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 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 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 Ju ...

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 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 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 J ...

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 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 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 Oth ...

```markdown PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Presents Accel Entertainment, Inc.'s unaudited condensed consolidated financial statements, covering operations, balance sheets, and cash flows [Notes to the Condensed Consolidated Financial Statements (Unaudited)](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) Detailed notes explain business operations, accounting policies, Century Gaming acquisition, debt facilities, and legal contingencies - The company operates as a terminal operator in various US jurisdictions, including Illinois, Georgia, Pennsylvania, Iowa, Montana, and Nevada. A significant event was the acquisition of Century Gaming, Inc. on June 1, 2022, expanding operations into Montana and Nevada and adding manufacturing capabilities[12](index=12&type=chunk) - In Q4 2021, the company changed its accounting estimates, extending the useful lives of gaming terminals (**10 to 13 years**), route/customer acquisition costs (**12.4 to 18 years**), and location contracts (**10 to 15 years**). This change decreased depreciation and amortization expense in 2022[23](index=23&type=chunk)[24](index=24&type=chunk)[29](index=29&type=chunk) - The company is in a legal dispute with Gold Rush Amusements, Inc. after the Illinois Gaming Board (IGB) denied the transfer of Gold Rush common stock to Accel following Accel's exercise of its conversion rights on convertible notes. Both parties have filed lawsuits against each other[42](index=42&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - On June 1, 2022, the company acquired Century Gaming for aggregate consideration of **$164.3 million**, resulting in **$53.3 million** of goodwill. The acquisition added **$21.1 million** in revenue and **$1.0 million** in net income for the month of June 2022[77](index=77&type=chunk)[78](index=78&type=chunk)[83](index=83&type=chunk) - The company is involved in several legal proceedings, including a dispute with J&J Ventures Gaming, lawsuits with Gold Rush, and a disciplinary complaint from the IGB seeking a **$5 million** fine. A loss of **$1.0 million** was recorded for legal liabilities in the first six months of 2022[130](index=130&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk) Condensed Consolidated Statements of Operations (Unaudited) | (In thousands, except per share amounts) | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | $227,869 | $201,974 | $424,760 | $349,043 | | **Operating income** | $27,315 | $24,927 | $48,522 | $34,482 | | **Net income** | $22,464 | $12,445 | $38,252 | $13,946 | | **Diluted EPS** | $0.24 | $0.13 | $0.41 | $0.15 | Condensed Consolidated Balance Sheets (Unaudited) | (In thousands) | June 30, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | **Total current assets** | $288,001 | $247,995 | | **Total assets** | $816,579 | $616,073 | | **Total current liabilities** | $85,997 | $71,835 | | **Total liabilities** | $642,704 | $457,612 | | **Total stockholders' equity** | $173,875 | $158,461 | Condensed Consolidated Statements of Cash Flows (Unaudited) | (In thousands) | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $41,211 | $54,158 | | **Net cash used in investing activities** | ($137,267) | ($13,758) | | **Net cash provided by financing activities** | $117,438 | $3,657 | | **Net increase in cash and cash equivalents** | $21,382 | $44,057 | | **Cash and cash equivalents, end of period** | $220,168 | $178,508 | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=30&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses financial performance, revenue growth from Century acquisition, key business metrics, liquidity, and non-GAAP measures [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Revenues and net income significantly increased for Q2 and six-month periods, driven by the Century acquisition and accounting changes Results of Operations Comparison - Three Months Ended June 30 | (in thousands) | 2022 | 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | $227,869 | $201,974 | $25,895 | 12.8% | | **Operating income** | $27,315 | $24,927 | $2,388 | 9.6% | | **Net income** | $22,464 | $12,445 | $10,019 | 80.5% | Results of Operations Comparison - Six Months Ended June 30 | (in thousands) | 2022 | 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Total net revenues** | $424,760 | $349,043 | $75,717 | 21.7% | | **Operating income** | $48,522 | $34,482 | $14,040 | 40.7% | | **Net income** | $38,252 | $13,946 | $24,306 | 174.3% | - Amortization expense decreased by **42.0%** for the three-month period and **41.9%** for the six-month period, primarily due to extending the useful lives of route/customer acquisition costs and location contracts in Q4 2021[182](index=182&type=chunk)[196](index=196&type=chunk) - A gain on the change in fair value of contingent earnout shares of **$5.7 million** in Q2 2022 (compared to a **$3.2 million** loss in Q2 2021) was primarily due to the change in the market value of the company's Class A-1 common stock[186](index=186&type=chunk) [Key Business Metrics](index=38&type=section&id=Key%20Business%20Metrics) Key metrics include total locations and gaming terminals, significantly increased by the Century acquisition, with some metrics no longer reported Number of Locations by State | State | As of June 30, 2022 | As of June 30, 2021 | | :--- | :--- | :--- | | Illinois | 2,572 | 2,527 | | Montana | 585 | — | | Nevada | 332 | — | | **Total** | **3,489** | **2,527** | Number of Gaming Terminals by State | State | As of June 30, 2022 | As of June 30, 2021 | | :--- | :--- | :--- | | Illinois | 13,801 | 13,177 | | Montana | 5,742 | — | | Nevada | 2,585 | — | | **Total** | **22,128** | **13,177** | - The company no longer reports average remaining contract term and location hold-per-day as key metrics