LONDON, Nov. 9, 2021 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the third quarter ended September 30, 2021. Today, at 8:00 a.m. EST, management will host a conference call and webcast to present the results; access details are provided below.

"Broad-based momentum across our Lottery, Gaming, and Digital & Betting activities drove significant improvement in key financial and performance metrics in the third quarter," said Marco Sala, CEO of IGT. "Revenue grew over 20% and operating income more than doubled, highlighting the strength of our portfolio. Based on our excellent year-to-date results and our solid financial condition, the Board reinstated a quarterly cash dividend, signaling their confidence in the Company's prospects."

"We are supporting strong top-line growth with strategic investments in the business while still making good progress on optimizing our cost structure," said Max Chiara, CFO of IGT. "Achieving our goal of  reducing net debt leverage below 4.0x was a big accomplishment in the quarter. We look forward to sharing our strategy, long-term growth initiatives, and capital allocation plans during our upcoming investor day on November 16, 2021."

Key Highlights:

• Sustained player demand in Global Lottery propels strong results; profit and related margins remain among the strongest in segment history
• Global Gaming achieves highest quarterly revenue and profit levels in seven quarters as progressive recovery continues
• Digital & Betting rapidly gaining scale with significantly higher revenue and profit driven by new and existing markets
• Strong year-to-date operating cash flow of $613 million and free cash flow of $445 million
• Successfully amended and extended term loan facility, adding an ESG margin adjustment demonstrating IGT's commitment to sustainability
• Awarded 10-year lottery contract with Connecticut Lottery Corporation following a competitive procurement
• Recently signed seven-year contract with La Française des Jeux, operator of the French National Lottery, to upgrade its lottery central system to IGT's advanced Aurora™ platform featuring enhanced, omnichannel capabilities
• Strengthened Digital & Betting leadership with appointment of Joe Asher as President of Sports Betting and Gil Rotem as President of iGaming
• Announced several turnkey sports betting solutions, including full retail and mobile services for Angel Of The Winds Casino Resort, Oneida Casino, and Snoqualmie Casino
• Extended cashless momentum with agreements to deploy Resort Wallet™ and IGTPay™ at Agua Caliente Casino and Indigo Sky properties
• Won several industry awards, including:
• "Technology Provider of the Year" and "Lottery Product of the Year" at 2021 International Gaming Awards
• "Product Innovation of the Year" for Resort Wallet and IGTPay cashless technologies at 2021 Global Gaming Awards Las Vegas
• "Best Consumer-Service Technology" for CrystalFlex sports betting terminal at 2021 GGB Gaming & Technology Awards

Financial highlights:

Consolidated revenue of $984 million, up 21% compared to the prior year

• Global Lottery revenue rises 14% to $652 million, as sustained momentum drives 9% global same-store sales growth
• Global Gaming revenue of $289 million, up from $216 million in the prior year and $274 million sequentially as market recovery progresses
• Digital & Betting revenue increases 37% to $43 million, with double-digit growth across activities

Operating income of $212 million, up 144% from the prior year

• High profit flow-through of Global Lottery same-store sales growth
• Mix of high-margin Italy lottery sales
• Strong operating leverage across businesses
• Disciplined cost management and benefits from OPtiMa structural cost-savings program

Net interest expense of $79 million compared to $101 million in the prior year, driven by lower average debt balances and interest rates

Provision for income taxes of $37 million compared to a benefit from income taxes of $41 million in the prior year, on significant increase in operating profitability

Net income of $101 million versus net loss of $129 million in the prior-year period, driven by higher revenue and operating profit, and a reduction in foreign exchange losses

Adjusted EBITDA of $407 million compared to $287 million in the prior-year period; Adjusted EBITDA margin of 41%, among the highest level in Company history

Net debt of $6.1 billion, down $1.2 billion from $7.3 billion at December 31, 2020; Net debt leverage of 3.8x, down from 6.4x at December 31, 2020, driven by strong cash flow generation and proceeds from sale of Italy gaming businesses, including €100 million installment received during Q3'21

Cash and Liquidity Update

• Total liquidity of $2.2 billion as of September 30, 2021; $435 million in unrestricted cash and $1.8 billion in additional borrowing capacity
• Executed amendment and extension of Term Loan Facility
• Enhancing credit profile, increasing liquidity, and extending debt maturities
• Includes ESG margin adjustment, highlighting commitment to sustainability; achieved higher ESG rating in Q3'21, lowering borrowing costs

