UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to ______ Commission File Number 001-38136 Accel Entertainment, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 98-1350261 (State or Other Jurisd ...

Accel Entertainment Announces 2023 Operating Results Chicago, IL – February 28, 2024 – Accel Entertainment, Inc. (NYSE: ACEL) today announced certain financial and operating results for the three-months and year ended December 31, 2023. Highlights: • Ended 2023 with 3,961 locations; an increase of 6% compared to 2022; excluding Nebraska, locations increased 3% compared to 2022 • Ended 2023 with 25,083 gaming terminals, an increase of 7% compared to 2022; excluding Nebraska, gaming terminals increased 5% com ...

Accel Entertainment, Inc. (NYSE:ACEL) Q3 2023 Earnings Conference Call November 7, 2023 5:30 PM ET Company Participants Derek Harmer - General Counsel, Chief Compliance Officer & Secretary Andrew Rubenstein - Co-Founder, President, CEO & Director Mathew Ellis - CFO Conference Call Participants Steven Pizzella - Deutsche Bank Samir Ghafir - Macquarie Research Gregory Gibas - Northland Capital Markets Operator Good afternoon, and thank you for attending today's Accel Entertainment third quarter earnings call. ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2023, covering operations, balance sheets, and cash flows [Condensed Consolidated Statements of Operations and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) For Q3 2023, total net revenues grew 7.7% to **$287.5 million**, but net income declined 53.4% to **$10.5 million**, primarily due to a loss on contingent earnout shares and higher interest expenses Consolidated Statements of Operations Highlights (in thousands, except per share amounts) | Metric | Q3 2023 | Q3 2022 | YoY Change | Nine Months 2023 | Nine Months 2022 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Net Revenues** | $287,497 | $266,967 | 7.7% | $873,352 | $691,727 | 26.3% | | **Operating Income** | $25,120 | $23,239 | 8.1% | $81,956 | $71,761 | 14.2% | | **Net Income** | $10,450 | $22,444 | (53.4%) | $29,615 | $60,696 | (51.2%) | | **Diluted EPS** | $0.12 | $0.25 | (52.0%) | $0.34 | $0.66 | (48.5%) | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of September 30, 2023, total assets increased slightly to **$871.4 million**, while total liabilities decreased to **$672.6 million**, and stockholders' equity grew to **$198.8 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2023 (Unaudited) | Dec 31, 2022 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $230,388 | $224,113 | | **Total current assets** | $282,650 | $299,212 | | **Total assets** | $871,408 | $862,769 | | **Total current liabilities** | $92,217 | $89,905 | | **Total debt, net of current maturities** | $484,004 | $518,566 | | **Total liabilities** | $672,634 | $684,179 | | **Total stockholders' equity** | $198,774 | $178,590 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2023, net cash from operations increased to **$92.0 million**, while investing activities used less cash, and financing activities reversed to a net use Consolidated Statements of Cash Flows Summary (in thousands) | Cash Flow Activity | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $92,007 | $78,250 | | **Net cash used in investing activities** | $(35,404) | $(168,871) | | **Net cash (used in) provided by financing activities** | $(50,328) | $103,898 | | **Net increase in cash and cash equivalents** | $6,275 | $13,277 | [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed information on business operations, accounting policies, acquisitions, debt, and legal contingencies, including revenue disaggregation and share repurchase program details - The company's business primarily consists of installing, maintaining, and operating gaming terminals and ATMs in non-casino locations like restaurants, bars, and convenience stores across several states including Illinois, Montana, and Nevada[19](index=19&type=chunk) Net Revenues by State (in thousands) | State | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Illinois** | $212,113 | $200,914 | $647,903 | $601,735 | | **Montana** | $39,362 | $33,456 | $115,088 | $44,282 | | **Nevada** | $28,003 | $28,439 | $87,833 | $37,359 | | **Other** | $8,019 | $4,158 | $22,528 | $8,351 | - In May 2023, the company settled its dispute with Gold Rush Amusements, receiving **$32.5 million**, which resolved all outstanding obligations under the convertible notes[33](index=33&type=chunk) - The company's Board of Directors approved a **$200 million** share repurchase program, under which **10,010,374 shares** totaling **$103.6 million** were acquired as of September 30, 2023[103](index=103&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=28&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the company's financial results, highlighting a 26.3% year-over-year revenue increase for the first nine months of 2023, despite a significant decline in net income due to non-cash charges and higher interest expenses [Results of Operations](index=31&type=section&id=Results%20of%20Operations) For Q3 2023, revenues increased 7.7% to **$287.5 million**, but net income fell 53.4% to **$10.5 million**, primarily due to a loss on contingent earnout shares and increased net interest expense Q3 2023 vs Q3 2022 Performance (in thousands) | Metric | Q3 2023 | Q3 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | $287,497 | $266,967 | $20,530 | 7.7% | | **Operating income** | $25,120 | $23,239 | $1,881 | 8.1% | | **Net income** | $10,450 | $22,444 | $(11,994) | (53.4)% | Nine Months 2023 vs 2022 Performance (in thousands) | Metric | Nine Months 2023 | Nine Months 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | $873,352 | $691,727 | $181,625 | 26.3% | | **Operating income** | $81,956 | $71,761 | $10,195 | 14.2% | | **Net income** | $29,615 | $60,696 | $(31,081) | (51.2)% | - The increase in general and administrative expenses for the nine months ended Sep 30, 2023, was driven by higher payroll costs, parts and repair expense, stock-based compensation, and a **$1.1 million** settlement with the Illinois Gaming Board (IGB)[168](index=168&type=chunk) [Key Business Metrics](index=36&type=section&id=Key%20Business%20Metrics) The company's growth is monitored through the number of locations and gaming terminals, which increased by 4.8% and 7.1% respectively year-over-year as of September 30, 2023 Number of Locations by State | State | As of Sep 30, 2023 | As of Sep 30, 2022 | YoY Change (%) | | :--- | :--- | :--- | :--- | | **Illinois** | 2,724 | 2,596 | 4.9% | | **Montana** | 611 | 586 | 4.3% | | **Nevada** | 352 | 335 | 5.1% | | **Total locations** | 3,687 | 3,517 | 4.8% | Number of Gaming Terminals by State | State | As of Sep 30, 2023 | As of Sep 30, 2022 | YoY Change (%) | | :--- | :--- | :--- | :--- | | **Illinois** | 15,020 | 14,033 | 7.0% | | **Montana** | 6,252 | 5,782 | 8.1% | | **Nevada** | 2,744 | 2,614 | 5.0% | | **Total gaming terminals** | 24,016 | 22,429 | 7.1% | [Non-GAAP Financial Measures](index=37&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA, a non-GAAP measure, increased by 7.3% to **$44.1 million** for Q3 2023 and by 14.9% to **$136.9 million** for the nine-month period, reflecting growth in locations and terminals Adjusted EBITDA Reconciliation (in thousands) | Metric | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net Income** | $10,450 | $22,444 | $29,615 | $60,696 | | **Adjusted EBITDA** | $44,138 | $41,125 | $136,869 | $119,083 | [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) The company ended Q3 2023 with **$230.4 million** in cash and cash equivalents, believing existing cash, operating cash flows, and borrowing availability are sufficient for future capital requirements - As of September 30, 2023, the company had **$230.4 million** in cash and cash equivalents[185](index=185&type=chunk) - In June 2023, the company drew **$100 million** on its delayed draw term loan facility, with **$342 million** remaining available under the Credit Agreement as of September 30, 2023[189](index=189&type=chunk) - The company was in compliance with all debt covenants as of September 30, 2023, and expects to remain so for the next 12 months[195](index=195&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate fluctuations on its **$515.5 million** floating-rate debt, which it mitigates using interest rate caplets to hedge cash flow variability - The company is exposed to interest rate risk on its **$515.5 million** of floating-rate debt, where a **1.0%** increase would raise annual interest expense by approximately **$2.2 million**[208](index=208&type=chunk) - To manage interest rate risk, the company uses a 4-year series of interest rate caplets to hedge cash flow variability on the first **$300 million** of its term loan, protecting against the 1-month LIBOR/SOFR rate exceeding **2%**[208](index=208&type=chunk) [Controls and Procedures](index=42&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management concluded that previously identified material weaknesses in internal controls persisted as of September 30, 2023, rendering disclosure controls ineffective, yet the