enhancing our financial flexibility, being operationally agile, and remaining disciplined with costs, all of which should enable the achievement of our 2025 margin and cash flow targets even in the current uncertain macroeconomic context."

Overview of Consolidated First Quarter 2023 Results


Quarter Ended

Y/Y
Change
(%)

Constant
Currency
Change
(%)


March 31,


2023


2022

($ in millions)






GAAP Financials:






Revenue






Global Lottery

624


680

(8) %

(7) %

Global Gaming

381


325

17 %

19 %

PlayDigital

55


47

17 %

20 %

Total revenue

1,060


1,051

1 %

3 %







Operating income (loss)






Global Lottery

240


252

(5) %

(3) %

Global Gaming

69


52

34 %

33 %

PlayDigital

14


13

9 %

15 %

Corporate support expense

(26)


(26)

1 %

(7) %

Other(1)

(42)


(38)

(10) %

(10) %

Total operating income

255


252

1 %

3 %

Operating income margin

24.1 %


24.0 %









Earnings per share - diluted

$0.11


$0.39

(72) %








Net cash provided by operating activities

311


189

65 %








Cash and cash equivalents

669


600

12 %








Non-GAAP Financial Measures:






Adjusted EBITDA






Global Lottery

339


356

(5) %

(3) %

Global Gaming

111


81

37 %

38 %

PlayDigital

18


17

3 %

9 %

Corporate support expense

(19)


(21)

8 %

(2) %

Total Adjusted EBITDA

449


433

4 %

5 %

Adjusted EBITDA margin

42.3 %


41.2 %









Adjusted earnings per share - diluted

$0.49


$0.60

(18) %








Free cash flow

217


115

88 %








Net debt

5,118


5,832

(12) %









(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:

  • Global Lottery same-store sales rose 8%; Italy up over 10% on new games and portfolio optimization strategies; elevated jackpot activity contributed to 7% growth in North America and Rest of world
  • Won several awards including "Lottery Product of the Year" at International Gaming Awards, "Casino Supplier of the Year" at Global Gaming Awards London, and "Best Slot Machine" and "Best Diversity and Inclusion Employer" at European Casino Awards
  • Recognized with top honors at EKG slot awards including "Most Improved Supplier - Premium," "Top Performing New Mechanical Reel Cabinet" for innovative new DiamondRS™ cabinet, "Top Performing Video Poker Game" for Ultimate X Poker™, and "Top Performing Third-Party IP-Branded Game" for Wheel of Fortune® High Roller™
  • Growth in cashless gaming leadership continues with signing of multi-year agreement with Graton Resort & Casino to enable cashless gaming through award-winning Resort Wallet™ and IGTPay™ solutions
  • Extended sports betting momentum through strategic agreements with Betfred, Treasure Bay Casino and Hotel, UBetOhio, Santa Ana Star Casino Hotel, and BetSkybox; recently signed three-year contract extension in Rhode Island
  • Achieved improved ESG score in 2022 S&P Global Corporate Sustainability Assessment and increased global environmental score from CDP

Financial Highlights:

Consolidated revenue of $1.06 billion, up 1% or 3% at constant currency, compared to $1.05 billion in the prior year; at constant currency and net of the Italy commercial services sale in September 2022, revenue increased 10%

  • Global Lottery revenue of $624 million was down 8% year-over-year due to the sale of Italy commercial services business; at constant currency and net of the Italy commercial services sale, revenue rose 4% primarily driven by strong same-store sales, led by Italy and elevated U.S. multi-jurisdictional jackpot activity
  • Global Gaming revenue rose 17%, 19% at constant currency, to $381 million, as demand for compelling products drove double-digit increases in both service and product sale revenue streams, with record first quarter unit shipments and average selling prices, installed base growth, and higher yields
  • PlayDigital revenue increased 17%, 20% at constant currency, to $55 million, primarily driven by iCasino with contributions from the iSoftBet acquisition and organic growth, partially offset by higher jackpot expense

