NEW YORK, March 11, 2013 /PRNewswire/ -- Scientific Games
Corporation (Nasdaq: SGMS) today announced results for the fourth
quarter and year ended December 31,
2012.
Summary
Financial Results
|
($ in
millions, except per share amounts)
|
|
|
|
Three
Months Ended
December 31,
|
|
Twelve
Months Ended
December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Revenue
|
|
$249.2
|
|
$239.1
|
|
$940.6
|
|
$878.7
|
Operating
(loss) income
|
|
(6.3)
|
|
19.2
|
|
38.2
|
|
83.8
|
Attributable EBITDA
|
|
90.6
|
|
80.3
|
|
343.3
|
|
327.5
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
(24.7)
|
|
(8.5)
|
|
(62.6)
|
|
(12.6)
|
Net loss
per share
|
|
(0.29)
|
|
(0.09)
|
|
(0.70)
|
|
(0.14)
|
|
|
|
|
|
|
|
|
|
Total
capital expenditures
|
|
(31.3)
|
|
(23.5)
|
|
(111.3)
|
|
(91.9)
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Free cash
flow
|
|
17.5
|
|
(5.1)
|
|
45.4
|
|
79.2
|
|
|
|
|
|
|
|
|
|
Attributable EBITDA and free cash flow are non-GAAP financial
measures defined below under "Non-GAAP Financial Measures" and
reconciled to GAAP financial measures in the accompanying tables.
Recent Business Highlights
- In January 2013, Scientific Games
entered into an agreement to acquire WMS Industries Inc. (NYSE:
WMS) ("WMS"), a leading supplier of gaming machines and interactive
gaming systems and content; the acquisition would combine two
leading companies in the lottery and gaming industries to create a
company with the ability to offer an extensive range of products
and services to public and private sector lottery and gaming
customers around the world
- In December 2012, a consortium in
which Scientific Games owns a 16.5% equity interest, was
provisionally awarded a 12-year concession for the exclusive rights
to the production, operation and management of instant ticket
lotteries in Greece; Scientific
Games expects to serve as the exclusive supplier of instant tickets
over the term of the concession
- Scientific Games' U.S. instant ticket and lottery systems
customers' retail sales increased 5.1% and 10.9%, respectively, in
the fourth quarter of 2012 compared to the prior-year period, based
on third-party data
- Global Draw's U.K. total gross win and gross win per terminal
per day increased approximately 4% and 1%, respectively, in the
fourth quarter of 2012 versus the prior-year period, excluding
gross win attributable to the William Hill contract in the
prior-year period
- The Company executed the following contracts:
- Five-year contract extension with the Connecticut Lottery to
continue providing lottery systems and services until May 2018
- Two-year contract with the Iowa Lottery to supply instant
tickets through December 2014
- Agreement with the Maryland Lottery to provide Properties
Plus® internet-based player loyalty rewards program
through June 2016
- Scientific Games repurchased 2,735,233 of its common shares
during the fourth quarter and a total of 9,157,139 shares during
2012
"2012 was a productive year for Scientific Games, with growth in
revenue and attributable EBITDA, and the securing of a number of
key contracts," Chairman and Chief Executive Officer A. Lorne Weil commented. "We remain focused on
the execution of our numerous business development opportunities as
lotteries and gaming operators continue to pursue new sources of
revenue."
Mr. Weil continued, "We are also excited about the pending
acquisition of WMS, which will combine our respective game content,
technology, operational capabilities, geographic footprints and
financial profiles to create an enterprise poised to capitalize on
significant growth opportunities across our global lottery and
gaming businesses. The transaction is also expected to be
immediately accretive, creating value for our stockholders."
Jeffrey S. Lipkin, Senior Vice
President and Chief Financial Officer, added, "Our solid fourth
quarter results reflected the benefits of our diverse,
participation-based business model, which resulted in increases in
revenue, attributable EBITDA and free cash flow. During 2012, we
were also pleased to return over $68
million to stockholders in the form of share
repurchases."
Business Update
Our fourth quarter results reflected strength across the
majority of our diverse global businesses. Revenue increased over
4% and attributable EBITDA rose 13%. We benefitted from solid
lottery retail sales, not only in the U.S. but also notably in
Italy, where instant ticket sales
grew 3.9%.
Our U.S. customers' retail sales of instant tickets increased
5.1% in the quarter and their sales of draw games grew 10.9%.
Instant ticket sales continued to be propelled by strong
performance in larger states, and draw sales benefited from a
record Powerball® jackpot of $587.5 million in the quarter. These increases
capped off a successful year for the U.S. lottery industry, with
our customers' instant ticket retail sales increasing 9.1% for 2012
and our Lottery Systems customers' draw game retail sales growing
9.7%.
Instant ticket retail sales in China remained weak in the fourth quarter,
although improving slightly compared to the third quarter's
year-over-year results. We continue to believe there is sustained
consumer demand for lottery products in China, as retail sales of the overall lottery
segment grew by 18% in 2012, but that competition from other
lottery products is impacting instant ticket sales. We remain
focused on improving sales trends by expanding the lottery retailer
network and increasing our involvement in the game selection
process.
As we mentioned last quarter, video gaming was launched in
Illinois in early October, with
statewide monitoring and control provided by our central system.
The licensing approval process is ongoing and we believe the
initial roll-out has proven successful, with approximately 4,200
machines installed and connected to our central system in over
1,000 locations.
During the quarter, our U.K. gaming business again experienced
an increase in gross win per terminal per day; however, the loss of
the William Hill contract and the 2011 closing of our
over-the-counter business, along with a reduction in U.K. pub
revenue and revenue generated outside the U.K., negatively impacted
overall gaming revenue. While this is disappointing, we are pleased
with our strong U.K. LBO machine performance, as evidenced by
Ladbrokes' results for fiscal 2012. Ladbrokes' gross win per
machine per week and gross win per shop per week increased by 10%
and 11.5%, respectively, compared to fiscal 2011.
Looking ahead, while we expect the first half of the year to
start off more slowly, we anticipate momentum will accelerate as
the year progresses based on several business developments and
initiatives which are planned to commence later in 2013.