financial statements are fairly presented - The CEO and CFO concluded that material weaknesses identified in the 2022 Form 10-K were still present as of September 30, 2023, rendering disclosure controls and procedures ineffective[210](index=210&type=chunk) - Notwithstanding the material weaknesses, management asserts that the condensed consolidated financial statements in this Form 10-Q are fairly presented in all material respects[211](index=211&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=43&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is involved in various legal matters, including a **$1.1 million** settlement with the Illinois Gaming Board in Q3 2023 and ongoing disputes with competitors over contractual rights - On July 6, 2023, the company entered into a settlement agreement with the IGB for **$1.1 million** to resolve a disciplinary complaint, which was paid in Q3 2023[121](index=121&type=chunk) - The company remains involved in a series of litigated matters with J&J Ventures Gaming, LLC, stemming from claims of tortious interference with contracts dating back to 2012[112](index=112&type=chunk)[114](index=114&type=chunk) [Risk Factors](index=43&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company highlights key business risks, emphasizing that unfavorable economic conditions and instability in the financial services industry could adversely affect revenue and operations - Unfavorable economic conditions, including recession, inflation, and rising interest rates, pose a significant risk by potentially reducing players' disposable income and gaming activity, adversely affecting revenue[217](index=217&type=chunk)[219](index=219&type=chunk) - Instability in the U.S. and global banking systems could lead to less favorable financing terms, tighter credit access, and potential financial distress for location partners, negatively impacting operations[218](index=218&type=chunk)[222](index=222&type=chunk) [Issuer Purchases of Equity Securities](index=44&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%2C%20USE%20OF%20PROCEEDS%2C%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES) Under its **$200 million** share repurchase program, the company bought back **301,199 shares** of Class A-1 common stock in Q3 2023 at an average price of **$11.10** per share, with **$96.4 million** remaining available Share Repurchases in Q3 2023 | Period | Total Shares Purchased | Average Price Paid per Share | Max. Value Remaining for Purchase (in millions) | | :--- | :--- | :--- | :--- | | **July 2023** | — | $— | $99.7 | | **August 2023** | — | $— | $99.7 | | **September 2023** | 301,199 | $11.10 | $96.4 | | **Total Q3** | **301,199** | **$11.10** | | - The share repurchase program, approved in November 2021, authorizes up to **$200 million** in repurchases of Class A-1 common stock[224](index=224&type=chunk)

Second Quarter 2023 Earnings Presentation Important Information Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, contained in this presentation are forward-looking statements, including, but not limited to, any statements regarding our estimates of number of gaming terminals, ...

Accel Entertainment, Inc. (NYSE:ACEL) Q2 2023 Earnings Conference Call August 3, 2023 5:30 PM ET Company Participants Derek Harmer - General Counsel and Chief Compliance Officer Andrew Rubenstein - CEO Mathew Ellis - CFO Conference Call Participants Steve Pizzella - Deutsche Bank Chad Beynon - Macquarie Greg Gibas - Northland Operator Good afternoon. Thank you for attending the Accel Entertainment's Second Quarter 2023 Earnings Call. My name is Matt, and I'll be your moderator for today's call. [Operator In ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) The company's financial statements for the period ended June 30, 2023, show a significant increase in total net revenues to $585.9 million for the six-month period, up 37.9% year-over-year, largely driven by the acquisition of Century Gaming, though net income decreased by 49.9% to $19.2 million for the same period, impacted by higher operating expenses, increased interest expense, and a loss on the change in fair value of contingent earnout shares, while the balance sheet remains stable with total assets at $863.3 million and cash flow from operations increased to $63.8 million for the first six months of 2023 [Condensed Consolidated Statements of Operations and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) For the three months ended June 30, 2023, total net revenues increased 28.4% YoY to $292.6 million, while net income decreased 55.6% to $10.0 