due to significant operational expansion and entry into new markets from the Century acquisition[201](index=201&type=chunk) [Non-GAAP Financial Measures](index=39&type=section&id=Non-GAAP%20Financial%20Measures) Adjusted EBITDA and Adjusted Net Income are key non-GAAP metrics, with Adjusted EBITDA increasing **13.3%** to **$78.0 million** for the six months Adjusted EBITDA Reconciliation | (in thousands) | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Net income** | $22,464 | $12,445 | $38,252 | $13,946 | | **Adjusted EBITDA** | $42,716 | $42,983 | $77,958 | $68,796 | [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$220.2 million** cash, supported by an amended credit facility with **$381 million** available - The company had **$220.2 million** in cash and cash equivalents as of June 30, 2022[213](index=213&type=chunk) - The Credit Agreement was amended to increase the revolving credit facility to **$150.0 million** and add a new **$400.0 million** delayed draw term loan facility, extending the maturity to October 2026[218](index=218&type=chunk)[219](index=219&type=chunk) - As of June 30, 2022, there was approximately **$381 million** of availability under the Credit Agreement[219](index=219&type=chunk) - Net cash from financing activities increased to **$117.4 million** for the six months ended June 30, 2022, up from **$3.7 million** in the prior year, mainly due to borrowings for acquisitions, partially offset by **$36.9 million** in share repurchases[231](index=231&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's primary market risk is interest rate fluctuations on its **$505.9 million** floating-rate debt, hedged by interest rate caplets - The company is exposed to interest rate risk on **$505.9 million** of borrowings under its senior secured credit facility as of June 30, 2022[236](index=236&type=chunk) - To hedge against rising interest rates, the company entered into a 4-year series of interest rate caplets on January 12, 2022, which protect the company if the 1-month LIBOR exceeds **2%** on the first **$300 million** of its term loan[236](index=236&type=chunk) [Controls and Procedures](index=45&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Disclosure controls and procedures were deemed ineffective due to material weaknesses, though financial statements are believed to be fairly presented - The CEO and CFO concluded that disclosure controls and procedures were not effective as of June 30, 2022, due to previously identified material weaknesses[237](index=237&type=chunk) - Notwithstanding the material weaknesses, management believes the condensed consolidated financial statements included in the Form 10-Q are fairly presented in all material respects[238](index=238&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=46&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is involved in several legal proceedings, including disputes with J&J Ventures Gaming and Gold Rush, and an IGB disciplinary complaint - The company is in a dispute with J&J Ventures Gaming, LLC over contractual rights to **10** licensed establishments dating back to 2012. The matter has involved various courts and petitions with the IGB[242](index=242&type=chunk)[243](index=243&type=chunk)[244](index=244&type=chunk) - The company received a disciplinary complaint from the IGB in December 2020 alleging violations of the Video Gaming Act, with the IGB seeking a **$5 million** fine. Both parties filed motions for summary judgment in July 2022[250](index=250&type=chunk) - The company and Gold Rush have filed lawsuits against each other in 2022 related to Accel's convertible notes and the IGB's denial of the stock transfer[251](index=251&type=chunk) [Risk Factors](index=47&type=section&id=ITEM%201A.%20RISK%20FACTORS) Key risks include extensive government regulation, consumer spending reliance, new market expansion, geographic concentration, and Century acquisition integration - The business is subject to extensive and evolving government regulation, and failure to obtain or maintain required licenses in jurisdictions like Illinois, Montana, and Nevada could adversely affect operations and growth[255](index=255&type=chunk)[258](index=258&type=chunk)[259](index=259&type=chunk) - Revenue is dependent on players' disposable income, which can be negatively impacted by unfavorable economic conditions, inflation, public health issues like COVID-19, or other uncertainties[263](index=263&type=chunk)[265](index=265&type=chunk) - The business is geographically concentrated, primarily in Illinois, making it vulnerable to local economic conditions, regulatory changes, and competition. Similar risks exist in its newer markets like Montana and Nevada[269](index=269&type=chunk)[270](index=270&type=chunk) - There are significant risks associated with integrating the Century acquisition, including challenges with systems, personnel, and business cultures, which could divert management attention and lead to unanticipated expenses[271](index=271&type=chunk)[272](index=272&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=53&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) Details share repurchase activity under the **$200 million** program, with **$151.6 million** remaining for future repurchases Issuer Purchase of Equity Securities (Q2 2022) | Period | Total number of shares purchased | Average price paid per share | Maximum approximate dollar value of shares that may yet be purchased under the program (in millions) | | :--- | :--- | :--- | :--- | | April 2022 | 485,194 | $12.19 | $171.2 | | May 2022 | 697,481 | $10.64 | $163.7 | | June 2022 | 1,143,738 | $10.63 | $151.6 | | **Total** | **2,326,413** | | | [Defaults Upon Senior Securities](index=53&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) None reported [Mine Safety Disclosures](index=53&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) Not applicable [Exhibits](index=54&type=section&id=ITEM%206.%20EXHIBITS) Lists exhibits filed with Form 10-Q, including CEO/CFO certifications and XBRL data files ```

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 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 J ...

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, 2021 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 ...