International Gaming Technology (IGT) has published its financial results for Q3 of FY2021, revealing total consolidated revenue growth of 21% as a result of ‘broad-based’ momentum across its business operations.
Total revenue for the period ending September 30 was $984m, a 21% increase year-on-year. This was partly driven by the strong performance of the firm’s global lottery business, which reported revenue of $652m, a 14% improvement from the $570m reported this time last year.
IGT stated that its lottery revenue was driven by sustained momentum with a 9% global same-store sales growth.
Lottery operations also contributed to the firm’s operating income which totalled $212m, a 144% increase year-on-year. Lottery operating income increased by 19% up to $234m, whilst IGT’s global gaming operating income was $31m which was a $56m loss in Q3 of FY2020.
Growth in the lottery operation’s profit was attributed to both ‘high-profit flow-through of Global Lottery same-store sales growth’ and ‘large profit margin Italian lottery sales’.
Finally, IGT’s lottery adjusted EBITDA improved 12% year-on-year to $347m, contributing to the 42% total adjusted EBITDA growth up to $407m. The adjusted EBITDA margin ranks as one of the highest in the firm’s history.
“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, signalling their confidence in the Company’s prospects.”
IGT made two significant partnerships throughout Q3 which helps aid its long-term lottery growth.
Firstly, following a competitive procurement process, it was awarded a 10-year lottery contract with the Connecticut Lottery Corporation to provide facility management services including a new central system.
In addition, it was announced that the firm signed a 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.
From a holistic financial perspective, IGT drove its net debt down to $6.1bn from $7.3bn on December 31, 2020. This was driven by strong cash flow generation and proceeds from the sale of its Italy gaming businesses, including a €100m installment received during Q3.
Max Chiara, CFO of IGT, added: “We are supporting strong top-line growth with strategic investments in the business while still making good progress on optimizing our cost structure.
“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.”