IGT CEO exuberant on earnings call

May 14, 2024 3:55 PM
Photo: CDC Gaming Reports
  • David McKee, CDC Gaming Reports
May 14, 2024 3:55 PM
  • David McKee, CDC Gaming Reports
  • United States

“We’re in the best shape we’ve been in in a decade,” proclaimed International Game Technology CEO Vince Sadusky, referring to a first quarter that saw $661 million in overseas lottery revenue and a record amount of operating income.

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“2024 is off to a strong start,” despite weather-related January adversity, Sadusky reported. A four percent increase in Italian lottery receipts was part of the company’s sixth consecutive quarter of growth on the international-lottery front.

Global game sales were up strongly, offsetting same-store declines in North America. New-game launches and increased frequency of play were credited with the lottery outperformance.

Domestically, 500 Times the Money was described as a big lottery hit in Georgia, while Cash Pop expanded into its 13th jurisdiction. Eight Quick Win games came to market, with six more in the works.

In terms of IGT’s traditional slot machine business, Mystery of the Lamp and Prosperity Link were reported as doing boffo business, while IGT’s newest cabinets “remain among the top-performing North American cabinets.”

Another strong performer was Rising Rockets, doing two and a half times the house average in its early going. Digitally, “We continue to see success in our bespoke game program,” including a collaboration with BetMGM.

Of upcoming products, Sadusky said, “We’ve got exciting new titles on the horizon,” including a Whitney Houston-themed game. “The amazing land-based results are also visible in the igaming business.”

“We delivered record operating income when you exclude $18 million in separation and divestiture costs,” interposed CFO Max Chiara. This included the 12th straight quarter of operating-income growth.

Chiara raised revenue guidance for the full year to $4.4 billion, with $30 million in separation and divestiture costs projected. Second-quarter revenues were predicted to be $1.05 billion, with a 22 percent operating-income margin.

The CFO expected the Everi Holdings merger to close late this year or early next. He reported “seven more high-caliber financial institutions” as signing on as underwriters of the transaction.

Sadusky described customer reaction to the merger as completely positive. Customers like providers with deep research-and-development resources, he said. Everi’s cash-access infrastructure was said to be complementary to IGT’s strengths. Also, “The opportunity over time to bring game themes into those [new] markets is something that operators understand,” stated the CEO, describing casinos as “cheerleaders” for the deal.

In Italy, IGT and its joint-venture partners inked memoranda of understanding pursuant to applying for the newest nine-year tender to run the country’s lottery. Annual ticket sales for that lottery total upwards of $8 billion euros.

“We think the partnership has been successful,” remarked Sadusky. It has the advantage, he explained, of bringing in people with lottery success in different areas. “The stability we’ve had for many years is beneficial.”

Chiara cautioned that a concession renewal wasn’t in the bag. “The process of the amount of term and the rate is the first step. All in all, we expect the time is 12 to 18 months in this process.”

On the domestic side, he said that a “very slow” January was followed by a sharp pickup in February lottery sales, “aligned with trends in that quarter.” In 2023, new-game launches created stronger initial momentum, but Chiara expects to pick up the pace as 2024 goes on.

What about effects in the United Kingdom from the government’s White Paper? “No. Nothing. We can’t think of anything that has impacted our projections,” replied Sadusky.