International Game Technology PLC Reports First Quarter 2017 Results
First quarter results for International Game Technology weren’t as expected. The gaming provider’s performance for its social business; DoubleDown disappointed in more ways than one. The gaming company reported they lost $55 million with their adjusted net income valuing at $59 million. Their EBITDA was $371 million which is a 19% decreased.
DoubleDown Casino is expected to be sold sometime in the second quarter. Expectations with EBITDA is said to be $1.6 billion and $1.68 billion with $6.95 billion of net debt as well as $7.15billion.
The transaction of DoubleDown will be complete with a $825 million transfer to DoubleU Games. This is a new strategic structure for IGT’s partnership with social casino activities. Both parties will enter into a distribution and game development agreement that will allow DoubleU Games to offer IGT’s game library.
“The first quarter of 2017 has been a dynamic period for us,” said Marco Sala, CEO of IGT. “Our revenue and profit are consistent with the pattern of the year that we described in March. Year to date, we’ve strengthened our leading positions in global lotteries and begun the rollout of a new generation of gaming machines. We are monetizing non-core assets that will allow us to significantly reduce debt, and we are adopting a new business model for our future participation in the social casino space.” “As we noted in March, a unique combination of elements affected first quarter revenue and profit comparisons, including record jackpot activity in 2016,” said Alberto Fornaro, CFO of IGT. “Disciplined asset and operational management are a top priority for the Company, and this is evident in the strong first quarter cash flow. We are updating our outlook to incorporate the DoubleDown transaction and the impact of increased taxation on gaming machines in Italy.”