million, and for the six-month period, revenues grew 37.9% to $585.9 million, but net income fell 49.9% to $19.2 million, primarily driven by higher operating costs, a significant increase in interest expense, and a loss on the change in fair value of contingent earnout shares, which contrasted with a gain in the prior year Condensed Consolidated Statements of Operations (Unaudited, In thousands) | Financial Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | **$292,647** | **$227,869** | **$585,855** | **$424,760** | | Operating income | $29,164 | $27,315 | $56,836 | $48,522 | | **Net income** | **$9,983** | **$22,464** | **$19,165** | **$38,252** | | Diluted EPS | $0.11 | $0.24 | $0.22 | $0.41 | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2023, the company's balance sheet shows total assets of $863.3 million, a slight increase from $862.8 million at year-end 2022, with cash and cash equivalents increasing to $233.4 million, while total liabilities decreased slightly to $674.5 million, primarily due to a reduction in long-term debt, and total stockholders' equity grew to $188.7 million from $178.6 million at the end of 2022 Condensed Consolidated Balance Sheet Highlights (Unaudited, In thousands) | Account | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $233,434 | $224,113 | | Total current assets | $280,911 | $299,212 | | Property and equipment, net | $235,682 | $211,844 | | Goodwill | $101,554 | $100,707 | | **Total assets** | **$863,294** | **$862,769** | | **Liabilities & Equity** | | | | Total current liabilities | $92,752 | $89,905 | | Debt, net of current maturities | $489,721 | $518,566 | | Total liabilities | $674,546 | $684,179 | | **Total stockholders' equity** | **$188,748** | **$178,590** | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2023, net cash provided by operating activities increased significantly to $63.8 million from $41.2 million in the prior-year period, net cash used in investing activities decreased sharply to $16.2 million from $137.3 million, mainly due to lower acquisition spending compared to the Century acquisition in 2022, and net cash used in financing activities was $38.3 million, a reversal from $117.4 million provided in the prior year, reflecting lower debt proceeds and continued share repurchases Condensed Consolidated Statements of Cash Flows (Unaudited, In thousands) | Cash Flow Activity | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $63,845 | $41,211 | | Net cash used in investing activities | ($16,245) | ($137,267) | | Net cash (used in) provided by financing activities | ($38,279) | $117,438 | | **Net increase in cash and cash equivalents** | **$9,321** | **$21,382** | [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's accounting policies and provide further information on financial statement items, including its business as a distributed gaming operator in seven states, the settlement of the Gold Rush convertible notes for **$32.5 million**, recent business acquisitions including Rendezvous and IGE, a pending acquisition in Louisiana, details of the **$518.2 million** in outstanding debt, and a **$1.1 million** settlement with the Illinois Gaming Board (IGB) - The company operates as a distributed gaming operator in Illinois, Montana, Nevada, Georgia, Nebraska, Iowa, and Pennsylvania[15](index=15&type=chunk) - On May 31, 2023, the company settled its dispute with Gold Rush Amusements, receiving **$32.5 million** and resolving all outstanding obligations under the convertible notes[29](index=29&type=chunk) - In 2023, the company acquired Rendezvous Casino in Montana for **$2.6 million** and certain assets of Illinois Gaming Entertainment for **$1.5 million**, with a pending acquisition of a Louisiana operator also underway[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - On July 6, 2023, the company entered into a settlement agreement with the Illinois Gaming Board (IGB) for **$1.1 million** related to a 2020 disciplinary complaint[115](index=115&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=26&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management attributes the **28.4% revenue growth** for Q2 2023 primarily to the full-quarter impact of the Century Gaming acquisition and organic growth in locations and gaming terminals, despite net income declining due to increased costs, higher interest rates on debt, and non-cash charges related to contingent earnout shares, while the company maintains strong liquidity with **$233.4 million** in cash and **$342 million** available under its credit facility, with key metrics