International Game Technology (IGT) ended Q2 2023 in a strong financial position despite a minor slowdown in revenue for its Global Lottery division, according to the firm’s latest trading update.
The iLottery, igaming and sportsbook solutions supplier updated its NYSE investors today that group-wide revenue during the second quarter of the year had increased 3% to $1.06bn (Q2 2022: $1.02bn).
This was accompanied by an 8% increase in adjusted EBITDA to $443m ($409m), with a margin of 42% (40%), with net income up 10% to $251m ($228m). The company closed the quarter with slightly reduced net debt, down 6% from $5.7m to $5.3m.
Vince Sadusky, IGT CEO, said: “Our second-quarter and first-half results reflect solid revenue and profit momentum across all business segments.
“We achieved the high end of our outlook by executing key strategic initiatives and growing demand for IGT’s compelling content and solutions. We are solidly on track to deliver on our 2025 objectives and remain focused on unlocking the intrinsic value of IGT’s market-leading businesses.”
The overall strong performance in Q2 has prompted IGT to raise its guidance for the remainder of the year, projecting Q3 revenue of around $1bn and an operating income margin of between 22-23%.
For the full year, the firm expects revenue of between $4.2bn-$4.3bn, an operating income margin of 23%, cash from operations of between $900m-$1bn and capital expenditures of $400m-$450m.
Cementing some long-term business relationships in the quarter, IGT notably secured a 20-year licence to promote lottery games for the Minas Gerais State Lottery in Brazil, as part of a consortium with Saga Games BGI and Scientific Games.
The London-based firm also signed a 10-year contract with the Maltese National Lottery, an eight-year deal with the Connecticut Lottery Corporation (CLC), a contract extension in Costa Rica and an eight-year transition agreement in Belgium.
Financially, however, some hurdles have remained for its Global Lottery division. The unit’s total revenue was down 4% year-on-year to $624m ($648m), although a bulwark was provided by the sale of its Italian commercial services business in September of last year.
Operating income for the division, meanwhile, stood at £229m – which the firm stated is ‘in line with the prior year’. The figure for the end of Q2 was slightly lower than the year prior, dippling from $230m to $229m.
The real standout performers for IGT this quarter were its Global Gaming division and PlayDigital division. The former saw revenue rise 13% to $373m ($330m) with operating income up 25% to $71m ($57m).
Meanwhile, PlayDigital revenue grew 38% to $59m ($43m) and operating income increased 125% to $18m ($8m). IGT attributed this strong performance to ‘strong player demand trends’ as well as the contribution of iSoftBet, acquired in July last year.
“Our year-to-date performance showcases the strong cash generation of the business,” concluded Max Chiara, IGT CFO.
“We have a solid foundation to build from as we continue to invest in our growth objectives, further reduce debt, and return capital to shareholders. Based on our first-half results, we are confidently raising our full-year 2023 revenue and operating margin outlook.”
