Slot machine giant Scientific Games Corp., with an eye on refinancing $1.6 billion of debt, pre-announced its fourth quarter earnings Wednesday in hopes of taking “advantage of favorable market conditions.”
The Las Vegas-based company, which develops gaming equipment and management systems for casinos and the worldwide lottery industry, is looking to reduce costs and extend maturity dates for a portion of its more than $8 billion debt.
In a statement, Scientific Games said it was sharing preliminary financial results with possible lenders in connection with a debt refinancing transaction. Much of the company’s debt was accumulated through its acquisitions of rival slot machine providers Bally Technologies and WMS between 2013 and 2015.
The company said it expected to report revenue of between $820 million to $825 million for the quarter that ended Dec. 31, an increase of 9 percent. For all of 2017, the manufacturer said it expected revenues to increase 7 percent, between $3.081 billion to $3.086 billon.
However, Scientific Games expects to report a net loss of $40 million to $50 million in the quarter and a full-year net loss of $238 million to $248 million.
The quarterly net loss includes a projected $28 million of restructuring and other charges, which primarily covers costs associated with the acquisition of NYX Gaming Group. The transaction was completed on Jan. 5.
“Our preliminary results for the fourth quarter 2017 reflect our focus on generating top-line growth and ongoing improvements across our gaming, lottery and interactive operations,” Scientific Games CEO Kevin Sheehan said in a statement.
The company expects to release full results on Feb. 28.
Analysts said Scientific Game’s pre-announcement shows the company beating Wall Street projections.
“Scientific Games didn’t mention if the beat came in gaming, lottery or interactive, but we expect at least half to come from interactive given the lower-than-expected margin,” Macquarie Securities gaming analyst Chad Beynon told investors.
Shares of Scientific Games, traded on the Nasdaq, closed at $53 on Wednesday, down $1.87, or 3.37 percent. The company released the preliminary quarterly results prior to the stock market opening.
