Accel Entertainment posts increases in net income and revenue for fourth quarter and full-year 2022

Accel Entertainment posts increases in net income and revenue for fourth quarter and full-year 2022

  • Matthew Crowley, CDC Gaming Reports
March 1, 2023 8:38 PM
  • Matthew Crowley, CDC Gaming Reports
  • Illinois
  • Montana
  • Nevada

The June acquisition of Century Gaming rippled throughout Accel Entertainment’s year-end 2022 earnings report Tuesday. The video-gaming-terminal provider finished with year-over-year increases in locations and gaming terminals, while posting record full-year revenue, net income, and adjusted cash flow.

The fourth quarter also yielded positives, with higher net income, cash flow, and revenue.

In a statement, the Burr Ridge, Illinois-based Accel, which operates in Illinois, Montana, and Nevada, reported net income of $13.4 million for the three months ended Dec. 31, up from $6.8 million a year earlier. The company didn’t disclose quarterly earnings per share.

Adjusted earnings before interest, taxes, depreciation, and amortization, a cash-flow measure that excludes one-time costs, rose 30.4% to $43.3 million from $33.2 million.

Fourth-quarter revenue rose 44.6% to $278.1 million from $192.3 million.

Adding Century Gaming pulled 8,300 gaming terminals and more than 900 licensed locations across Montana and Nevada into Accel’s portfolio. And a December deal for Montana gaming operator DEP Inc. added 26 Montana gaming locations and approximately 300 more gaming terminals to Century’s portfolio to be integrated into Accel. (The DEP acquisition’s price wasn’t disclosed.)

“The integration of Century is well under way,” Accel Entertainment CEO Andy Rubenstein said in the statement. “Our asset-light and hyperlocal business model remains compelling and continues to give us a unique competitive advantage in the industry.”

Accel bought back $17 million of Class A-1 common stock in the fourth quarter and $79 million for full-year 2022. The company finished 2022 with 359 locations and 23,150 terminals.

For the full year, Accel had net income of $74.1 million, or 81 cents per diluted share, up from $31.6 million, or 33 cents per diluted share, a year earlier. The 2022 earnings per share missed the 83-cents-per-share consensus forecast of analysts surveyed by Seeking Alpha.

Twelve-month revenue rose 32% to $969.8 million from $734.7 million and topped the $697.2 million forecast of Seeking Alpha-polled analysts.

Julius Juenemann, associate editor of the Forbes Investor, wrote bullishly Thursday about Accel, saying that the momentum that powered its strong 2022 finish has continued into the new year.

“In my view,” Juenemann wrote, “this reflects the strength and resilience of ACEL’s locally focused business model that is expected to further benefit from the continued investments that bars, restaurants, convenience stores, truck stops, and other authorized non-casino establishments are making to improve their gaming offerings.”

ACEL’s push to expand beyond Illinois will buoy the company, Juenemann wrote. “I think its operating performance in 2023 will be strong enough for the stock to maintain the nice momentum it’s recently enjoyed in the periods ahead.”

Accel Entertainment shares rose 23 cents, 2.51%, to close at $9.38 on the Nasdaq Stock Market. The shares slid after hours, dropping 1 cent, or 0.11%, to settle at $9.38.

Follow Matthew Crowley on Twitter @copyjockey.