Days after SciPlay widened its global footprint, buying a majority stake in Alictus, a Turkey-based game maker, the Las Vegas mobile- and web-platform game maker posted lower fourth-quarter earnings that missed Wall Street forecasts and higher revenue that beat them.
In a Tuesday statement, SciPlay said its net income was $12.2 million, or 9 cents per diluted share, for the three months ended Dec. 31, down from net income of $31 million, or 18 cents per diluted share, a year earlier. The latest result missed the average 23 cents-per-share estimate of analysts surveyed by Seeking Alpha.
SciPlay said a $24.5 million charge related to a settlement agreement for a putative class-action lawsuit in Washington state and higher expenses related to the Scientific Games merger proposal hurt fourth-quarter net earnings.
On July 15, Scientific Games, which rebranded this week as Light & Wonder, proposed to acquire the 19% of SciPlay it didn’t already own. Under the deal, SciPlay would have received 0.25 shares of Light & Wonder common stock for each share of SciPlay Class A common stock.
However, on Dec. 22, SciPlay said a special committee of independent directors ended talks with Light & Wonder after failing to reach a deal. The companies didn’t specify what went awry. (SciPlay was spun off from Light & Wonder in 2019.)
Earnings before interest, taxes, depreciation, and amortization rose 5.3% to $47.4 million compared to $45 million, boosted by higher revenue performance but tempered by higher general and administrative and research and development expenses.
Revenue rose 5% to $154.4 million from $147.1 million and topped the $153.7 million forecast of seeking Alpha-polled analysts.
Mobile revenue grew 7.2% to $137.8 million. Payer conversion rate hit a record 8.9% and average monthly revenue per paying user rose 13.9% to $98.38.
Meanwhile, SciPlay will acquire the remaining 20% of Alictus in equal installments to total $200 million, with valuations based on revenue and profitability targets. In a statement, SciPlay Chief Executive Office Josh Wilson said Alictus’ deep games pipeline will let his company venture further into the $13 billion global mobile in-game advertising market.
“Everything they’ve built is their own proprietary solution. It seriously is amazing,” Wilson said of Alictus during a conference call with analysts and journalists. “They’re able to take data from all networks and create their own first-party data, allowing them to very much tailor the ad that is going to each individual.”
For the full year ended Dec. 31, SciPlay had net income of $125 million, or 77 cents per diluted share, down from net income of $146 million, or 86 cents per diluted share, a year earlier.
Twelve-month revenue rose 4.1% to $606.1 million from $582.2 million.
SciPlay shares rose 20 cents, or 1.57%, Thursday to close at $12.94 on the Nasdaq.
Follow Matthew Crowley on Twitter @copyjockey.
