GGRAsia – L&W Posts Q1 Profit as Gaming Operations Revenue Surpasses 2019 Levels
L&W posts first quarter profit as gaming operations revenue tops 2019 levels
Online casino and gaming equipment provider Light & Wonder Inc – formerly known as Scientific Games Corp – reported net profit attributable to its shareholders of $26 million in the first quarter, compared with a net loss of $15 million the previous year. period. The improvement is the “result of higher operating profit driven by double-digit revenue growth,” the company said in a press release Tuesday.
Accounting only for the group’s continuing operations, Light & Wonder reported a net loss of $67 million in the first three months of this year, compared with a loss of $88 million a year earlier.
Consolidated first-quarter revenue was $572 million, up 26.3% year-over-year. “Our gaming business demonstrated continued strong momentum in the North American market, including year-over-year growth across all lines of business, with total gaming operations revenue exceeding 2019″, before the start of the Covid-19 pandemic.
“Revenues also benefited from sequential and year-over-year growth in our SciPlay and iGaming businesses,” the games provider said.
The group’s consolidated quarterly adjusted profit before interest, tax, depreciation and amortization (EBITDA) from continuing operations rose 42.3% year-on-year to $202 million.
Light & Wonder completed in april its rebranding exercise, as “the culmination of a year-long strategic process” of restructuring.
The game provider also completed last month the sale of its lottery business to Brookfield Business Partners LP and its institutional partners. The sale of its lottery business generated gross cash proceeds of US$5.6 billion.
Light & Wonder said it “significantly deleveraged and transformed” its balance sheet in April, following a debt repayment and refinancing operationswhich reduced the face value of principal of outstanding debt to US$4.0 billion from US$8.9 billion as of March 31.
Light & Wonder is also sell your sports betting business: the agreement must be concluded in the third quarter of this year. The company is to secure $1 billion in cash and $200 million in stock from acquiring U.S.-listed Endeavor Group Holdings Inc, a sports and entertainment company.
Increase in sales, acquisition
Tuesday’s release quotes Barry Cottle, President and CEO of Scientific Games, as saying, “We kicked off 2022 with a number of significant achievements and strong momentum across our business.”
“The sale of our lottery business was another important step as we deleverage and maximize cash, which transformed our balance sheet by reducing our net debt leverage ratio from a high of 10.5 times a year ago. is just over 15 months old at an adjusted net leverage ratio of 3.7x,” he added.
First-quarter gaming revenue grew 45.5% year-over-year to $355 million. Light & Wonder said this growth was “primarily driven by the continued market recovery reflecting strong growth in gaming operations, which exceeded 2019 levels driven by record premium installed base units in North America, revenue average daily per unit continued to be high, coupled with growth in sales of games, systems and tabletop games businesses.
Gaming operations revenue grew 37.2% year-on-year to $155 million. Gaming machine sales hit $103 million in the first three months of 2022, up 87.3% from a year ago.
The company said it sold 5,296 units of gaming machines in the three months to March 31, up from 2,599 a year earlier. These shipments included 1,914 units sold in the international market, including Asia-Pacific, compared to 656 machines in the prior year quarter.
SciPlay’s revenue rose 4.6% year-on-year to $158 million in the first three months of 2022, “the second highest quarter in its history,” the company said.
Connie James, the group’s chief financial officer, said the company was “actively executing” its capital allocation priorities, “including a return on capital of $140 million” via share buyback since early March.
“Going forward, we are accelerating our focus on our operations as we close these transactions, and the next phase of our growth strategy will drive operational excellence across our organization, creating growth long-term sustainable and profitable,” she added.
On Tuesday, Light & Wonder announced that it had acquired Playzido Ltd, a UK-based dynamic content creation and gaming platform provider, which will “power” the group’s iGaming content offering. The company said the acquisition would accelerate the partnership strategy that had already been instrumental in creating content for studios like Lightning Box, which was also recently acquired by Light & Wonder.