Late last year, the consortium in Greece in which we own a 16.5% equity
interest, was provisionally awarded a 12-year concession for the
exclusive rights to the operation and management of instant ticket
lotteries in Greece, with
Scientific Games expected to be the exclusive instant ticket
supplier. We believe that implementing the best practices we
have successfully used with lotteries around the world will result
in the successful re-launch of instant tickets in Greece.
We have made progress in our interactive business as well, with
the Maryland Lottery signing on to become our eighth Properties
Plus customer. We see additional opportunities in the pipeline and
believe the Properties Plus program will help lead the way for
states to begin providing internet-based offerings.
The most game-changing development is our pending acquisition of
WMS, which we believe will be transformative for our Company. The
merger of leading companies in lottery instant tickets, systems,
gaming machines and interactive gaming would enable the combined
company to offer a comprehensive scope of products and services to
both government-sponsored and commercial customers in the lottery
and gaming industries.
In addition to significantly enhancing our portfolio of lottery
and gaming products and services, we believe the combination will
broaden our revenue and geographic diversification, build our scale
in gaming and create a compelling position in interactive gaming,
all while delivering meaningful value to our stockholders through
the deal's expected immediate earnings per share accretion, the
monetization of our tax attributes, significantly improved free
cash flow and anticipated synergies. Scientific Games and WMS have
many shared and complementary core competencies, which we believe
we can capitalize on immediately following closing.
Having just recently announced the proposed acquisition, we are
in the early stages of the integration planning process. In
addition, WMS has filed its amended preliminary proxy statement for
the transaction and we believe we are making meaningful progress
towards securing the necessary regulatory approvals. The completion
of the WMS acquisition remains subject to the approvals of WMS
stockholders and gaming regulatory authorities and other customary
closing conditions, and there can be no assurance that the merger
will be completed.
In connection with the pending WMS acquisition, we currently
expect to incur regulatory costs, professional fees and other
expenses totaling approximately $4.0 million
to $6.0 million in the first quarter of 2013, with
additional transaction-related fees and expenses anticipated to be
incurred throughout the balance of 2013.
Fourth Quarter 2012 Financial Results
Revenue
- Revenue increase of 4.3% reflects growth in Printed Products
and Lottery Systems segments, partially offset by a decline in
Gaming
Operating Income
- Decrease in operating income primarily reflects $33.8 million increase in depreciation and
amortization, partially offset by a $6.8
million impact of a higher and more profitable revenue mix,
$1.7 million decrease in selling,
general and administrative and $0.2
million reduction in employee termination and
restructuring
- Higher depreciation and amortization principally reflects:
- $24.0 million of accelerated
depreciation of gaming terminals and software
- $5.8 million of asset impairment
charges on Lottery Systems contracts
- Reduction in selling, general and administrative primarily due
to:
- $3.6 million decrease in accrual
related to Asia-Pacific business
incentive compensation plan
- $1.1 million reduction in
professional fees
- Decreases partially offset by $1.4
million increase in accounts receivable reserves,
$0.8 million increased severance
expense, $0.8 million of incremental
overhead from acquisition of Provoloto and $0.7 million increased compensation expense
primarily related to growth initiatives
Net Income
- Decline in net income reflected the decrease in operating
income and was partially offset by the following:
- $4.7 million increase in earnings
from equity investments, primarily reflecting higher results from
RCN and Italy, partially offset by
lower results from Sportech
- $2.3 million increase in other
income principally due to decline in foreign exchange transaction
expense
- $1.7 million decrease in income
tax expense
Attributable EBITDA
- EBITDA from equity investments decreased by $0.3 million, as the $2.0
million increase in results from Italy was offset primarily by lower results
from China and RCN
- Attributable EBITDA increased by $10.2
million
Fourth
Quarter 2012 Operating Results by Segment
|
($ in
millions)
|
|
|
|
Revenue
|
|
Operating Income (Loss)
|
|
|
Three
Months Ended
December 31,
|
|
Three
Months Ended
December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Printed
Products
|
|
$129.6
|
|
$125.2
|
|
$34.1
|
|
$32.2
|
Lottery
Systems
|
|
80.7
|
|
69.5
|
|
9.0
|
|
11.1
|
Gaming
|
|
38.9
|
|
44.4
|
|
(25.4)
|
|
2.8
|
|
|
|
|
|
|
|
|
|
Printed Products
Revenue
- Revenue growth of 3.6% was driven primarily by a $5.5 million increase in sales to international
customers principally in Italy and
the U.K., a $1.6 million increase in
sales to U.S. customers that purchase tickets on a percentage of
sales basis, including cooperative services customers, and a
$1.5 million benefit from the
acquisition of Provoloto
- Revenue increases were partially offset by the following:
- $2.9 million decrease in licensed
properties business
- $2.0 million decrease in revenue
from U.S. customers that compensate us based on a price per
thousand units basis
Operating Income
- Operating income increase reflected:
- $3.2 million impact of a higher
and more profitable mix of revenue
- $1.4 million decrease in selling,
general and administrative, principally due to a reduction in the
accrual for incentive compensation expense
- The increase in operating income was partially offset by the
following:
- $1.7 million increase in
depreciation and amortization, primarily related to a write-down of
software development costs
- $1.1 million of employee
termination and restructuring costs related to the closing of our
Australian printing facility
Lottery Systems
Revenue
- Revenue increase of 16.1% primarily reflected $10.8 million of higher sales revenue from
increased demand for equipment and systems from both U.S. and
international customers
- Service revenue increased $0.6
million, as $4.1 million
increase in U.S. revenue, driven in part by a record Powerball
jackpot, was substantially offset by $3.0
million decline in international revenue principally
attributable to $1.8 million decrease
from China
Operating Income
- Decrease in operating income primarily reflects $6.8 million increase in depreciation and
amortization, resulting principally from $5.8 million in non-cash asset impairment
charges
- Operating income decrease partially offset by $4.3 million impact of higher revenue and
$0.4 million decrease in selling,
general and administrative
Gaming
Revenue
- Revenue decrease of 12.3% principally resulted from lower
service revenue that reflects $2.0
million impact from loss of the William Hill contract,
$1.9 million reduction primarily due
to exiting Austrian over-the-counter business, $1.6 million decline in results outside the U.K.