Operating income of $255 million increased 1%, or 3% at constant currency, from $252 million in the prior year

  • Global Lottery operating income of $240 million, down 5% and 3% at constant currency due to the sale of Italy commercial services business; strong 38% operating income margin driven by high profit flow-through of same-store sales growth, including elevated jackpot activity, and positive geographic mix
  • Global Gaming operating income of $69 million increased 34% on strong installed base productivity and operating leverage on a leaner cost structure
  • PlayDigital operating income of $14 million, up 9% as reported and 15% at constant currency; operating income margin modestly better than Q4'22 despite significantly higher jackpot expense
  • Corporate support and other expense of $68 million, up from $64 million in the prior year, driven by higher amortization expense resulting from changes in currency rates

Adjusted EBITDA of $449 million versus $433 million in the prior-year period, primarily as a result of the operating income dynamics above and higher depreciation and amortization; Adjusted EBITDA margin expands 110 basis points to 42.3% on higher Global Lottery and Global Gaming margins

Net interest expense of $70 million compared to $76 million in the prior year, primarily driven by lower average debt balances

Foreign exchange loss of $26 million, compared to foreign exchange gain of $3 million in the prior year, primarily reflecting the impact of fluctuations in the EUR/USD exchange rate on debt

Income tax provision of $87 million compared to $65 million in the prior year, primarily driven by incremental valuation allowances on deferred tax assets, partially offset by lower pre-tax income

Net income of $67 million versus $117 million in the prior-year period

Diluted earnings per share of $0.11 versus $0.39 in the prior year primarily reflects foreign currency gains/losses and related tax impact; Adjusted diluted earnings per share of $0.49 versus $0.60

Net debt of $5.1 billion compared to $5.2 billion at December 31, 2022; Net debt leverage of 3.0x, down from 3.1x at December 31, 2022

Cash and Liquidity Update
Total liquidity of $2.1 billion as of March 31, 2023; $0.7 billion in unrestricted cash and $1.4 billion in additional borrowing capacity from undrawn credit facilities

Successfully completed full redemption of 5.35% Notes due 2023 and partial make-whole redemption of certain Senior Secured Notes, repurchasing $200 million of 6.50% Notes due 2025 and €188 million of 3.50% Notes due 2024

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

  • Ex-dividend date of May 24, 2023
  • Record date of May 25, 2023
  • Payment date of June 8, 2023

Introducing Second Quarter 2023 Expectations; Reaffirming Full-Year 2023 Outlook Range
Second Quarter

  • Revenue of approximately $1.0 billion
  • Operating income margin of 22% - 24%

Full Year

  • Revenue of $4.1 billion - $4.3 billion
  • Operating income margin of 21% - 23%
  • Cash from operations of $900 million - $1,000 million
  • Capital expenditures of $400 million - $450 million

Earnings Conference Call and Webcast  
May 9, 2023, 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, 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, 2022 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) (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), net, other non-operating expenses, 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.

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. Cash and cash equivalents 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 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)












Sequential









Constant



Change as



Q1'23


Q1'22


Y/Y Change


Currency



Reported

GLOBAL LOTTERY




( %)


Change (%)(1)


Q4'22

( %)

Revenue












Service












Operating and facilities management contracts


637


599


6 %


8 %


622

2 %

Upfront license fee amortization


(47)


(49)


3 %


— %


(45)

(4) %

Operating and facilities management contracts, net


590


551


7 %


9 %


577

2 %

Other


12


84


(85) %


(85) %


16

(24) %

Total service revenue


602


635


(5) %


(4) %


593

2 %













Product sales


22


45


(51) %


(50) %


46

(52) %

Total revenue


624


680


(8) %


(7) %


639

(2) %













Operating income


240


252


(5) %


(3) %


216

11 %

Adjusted EBITDA(1)


