Operator News
US – Scientific to refinance some of its debt
By Phil - 24 July 2017
Scientific Games has announced plans to take advantage of favourable market conditions to refinance a portion of its debt to lower cash interest costs, extend debt maturities, and generally lower its cost of capital.
The company reported that second quarter revenue rose five per cent to $766.3m, up from $729.2m a year ago. The growth was driven by revenue increases in the gaming and interactive segments. Foreign exchange had an $8m, or one per cent, unfavorable impact on revenue.
Operating income in the second quarter doubled to $117.3m from $59.1m a year ago, reflecting revenue growth, a more effective organizational structure and lower depreciation and amortization. Net loss declined to $39.1m from $51.7m in the prior-year period.
“Second quarter results represent our seventh quarter of consecutive year-over-year growth, including $169 million of cash flow from operating activities, as a result of ongoing improvements in our gaming, lottery and interactive operations,” said Kevin Sheehan, Chief Executive Officer of Scientific Games. “We achieved year-over-year revenue growth in global gaming machine sales, gaming systems, table products and interactive; as well as in US instant games revenue. In addition, as a result of our improving organizational structure, we increased our AEBITDA margin by 270 basis points.
“Across the Company, we are maintaining a laser focus on executing our strategies and capitalizing on our many opportunities,” Mr. Sheehan added. “I am proud of all of our dedicated team members who daily commit themselves to empower our customers with the best gaming and lottery experiences in the world, while remaining focused on delivering our financial goals.”
Michael Quartieri, Chief Financial Officer of Scientific Games, added: “Our focus on innovative new products, continuous process improvement and fiscal discipline have enabled us to grow operating income and cash flow, leading to a reduction in our net debt. This has resulted in our net debt leverage ratio at June 30, 2017 declining to 6.8 times twelve-month AEBITDA. With our strengthened performance, we are well positioned to further improve our capital structure and lower our cost of capital.”