and $1.0 million reduction in revenue
from our pub business
- Decline in sales revenue primarily reflects exit from
Barcrest's analog machine business
- Revenue decline partially offset by $1.3
million increase in U.K. LBO business, which benefitted from
increase in gross win per terminal per day
Operating Income
- In addition to the impact from revenue decline, decrease in
operating income primarily due to:
- $25.3 million increase in
depreciation and amortization
- $3.2 million increase in selling,
general and administrative
- Increase in depreciation and amortization principally reflects:
- $12.5 million write-down of
terminals and software in our pub business
- $10.2 million write-down of
LBO terminals primarily related to customers transitioning to newer
generation machines
- Increase in selling, general and administrative primarily due
to:
- $1.8 million increase in
professional fees
- $1.4 million increase in accounts
receivable reserves
Liquidity and Capital Resources
- At December 31, 2012, cash and
cash equivalents of $109.0 million
and availability under revolving credit facility of $206.2 million
- Total debt of $1,468.2 million as
of December 31, 2012 increased from
$1,390.7 million at December 31, 2011, primarily reflecting the
issuance of $300 million of 2020
Notes and the redemption of $200
million of 2016 Notes during the third quarter, and the
reduction of our China loans by
approximately $15.7 million during
2012
- Free cash flow for the fourth quarter was $17.5 million, compared to ($5.1) million in prior-year quarter, principally
due to higher margins, lower selling general and administrative
expenses and reduced cash interest payments, partially offset by
increased capital expenditures
- Received return of capital payments from equity investments in
LNS of $5.9 million and ITL of
$0.6 million in fourth quarter of
2012; these amounts are not included in free cash flow metric
- Received $11.3 million in cash
dividends from equity investments in fourth quarter of 2012
- Common stock repurchases:
- Fourth quarter 2012: 2,735,233 shares for approximately
$21.1 million
- Fiscal 2012: 9,157,139 shares for approximately $68.5 million
Pending Acquisition of WMS Industries Inc.
As previously announced on January 31,
2013, Scientific Games entered into an agreement to acquire
WMS for $26.00 in cash per common
share, or approximately $1.5 billion
in the aggregate.
Completion of the transaction remains subject to approvals by
WMS stockholders and gaming regulatory authorities and other
customary closing conditions. Scientific Games is in the
process of filing for the required gaming approvals. On
March 8, 2013, WMS filed an amended
preliminary proxy statement with the Securities and Exchange
Commission relating to a special meeting of WMS' stockholders to
consider and approve the merger agreement. On March 11, 2013, Scientific Games received notice
from the Federal Trade Commission of early termination of the
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976 ("HSR Act") in connection with the merger.
Termination of the HSR Act waiting period satisfies one of
the conditions required for completion of the merger. Scientific
Games has obtained commitments for a term loan facility of
$2.3 billion and a revolving credit
facility of $300 million to finance
the acquisition and continues to expect the transaction to close by
the end of 2013. However, no assurance can be given that the merger
will be completed.
Conference Call Details
Scientific Games will host a conference call today at
5:00 pm Eastern Time to review these
results and discuss other topics. To access the call live via
a listen-only webcast, please visit www.scientificgames.com and
click on the webcast link under the Investor Information
section. To access the call by telephone, please dial (866)
202-0886 (U.S. and Canada) or
(617) 213-8841 (international). The conference ID is 56522020.
A presentation summarizing the results will also be provided in
the Investor Information section on our website prior to the
conference call. A replay of the webcast and accompanying
presentation will be archived in the Investor Information section
on our website.
About Scientific Games
Scientific Games Corporation
is a global leader in providing customized, end-to-end gaming
solutions to lottery and gaming organizations worldwide. Scientific
Games' integrated array of products and services includes instant
lottery games, lottery gaming systems, terminals and services, and
internet applications, as well as server-based interactive gaming
terminals and associated gaming control systems. For more
information, please visit our website at
www.scientificgames.com.
Company Contact:
Cindi Buckwalter, Investor
Relations
(212) 754-2233
Forward-Looking Statements
In this press release, the
Company makes "forward-looking statements" within the meaning of
the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements describe future expectations, plans,
results or strategies and can often be identified by the use of
terminology such as "may," "will," "estimate," "intend,"
"continue," "believe," "expect," "anticipate," "should," "could,"
"potential," "opportunity," or similar terminology. These
statements are based upon management's current expectations,
assumptions and estimates and are not guarantees of future results
or performance. Actual results may differ materially from
those contemplated in these statements due to a variety of risks
and uncertainties and other factors, including, among other
things: competition; material adverse changes in economic and
industry conditions; technological change; retention and renewal of
existing contracts and entry into new or revised contracts;
availability and adequacy of cash flows to satisfy obligations and
indebtedness or future needs; protection of intellectual property;
security and integrity of software and systems; laws and government
regulation, including those relating to gaming licenses, permits
and operations; inability to identify, complete and integrate
future acquisitions; inability to benefit from, and risks
associated with, strategic equity investments and relationships;
failure of our Northstar joint venture to meet the net income
targets or otherwise realize the anticipated benefits under its
private management agreement with the Illinois Lottery; the
seasonality of our business; inability to obtain the approvals
required to complete the merger with WMS; failure to complete the
merger with WMS or, if completed, failure to achieve the intended
benefits of such merger; inability to identify and capitalize on
trends and changes in the lottery and gaming industries, including
the potential expansion of regulated gaming via the internet;
inability to enhance and develop successful gaming concepts;
dependence on suppliers and manufacturers; liability for product
defects; fluctuations in foreign currency exchange rates and other
factors associated with international operations; influence of
certain stockholders; dependence on key personnel; failure to
perform under our contracts; resolution of pending or future
litigation; labor matters and stock price volatility. Additional
information regarding risks and uncertainties and other factors
that could cause actual results to differ materially from those
contemplated in forward-looking statements is included from time to
time in the Company's filings with the Securities and Exchange
Commission, including under the heading "Risk Factors" in the
Company's periodic reports. Forward-looking statements speak only
as of the date they are made and, except for the Company's ongoing
obligations under the U.S. federal securities laws, the Company
undertakes no obligation to publicly update any forward-looking
statements whether as a result of new information, future events or
otherwise.
