Lottery drawbacks impact IGT through Q2 as FY guidance is tightened


International Game Technology has slightly tightened its full-year revenue outlook as the group reported a slight drop of two per cent to $1.02bn (2021: $1.04bn) during the year’s second quarter.

The firm’s lottery segment dropped 11 per cent through the quarter to close at $648m (2021: $725m), which IGT noted included $70m in prior-year benefits primarily from the closure of gaming halls in Italy.

The company, which finalised the €160m acquisition of iSoftBet post quarter, saw its global gaming division increase 21 per cent year-on-year to $330m (2021: $274m) due to strong US and Canada replacement unit demand, higher average selling prices, and increased installed base yields.

Elsewhere, digital and betting remained stable at $43m (2021: $42m) as igaming growth in the US was partially offset by softness in other markets, as the North America sports betting market gross gaming revenue became impacted by lower hold levels.

Group-wide operating income dropped seven per cent to $228m (2021: $244m), with global lottery dropping 23 per cent to $230m (2021: $300m) due to the aforementioned prior-year benefits.

Global Gaming increased to close at $57m due to higher revenue and profit flow through that was partially offset by increased supply chain costs, with digital and betting “relatively stable” at $8m (2021: $9m).

Adjusted EBITDA dropped seven per cent YoY to close the three months at $409m (2021: $442m), with net debt down nine per cent to $5.72bn (2021: $6.31bn).

“Strong customer and player demand for IGT’s products and solutions drove some of our strongest profit results ever in the second quarter and first half of the year,” said Vince Sadusky, CEO of IGT. 

“Our business profile is supported by significant recurring revenue streams backed by long-term contracts and resilient end markets, providing a solid foundation on which to grow. We are laser focused on executing our strategic objectives and creating compelling value for our stakeholders.”

Tightened full-year revenue guidance has seen IGT lower its high end range by $100m to between $4.1bn-$4.2bn, with the third quarter expected to produce $1bn-$1.1bn.

“Our first half results set us firmly on the path to achieving our 2022 financial targets,” noted Max Chiara, CFO of IGT. 

“Rigour on costs and incremental revenue opportunities allow us to maintain our full-year operating income margin outlook despite unfavourable currency movements and macroeconomic challenges. 

“At the same time, we are returning significant capital to shareholders via dividends and share repurchases.”