showing a **4.8% increase** in locations and a **7.4% increase** in gaming terminals year-over-year [Results of Operations](index=29&type=section&id=Results%20of%20Operations) For Q2 2023, revenues rose **28.4% YoY** to **$292.6 million**, driven by a **27.1% increase** in net gaming revenue, with operating income growing modestly by **6.8%** to **$29.2 million**, while net income fell **55.6%** to **$10.0 million**, and for the six-month period, revenues increased **37.9%** to **$585.9 million**, with operating income up **17.1%** to **$56.8 million**, while net income decreased **49.9%** to **$19.2 million**, largely fueled by the Century acquisition which expanded operations in Montana and Nevada Q2 2023 vs Q2 2022 Performance (In thousands) | Metric | Q2 2023 | Q2 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total net revenues | $292,647 | $227,869 | $64,778 | 28.4% | | Operating income | $29,164 | $27,315 | $1,849 | 6.8% | | Net income | $9,983 | $22,464 | ($12,481) | (55.6)% | H1 2023 vs H1 2022 Performance (In thousands) | Metric | H1 2023 | H1 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total net revenues | $585,855 | $424,760 | $161,095 | 37.9% | | Operating income | $56,836 | $48,522 | $8,314 | 17.1% | | Net income | $19,165 | $38,252 | ($19,087) | (49.9)% | - The increase in revenues for both the three and six-month periods was primarily driven by higher net gaming revenue attributable to an increase in gaming terminals and locations, largely due to the acquisition of Century[146](index=146&type=chunk)[158](index=158&type=chunk) [Key Business Metrics](index=34&type=section&id=Key%20Business%20Metrics) As of June 30, 2023, the company operated in **3,655 locations**, a **4.8% increase** from the prior year, with the total number of gaming terminals growing by **7.4%** to **23,759**, and growth observed across all primary markets: Illinois, Montana, and Nevada Number of Locations by State | State | As of June 30, 2023 | As of June 30, 2022 | Change (%) | | :--- | :--- | :--- | :--- | | Illinois | 2,690 | 2,572 | 4.6% | | Montana | 610 | 585 | 4.3% | | Nevada | 355 | 332 | 6.9% | | **Total** | **3,655** | **3,489** | **4.8%** | Number of Gaming Terminals by State | State | As of June 30, 2023 | As of June 30, 2022 | Change (%) | | :--- | :--- | :--- | :--- | | Illinois | 14,767 | 13,801 | 7.0% | | Montana | 6,210 | 5,742 | 8.2% | | Nevada | 2,782 | 2,585 | 7.6% | | **Total** | **23,759** | **22,128** | **7.4%** | [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA for Q2 2023 was **$46.6 million**, a **9.1% increase** from **$42.7 million** in Q2 2022, and for the six months ended June 30, 2023, Adjusted EBITDA grew **18.9%** to **$92.7 million**, reflecting the increase in locations and gaming terminals, primarily from the Century acquisition Adjusted EBITDA Reconciliation (In thousands) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net income | $9,983 | $22,464 | $19,165 | $38,252 | | **Adjusted EBITDA** | **$46,612** | **$42,716** | **$92,730** | **$77,958** | [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) The company believes its **$233.4 million** in cash, operating cash flows, and borrowing availability will be sufficient for capital requirements over the next twelve months, with total debt under the Senior Secured Credit Facility at **$521.1 million** as of June 30, 2023, and **$342 million** of availability remaining, and in June 2023, the credit agreement was amended to replace LIBOR with SOFR as the reference interest rate - As of June 30, 2023, the company had **$233.4 million** in cash and cash equivalents[177](index=177&type=chunk) - The company was in compliance with all debt covenants as of June 30, 2023, and had **$342 million** of availability under its Credit Agreement[182](index=182&type=chunk)[189](index=189&type=chunk) - In June 2023, the Credit Agreement was amended to replace the LIBOR interest rate with the Secured Overnight Financing Rate (SOFR)[182](index=182&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk exposure is to interest rate fluctuations on its **$521.1 million** of floating-rate debt, where a **100 basis point (1.0%) increase** in interest rates would increase annual interest expense by approximately **$2.2 million**, a risk partially mitigated by interest rate caplets hedging the first **$300 million** of the term loan - The company is exposed to interest rate risk on its **$521.1 million** of borrowings under its senior secured credit facility[200](index=200&type=chunk) - A **1.0% (100 basis points)** increase in interest