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US – Scientific sees 63 per cent growth as it closes in on selling sports betting and lottery

By - 9 August 2021

Scientific Gaming’s second quarter consolidated revenue came in at $880m compared to $539m, up 63 per cent compared to the prior year period with the gaming business delivering over 300 per cent growth compared to the prior year period and 50 per cent growth compared to the prior quarter driven by the strength of our new product roadmap, record gross gaming revenue in the US and a rebound in the UK and Europe.

Gaming revenue and AEBITDA also benefited by $38m due to the FOBT recovery. The Lottery and Digital businesses both delivered record quarters fueled by strong instant sales and our original content offering respectively. Net income was $113m compared to a net loss of $198m in the prior year period primarily due to strong revenues in the Gaming business segment, which were significantly impacted by COVID-19 disruptions in the prior year period, coupled with $63m non-cash gain associated with the SportCast acquisition.

Barry Cottle, President and Chief Executive Officer of Scientific Games, said: “I am very pleased that we continue to make tremendous progress on all of our key strategic pillars while also driving significant growth in the quarter. We have emerged from the pandemic a much stronger Company with significant momentum. All of our businesses grew sequentially on both the top and bottom lines in the quarter. Gaming delivered its highest revenue quarter since the fourth quarter of 2019, Lottery and Digital achieved record results and SciPlay delivered its second highest revenue quarter in its history. Following our strategic review, we will be singularly focused on becoming a leading cross-platform global game company with focus on content and digital markets. We are moving rapidly to transform our company and I have never been more optimistic about our path forward.”

Michael Eklund, Executive Vice President and Chief Financial Officer of Scientific Games, added: “In concert with our Board, we announced a strategic action plan to transform our company and unlock value. We are taking decisive steps to optimize our portfolio, de-lever our balance sheet and invest to grow. I am very encouraged by the interest and discussions we are having around our proposed divestitures, and we are making great progress as we move quickly to unlock shareholder value. We are proud of the team as they continue to execute during this exciting time, delivering a quarter with strong revenue, profit and cash flow growth. The team is laser focused on maintaining discipline to drive balance sheet strength and operational efficiency and we are energized for the future.”

In terms of its panned restructure, the company added: “Overall, the company is moving rapidly to execute on its vision with a singular focus to become a leading cross-platform global game company, accelerating efforts to de-lever and invest for sustainable growth.”

It said it was ‘moving quickly on planned divestitures of both the Lottery and Sports Betting businesses’ in order to invest ‘in our largest growth opportunities, both organically and inorganically, in content and digital markets to accelerate growth.’ It added that this was ‘evidenced by the organic investments in content R&D and a new Las Vegas iGaming studio, as well as the targeted acquisitions of Lightning Box and Koukoi Games.’

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