Solid performance and company on track for $235 million in annual cost savings, but SG is still carrying a heavy debt burden
Scientific Games Corporation has posted its financial results for the first quarter ended March 31, 2015, reporting the following highlights at group level:
* Revenue up at $658.7 million (Q1-2014: $388.1 million);
* Operating income up at $18.1 million – a major turnaround from Q1-2014's $12.1 million loss;
* Net loss of $86.4 million (Q1-2014: $45 million;
* Capex at $72.1 million (Q1-2014: $59.6 million;
* EBITDA up at $252.1 million (Q1-2014: $122.8 million;
* Cash on hand of $152.2 million (Q1-2014: $171.8 million);
* Total debt slightly down at $8.49 billion (Q1-2014: $8.51 billion).
"In our first full quarter following our merger with Bally, we made significant progress in our strategies to integrate Bally operations and unify our organization," said Gavin Isaacs, president and CEO.
"The process of integrating Bally and Scientific Games is ahead of schedule. Having already implemented actions to achieve approximately $90 million in Bally-related annualized savings through March 31, 2015, we expect to achieve our goal to implement initiatives to generate approximately 80 percent of the anticipated $235 million of annual cost savings and another $30 million of WMS-related annual cost savings by the end of 2015.
"We expect our debt reduction to accelerate in the second half of 2015 and beyond."
In addition to approximately $9.5 million of restructuring and integration costs incurred in the 2015 first quarter, the company expects to incur $20 million to $25 million of additional operating costs to achieve anticipated cost savings and $15 million to $25 million of capital expenditures related to integration efforts during the remainder of 2015.
The company's interactive division reported that revenue increased $16.1 million to $46.9 million, reflecting $7 million of revenue from Bally, as well as an increase in real money gaming revenue and increased DAU for the Jackpot Party and Gold Fish social casino apps, partially offset by a decrease in ARPDAU.
In the social gaming space, average revenue per daily active player (ARPDAU) dipped from 23 US cents to 19 US cents, whilst monthly active users soared 57.1 percent to 7.7 million.
EBITDA significantly increased, reaching $9.9 million (Q1-2014: $3.2 million).
Operating income increased $7.7 million, reflecting the impact of higher revenue and improved scale of the legacy Interactive business, which achieved an $11.3 million increase in operating income, partially offset by a $3.6 million operating loss from Bally.
Operational highlights included the launch of real money gaming products, including premium slots games, with four new customers for desktop and mobile apps, and the entry into Denmark, and an agreement with Penn National Gaming for the deployment of the SG Universe interactive gaming suite of products at four Penn National properties, including our Play4Fun social casino platform.
The company also launched a Quick Hits slot game on the Dragonplay Slots Free Casino app, the company's first Bally social game launch, along with Star Trek slots games on Facebook and other desktop and mobile apps.
Online Casino News Courtesy of Infopowa