rates would increase annual interest expense by approximately **$2.2 million**[200](index=200&type=chunk) - To mitigate risk, the company uses interest rate caplets to hedge the variability of cash flows on the first **$300 million** of its term loan[200](index=200&type=chunk) [Controls and Procedures](index=40&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that as of June 30, 2023, the company's disclosure controls and procedures were not effective, based on the continued presence of material weaknesses previously identified in the 2022 Annual Report on Form 10-K, despite management's belief that the financial statements are fairly presented - The CEO and CFO concluded that disclosure controls and procedures were not effective as of June 30, 2023[202](index=202&type=chunk) - The ineffectiveness is due to material weaknesses previously identified in the Annual Report on Form 10-K for the year ended December 31, 2022, which were still present[202](index=202&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is involved in various legal proceedings in the ordinary course of business, with a notable recent development being the July 6, 2023 settlement with the Illinois Gaming Board (IGB) for **$1.1 million** regarding a 2020 disciplinary complaint, and other ongoing matters include disputes with competitors over contractual rights and challenges to municipal taxes - On July 6, 2023, the company and the IGB entered into a settlement agreement for **$1.1 million** to resolve a disciplinary complaint from December 2020, with the amount paid in Q3 2023[115](index=115&type=chunk) - The company is involved in ongoing litigation with J&J Ventures Gaming, LLC over contractual rights to certain licensed establishments dating back to 2012[106](index=106&type=chunk)[108](index=108&type=chunk) [Risk Factors](index=41&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company highlights updated risks related to unfavorable macroeconomic conditions and instability in the financial services industry, where a recession, inflation, or rising interest rates could reduce players' disposable income and harm business, and instability in the banking sector could make it more difficult for the company to obtain financing on favorable terms - Unfavorable economic conditions, such as recession, inflation, and rising interest rates, could reduce players' disposable income and gaming activity, adversely affecting revenue[210](index=210&type=chunk)[211](index=211&type=chunk) - Adverse developments in the financial services industry, such as bank failures, could lead to market-wide credit and liquidity problems, potentially making it more difficult for Accel to obtain financing on favorable terms[213](index=213&type=chunk)[214](index=214&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) Under its **$200 million** share repurchase program, the company repurchased **887,174 shares** of its Class A-1 common stock during the second quarter of 2023 for a total cost of approximately **$8.1 million**, with approximately **$99.7 million** remaining available for future repurchases as of June 30, 2023 Share Repurchases in Q2 2023 | Period | Total Shares Purchased | Average Price Paid per Share | Approx. Value Remaining in Program (millions) | | :--- | :--- | :--- | :--- | | April 2023 | 481,515 | $8.96 | $103.5 | | May 2023 | 311,442 | $9.26 | $100.6 | | June 2023 | 94,217 | $9.66 | $99.7 | | **Total** | **887,174** | **$9.14** | | - The company has a board-approved share repurchase program for up to **$200 million** of its Class A-1 common stock[215](index=215&type=chunk) [Other Information](index=43&type=section&id=ITEM%205.%20OTHER%20INFORMATION) On May 18, 2023, CEO and President Andrew Rubenstein entered into a pre-arranged Rule 10b5-1 stock sale plan, allowing for the potential sale of up to **750,000 shares** of Class A-1 common stock between August 16, 2023, and April 1, 2024, subject to certain minimum price thresholds - CEO Andrew Rubenstein established a Rule 10b5-1 trading plan for the potential sale of up to **750,000 shares** of Class A-1 common stock[220](index=220&type=chunk) - The sales are scheduled to occur between August 16, 2023, and April 1, 2024, provided the stock price meets specified minimum thresholds[220](index=220&type=chunk)

First Quarter 2023 Earnings Presentation Important Information Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, contained in this presentation are forward-looking statements, including, but not limited to, any statements regarding our estimates of number of gaming terminals, l ...