Non-GAAP Financial Measures
Attributable EBITDA, as
used herein, is based on the definition of "consolidated EBITDA" in
our credit agreement (summarized below), except that attributable
EBITDA as used herein includes our share of the EBITDA of all of
our equity investments (whereas "consolidated EBITDA" for purposes
of the credit agreement generally includes our share of the EBITDA
of our Italian joint venture but only the income of our other
equity investments to the extent it has been distributed to
us). Attributable EBITDA is a non-GAAP financial measure that
is presented herein as a supplemental disclosure and is reconciled
to net income (loss) in a schedule below.
Attributable EBITDA includes adjustments only to the extent
contemplated by the definition of "consolidated EBITDA" in our
credit agreement (which adjustments are summarized in the paragraph
below). Note that the adjustment referred to in clause (9) in the
paragraph below was added to the definition of "consolidated
EBITDA" as part of the March 11, 2011
amendment to our credit agreement and revised as part of the
August 25, 2011 amendment to our
credit agreement.
"Consolidated EBITDA" means, for any period, "consolidated net
income" as defined in the credit agreement (i.e., generally our
consolidated net income (or loss) excluding the income (or deficit)
of our equity investments (other than our Italian joint venture)
except to the extent that such income has been distributed to us)
for such period plus, to the extent deducted in calculating such
consolidated net income for such period, the sum of (1) income tax
expense, (2) depreciation and amortization expense, (3) interest
expense (other than any interest expense of our Italian joint
venture in respect of debt for borrowed money of such joint venture
if such debt exceeds $25,000,000 in
the aggregate), (4) amortization or write-off of debt discount and
debt issuance costs and commissions, discounts and other fees and
charges associated with debt (see line item captioned "Debt-Related
Fees and Charges" in the schedules below), (5) amortization of
intangibles (including goodwill) and organization costs (see line
item captioned "Amortization of Intangibles" in the schedules
below), (6) earn-out payments with respect to certain acquisitions
that we have made or any other "permitted acquisitions"(generally,
acquisitions of companies that are primarily engaged in the same or
related line of business and that become subsidiaries of ours, or
acquisitions of all or substantially all of the assets of another
company or division or business unit of another company), including
any loss or expense with respect to such earn-out payments (see
line item captioned "Earn-Outs for Permitted Acquisitions" in the
schedules below), (7) extraordinary charges or losses determined in
accordance with GAAP, (8) non-cash stock-based compensation
expenses, (9) any cash compensation expense incurred but not paid
in such period so long as no cash payment in respect thereof is
made or required to be made prior to the scheduled maturity of the
borrowings under the credit agreement (provided that up to
$993,000 of non-cash compensation
expense accrued prior to August 25,
2011 may be added back notwithstanding that cash payments
may be required to be made in respect thereof prior to the
scheduled maturity of the borrowings) (see line item captioned
"Deferred Contingent Compensation Expense" in the schedules below),
(10) up to $3,000,000 of expenses,
charges or losses resulting from certain Peru investments (see line item captioned
"Peru Investment Expenses, Charges or Losses" in the schedules
below), (11) the non-cash portion of any non-recurring write-offs
or write-downs as required in accordance with GAAP (see line item
captioned "Non-Recurring Write-Offs under GAAP" in the schedules
below), (12) advisory fees and related expenses paid to advisory
firms in connection with "permitted acquisitions" (see line item
captioned "Acquisition Advisory Fees" in the schedules below), (13)
certain specified "permitted add-backs" (i.e., (A) up to
$15,000,000 (less the amount of
certain permitted pro forma adjustments to "consolidated EBITDA" in
connection with material acquisitions) of charges incurred during
any 12-month period in connection with (i) reductions in workforce,
(ii) contract losses, discontinued operations, shutdown expenses
and cost reduction initiatives, (iii) transaction expenses incurred
in connection with potential acquisitions and divestitures, whether
or not consummated, and (iv) restructuring charges and transaction
expenses incurred in connection with certain transactions with
Playtech Limited or its affiliates, and (B) reasonable and
customary costs incurred in connection with amendments to the
credit agreement) (see line item captioned "Specified Permitted
Add-Backs" in the schedules below) (provided that the foregoing
items (1) through (13) do not include write-offs or write-downs of
accounts receivable or inventory and, except with respect to
"permitted add-backs", any write-off or write-down to the extent it
is in respect of cash payments to be made in a future period), (14)
to the extent treated as an expense in the period paid or incurred,
certain payments, costs and obligations made or incurred by us in
connection with any award of a concession to operate the instant
ticket lottery in Italy, including
any up-front fee required under the applicable tender process (see
line item captioned "Italian Concession Obligations" in the
schedules below), (15) restructuring charges, transaction expenses
and shutdown expenses incurred in connection with the disposition
of all or part of our racing and venue management businesses,
together with any charges incurred in connection with discontinued
operations and cost-reduction initiatives associated with such
disposition, in an aggregate amount (for all periods combined) not
to exceed $7,325,000 (see line item
captioned "Racing Disposition Charges and Expenses" in the
schedules below) and (16) up to 5,250,000
pounds Sterling during any four-quarter period of expenses
or charges incurred in connection with the payment of license
royalties or other fees to Playtech Limited or its affiliates and
for software services provided to Global Draw or Games Media by
Playtech Limited or its affiliates (see line item captioned
"Playtech Royalties and Fees" in the schedules below), minus, to
the extent included in the statement of such consolidated net
income for such period, the sum of (1) interest income, (2)
extraordinary income or gains determined in accordance with GAAP
and (3) income or gains with respect to earn-out payments with
respect to acquisitions referred to above (see line item captioned
"Income on Earn-Outs for Permitted Acquisitions" in the schedules
below), provided that the aggregate amount of "consolidated EBITDA"
that is attributable to the Company's interest in its Italian joint
venture that would not have otherwise been permitted to be included
in "consolidated EBITDA" prior to giving effect to the March 11, 2011 amendment to the credit agreement
will be capped at $25,000,000 in any
period of four consecutive fiscal quarters (or $30,000,000 in the case of any such period ending
on or prior to June 30, 2012).
