IGT Reports a 2% Drop in Q1 Revenue

International Game Technology PLC, also known as IGT, has revealed official results from the first quarter of 2019.

This multinational gambling company that produces slot machines and other gambling technology…

…has reported a 5% year-on-year decline in group revenue which is probably a result of lower revenue coming from gaming operations.

More Details on the Results

IGT’s total revenue for the first three months declined to $1.14 billion, while $991 million was generated by the service revenue.

This represents a 5% decline from the first quarter of 2018 while product sales dropped 4% year-on-year to $153.9 million.

The majority of the revenue came from IGT’s Italy business unit, which generated $437 million of the total revenue amount, but it was down 10% year-on-year.

Scratch & Win sales decreased marginally as a result of one fewer day of sales than in the prior year…

…although this was offset by an “exceptional” performance from IGT’s Multiplier games in the period.

Italian gaming service revenue fell 20% to $153 million, which the company blames partially on increased taxes.

More Drops in other Units

The revenue coming from IGT’s second-largest unit, North American Lottery, stayed the same at $296 million. Lottery service revenue remained at $241 million, offset by a 13% decline in lottery product sales.

On the other hand, this division benefited from an 8% increase in gaming revenue to $41 million.

The North America Gaming & Interactive division saw a 2% revenue fall to $239 million.

Finally, the International segment saw a 7% drop in year-on-year revenue to $172 million. This division of the company was hit by a $10 million fall in gaming revenue…

…which dropped to $81 million.

Currently, a total number of IGT’s gaming machines dropped 3% to 60,444 machines. During the first quarter of this year, 7,001 machines were shipped worldwide, which shows a 20% year-on-year rise.

A Word from IGT CEO

“Our first-quarter results confirm the consistent growth profile of our global lottery business and the progress we’ve made in sales of gaming machines, where global unit shipments increased 20%,” IGT chief executive, Marco Sala, said.

“The results of our Italy operations are also noteworthy, with further growth in lottery and resilient machine gaming performance.

“As we look to the future, our focus remains on improving revenue and profits from gaming activities, innovating with new lottery games and technologies, and pursuing emerging growth opportunities.”

More Information on the Costs

Total costs for Q1 declined 4% to $966.8 million because this London-based company reduced costs of services and product sales-related expenses.

Selling, general and istrative expenses dropped 6% to $205.1 million, while research and development costs fell to $66.1 million.

This left an operating profit of $178.2 million, which is a 10% year-on-year decline. However, a foreign exchange gain of $58.6m saw IGT’s non-operational expenses decline from $201m in Q1 2018 to $45m.

This ultimately resulted in the supplier posting a net profit of $40.3m for the quarter, a significant improvement on the prior year loss of $103.1m.

Source:

“IGT reports 2% decline in Q1 revenue”, igamingbusiness.com, May 20, 2019.