Scientific Games has divulged its Q4 and full-year financial results for the period ended 31 December, 2021, reporting a 27% revenue increase.
The company, which has just announced its intention to rebrand as ‘Light & Wonder’, produced a significant upturn on its 2020 performance which yielded $1.7bn in consolidated revenues, a figure that was heavily attributed to the impact of COVID-19.
In FY21, however, Scientific Games achieved $2.1bn in consolidated revenues while also agreeing the sale of its lottery business to Brookfield Business Partners for a fee that could rise above $6m. The deal is expected to be completed by March 2022.
Barry Cottle, President and Chief Executive Officer of Scientific Games, commented: “We expect to dedicate more than 90% of the lottery proceeds to pay down debt, which combined with the expected sports betting proceeds will put us within our target range.
“Second, the board has authorised a three-year, $750m share repurchase programme. We see buy-backs at current share price levels as highly accretive to shareholder value. And, third, we will always prefer using our capital for buy-backs, debt reduction and organic investments unless we are convinced that M&A will deliver greater long-term shareholder value than other uses of our capital.”
There was a marked improvement in continuing operations with a net profit of $24m in FY21 compared to an $801m net loss in the prior corresponding year. Scientific Games attributed it to the significant impact of COVID-19 in FY20 and an income tax benefit, partially offset by restructuring.
SciPlay enjoyed record revenue ($154m) in Q4 as it increased 5% from the prior year quarter, its second highest quarterly revenue ever. In addition, igaming revenue increased 15% in Q4.
Scientific Games also cited that net cash provided by operating activities was $226m compared to $159m in the prior year period. AEBITDA also increased 175%, from $240m in FY20 to $659m in FY21.
Jamie Odell, Executive Chair of Scientific Games, added: “From the outset we recognised the enormous opportunity to drive increased shareholder value through restructuring the balance sheet, redefining the portfolio and becoming a sustainable growth company.
“We are already seeing the early stages of the strategy successfully executed and with the announced divestitures, the company will immediately shift from a debt to an equity story and achieve gearing significantly below the levels we underwrote in our investment thesis. We couldn’t be happier with the way the entire team have executed on the transformation strategy, and our initial expectations are already being exceeded.”