International Game Technology PLC(US:IGT)2024-07-30 20:03Financial Performance - Total revenue for Q2 2024 was $1,049 million, a slight decrease of 0.6% compared to $1,055 million in Q2 2023[14] - Net income attributable to IGT PLC for Q2 2024 was $42 million, down 8.7% from $46 million in Q2 2023[14] - Operating income for the first half of 2024 was $486 million, a decrease of 3.9% compared to $506 million in the same period of 2023[14] - As of June 30, 2024, total comprehensive income was $45 million, compared to $90 million for the same period in 2023, reflecting a decrease of 50%[22] - Net income for the six months ended June 30, 2024, was $42 million, down from $82 million for the same period in 2023, representing a decline of 48%[22] - Total revenue for the three months ended June 30, 2024, decreased by $6 million to $1,049 million, primarily due to lower gaming terminal sales volumes[91] - Total revenue for the six months ended June 30, 2024 was $2,117 million, a slight increase of $1 million or 0% compared to the prior year[119] Assets and Liabilities - Cash and cash equivalents decreased to $438 million as of June 30, 2024, down from $572 million at the end of 2023[12] - Total assets decreased to $10,042 million as of June 30, 2024, compared to $10,465 million at the end of 2023[12] - Total liabilities decreased to $8,166 million as of June 30, 2024, down from $8,513 million at the end of 2023[12] - The company’s total shareholders' equity decreased to $1,877 million as of June 30, 2024, down from $1,952 million at the end of 2023[12] - Total debt as of June 30, 2024, was $5,547 million, a decrease from $5,671 million at December 31, 2023[51] Cash Flow - The company reported a net cash provided by operating activities of $463 million for the first half of 2024, an increase from $345 million in the same period of 2023[19] - The Company used $180 million in net cash for investing activities during the six months ended June 30, 2024, a decrease of $10 million from $190 million in the prior year[156] - Cash flows used in financing activities totaled $433 million for the six months ended June 30, 2024, an increase of $129 million compared to $303 million in the same period of 2023[157] - Non-cash adjustments to net income for the six months ended June 30, 2024, were $376 million, down from $479 million in the prior year[154] - Changes in operating assets and liabilities resulted in cash outflows of $126 million for the six months ended June 30, 2024, compared to $292 million in 2023[155] Expenses - Research and development expenses for Q2 2024 were $53 million, a decrease of 11.7% from $60 million in Q2 2023[14] - Operating expenses for the three months ended June 30, 2024, included a $9 million increase in cost of services, primarily due to additional payroll and benefit costs[95] - Selling, general and administrative expenses decreased by $9 million, or 4%, primarily due to a reduction in outside service costs and incentive compensation[97] - Research and development expenses decreased by $7 million, or 12%, primarily due to higher capitalization of software development activities[98] - Separation and divestiture costs for the three months ended June 30, 2024, were $26 million, primarily related to activities necessary for the Transaction Agreements[99] Dividends and Shareholder Returns - Dividends declared for the three months ended June 30, 2024, were $40 million, unchanged from the same period in 2023[22] - The Company declared a quarterly cash dividend of $0.20 per share in both the first and second quarters of 2024[63] - The Board declared a quarterly cash dividend of $0.20 per share, totaling approximately $40 million, payable on August 27, 2024[64] Segment Performance - The Gaming & Digital segment generated $436 million in revenue for the three months ended June 30, 2024, compared to $432 million in the same period of 2023[71] - The operating income for the Gaming & Digital segment for the three months ended June 30, 2024, was $103 million, compared to $89 million in the same period of 2023[71] - Total service revenue for the three months ended June 30, 2024 was $586 million, a decrease of $2 million or 0% compared to the prior year[105] - Total service revenue in the Gaming & Digital segment increased to $250 million, a 2% increase from the prior year[111] - Lottery products revenue increased by $11 million, or 20%, from $57 million in 2023 to $69 million in 2024, primarily due to terminal and software deliveries[134] Future Outlook and Transactions - The company plans to divest its Gaming & Digital businesses to Apollo Global Management, which may impact future financial performance[7] - IGT Gaming is set to be acquired in an all-cash transaction valued at approximately $6.3 billion, with the Parent expected to receive about $4.05 billion in cash[77] - The Proposed Transaction with Everi is valued at $6.3 billion, with the Parent expected to receive approximately $4.05 billion in gross cash proceeds for IGT Gaming[86] - The transaction with Everi is expected to close by the end of the third quarter of 2025, subject to regulatory approvals[78] - The Company expects to present the operating results and cash flows of the IGT Gaming disposal group as discontinued operations starting in Q3 2024[79] Tax and Interest - The effective income tax rate for the three months ended June 30, 2024, was 45.7%, down from 48.9% in the same period of 2023[59] - Provision for income taxes decreased by $15 million, or 17%, primarily due to a lower valuation allowance related to U.S. business interest expense limitation carryforward[103] - Provision for income taxes decreased by $33 million, or 19%, from $173 million in 2023 to $141 million in 2024, driven by lower valuation allowances and tax liabilities[130] - Interest expense for the three months ended June 30, 2024, was $78 million, slightly up from $77 million in the same period of 2023[52] - Interest expense, net increased by $1 million to $73 million, primarily due to higher borrowings on the Revolving Credit Facilities[101]