IGT reverses loss in 2016, reports profit of $264M

INTERNATIONAL GAME Technology PLC reported profit of $264.2 million, or $1.05 per diluted share, in 2016, reversing a loss of $55.9 million, or 39 cents per diluted share in 2015.
INTERNATIONAL GAME Technology PLC reported profit of $264.2 million, or $1.05 per diluted share, in 2016, reversing a loss of $55.9 million, or 39 cents per diluted share in 2015.

PROVIDENCE – International Game Technology PLC reported profit of $264.2 million, or $1.05 per diluted share, in 2016, reversing a loss of $55.9 million, or 39 cents per diluted share in 2015, boosted by growth in lottery service revenue.
The gaming company, in its earnings report on Thursday, also reported a nearly 10 percent jump in revenue last year, to $5.2 billion from $4.7 billion a year ago. The strengthening dollar impacted results, the company said.

Marco Sala, CEO of IGT, said in a statement that the company reached “many important milestones” in 2016.
“We reinforced our number one position in lottery globally, achieving robust same-store revenue growth and securing valuable, multi-year contracts. We also made good progress with our gaming turnaround, developing compelling new titles and hardware, in addition to expanding our International presence. We operate in growing global market segments, and IGT has a long history of investing in innovation to create shareholder value,” Sala said.
Alberto Fornaro, chief financial officer of IGT, said IGT achieved its financial goals last year, and it expects 2017 to “evolve as a year of two halves, with difficult comparisons in the first part of the year easing as we reach the second half.”
Due to the merger of IGT and GTECH in April 2015, financial information for 2016 includes IGT operations for the entire period, while financial information for 2015 includes IGT for the second through fourth quarters, and only GTECH for the first quarter.
On a pro forma basis, which combines the results of IGT and GTECH, revenue for 2015 changes to $5.1 billion, so the year-over-year increase lowers to 2 percent on a constant-currency basis, instead of 10 percent.

Among IGT’s four revenue categories, North America Gaming & Interactive reported pro forma revenue in 2016 of $1.37 billion, a 2.8 percent decline, while North America Lottery reported pro forma revenue of $1.2 billion, a 12.1 percent increase.
International gaming revenue, on a pro forma basis, fell to $827 billion in 2016, a 10.3 percent decline, although on a constant-currency basis, the decline was 6.8 percent. Italy revenue, also on a pro forma basis, increased 3.4 percent to $1.8 billion from $1.7 billion in 2015. On a constant-currency basis, revenue from Italy operations increased 3.5 percent.

The company said it shipped 33,147 gaming machines worldwide last year, and global lottery same-store revenue, excluding Italy, climbed 8 percent. Italy lottery wagers jumped 6 percent in 2016.
IGT said it expects to achieve adjusted earnings before interest, tax, depreciation and amortization between $1.7 billion and $1.8 billion in 2017.
Maintenance capital expenditures are expected to be between $525 million and $575 million, including approximately $100 million related to the timing of the new Florida Lottery contract. Growth capital expenditures will be approximately $100 million.
Fourth-quarter revenue fell 3.2 percent to $1.3 billion from $1.4 billion in the fourth quarter of 2015. Fourth-quarter net income rose 200.3 percent to $249.4 million, or $1.15 per diluted share, from $83 million, or 37 cents per diluted share.
IGT shares were trading at $24.03 as of 1:35 p.m., a decline from the previous close of $27.66.

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