339


356


(5) %


(3) %


318

6 %













Global same-store sales growth (%)












Instant ticket & draw games


4.8 %


(6.7 %)






1.0 %


Multi-jurisdiction jackpots


48.2 %


(40.0 %)






66.0 %


Total


8.0 %


(10.3 %)






6.7 %














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












Instant ticket & draw games


3.2 %


(3.9 %)






0.4 %


Multi-jurisdiction jackpots


48.2 %


(40.0 %)






66.0 %


Total


7.4 %


(9.0 %)






7.7 %














Italy same-store sales growth (%)












Instant ticket & draw games


10.3 %


(14.5 %)






3.1 %














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

 












Sequential









Constant



Change as



Q1'23


Q1'22


Y/Y Change


Currency



Reported

GLOBAL GAMING




( %)


Change (%)(1)


Q4'22

( %)

Revenue












Service












Terminal


129


108


20 %


23 %


126

3 %

Systems, software, and other


60


58


3 %


5 %


60

(2) %

Total service revenue


189


165


14 %


16 %


186

1 %













Product sales












Terminal


135


104


30 %


32 %


149

(9) %

Other


57


55


4 %


5 %


54

6 %

Total product sales revenue


192


160


21 %


23 %


203

(5) %

Total revenue


381


325


17 %


19 %


389

(2) %













Operating income


69


52


34 %


33 %


68

1 %

Adjusted EBITDA(1)


111


81


37 %


38 %


101

10 %













Installed base units












Casino


50,030


47,237


6 %




48,578


Casino - L/T lease(2)


872


1,142


(24) %




1,008


Total installed base units


50,902


48,379


5 %




49,586














Installed base units (by geography)












US & Canada


33,175


32,772


1 %




32,335


Rest of world


17,727


15,607


14 %




17,251


Total installed base units


50,902


48,379


5 %




49,586














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












US & Canada


$42.36


$39.05


8 %




$42.08


Rest of world


$7.41


$5.77


28 %




$6.53


Total yields


$30.13


$28.19


7 %




$29.72














Global machine units sold












New/expansion


1,012


328


209 %




728


Replacement


7,260


6,848


6 %




8,755


Total machine units sold


8,272


7,176


15 %




9,483














US & Canada machine units sold












New/expansion


892


18


NM




574


Replacement


5,642


5,299


6 %




6,875


Total machine units sold


6,534


5,317


23 %




7,449














(1) Non-GAAP measures; 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



 












Sequential









Constant



Change as



Q1'23


Q1'22


Y/Y Change


Currency



Reported

GLOBAL GAMING (Continued)




( %)


Change (%)(1)


Q4'22

( %)

Rest of world machine units sold












New/expansion


120


310


(61) %




154


Replacement


1,618


1,549


4 %




1,880


Total machine units sold


1,738


1,859


(7) %




2,034














Average Selling Price (ASP), in absolute $












US & Canada


$16,000


$14,800


8 %




$15,600


Rest of world


$15,400


$12,300


25 %




$15,300


Total ASP


$15,900


$14,200


12 %




$15,500



























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

 












Sequential









Constant



Change as



Q1'23


Q1'22


Y/Y Change


Currency



Reported

PLAYDIGITAL




( %)


Change (%)(1)


Q4'22

( %)

Revenue












Service


55


47


17 %


21 %


65

(16) %

Product sales




(60) %


(60) %


(45) %

Total revenue


55


47


17 %


20 %


65

(16) %













Operating income


14


13


9 %


15 %


17

(15) %

Adjusted EBITDA(1)


18


17


3 %


9 %


22

(21) %

























CONSOLIDATED












Revenue (by geography)