[Part I: Financial Information](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for Accel Entertainment, Inc. for the quarter ended March 31, 2023, including statements of operations, balance sheets, stockholders' equity, and cash flows, along with detailed notes explaining accounting policies and significant events [Condensed Consolidated Statements of Operations and Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) For the three months ended March 31, 2023, total net revenues increased by 48.9% year-over-year to $293.2 million, primarily driven by the acquisition of Century, while net income decreased by 41.8% to $9.2 million from $15.8 million in the prior-year period, impacted by higher operating costs, increased interest expense, and a $4.6 million loss on the change in fair value of contingent earnout shares, compared to a $3.4 million gain in Q1 2022, with diluted earnings per share falling to $0.11 from $0.17 Q1 2023 vs Q1 2022 Statement of Operations (in thousands, except EPS) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Total Net Revenues** | $293,208 | $196,891 | 48.9% | | **Operating Income** | $27,672 | $21,207 | 30.5% | | **Net Income** | $9,182 | $15,788 | (41.8)% | | **Diluted EPS** | $0.11 | $0.17 | (35.3)% | - The significant decrease in net income was largely driven by a loss on the change in fair value of contingent earnout shares of **$4.6 million** in Q1 2023, compared to a gain of **$3.4 million** in Q1 2022[5](index=5&type=chunk) [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2023, the company's total assets increased slightly to $870.3 million from $862.8 million at year-end 2022, with key assets including $228.5 million in cash and cash equivalents, $225.8 million in net property and equipment, and $101.6 million in goodwill, while total liabilities remained stable at $687.8 million, with total debt (net of current maturities) at $514.1 million, and total stockholders' equity grew to $182.5 million Balance Sheet Summary (in thousands) | Account | March 31, 2023 (Unaudited) | December 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $228,529 | $224,113 | | Total assets | $870,328 | $862,769 | | Total debt, net of current maturities | $514,146 | $518,566 | | Total liabilities | $687,842 | $684,179 | | Total stockholders' equity | $182,486 | $178,590 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the first three months of 2023, net cash provided by operating activities increased significantly to $38.0 million from $22.1 million in the prior-year period, mainly due to favorable working capital changes, while net cash used in investing activities rose to $23.6 million, driven by higher purchases of property and equipment, and net cash used in financing activities decreased to $10.0 million from $19.6 million, primarily due to reduced share repurchases Cash Flow Summary for Three Months Ended March 31 (in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $37,983 | $22,061 | | Net cash used in investing activities | $(23,585) | $(6,387) | | Net cash used in financing activities | $(9,982) | $(19,562) | | **Net increase (decrease) in cash** | **$4,416** | **$(3,888)** | [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the company's business operations, accounting policies, and specifics behind the financial statements, including the impact of the Century Gaming acquisition in June 2022, which expanded operations into Montana and Nevada, and provide details on acquisitions, debt facilities, legal contingencies, and the ongoing $200 million share repurchase program - The company is a leading distributed gaming operator in the U.S., with operations expanded into **Montana** and **Nevada** following the acquisition of Century Gaming, Inc. in June 2022[16](index=16&type=chunk)[17](index=17&type=chunk) Net Revenues by State for Three Months Ended March 31 (in thousands) | State | 2023 | 2022 | | :--- | :--- | :--- | | Illinois | $219,843 | $194,859 | | Montana | $36,451 | $— | | Nevada | $29,961 | $— | | Other | $6,953 | $2,032 | | **Total** | **$293,208** | **$196,891** | - The company is involved in several legal proceedings, including a dispute with Gold Rush over convertible notes, litigation with J&J Ventures Gaming, and a disciplinary complaint from the Illinois Gaming Board (IGB) seeking a **$5 million** fine[96](index=96&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk) - Under its **$200 million** share repurchase program, the company bought back **476,718 shares** for **$4.2 million** during the first quarter of 2023, and as of March 31, 2023, a total of **8.8 million shares** have been repurchased for **$92.2 million** under the plan[89](index=89&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=26&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS%20%28MD%26A%29) Management attributes the 48.9% year-over-year revenue growth in Q1 2023 primarily to the acquisition of Century Gaming, with increased operating expenses driven by Century's integration, higher payroll costs, and increased professional fees, while interest expense rose 97.2% due to higher average debt and interest rates, Adjusted EBITDA increased 30.9% to $46.1 million, and the company maintains a strong liquidity position with $228.5 million in cash and believes it has sufficient capital for the next twelve months - The acquisition of Century Gaming, Inc. on June 1, 2022, for **$164.3 million** is the primary driver of increased revenues and expenses in the first quarter of 2023[120](index=120&type=chunk) Key Business Metrics as of March 31 | Metric | 