Scientific Games announces $111m loss for Q3 2020
Las Vegas-based supplier records losses across revenue and EBITDA as strategic review is set in motion
Scientific Games has recorded a Q3 net loss of $111m (£84.8m) as the financial strain of Covid-19 continues to apply pressure on the supplier.
The nine-figure loss stands in stark comparison to the group’s $18m net income in Q3 2019, with falling revenue, debt repayments and the pandemic all cited as key reasons for the fall.
The Las Vegas-based supplier noted an 18.4% year-on-year (YoY) decrease in revenue for Q3 2020 at $698m, down from $855m in Q3 2019, with gaming revenue plummeting by nearly 50%.
Gaming revenue reached $231m in Q3 2020 compared to $454m in Q3 2019.
Conversely, the group’s lottery, SciPlay and digital arms all increased YoY, with lottery taking the lion’s share of the total revenue.
Lottery increased 10% to $241m for Q3 2020, while SciPlay leapt 30% to $151m and digital rose by 15% to $75m.
Scientific Games also recorded a 31.7% decrease in EBITDA, down from $344m in Q3 2019 to $235m in Q3 2020.
However, despite the falling revenue and EBITDA, Scientific Games did secure a 21.6% YoY increase in its free cashflow for Q3 to $62m.
The supplier noted in its results that following the successful sale of Ronald Perelman’s 34.9% stake in the company, it would look forward towards new strategic options.
A statement read: “The reconstituted board will review all strategic options to improve and maximise shareholder value with an objective to de-lever the balance sheet.
“This broader review of strategy will be supported by operational improvements along with renewed focus on working capital management. This was demonstrated by the solid financial results, improvements in working capital activities, and strong free cashflow this quarter,” the statement continued.
Barry Cottle, Scientific Games CEO, said: “As a result of our team’s focus on our strategy, our diverse portfolio and our commitment to cost management, we delivered strong cashflow in the third quarter.
“I really am excited around all the great games, products and solutions we have to help our partners navigate the current environment and provide innovative solutions for the future. I’d also like to welcome the proven industry leaders to our board who will augment our focus on de-levering our balance sheet and will help the company prudently and thoughtfully shape our corporate strategy,” he added.
Elsewhere, Hamish McLennan has joined the supplier as a new independent member of its board of directors.
McLennan is the current chair of several Australian Securities Exchange-listed companies, including global digital advertising firm REA Group and HT&E. He also serves as the chair for the governing body of rugby union in Australia.