International Game Technology (NYSE:IGT) reported third-quarter adjusted earnings per share of 2 cents loss, missing the street view of 21 cents earnings.
Quarterly sales of $587 million (down 2%) missed the analyst consensus of $591.5 million.
Sales fell as there was elevated U.S. multi-state jackpot activity in the prior year. This apart, the quarterly revenues was weighed by $38 million restructuring charge associated with proactively optimizing general and administrative, and operating activities following transformational actions over the last several years.
In the quarter under review, the company announced the sale of Gaming & Digital business to funds managed by affiliates of Apollo Global Management, Inc. for $4.05 billion in cash.
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Italy saw a 2.7% increase in same-store sales, and there was improvement in U.S. instant ticket and draw game trends, partially offset by customer allowance. Other service revenue grew due to non-wager-based service contracts in Europe.
Operating income fell 33% year-over-year to $110 million, while operating income margin contracted to 18.7% from 27.1%.
The company reported a gross profit of $263 million, down from $278 million in the prior year. The decline was due to high profit flow-through from U.S. multi-state jackpot activity last year, partially offset by a positive geographic mix this year.
Adjusted EBITDA for the company was $264 million, compared to $279 million in the prior year. The adjusted EBITDA margin decreased to 44.9%, from 46.4% in the previous period.
International Game Technology’s long-term debt, less current portion, as of quarter end pegs at $5.406 billion. As of Sept. 30, the company reported total liquidity of $1.9 billion, including $500 million in unrestricted cash and $1.4 billion in available borrowing capacity from undrawn credit facilities.
Outlook: International Game Technology expects Q4 revenue for continuing operations to range between $640 million and $690 million, above the $632.04 million estimate.
For fiscal year 2024, the company anticipates total revenue of $2.5 billion to $2.55 billion, compared with the $2.506 billion estimate.
Price Action: IGT shares are trading higher by 0.47% to $21.50 premarket at last check Tuesday.
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