International Game Technology PLC(US:IGT)2023-10-30 16:00Financial Performance - Total revenue for Q3 2023 was $1,065 million, a slight increase from $1,060 million in Q3 2022, representing a growth of 0.5%[12] - Service revenue for the nine months ended September 30, 2023, was $2,508 million, compared to $2,514 million for the same period in 2022, showing a decrease of 0.2%[12] - Net income attributable to IGT PLC for Q3 2023 was $94 million, down from $264 million in Q3 2022, reflecting a decline of 64.5%[12] - Operating income for the nine months ended September 30, 2023, was $745 million, an increase from $691 million in the same period of 2022, marking a growth of 7.8%[12] - Total revenue for Q3 2023 increased by $5 million to $1,065 million, compared to $1,060 million in Q3 2022, driven by consistent player demand and game performance[88] - Service revenue for Q3 2023 was $828 million, representing a 2% increase from $826 million in Q3 2022, while product sales rose to $237 million, a 1% increase from $234 million[88] - Operating income for Q3 2023 was $239 million, compared to $211 million in Q3 2022, reflecting improved operational efficiency[88] - For the nine months ended September 30, 2023, total revenue reached $3,180 million, up from $3,180 million in the same period of 2022[76] - The company reported a total operating income of $745 million for the nine months ended September 30, 2023, compared to $691 million for the same period in 2022[76] Cash and Liquidity - Cash and cash equivalents at the end of Q3 2023 were $558 million, down from $590 million at the end of 2022, a decrease of 5.4%[10] - Total liquidity as of September 30, 2023, was $1.897 billion, down from $2.412 billion at December 31, 2022, primarily due to cash used in investing activities[150] - Net cash provided by operating activities for the nine months ended September 30, 2023, was $641 million, an increase of $20 million from the prior period[156] - Cash used in investing activities was $289 million for the nine months ended September 30, 2023, a decrease of $433 million compared to the prior period, mainly due to the sale of the Italy Commercial Services Business[158] - Cash flows used in financing activities decreased by $714 million to $371 million, primarily due to reduced principal payments on long-term debt[159] Debt and Equity - Long-term debt, less current portion, decreased to $5,421 million from $5,690 million, a reduction of 4.7%[10] - As of September 30, 2023, total equity was $1.967 billion, a decrease from $1.979 billion at December 31, 2022[21] - The carrying value of total debt as of September 30, 2023, was $5,752 million, with a fair value of $5,566 million[57] - Long-term debt decreased from $5,735 million as of December 31, 2022, to $5,465 million as of September 30, 2023[50] Expenses - Research and development expenses for the nine months ended September 30, 2023, were $177 million, compared to $185 million in the same period of 2022, a decrease of 4.3%[12] - Selling, general and administrative expenses increased by $9 million, or 4%, mainly due to higher costs for outside legal and technical consultants[93] - Research and development expenses decreased by $12 million, or 18%, to $55 million for the three months ended September 30, 2023, primarily due to higher capitalization of software development activities[94] - Amortization expense on intangible assets for the nine months ended September 30, 2023, was $159 million, compared to $134 million for the same period in 2022[46] Tax and Legal Matters - The effective income tax rate for the three months ended September 30, 2023, was 34.8%, a substantial increase from 6.7% in the same period of 2022, primarily due to foreign rate differentials and other tax-related adjustments[65][66] - Reserves for uncertain tax positions decreased from $27 million at December 31, 2022, to $14 million as of September 30, 2023, indicating a reduction in potential tax liabilities[67] - The company reached a settlement agreement with the Italian Tax Authorities for €10 million related to tax assessments for 2015 and 2016, impacting the financial position by $14 million net of previously reserved amounts[68] - The company is involved in ongoing legal proceedings with potential claims exceeding $600 million, with a tentative settlement reached in one case that is not expected to materially affect financial results[64] - The company reported a total of $14 million in outstanding liabilities for all legal proceedings as of September 30, 2023[61] Business Segments and Strategy - The company’s organizational structure includes three business segments: Global Lottery, Global Gaming, and PlayDigital, which are essential for resource allocation and performance assessment[73] - The company continues to focus on expanding its integrated portfolio of gaming technology products and services across various channels[25] - The company is evaluating potential strategic alternatives for the Global Gaming and PlayDigital segments, including a sale, merger, or spin-off[85] Revenue by Segment - Global Lottery service revenue decreased by $11 million, or 2%, to $576 million, with a notable 9% increase in operating and facilities management contracts revenue[99] - Gaming terminal services revenue increased by $9 million, or 7%, to $136 million, attributed to an 8% increase in installed base units[105] - Total product sales in Global Gaming rose by $16 million, or 8%, to $212 million, with gaming other sales increasing by 24%[107] - PlayDigital services revenue remained relatively flat at $55 million, with a 1% increase driven by higher iCasino revenues[112] - Total product sales for the nine months ended September 30, 2023, increased by $83 million, or 16%, to $589 million compared to $506 million in the prior period[138] Comprehensive Income - The company reported a comprehensive income attributable to IGT PLC of $93 million for Q3 2023, down from $326 million in Q3 2022, a decline of 71.5%[15] - Total comprehensive income for the third quarter of 2023 was $93 million, compared to $47 million in the previous quarter[21] - The company’s accumulated other comprehensive income (AOCI) was $465 million as of September 30, 2023, reflecting changes in foreign currency translation and hedges[71]