Scientific Games Corporation (SG) has revealed its Q4 and full-year financials for the period ended December 31, 2020, reporting a 20% fall in 2020 revenue due to the impact of COVID-19.
The company declared an FY20 consolidated revenue of $2.7bn compared to $3.4bn in FY19 as its gaming business was affected by COVID-19 disruptions, partially offset by 25% SciPlay revenue growth driven by improved player monetization, as well as digital and lottery growth.
Meanwhile, SG’s Q4 consolidated revenues came in at $762m compared to $863m in the prior year.
Barry Cottle, CEO and President, said: “While 2020 certainly had unforeseen challenges, I couldn’t be more proud of our team for successfully navigating through them. The strong execution coupled with the diversity of our business enabled positive cash flow.
“As we start off the year, I am truly excited about the team, products, and game franchises that should enable share gains, deal wins, and opportunities to enter new genres. The executive team and our board are working purposefully to transform our company, capitalize on the evolving industry trends and deliver outsized returns to our shareholders.”
The company’s FY20 net loss was $548m as compared to FY19’s $118m, primarily due to lower revenue coupled with higher restructuring and goodwill impairment charges, partially offset by lower D&A and interest expense, reflecting the favourable impact of 2019 refinancing activities.
SG’s Q4 net loss was $84m compared to a net loss of $37m in 2019 due to lower revenue partially offset by lower interest expense reflecting the favourable impact of last year’s refinancing activities.
The company’s consolidated adjusted EBITDA (AEBITDA) in FY20 was $800m compared to $1,334m in the prior year as a result of COVID-19 disruptions, partially offset by strong SciPlay and digital growth of 55% and 40%, respectively.
Meanwhile, its Q4 consolidated AEBITDA was $244m which improved sequentially, principally driven by gaming improvements. The results compared to $328m in 2019, with the decline due to lower gaming revenue as a result of COVID-19. The results were also impacted by a $15m gaming segment charge related to receivables credit allowances.
SciPlay revenue in Q4 increased by 30% and AEBITDA increased by 41% from 2019’s Q4 thanks to improved payer conversion, which outpaced industry growth. Digital revenue increased by 1% to $73m.
The company’s gaming revenue for all its business lines increased sequentially from the prior quarter, while its gaming operations handle for its active fleet was up as well.
Lottery systems revenue was $18m higher primarily due to stronger international product sales, and instant products revenue was $5m higher than the prior year.
CFO Michael Eklund added: “We continued to execute, having driven cash flow improvements in the fourth quarter despite a number of COVID-19 related restrictions to our land-based business. The focus remains on disciplined cost and balance sheet management.
“I’m confident in the opportunities for operational and business process improvements that will drive increased cash flow conversion and deleveraging, leading to increased stakeholder value.”