Copyright: rrraum / 123RF Stock Photo

Releasing its results for the three months to March 31, Scientific Games reported solid growth in revenues but a falling quarterly revenue, offset by earnings from NYX Gaming Group, which SG acquired in January.

Revenue was up 12 per cent compared with the same period in 2017, to $811.8m, which included a $49.2m contribution from NYX.

Gaming revenue increased one per cent year on year year, a modest increase SG attributes to a drop in new casino schemes worldwide and a relative increase in machine replacement costs.

Operating income in Q1 was $49.4m, down significantly on the $88m posted in Q1 2017, a fall accounted for by $52.2m in restructuring and other charges, including an additional $18m associated with higher-than-anticipated purchase cost for Spicerack.

There was a $15m cost related to litigation and $13.5m of acquisition and integration costs connected to the NYX acquisition.

Net loss increased to $201.8m from $100.8m in the comparable 2017 period, thanks largely to a $93.2m hit from debt financing transactions associated with SG’s February refinancing and the change in operating income.

“Our first-quarter results reflect our strength as a global diversified gaming technology provider,” said Kevin Sheehan, CEO and president of Scientific Games, who it was also announced would be replaced in the roles by Barry Cottle.

“Our results reflect the significant success our team achieved during the quarter such as the inclusion of NYX and our refinancing, as well as the underlying robust business fundamentals, such as the 30 per cent increase in gaming machine replacement sales.

“With improving momentum across all our businesses, we are excited by the prospects and opportunities to smartly grow our revenue and attributable EBITDA [up 12 per cent to $320.1m] during the remainder of 2018 and beyond.”

Michael Quartieri, chief financial officer, added: “Our continued growth in revenue and AEBITDA, coupled with the lower interest costs resulting from our recent refinancing, establishes a solid platform for increased cash flows. We remain committed to our path of increasing cash flow, de-levering and strengthening our balance sheet.”