Upcoming AWS Coverage on Scientific Games Post-Earnings Results

LONDON, UK / ACCESSWIRE / December 1, 2016 / Active Wall St. announces its post-earnings coverage on International Game Technology PLC (NYSE: IGT) ("IGT"). The company released its third quarter fiscal 2016 (Q3 FY16) earnings on November 21, 2016. The London, U.K.-based Company's total revenue grew 5% y-o-y, whereas operating income surged 26% y-o-y. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of International Game Technology's competitors within the Gaming Activities space, Scientific Games Corp. (NASDAQ: SGMS), reported on November 03, 2016, results for the third quarter ended September 30, 2016. AWS will be initiating a research report on Scientific Games in the coming days.

Today, AWS is promoting its earnings coverage on IGT; touching on SGMS. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=IGT

http://www.activewallst.com/registration-3/?symbol=SGMS

Earnings Reviewed

During the Q3 FY16, IGT's reported revenues of $1.27 billion compared to $1.20 billion in Q3 FY15. Total revenue for Q3 FY16 came in above market expectations of $1.24 billion. Furthermore, on a constant currency, IGT's revenues grew 6% y-o-y. Revenue growth, during the quarter, primarily reflects the company's strong performance in the North America Lottery and Italy segments.

The multinational gaming company reported net loss attributed to IGT PLC of $1.90 million, or $0.01 loss per diluted share, in Q3 FY16, compared to net income attributed to IGT PLC of $7.13 million, or $0.04 per share, in Q3 FY15. The company's adjusted net income for Q3 FY16 came in at $0.45 per diluted share compared to $0.42 per diluted share in the year ago comparable quarter. The company's adjusted net income also beat market consensus estimates of $0.44 per diluted share.

Operating Metrics

In Q3 FY16, the company's operating income came in at $163.83 million compared to $130.04 million in Q3 FY15. Adjusted operating income also grew 9% during Q3 FY16 to $285.91 million from $261.45 million in the year ago comparable quarter, primarily on the back of higher lottery profits and partially offset by the timing of bad debt expense, investment in the installed base, increased global product marketing costs, and research & development spending. The company's adjusted EBITDA stood at $429.86 million in Q3 FY16, up 4% from $413.80 million reported in the prior year's same quarter, representing the fourth consecutive quarter of year-over-year growth.

Segment Wise

During Q3 FY16, North America Gaming & Interactive's revenue came in at $317 million compared to $341 million in Q3 FY15. The segment's gaming services revenue was down to $241 million from $267 million in the prior year's same period primarily due to fewer daily active users. However, product sales increased to $76 million in Q3 FY16 from $73 million in Q3 FY15, primarily attributed to higher replacement unit volume. Additionally, the segment reported operating income of $66 million versus $85 million in the year ago comparable period.

North America Lottery's revenues surged 21.6% y-o-y, during the reported period, to $307 million. The segment's services revenue grew 19% y-o-y to $290 million in Q3 FY16. Product sales also increased to $18 million in Q3 FY16 from $10 million in the previous year's same quarter. Furthermore, the segment's Q3 FY16 operating income surged 70.1% y-o-y to $85 million.

IGT's Q3 FY16 International revenue came in at $215 million compared to $210 million in Q3 FY15. International lottery service's revenue grew 4.8% y-o-y in Q3 FY16 to $71 million. However, International gaming service's revenue fell to $43 million in Q3 FY16 from $50 million in Q3 FY15, primarily due to the exit of certain interactive operations. Furthermore, the segment's operating income came in at $39 million compared to $37 million in the last year's comparable quarter.

The company's revenues from Italy rose 6.5% to $426 million in Q3 FY16. In the reported period, operating income from the Italy segment came in at $147 million, up 12.4% y-o-y.

Balance Sheet

In the first nine months of FY16, cash from operations was $621.00 million compared to $470.99 million in the year ago comparable period. Capital expenditures for the first nine months ended September 30, 2016, were $371.50 million compared to $288.74 million in the prior year's comparable period.
As on September 30, 2016, the company had cash and cash equivalents balance of $340.90 million compared $627.48 million as on December 31, 2015. Additionally, the company had net debt of $7.94 billion at the end of Q3 FY16 with leverage ratio of 4.45 times.

Earnings Outlook

In its outlook for full year FY16, IGT's management expects adjusted EBITDA to be in the range of $1.74 billion to $1.79 billion. The company updated its capital expenditures outlook to not more than $550 million, down from prior expectation range of $550 million to $580 million. Furthermore, the company continues to project net debt at year-end to be in the range of $7.7 billion to $7.9 billion.

Stock Performance

On Wednesday, the stock closed the trading session at $25.78, marginally down 0.77% from its previous closing price of $25.98. A total volume of 1.65 million shares have exchanged hands, which was higher than the 3-month average volume of 1.53 million shares. International Game Technology's stock price rallied 12.92% in the past three months, 37.95% in the last six months, and 70.77% in the previous twelve months. Additionally, the stock has surged 64.34% since the start of the year. The company's shares are trading at a PE ratio of 85.93 and have a dividend yield of 3.10%.

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