"Consolidated EBITDA" is also subject to certain adjustments in
connection with material acquisitions and dispositions as provided
in the credit agreement. The foregoing definitions of
"consolidated net income" and "consolidated EBITDA" are qualified
in their entirety by reference to the full text of such definitions
in our credit agreement, which was amended and restated on
August 25, 2011, a copy of which is
attached as Exhibit 10.1 to our Current Report on Form 8-K filed
with the Securities and Exchange Commission on August 31, 2011.
Free cash flow, as included herein, represents net cash provided
by operating activities less total capital expenditures (which
includes lottery and gaming systems expenditures and other
intangible assets and software expenditures). Free cash flow
is a non-GAAP financial measure that is presented herein as a
supplemental disclosure and is reconciled to net cash provided by
operating activities in a schedule below.
EBITDA from equity investments, as included herein, represents
our share of EBITDA from equity investments, which is defined as
equity in earnings from our equity investments (whether or not any
such earnings have been distributed to us) plus income tax expense,
depreciation and amortization expense and interest (income)
expense, net of other. EBITDA from equity investments is a
non-GAAP financial measure that is presented herein as a
supplemental disclosure and is reconciled to earnings from equity
investments in a schedule below.
The Company's management uses the foregoing non-GAAP financial
measures in conjunction with GAAP financial measures to: monitor
and evaluate the performance of the Company's business operations,
as well as the performance of its equity investments, which have
become a more significant part of the Company's business;
facilitate management's internal comparisons of the Company's
historical operating performance of its business operations;
facilitate management's external comparisons of the results of its
overall business to the historical operating performance of other
companies that may have different capital structures and debt
levels; review and assess the operating performance of the
Company's management team; analyze and evaluate financial and
strategic planning decisions regarding future operating
investments; and plan for and prepare future annual operating
budgets and determine appropriate levels of operating
investments. Accordingly, the Company's management believes
that these non-GAAP financial measures are useful to investors to
provide them with disclosures of the Company's operating results on
the same basis as that used by the Company's management.
In addition, the Company's management believes that attributable
EBITDA is helpful in assessing the overall operating performance of
the Company and its equity investments and highlighting trends in
the Company's and its equity investees' core businesses that may
not otherwise be apparent when relying solely on GAAP financial
measures, because this non-GAAP financial measure eliminates from
the Company's and its equity investees' earnings financial items
that management believes have less bearing on the Company's and its
equity investees' performance, such as income tax expense,
depreciation and amortization expense and interest (income)
expense. Moreover, management believes attributable EBITDA is
useful to investors because a significant and increasing amount of
the Company's business is through its equity investments.
Management further believes that attributable EBITDA and free cash
flow provide useful information regarding the Company's liquidity
and its ability to service debt and fund investments.
Management believes that EBITDA from equity investments is helpful
in monitoring the financial performance of the Company's equity
investments and eliminates from the equity investees' earnings
financial items that management believes have less bearing on the
equity investments' performance.
The Company's management also believes attributable EBITDA is
useful to investors because the definition is derived from the
definition of "consolidated EBITDA" in our credit agreement, which
is used to calculate the Company's compliance with the financial
covenants contained in the credit agreement. Moreover,
attributable EBITDA and free cash flow (calculated by subtracting
total capital expenditures (which includes lottery and gaming
systems expenditures and other intangible assets and software
expenditures) from attributable EBITDA) are metrics used in
determining performance-based bonuses (subject to certain
additional adjustments in the discretion of the Compensation
Committee (e.g., to take into account changes in applicable
accounting rules during the year)).
Accordingly, the Company's management believes that the
presentation of the non-GAAP financial measures, when used in
conjunction with GAAP financial measures, provides both management
and investors with financial information that can be useful in
assessing the Company's financial condition and operating
performance.
The non-GAAP financial measures used herein should not be
considered in isolation of, as a substitute for, or superior to,
the financial information prepared in accordance with GAAP.
The non-GAAP financial measures as defined in this press release
may differ from similarly titled measures presented by other
companies. The non-GAAP financial measures, as well as other
information in this press release, should be read in conjunction
with the Company's financial statements filed with the Securities