US & Canada


666


598


11 %


12 %


714

(7) %

Italy


243


298


(18) %


(16) %


226

7 %

Rest of world


151


155


(3) %


1 %


153

(1) %

Total revenue


1,060


1,051


1 %


3 %


1,093

(3) %













(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

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

Unaudited






For the three months ended


March 31,


2023


2022

Service revenue

846


846

Product sales

215


205

Total revenue

1,060


1,051





Cost of services

398


428

Cost of product sales

127


122

Selling, general and administrative

217


193

Research and development

62


57

Total operating expenses

805


799





Operating income

255


252





Interest expense, net

70


76

Foreign exchange loss (gain), net

26


(3)

Other non-operating expense (income), net

4


(3)

Total non-operating expenses

101


70

Income before provision for income taxes

155


182

Provision for income taxes

87


65

Net income

67


117

Less: Net income attributable to non-controlling interests

44


38

Net income attributable to IGT PLC

23


79





Net income attributable to IGT PLC per common share - basic

0.12


0.39

Net income attributable to IGT PLC per common share - diluted

0.11


0.39

Weighted-average shares - basic

199,684


203,743

Weighted-average shares - diluted

201,698


205,166

 

International Game Technology PLC

Consolidated Balance Sheets

($ in millions)

Unaudited








March 31,


December 31,



2023


2022

Assets





Current assets:





Cash and cash equivalents


669


590

Restricted cash and cash equivalents


137


150

Trade and other receivables, net


705


670

Inventories, net


294


254

Other current assets


460


467

Total current assets


2,264


2,131

Systems, equipment and other assets related to contracts, net


910


899

Property, plant and equipment, net


113


118

Operating lease right-of-use assets


248


254

Goodwill


4,495


4,482

Intangible assets, net


1,340


1,375

Other non-current assets


1,142


1,174

Total non-current assets


8,247


8,302

Total assets


10,511


10,433






Liabilities and shareholders' equity





Current liabilities:





Accounts payable


835


731

Current portion of long-term debt


218


61

Short term borrowings


54


DDI / Benson Matter provision


220


220

Other current liabilities


874


837

Total current liabilities


2,200


1,848

Long-term debt, less current portion


5,524


5,690

Deferred income taxes


334


305

Operating lease liabilities


234


239

Other non-current liabilities


351


372

Total non-current liabilities


6,443


6,607

Total liabilities


8,644


8,454

Commitments and contingencies





IGT PLC's shareholders' equity


1,417


1,429

Non-controlling interests


450


550

Shareholders' equity


1,867


1,979

Total liabilities and shareholders' equity


10,511


10,433

 

International Game Technology PLC

Consolidated Statements of Cash Flows

($ in millions)

Unaudited


For the three months ended


March 31,


2023


2022

Cash flows from operating activities




Net income

67


117

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




Depreciation

77


74

Amortization

55


47

Amortization of upfront license fees

50


51

Deferred income taxes

28


9

Foreign exchange loss (gain), net

26


(3)

Stock-based compensation

11


10

Other non-cash items, net

6


(4)

Changes in operating assets and liabilities:




Trade and other receivables

(32)


(35)

Inventories

(38)


(25)

Accounts payable

111


18

Accrued interest payable

(20)


(31)

Accrued income taxes

40


49

Other assets and liabilities

(71)


(89)

Net cash provided by operating activities

311


189





Cash flows from investing activities




Capital expenditures

(94)


(73)

Other

3


11

Net cash used in investing activities

(91)


(62)





Cash flows from financing activities




Principal payments on long-term debt

(462)


Net receipts from financial liabilities

8


43

Net proceeds from (payments of) short-term borrowings

53


(12)

Net proceeds from Revolving Credit Facilities

392


33

Repurchases of common stock


(39)

Dividends paid

(40)


(41)

Dividends paid - non-controlling interests

(92)


(98)

Return of capital - non-controlling interests

(10)


(10)

Other

(12)


(7)

Net cash used in financing activities

(163)


(131)





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

57


(4)

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

8


(13)

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

740


808

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

805


791

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


39

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


67

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

805


685





Supplemental Cash Flow Information




Interest paid

90


106

Income taxes paid

20


7

 

