Scientific Games Corporation reported a loss of $2.15 per share for second-quarter 2020. The company had reported GAAP loss of 83 cents per share in the year-ago quarter.
Revenues came in at $539 million, down 36.2% year over year. The decline primarily resulted from decline in Gaming and Lottery revenues due to temporary closures of casino operations globally and a lower level of lottery ticket sales as a result of coronavirus-led lockdown.
Notably, the Zacks Consensus Estimate for earnings and revenues was pegged at loss of $1.89 per share and $463 million, respectively.
Services revenues decreased 28.9% to $322 million. Product sales were down 64.7% to $84 million. Instant product revenues were $133 million, down 11.3%.
Quarter Details
Gaming revenues (16.9% of revenues) decreased 78.7% year over year to $91 million. The company’s Gaming revenues were negatively impacted by COVID-19 disruptions that resulted in temporary closures of casino operations in jurisdictions globally. Notably, as of Jul 23, 85% of domestic casinos have reopened.
Lottery revenues (28.8% of revenues) declined 9.5% year over year to $209 million on lower lottery ticket sales related to the COVID-19 outbreak.
Scientific Games Corp Price, Consensus and EPS Surprise
Balance Sheet & Cash Flow
As of Jun 30, cash and cash equivalents were $790 million compared with $334 million as of Mar 31, 2020.
Net debt was $8.52 billion ($9.31 billion in face value of debt outstanding less $790 million of cash and cash equivalents) as of Jun 30.
As of Jun 30, the company had $943 million in available liquidity, which included SciPlay’s revolving credit facility.
In July, as a result of successfully completing a private offering of 2025 Notes and the redemption of the outstanding 2021 Notes, total liquidity increased more than $200 million subsequent to quarter-end.
On Apr 9, 2020, Scientific Games borrowed $480 million under SGI’s revolving credit facility, which was substantially the remaining availability thereunder.
Net debt leverage ratio was 8.6 times as of Jun 30. Scientific Games aims at achieving net debt leverage of 6 times by the end of 2020 and 5.5 times in 2021.
Cash from operating activities was $52 million compared with the prior quarter’s $120 million. Free cash flow was $5 million compared with $56 million in the previous quarter.
Guidance
For 2020, the company now anticipates capital expenditure in the range of $210 million-$240 million due to capital liquidity-saving measures implemented as a result of COVID-19 disruptions.
Zacks Rank & Stocks to Consider
Scientific Games currently carries a Zacks Rank #3 (Hold).
A10 Networks, Inc. (ATEN - Free Report) , Advanced Micro Devices (AMD - Free Report) and SAP SE (SAP - Free Report) are some better-ranked stocks in the broader computer and technology sector. While A10 Networks sports a Zacks Rank #1 (Strong Buy), Advanced Micro Devices and SAP SE each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
A10 Networks and Advanced Micro Devices will both report second-quarter 2020 results on Jul 28, while SAP will report on Jul 27.
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Scientific Games Corporation reported a loss of $2.15 per share for second-quarter 2020. The company had reported GAAP loss of 83 cents per share in the year-ago quarter.
Revenues came in at $539 million, down 36.2% year over year. The decline primarily resulted from decline in Gaming and Lottery revenues due to temporary closures of casino operations globally and a lower level of lottery ticket sales as a result of coronavirus-led lockdown.
Notably, the Zacks Consensus Estimate for earnings and revenues was pegged at loss of $1.89 per share and $463 million, respectively.
Services revenues decreased 28.9% to $322 million. Product sales were down 64.7% to $84 million. Instant product revenues were $133 million, down 11.3%.
Quarter Details
Gaming revenues (16.9% of revenues) decreased 78.7% year over year to $91 million. The company’s Gaming revenues were negatively impacted by COVID-19 disruptions that resulted in temporary closures of casino operations in jurisdictions globally. Notably, as of Jul 23, 85% of domestic casinos have reopened.
Lottery revenues (28.8% of revenues) declined 9.5% year over year to $209 million on lower lottery ticket sales related to the COVID-19 outbreak.
Scientific Games Corp Price, Consensus and EPS Surprise
Balance Sheet & Cash Flow
As of Jun 30, cash and cash equivalents were $790 million compared with $334 million as of Mar 31, 2020.
Net debt was $8.52 billion ($9.31 billion in face value of debt outstanding less $790 million of cash and cash equivalents) as of Jun 30.
As of Jun 30, the company had $943 million in available liquidity, which included SciPlay’s revolving credit facility.
In July, as a result of successfully completing a private offering of 2025 Notes and the redemption of the outstanding 2021 Notes, total liquidity increased more than $200 million subsequent to quarter-end.
On Apr 9, 2020, Scientific Games borrowed $480 million under SGI’s revolving credit facility, which was substantially the remaining availability thereunder.
Net debt leverage ratio was 8.6 times as of Jun 30. Scientific Games aims at achieving net debt leverage of 6 times by the end of 2020 and 5.5 times in 2021.
Cash from operating activities was $52 million compared with the prior quarter’s $120 million. Free cash flow was $5 million compared with $56 million in the previous quarter.
Guidance
For 2020, the company now anticipates capital expenditure in the range of $210 million-$240 million due to capital liquidity-saving measures implemented as a result of COVID-19 disruptions.
Zacks Rank & Stocks to Consider
Scientific Games currently carries a Zacks Rank #3 (Hold).
A10 Networks, Inc. (ATEN - Free Report) , Advanced Micro Devices (AMD - Free Report) and SAP SE (SAP - Free Report) are some better-ranked stocks in the broader computer and technology sector. While A10 Networks sports a Zacks Rank #1 (Strong Buy), Advanced Micro Devices and SAP SE each carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
A10 Networks and Advanced Micro Devices will both report second-quarter 2020 results on Jul 28, while SAP will report on Jul 27.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
With users in 180 countries and soaring revenues, it’s set to thrive on remote working long after the pandemic ends. No wonder it recently offered a stunning $600 million stock buy-back plan.
The sky’s the limit for this emerging tech giant. And the earlier you get in, the greater your potential gain.
Click Here, See It Free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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