and Exchange Commission.
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
(Unaudited, in thousands, except per share
amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
Twelve
Months Ended December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Revenue:
|
|
|
|
|
|
|
|
|
Instant
tickets
|
|
$
126,257
|
|
$
122,303
|
|
$
493,642
|
|
$
493,275
|
Services
|
|
90,774
|
|
94,429
|
|
352,317
|
|
331,701
|
Sales
|
|
32,212
|
|
22,347
|
|
94,643
|
|
53,746
|
Total
revenue
|
|
249,243
|
|
239,079
|
|
940,602
|
|
878,722
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Cost of
instant tickets(1)
|
|
71,080
|
|
70,414
|
|
282,548
|
|
281,565
|
Cost of
services (1)
|
|
47,029
|
|
48,430
|
|
181,108
|
|
171,374
|
Cost of
sales(1)
|
|
21,104
|
|
16,957
|
|
65,053
|
|
38,340
|
Selling,
general and administrative
|
|
51,087
|
|
52,382
|
|
188,813
|
|
183,022
|
Employee
termination and restructuring
|
|
751
|
|
967
|
|
11,502
|
|
1,997
|
Depreciation and amortization
|
|
64,525
|
|
30,701
|
|
173,370
|
|
118,603
|
Operating
income (loss)
|
|
(6,333)
|
|
19,228
|
|
38,208
|
|
83,821
|
Other
income (expense):
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(24,935)
|
|
(25,542)
|
|
(100,008)
|
|
(104,703)
|
Earnings
from equity investments
|
|
6,611
|
|
1,922
|
|
28,073
|
|
29,391
|
Early
extinguishment of debt
|
|
-
|
|
-
|
|
(15,464)
|
|
(4,185)
|
Other
income (expense), net
|
|
1,278
|
|
(1,070)
|
|
1,185
|
|
(911)
|
Total
other expense
|
|
(17,046)
|
|
(24,690)
|
|
(86,214)
|
|
(80,408)
|
Income
(loss) before income tax expense
|
|
(23,379)
|
|
(5,462)
|
|
(48,006)
|
|
3,413
|
Income tax
expense
|
|
1,345
|
|
3,071
|
|
14,621
|
|
15,983
|
Net income
(loss)
|
|
$
(24,724)
|
|
$
(8,533)
|
|
$
(62,627)
|
|
$
(12,570)
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per share:
|
|
|
|
|
|
|
|
|
Basic net
income (loss)
|
|
$
(0.29)
|
|
$
(0.09)
|
|
$
(0.70)
|
|
$
(0.14)
|
Diluted
net income (loss)
|
|
$
(0.29)
|
|
$
(0.09)
|
|
$
(0.70)
|
|
$
(0.14)
|
Weighted
average number of shares:
|
|
|
|
|
|
|
|
|
Basic
shares
|
|
84,902
|
|
92,187
|
|
90,011
|
|
92,068
|
Diluted
shares
|
|
84,902
|
|
92,187
|
|
90,011
|
|
92,068
|
|
|
|
|
|
|
|
|
|
(1)
Exclusive of depreciation and amortization.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
CONDENSED CONSOLIDATED BALANCE SHEET
DATA
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
2012
|
|
2011
|
Assets:
|
|
|
|
|
Cash and
cash equivalents
|
|
$
109,015
|
|
$
104,402
|
Other
current assets
|
|
375,878
|
|
301,154
|
Property
and equipment, net
|
|
376,877
|
|
426,488
|
Equity
investments
|
|
316,234
|
|
340,494
|
Other
long-term assets
|
|
1,008,904
|
|
989,373
|
Total assets
|
|
$
2,186,908
|
|
$
2,161,911
|
|
|
|
|
|
Liabilities and Stockholders' Equity:
|
|
|
|
|
Current
portion of long-term debt
|
|
$
16,458
|
|
$
26,191
|
Other
current liabilities
|
|
239,889
|
|
210,902
|
Long-term
debt, excluding current portion
|
|
1,451,708
|
|
1,364,476
|
Other
long-term liabilities
|
|
114,062
|
|
116,628
|
Stockholders' equity
|
|
364,791
|
|
443,714
|
Total liabilities and stockholders'
equity
|
|
$
2,186,908
|
|
$
2,161,911
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
CONSOLIDATED SEGMENT OPERATING DATA
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31, 2012
|
|
|
|
|
|
|
|
|
Unallocated
|
|
|
|
|
Printed
|
|
Lottery
|
|
|
|
Corporate
|
|
|
|
|
Products
|
|
Systems
|
|
Gaming
|
|
Expense
|
|
Totals
|
|
|
|
|
|
|
|
|
|
|
|
Instant
tickets
|
|
$
126,257
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
126,257
|
Services
|
|
-
|
|
56,074
|
|
34,700
|
|
-
|
|
90,774
|
Sales
|
|
3,349
|
|
24,646
|
|
4,217
|
|
-
|
|
32,212
|
Total revenue
|
|
129,606
|
|
80,720
|
|
38,917
|
|
-
|
|
249,243
|
Cost of
instant tickets(1)
|
|
71,080
|
|
-
|
|
-
|
|
-
|
|
71,080
|
Cost of
services (1)
|
|
-
|
|
29,744
|
|
17,285
|
|
-
|
|
47,029
|
Cost of
sales(1)
|
|
2,324
|
|
16,594
|
|
2,186
|
|
-
|
|
21,104
|
Selling,
general and administrative
|
|
10,478
|
|
6,318
|
|
8,597
|
|
19,064
|
|
44,457
|
Stock-based compensation
|
|
850
|
|
566
|
|
447
|
|
4,767
|
|
6,630
|
Employee
termination and restructuring
|
|
1,058
|
|
-
|
|
(307)
|
|
-
|
|
751
|
Depreciation and amortization
|
|
9,711
|
|
18,521
|
|
36,144
|
|
149
|
|
64,525
|
Operating
income (loss)
|
|
$
34,105
|
|
$
8,977
|
|
$
(25,435)
|
|
$
(23,980)
|
|
$
(6,333)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31, 2011
|
|
|
|
|
|
|
|
|
Unallocated
|
|
|
|
|
Printed
|
|
Lottery
|
|
|
|
Corporate
|
|
|
|
|
Products
|
|
Systems
|
|
Gaming
|
|
Expense
|
|
Totals
|
|
|
|
|
|
|
|
|
|
|
|
Instant
tickets
|
|
$
122,303
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
122,303
|
Services
|
|
-
|
|
55,445
|
|
38,984
|
|
-
|
|
94,429
|
Sales
|
|
2,854
|
|
14,081
|
|
5,412
|
|
-
|
|
22,347
|
Total revenue
|
|
125,157
|
|
69,526
|
|
44,396
|
|
-
|
|
239,079
|
Cost of
instant tickets (1)
|
|
70,414
|
|
-
|
|
-
|
|
-
|
|
70,414
|
Cost of
services(1)
|
|
-
|
|
29,929
|
|
18,501
|
|
-
|
|
48,430
|
Cost of
sales(1)
|
|
1,778
|
|
9,549
|
|
5,630
|
|
-
|
|
16,957
|
Selling,
general and administrative
|
|
11,880
|
|
6,689
|
|
5,349
|
|
22,219
|
|
46,137
|
Stock-based compensation
|
|
868
|
|
602
|
|
259
|
|
4,516
|
|
6,245
|
Employee
termination and restructuring
|
|
-
|
|
-
|
|
967
|
|
-
|
|
967
|
Depreciation and amortization
|
|
8,001
|
|
11,706
|
|
10,854
|
|
140
|
|
30,701
|
Operating
income (loss)
|
|
$
32,216
|
|
$
11,051
|
|
$
2,836
|
|
$
(26,875)
|
|
$
19,228
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Exclusive of depreciation and amortization.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