2023 | 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Total Locations** | 3,628 | 2,565 | 41.4% | | **Total Gaming Terminals** | 23,497 | 13,663 | 72.0% | Non-GAAP Financial Measures for Three Months Ended March 31 (in thousands) | Metric | 2023 | 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Adjusted Net Income** | $21,064 | $17,605 | 19.6% | | **Adjusted EBITDA** | $46,118 | $35,242 | 30.9% | - The company believes its cash on hand of **$228.5 million**, cash flows from operations, and borrowing availability under its credit facility are sufficient to meet capital requirements for the next twelve months[154](index=154&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk exposure is to interest rate fluctuations on its $540.8 million of borrowings under its senior secured credit facility, which it mitigates through interest rate caplets hedging the first $300 million of its term loan if the 1-month LIBOR rate exceeds 2%, where a hypothetical 1% increase in interest rates would increase annual interest expense by approximately $2.4 million on the outstanding floating-rate debt - The company's main market risk is interest rate risk on its **$540.8 million** of floating-rate debt as of March 31, 2023[176](index=176&type=chunk) - To manage interest rate risk, the company uses interest rate caplets to hedge the first **$300 million** of its term loan against the 1-month LIBOR rate rising above **2%**[176](index=176&type=chunk) [Controls and Procedures](index=38&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that as of March 31, 2023, the company's disclosure controls and procedures were **not effective** due to previously identified **material weaknesses** in the Annual Report on Form 10-K for the year ended December 31, 2022, though management believes the condensed consolidated financial statements in this report are fairly presented in all material respects - The CEO and CFO concluded that disclosure controls and procedures were **not effective** as of March 31, 2023, due to previously identified **material weaknesses**[179](index=179&type=chunk) - Notwithstanding the material weaknesses, management asserts that the financial statements included in the Form 10-Q are fairly presented in all material respects[180](index=180&type=chunk) [Part II: Other Information](index=39&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=39&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section incorporates by reference the information on legal matters discussed in Note 16, "Commitments and Contingencies," of the condensed consolidated financial statements, covering key legal issues including disputes with J&J Ventures, Gold Rush, and a disciplinary complaint from the Illinois Gaming Board - Information regarding legal proceedings is detailed in Note 16 of the financial statements[183](index=183&type=chunk) [Risk Factors](index=39&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company states there have been no material changes to the risk factors disclosed in its 2022 Annual Report on Form 10-K, except for newly highlighted risks, including the potential adverse effects of **unfavorable economic conditions** (recession, inflation, rising interest rates) on discretionary spending and location partner viability, and risks related to **adverse developments in the financial services industry**, which could impact access to credit and liquidity - New risk factors have been added concerning **unfavorable economic conditions**, such as recession and inflation, which could reduce players' disposable income and harm the business[186](index=186&type=chunk)[188](index=188&type=chunk) - The company has also identified new risks related to **adverse developments in the financial services industry**, which could impact its financial condition and access to capital[190](index=190&type=chunk)[191](index=191&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section details the company's share repurchase activity under its publicly announced $200 million program, where during the first quarter of 2023, the company repurchased a total of 476,718 shares of its Class A-1 common stock at an average price of $8.82 per share, for a total cost of approximately $4.2 million, and as of March 31, 2023, approximately $107.8 million remained available for future repurchases under the program Share Repurchases in Q1 2023 | Period | Total Shares Purchased | Average Price Paid per Share | Approx. Value Remaining in Program (in millions) | | :--- | :--- | :--- | :--- | | Jan 2023 | 249,821 | $8.69 | $109.8 | | Feb 2023 | 1,600 | $9.02 | $109.8 | | Mar 2023 | 225,297 | $8.97 | $107.8 | | **Total Q1** | **476,718** | **$8.82** | **$107.8** | [Defaults Upon Senior Securities](index=41&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) The company reported no defaults upon senior securities during the period - None [Mine Safety Disclosures](index=41&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company's business - Not applicable [Exhibits](index=42&type=section&id=ITEM%206.%20EXHIBITS) This section lists the exhibits filed with the Form 10-Q, including forms of Restricted Stock Unit Award Agreements, officer certifications as required by the Sarbanes-Oxley Act, and XBRL data files - Exhibits filed include forms of employee stock award agreements and required CEO/CFO certifications[198](index=198&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to ______ Commission File Number 001-38136 Accel Entertainment, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 98-1350261 (State or Other Jurisd ...