International Game Technology PLC

Net Debt

($ in millions)

Unaudited






March 31,


December 31,


2023


2022

3.500% Senior Secured Euro Notes due July 2024

122


319

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

498


697

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

745


745

3.500% Senior Secured Euro Notes due June 2026

812


796

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

746


746

2.375% Senior Secured Euro Notes due April 2028

541


530

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

745


745

Senior Secured Notes

4,208


4,578





Euro Term Loan Facilities due January 2027

861


1,058

Revolving Credit Facility A due July 2027


55

Revolving Credit Facility B due July 2027

455


Long-term debt, less current portion

5,524


5,690





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


61

Euro Term Loan Facilities due January 2027

218


Current portion of long-term debt

218


61





Short-term borrowings

54


Total debt

5,796


5,750





Less: Cash and cash equivalents

669


590

Less: Debt issuance costs, net - Revolving Credit Facility A due July 2027

10


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


9

Net debt

5,118


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 March 31, 2023









Business







Global


Global




Segments


Corporate


Total



Lottery


Gaming


PlayDigital


Total


and Other


IGT PLC

Net income












67

Provision for income taxes












87

Interest expense, net












70

Foreign exchange loss, net












26

Other non-operating expense, net












4

Operating income (loss)


240


69


14


323


(68)


255

Depreciation


43


30


3


76


2


77

Amortization - service revenue (1)


49




50



50

Amortization - non-purchase accounting


5


10



15


1


16

Amortization - purchase accounting






40


40

Stock-based compensation


2


2



4


6


11

Adjusted EBITDA


339


111


18


468


(19)


449



























Cash flows from operating activities












311

Capital expenditures












(94)

Free Cash Flow












217






















Pre-Tax Impact


Tax Impact (2)(3)


Net Impact

Reported EPS attributable to IGT PLC - diluted








0.11

Adjustments:













Foreign exchange loss, net








0.13


(0.02)


0.15

Amortization - purchase accounting








0.20


0.05


0.15

Loss on extinguishment and modifications of debt, net






0.02



0.02

Discrete tax items









(0.05)


0.05

Net adjustments












0.38

Adjusted EPS attributable to IGT PLC - diluted (4)






0.49














(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 56.5%. Adjusted for the above items, the effective tax rate was 36.3%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 201.7 million, which includes the dilutive impact of share-based payment awards

 



For the three months ended March 31, 2022









Business







Global


Global




Segments


Corporate


Total



Lottery


Gaming


PlayDigital


Total


and Other


IGT PLC

Net income












117

Provision for income taxes












65

Interest expense, net












76

Foreign exchange gain, net












(3)

Other non-operating income, net












(3)

Operating income (loss)


252


52


13


316


(64)


252

Depreciation


44


27


4


75



74

Amortization - service revenue (1)


51




51



51

Amortization - non-purchase accounting


7


2



9


1


9

Amortization - purchase accounting






38


38

Stock-based compensation


2


2



4


6


10

Adjusted EBITDA


356


81


17


454


(21)


433



























Cash flows from operating activities












189

Capital expenditures












(73)

Free Cash Flow












115






















Pre-Tax Impact


Tax Impact (2) (3)


Net Impact

Reported EPS attributable to IGT PLC - diluted







0.39

Adjustments:













Foreign exchange gain, net








(0.01)


0.04


(0.06)

Amortization - purchase accounting








0.19


0.04


0.14

Discrete tax items









(0.14)


0.14

Other (non-recurring adjustments)








(0.01)



Net adjustments












0.22

Adjusted EPS attributable to IGT PLC - diluted (4)






0.60














(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 35.5%. Adjusted for the above items, the effective tax rate was 25.0%

(4) Adjusted EPS was calculated using weighted average shares outstanding of 205.2 million, which includes the dilutive impact of share-based payment awards

 

 

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SOURCE International Game Technology PLC