Other Developments
The Company's Board of Directors declared a quarterly cash dividend of $0.20 per common share

• Ex-dividend date of November 22, 2021
• Record date of November 23, 2021
• Payment date of December 7, 2021

Investor Day Details
IGT will host a virtual Investor Day on Tuesday, November 16, 2021, at 8:30 a.m. EST

• Senior management will present an in-depth review of the Company's business strategy, long-term growth prospects, and capital allocation plans
• A live webcast is available under "Events Calendar" on IGT's Investor Relations website at www.IGT.com
• Registration for the event is required and can be completed in advance
• A replay will also be available on the website following the call

Raising Full-year 2021 Outlook (Continuing operations)

• Revenue of ~$4.1 billion
• Updating operating income outlook to ~$900 million from ~$800 million
• Depreciation and amortization of ~$700 - $725 million
• Cash from operations of ~$850 - $900 million
• Capital expenditures below $300 million
• Does not factor in any additional impact from COVID-19 restrictions

Earnings Conference Call and Webcast 
November 9, 2021, at 8:00 a.m. EST

To register to participate in the conference call, or to listen to the live audio webcast, please visit the "Events Calendar" on IGT's Investor Relations website at www.IGT.com. A replay will be available on the website following the live event.

Note: Certain totals in the tables included in this press release may not add due to rounding

Comparability of Results
All figures presented in this news release are prepared under U.S. GAAP, unless noted otherwise. Adjusted figures exclude the impact of items such as purchase accounting, impairment charges, restructuring expense, foreign exchange, and certain one-time, primarily transaction-related items. Reconciliations to the most directly comparable U.S. GAAP measures are included in the tables in this news release. Constant currency changes for 2021 are calculated using the same foreign exchange rates as the corresponding 2020 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate the Company's financial performance. Management believes these non-GAAP financial measures reflect the Company's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with U.S. GAAP. Amounts reported in millions are computed based on amounts in thousands. As a result, the sum of the components may not equal the total amount reported in millions due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages and earnings per share amounts presented are calculated from the underlying unrounded amounts.

About IGT
IGT (NYSE:IGT) is a global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivalled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 11,000 employees. For more information, please visit www.IGT.com.

Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the "Company") and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as "aim," "anticipate," "believe," "plan," "could," "would," "should," "shall", "continue," "estimate," "expect," "forecast," "future," "guidance," "intend," "may," "will," "possible," "potential," "predict," "project" or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company's control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the factors and risks described in the Company's annual report on Form 20-F for the financial year ended December 31, 2020 and other documents filed from time to time with the SEC, which are available on the SEC's website at www.sec.gov and on the investor relations section of the Company's website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company's business. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance of International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.

Non-GAAP Financial Measures
Management supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Adjusted EBITDA represents net income (loss) from continuing operations (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), other non-operating expenses, depreciation, impairment losses, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income) and certain other non-recurring items. Adjusted EBITDA – discontinued operations represents income (loss) from discontinued operations (a GAAP measure) before income taxes, interest expense, depreciation and amortization, and gain on sale of discontinued operations. Adjusted EBITDA – combined represents Total Adjusted EBITDA plus Adjusted EBITDA – discontinued operations. Management believes that the non-GAAP measures just mentioned are useful in providing period-to-period comparisons of the results of the Company's ongoing operational performance.

Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash and equivalents. Cash and cash equivalents are subtracted from the GAAP measure because they could be used to reduce the Company's debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet.

Net debt leverage is a non-GAAP financial measure that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months ("LTM") prior to such date. Prior to the disposal of the Italian B2C gaming businesses in the second quarter of 2021, management calculated the Net debt leverage ratio as the ratio of Net debt as of a particular balance sheet date to the LTM of Adjusted EBITDA – combined prior to such date. Management believes that Net debt leverage is a useful measure to assess our financial strength and ability to incur incremental indebtedness when making key investment decisions.

Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing IGT's ability to fund its activities, including debt service and distribution of earnings to shareholders.

Constant currency is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the exchange rates used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates.

A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.

Contact:
Phil O'Shaughnessy, Global Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
Francesco Luti, +39 06 5189 9184; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190