CONSOLIDATED SEGMENT OPERATING DATA
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2012
|
|
|
|
|
|
|
|
|
Unallocated
|
|
|
|
|
Printed
|
|
Lottery
|
|
|
|
Corporate
|
|
|
|
|
Products
|
|
Systems
|
|
Gaming
|
|
Expense
|
|
Totals
|
|
|
|
|
|
|
|
|
|
|
|
Instant
tickets
|
|
$
493,642
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
493,642
|
Services
|
|
-
|
|
209,585
|
|
142,732
|
|
-
|
|
352,317
|
Sales
|
|
11,526
|
|
62,092
|
|
21,025
|
|
-
|
|
94,643
|
Total revenue
|
|
505,168
|
|
271,677
|
|
163,757
|
|
-
|
|
940,602
|
Cost of
instant tickets(1)
|
|
282,548
|
|
-
|
|
-
|
|
-
|
|
282,548
|
Cost of
services (1)
|
|
-
|
|
113,918
|
|
67,190
|
|
-
|
|
181,108
|
Cost of
sales(1)
|
|
7,569
|
|
40,275
|
|
17,209
|
|
-
|
|
65,053
|
Selling,
general and administrative
|
|
42,223
|
|
24,109
|
|
29,906
|
|
68,416
|
|
164,654
|
Stock-based compensation
|
|
3,394
|
|
2,267
|
|
1,753
|
|
16,745
|
|
24,159
|
Employee
termination and restructuring
|
|
5,852
|
|
-
|
|
5,650
|
|
-
|
|
11,502
|
Depreciation and amortization
|
|
40,953
|
|
54,474
|
|
77,345
|
|
598
|
|
173,370
|
Operating
income (loss)
|
|
$
122,629
|
|
$
36,634
|
|
$
(35,296)
|
|
$
(85,759)
|
|
$
38,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended December 31, 2011
|
|
|
|
|
|
|
|
|
Unallocated
|
|
|
|
|
Printed
|
|
Lottery
|
|
|
|
Corporate
|
|
|
|
|
Products
|
|
Systems
|
|
Gaming
|
|
Expense
|
|
Totals
|
|
|
|
|
|
|
|
|
|
|
|
Instant
tickets
|
|
$
493,275
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
493,275
|
Services
|
|
-
|
|
205,801
|
|
125,900
|
|
-
|
|
331,701
|
Sales
|
|
9,664
|
|
36,528
|
|
7,554
|
|
-
|
|
53,746
|
Total revenue
|
|
502,939
|
|
242,329
|
|
133,454
|
|
-
|
|
878,722
|
Cost of
instant tickets(1)
|
|
281,565
|
|
-
|
|
-
|
|
-
|
|
281,565
|
Cost of
services (1)
|
|
-
|
|
109,016
|
|
62,358
|
|
-
|
|
171,374
|
Cost of
sales(1)
|
|
5,928
|
|
25,134
|
|
7,278
|
|
-
|
|
38,340
|
Selling,
general and administrative
|
|
45,830
|
|
21,736
|
|
14,969
|
|
78,949
|
|
161,484
|
Stock-based compensation
|
|
3,439
|
|
1,977
|
|
1,439
|
|
14,683
|
|
21,538
|
Employee
termination and restructuring
|
|
-
|
|
-
|
|
1,997
|
|
-
|
|
1,997
|
Depreciation and amortization
|
|
32,746
|
|
46,891
|
|
38,435
|
|
531
|
|
118,603
|
Operating
income (loss)
|
|
$
133,431
|
|
$
37,575
|
|
$
6,978
|
|
$
(94,163)
|
|
$
83,821
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Exclusive of depreciation and amortization.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
RECONCILIATION OF NET INCOME TO ATTRIBUTABLE
EBITDA
|
RECONCILIATION OF EARNINGS FROM EQUITY INVESTMENTS
TO EBITDA FROM EQUITY INVESTMENTS
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
Twelve
Months Ended December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
(24,724)
|
|
$
(8,533)
|
|
$
(62,627)
|
|
$
(12,570)
|
Add:
Income tax expense
|
|
1,345
|
|
3,071
|
|
14,621
|
|
15,983
|
Add:
Depreciation and amortization
|
|
64,525
|
|
30,701
|
|
173,370
|
|
118,603
|
Add:
Interest expense
|
|
24,935
|
|
25,542
|
|
100,008
|
|
104,703
|
Add: Early
extinguishment of debt
|
|
-
|
|
-
|
|
15,464
|
|
4,185
|
Add/Less:
Other (income) expense
|
|
(1,278)
|
|
1,070
|
|
(1,185)
|
|
911
|
EBITDA
|
|
$
64,803
|
|
$
51,851
|
|
$
239,651
|
|
$
231,815
|
|
|
|
|
|
|
|
|
|
Credit
Agreement adjustments:
|
|
|
|
|
|
|
|
|
Add:
Debt-Related Fees and Charges (1)
|
|
$
28
|
|
$
851
|
|
$
15,592
|
|
$
5,157
|
Add:
Amortization of Intangibles
|
|
-
|
|
-
|
|
-
|
|
-
|
Add:
Earn-outs for Permitted Acquisitions
|
|
-
|
|
-
|
|
-
|
|
105
|
Add:
Extraordinary Charges or Losses under GAAP
|
|
-
|
|
-
|
|
-
|
|
-
|
Add:
Non-Cash Stock-Based Compensation Expenses
|
|
6,630
|
|
6,245
|
|
24,159
|
|
21,538
|
Add:
Deferred Contingent Compensation Expense
|
|
-
|
|
-
|
|
-
|
|
993
|
Add:
Non-Recurring Write-Offs under GAAP
|
|
228
|
|
66
|
|
228
|
|
390
|
Add:
Acquisition Advisory Fees (2)
|
|
319
|
|
606
|
|
1,475
|
|
2,193
|
Add:
Specified Permitted Add-Backs (2) (3)
|
|
2,876
|
|
2,685
|
|
15,000
|
|
8,782
|
Add:
Italian Concession Obligations
|
|
-
|
|
-
|
|
-
|
|
-
|
Add:
Racing Disposition Charges and Expenses
|
|
-
|
|
-
|
|
-
|
|
96
|
Add:
Playtech Royalties and Fees
|
|
1,819
|
|
1,597
|
|
7,183
|
|
3,250
|
Less:
Interest Income
|
|
(29)
|
|
(74)
|
|
(385)
|
|
(348)
|
Less:
Extraordinary Income or Gains under GAAP
|
|
-
|
|
-
|
|
-
|
|
-
|
Less:
Income on Earn-Outs for Permitted Acquisitions
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
Adjustments to conform to Credit Agreement
definition:
|
|
|
|
|
|
|
|
|
Add/Less:
Other (income) expense (4)
|
|
1,278
|
|
(1,070)
|
|
1,185
|
|
(911)
|
Less:
Early extinguishment of debt
|
|
-
|
|
-
|
|
(15,464)
|
|
(4,185)
|
Less:
Earnings from equity investments
|
|
(6,611)
|
|
(1,922)
|
|
(28,073)
|
|
(29,391)
|
Add:
EBITDA from equity investments
|
|
19,213
|
|
19,481
|
|
82,748
|
|
88,006
|
Attributable EBITDA
|
|
$
90,554
|
|
$
80,316
|
|
$
343,299
|
|
$
327,490
|
|
|
|
|
|
|
|
|
|
EBITDA
from equity investments (5):
|
|
|
|
|
|
|
|
|
Earnings
from equity investments
|
|
$
6,611
|
|
$
1,922
|
|
$
28,073
|
|
$
29,391
|
Add:
Income tax expense
|
|
1,770
|
|
2,167
|
|
11,020
|
|
12,079
|
Add:
Depreciation and amortization
|
|
10,707
|
|
11,893
|
|
40,591
|
|
39,387
|
Add:
Interest expense, net of other
|
|
125
|
|
3,499
|
|
3,064
|
|
7,149
|
EBITDA
from equity investments
|
|
$
19,213
|
|
$
19,481
|
|
$
82,748
|
|
$
88,006
|
|
|
|
|
|
|
|
|
|
(1)
Amounts reflect write-off of unamortized deferred financing costs
in connection with early extinguishment of debt and other
debt-related fees and charges.
