SciPlay Corp. thrived during the coronavirus shutdown, providing a diversion for homebound game players amid state officials-ordered casino closures. Although casinos have reopened, staggering toward revival, SciPlay’s earnings and revenue continued to improve in the third quarter.
Earnings for the mobile games unit, which was spun off from Scientific Games in May 2019, missed Wall Street forecasts, though revenue exceeded them.
In a statement Wednesday, Las Vegas-based SciPlay said its net income was $35.1 million, or 23 cents per share, for the three months ended Sept. 30, up from net income of $25 million, or 9 cents per diluted share, a year earlier.
Analysts surveyed by Seeking Alpha had, on average, expected 25 cents in earnings per share.
“SciPlay continues to benefit from shelter-in-place orders as well as solid execution of its live ops strategy to drive monetization,” said Macquarie Securities gaming analyst Chad Beynon. “Importantly, baseline trends remain above pre-pandemic levels and we believe SciPlay is well-positioned to capitalize should there be further coronavirus shutdowns.”
Adjusted earnings before interest, taxes, depreciation, and amortization, a cash flow measure that excludes one-time costs, rose 54.1% to $49.3 million from $32 million.
Revenue rose 29.9% to $151.2 million from $116.4 million, topping the $142.3 million average revenue forecast of Seeking Alpha-polled analysts.
“Our baseline remains above pre-COVID-19 levels even as the tailwind from ‘stay at home’ begins to normalize,” SciPlay CEO Josh Wilson said in the statement. “We outperformed the market … driven by execution of our live ops strategy to increase monetization of games and franchises that players love to play.”
Later, during the question-and-answer session of a conference call with analysts and journalists, Wilson said SciPlay said player counts and engagement have risen since the end of the shutdown; they’re playing more days for more hours.
Meanwhile, SciPlay CFO Mike Cody said the company was working toward integrating Come2Play and launching Solitaire Pets Adventure in 2021. SciPlay acquired Come2Play, an Israel-based mobile game developer and manager, for an undisclosed price on June 22.
On Sept. 23, SciPlay named Danny Moy senior vice president and chief strategy officer. Moy, who has nearly 20 years of experience in mergers and acquisitions, business development, strategy, and operations, will oversee SciPlay’s business development team.
Moy had been executive vice president of corporate development and strategy at Playstudios. He’s also worked in banking, private equity, and operational finance at Bank of America Securities, Halyard Capital, and Yahoo.
“(Mergers and acquisition) remains core focus and the company continues to see ample opportunity,” said Truist Securities gaming analyst Matthew Thornton, citing Moy being on board to help lead those efforts.
SciPlay shares rose 60 cents, or 4.41%, to close at $14.09 on the Nasdaq Wednesday. Shares were up roughly 4% Thursday morning. SciPlay’s share price has risen by 13.5% in 2020.
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