GGRAsia – Sci Games 4Q loss narrows sequentially, as revenue grows

Sci Games 4Q loss narrows sequentially, as revenue grows

Mar 02, 2021 Newsdesk Industry Talk, Latest News, Top of the deck

Casino equipment, lottery services and online games provider Scientific Games Corp said in a Monday filing that its fourth-quarter net loss narrowed to US$84 million compared to US$111 million in the third quarter.

The fourth quarter figure was higher than the US$37-million loss posted a year earlier, with the company saying it was a result of “lower revenue” in the final quarter of 2020.

Scientific Games recorded revenue of US$762 million for the three months ended December 31, 11.7 percent lower than in the fourth quarter of 2019. The firm stated the decline in revenue was related to a decline in sales in its gaming segment as these were “impacted by Covid-19 restrictions for casinos globally”.

The company posted a 9.2-percent sequential rise in revenue, from US$698 million in the third quarter, “benefiting from improvements in gaming”.

In the fourth quarter, revenue in the traditional gaming segment rose 23.8 percent sequentially to US$286 million. That included a 14.1-percent increase in the gaming operations segment, to US$105 million; and a one-third jump in revenue from sales of gaming machines, to US$96 million.

In the international portion of the group’s gaming machine sales – including the Asia-Pacific region – new unit shipments in the three months to December 31 tripled sequentially to 5,784, from 1,887 in the three months ended September 30. Aggregate shipments – including new unit shipments to the United States and Canada – rose two-thirds from the third quarter, to 8,336.

“The strong execution coupled with the diversity of our business enabled positive cash flow,” said Barry Cottle, Scientific Games’ chief executive and president, in commentary quoted in a press release accompanying the results.

The group stated that its lottery segment, SciPlay digital social games and the digital real-money gaming businesses all delivered year-on-year growth in the fourth quarter.

In the SciPlay segment, revenue rose by 30.1 percent year-on-year, to US$147 million from US$113 million a year earlier; while the lottery segment saw a 9.9-percent growth in revenue, to US$256 million.

Scientific Games’ consolidated adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) increased slightly from the third quarter to US$244 million. It was down by almost 26 percent from a year earlier “as a result of Covid-19 disruptions”, the company said.

The company posted a full-2020 net loss of US$548 million, up from a net loss of US$118 million in 2019. Full-year group revenue was down at US$2.72 billion, compared to US$3.40 billion in the previous year.

The group said it had available liquidity of US$1.27 billion at the end of 2020.

Scientific Games’ net debt as of December 31 was US$8.39 billion, down from US$8.59 billion a year earlier.

Michael Eklund, chief financial officer of Scientific Games, was quoted as saying in the release: “The focus remains on disciplined cost and balance sheet management”.