|
(2)
Amounts for the three and twelve months ended December 31, 2012
reflect a reallocation of $157,000 from Specified Permitted
Add-Backs to Acquisition Advisory Fees as permitted in the Credit
Agreement.
|
(3)
Amounts include management transition expenses, transaction
expenses and restructuring expenses.
|
|
|
(4)
Amounts include foreign exchange transactions, interest income,
minority interest and other items.
|
|
|
(5) EBITDA
from equity investments includes results from the Company's
participation in Lotterie Nazionali S.r.l., Roberts Communications
Network, LLC, Beijing CITIC Scientific Games Technology Co., Ltd.,
Sportech Plc, Sciplay (through January 23, 2012), Beijing Guard
Libang Technology Co., Ltd. and Northstar Lottery Group, LLC
(beginning March 1, 2011).
|
|
|
|
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
CALCULATION OF FREE CASH FLOW
|
(Unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
Twelve
Months Ended December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
Net cash
provided by operating activities
|
|
$
48,822
|
|
$
18,451
|
|
$
156,750
|
|
$
171,078
|
|
|
|
|
|
|
|
|
|
Less:
Capital expenditures
|
|
(3,005)
|
|
(2,714)
|
|
(12,199)
|
|
(8,577)
|
Less:
Lottery and gaming systems expenditures
|
|
(14,054)
|
|
(9,487)
|
|
(44,776)
|
|
(43,459)
|
Less:
Other intangible assets and software expenditures
|
(14,247)
|
|
(11,312)
|
|
(54,357)
|
|
(39,848)
|
Total Capital
Expenditures
|
|
$
(31,306)
|
|
$
(23,513)
|
|
$
(111,332)
|
|
$
(91,884)
|
|
|
|
|
|
|
|
|
|
Free cash
flow
|
|
$
17,516
|
|
$
(5,062)
|
|
$
45,418
|
|
$
79,194
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
fourth quarter ended December 31, 2012, the Company received return
of capital payments from its equity
|
|
|
investments in LNS of $5.9 million and ITL of $0.6
million. For the fourth quarter ended December 31,
2011,
|
|
|
the
Company received a return of capital payment from its equity
investment in LNS of $11.2 million.
|
|
|
|
|
|
|
|
|
|
|
|
For the
third quarter ended September 30, 2012, the Company received no
return of capital payments from its equity
|
|
investments. For the third quarter ended September
30, 2011, the Company received a return of capital payment
from
|
|
its equity
investment in LNS of $0.4 million.
|
|
|
|
|
|
|
|
|
|
|
|
For the
second quarter ended June 30, 2012, the Company received return of
capital payments from its equity
|
|
|
investments in LNS of $15.1 million and ITL of $0.9
million. For the second quarter ended June 30, 2011,
the
|
|
|
Company
received return of capital payments from its equity investment in
LNS of $6.3 million.
|
|
|
|
|
|
|
|
|
|
|
|
For the
first quarter ended March 31, 2012, the Company received return of
capital payments from its
|
|
|
equity
investment in ITL of $2.2 million. For the first quarter
ended March 31, 2011, the Company received
|
|
|
no return
of capital payments from its equity investments.
|
|
|
|
|
|
|
|
|
|
|
|
During the
year ended December 31, 2011, the Company invested $31.2 million in
its equity investment which
|
|
|
funds the
acquisition of gaming terminals.
|
|
|
|
|
|
|
|
|
|
|
|
These
items were not included in the Company's Free Cash Flow
metric.
|
|
|
|
|
|
|
|
|
|
|
|
SCIENTIFIC GAMES CORPORATION AND
SUBSIDIARIES
|
KEY
PERFORMANCE INDICATORS
|
(Unaudited, in millions, except terminals
and ASP)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended December 31,
|
|
Twelve
Months Ended December 31,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
Italy -
Gratta e Vinci (1):
|
|
|
|
|
|
|
|
|
Retail
Sales (Euros) (1)
|
|
2,468
|
|
2,376
|
|
9,764
|
|
10,151
|
|
|
|
|
|
|
|
|
|
China -
China Sports Lottery (1):
|
|
|
|
|
|
|
|
|
Retail
Sales (RMB)
|
|
4,541
|
|
5,334
|
|
18,021
|
|
20,031
|
Tickets
Sold
|
|
602
|
|
684
|
|
2,403
|
|
2,781
|
ASP
(RMB)
|
|
7.54
|
|
7.80
|
|
7.50
|
|
7.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of
December 31,
|
|
|
|
|
Terminal
installed base at end of period:
|
|
2012
|
|
2011
|
|
|
|
|
Global
Draw
|
|
25,848
|
|
27,138
|
|
|
|
|
Games
Media
|
|
2,467
|
|
3,634
|
|
|
|
|
Barcrest
|
|
2,723
|
|
4,936
|
|
|
|
|
|
|
|
|
|
(1)
Information provided by third-party lottery
operators.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE Scientific Games Corporation