LAS VEGAS,
Nov. 3, 2021 /PRNewswire/
-- Everi Holdings Inc. (NYSE: EVRI) ("Everi" or the
"Company"), a premier provider of land-based and digital casino
gaming content and products, financial technology and player
loyalty solutions, today announced third quarter results for the
period ended September 30,
2021.
Third Quarter 2021 Financial Highlights and Updated
Full Year Outlook
As the third quarter 2020 financial results were
significantly impacted by the COVID-19 pandemic, Everi believes a
more meaningful comparison for its 2021 third quarter results and
an indication of its growth is to the 2019 third quarter results,
for which revenues and Adjusted EBITDA were higher than in the 2020
third quarter. Financial results for the 2021, 2020 and 2019 third
quarter periods are presented in the Consolidated, Games and
Financial Technology Solutions comparative results tables
below.
- Revenues rose 25% to $168.3
million, compared to $134.6
million in the 2019 third quarter.
- Operating income more than doubled to a record
$55.1 million compared to
$27.3 million in the 2019 third
quarter. Net income, inclusive of $34.4
million in pre-tax costs for the extinguishment of debt
associated with the Company's refinancing of its outstanding debt
in the quarter, decreased to $6.7
million, or $0.07 per diluted
share, compared to $9.3 million, or
$0.12 per diluted share, in the 2019
third quarter.
- Adjusted EBITDA, a non-GAAP financial measure,
increased 40% to $90.6 million,
compared to $64.7 million in the 2019
third quarter.
- Free Cash Flow, a non-GAAP financial measure,
increasedmore than fivefold to a quarterly record of $56.3 million, compared to $11.1 million in the 2019 third
quarter.
- Company now expects full year revenue of $645 million to $653
million, net income of $98
million to $100 million,
Adjusted EBITDA of $342 million to
$346 million and Free Cash Flow of
$155 million to $160 million.
Michael Rumbolz, Chief
Executive Officer of Everi, said, "The growth in our third quarter
revenue, operating earnings and Free Cash Flow demonstrate the
substantial ongoing momentum in our financial performance. We
expect that further growth across both our Games and FinTech
segments will continue for the remainder of this year and into 2022
and beyond. We expect to continue to benefit from the expansion of
our installed base of leased gaming units, growth in ship share,
same-store increases in financial access transactions, and the
ongoing organic growth of our loyalty and regulatory compliance
solutions. We believe the ongoing strength across both businesses
and our deep pipeline of new offerings will drive consistent
earnings and revenue growth as well as the continued generation of
significant Free Cash Flow.
"The favorable customer reaction to our newest products at
G2E® last month bolsters our confidence in our near- and long-term
outlook. For our Games segment, the scale of our newest content
continues to increase with well-received new themes introduced
across the spectrum of premium video, premium mechanical, standard
video, standard mechanical, and wide-area progressive ("WAP")
machines. New premium games such as Cashnado™ and Smokin'
Hot Stuff Wicked Wheel Fire and Ice® further demonstrated to
customers our commitment to offer both new themes and support of
our popular hit franchises, while our unique for-sale Cha
Ching™ and Moneyline™ games for the high-performing
Empire Flex® portrait cabinet highlight the creativity and
innovation of our game design teams. Everi's development teams
continue to create products that raise the level of gaming
entertainment and thereby offer an attractive return on the
investments our customers make in our gaming products.
"Our portfolio of integrated FinTech products and services
is more comprehensive and provides more value to casino operators
than ever before and our newest offerings were similarly met with
very favorable response at G2E. Our omni-channel, digital
Cashclub Wallet® was a highlight of the show, including our
demonstration of its seamless integration with our mobile-player
loyalty offering. New products, such as MetersXpress™ and
PitXpress™, which extends our Digital Neighborhood to the
casino pit, provide key process efficiencies. With the
strength and depth of our newest products and core offerings, Everi
is favorably positioned to execute on our significant opportunities
to gain market share and deliver consistent future growth across
our Games and FinTech businesses."
Consolidated Full Quarter Comparative Results
(unaudited)
|
As of and for the Three Months Ended September
30,
|
|
2021
|
|
2020
|
|
2019
|
|
(in millions, except per share
amounts)
|
Consolidated
revenue
|
$
|
168.3
|
|
|
$
|
112.1
|
|
|
$
|
134.6
|
|
|
|
|
|
|
|
Operating
income
|
$
|
55.1
|
|
|
$
|
19.7
|
|
|
$
|
27.3
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
6.7
|
|
|
$
|
(0.9)
|
|
|
$
|
9.3
|
|
|
|
|
|
|
|
Net earnings (loss)
per diluted share
|
$
|
0.07
|
|
|
$
|
(0.01)
|
|
|
$
|
0.12
|
|
|
|
|
|
|
|
Diluted shares
outstanding (1)
|
101.4
|
|
|
85.6
|
|
|
79.1
|
|
|
|
|
|
|
|
Adjusted EBITDA
(2)
|
$
|
90.6
|
|
|
$
|
59.8
|
|
|
$
|
64.7
|
|
|
|
|
|
|
|
Free Cash Flow
(2)
|
$
|
56.3
|
|
|
$
|
22.8
|
|
|
$
|
11.1
|
|
|
|
|
|
|
|
Principal amount of
outstanding debt (3)
|
$
|
1,000.0
|
|
|
$
|
1,145.6
|
|
|
$
|
1,157.0
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
215.6
|
|
|
$
|
235.4
|
|
|
$
|
275.7
|
|
|
|
|
|
|
|
Net Cash Position
(4)
|
$
|
88.6
|
|
|
$
|
128.3
|
|
|
$
|
33.3
|
|
|
|
(1)
|
In December 2019, the
Company completed a public offering of 11.5 million shares of
common stock. Weighted average basic shares outstanding were 90.3
million, 85.6 million, and 72.3 million shares for the three months
ended September 30, 2021, 2020, and 2019, respectively.
|
(2)
|
For a reconciliation
of net income (loss) to Adjusted EBITDA and Free Cash Flow, see the
Unaudited Reconciliation of Selected Financial GAAP to Non-GAAP
Measures provided at the end of this release.
|
(3)
|
In the third quarter
of 2021, the Company reduced its total outstanding debt to $1.0
billion through the successful issuance of $400 million of 5.000%
senior unsecured notes due 2029 and $600 million of senior secured
term loan, along with a $125 million revolving credit facility that
is currently undrawn. In completing the transactions on August 3,
2021, the Company used cash on hand to pay the transaction fees and
expenses and reduce the total debt outstanding by $144.6
million.
|
(4)
|
For a reconciliation
of Net Cash Position to Cash and Cash Equivalents, see the
Unaudited Reconciliation of Cash and Cash Equivalents to Net Cash
Position and Net Cash Available at the end of this
release.
|
Third Quarter 2021 Results Overview
Results for the three-month period ended September 30, 2021 continued to reflect the
impact of the COVID-19 pandemic, albeit to a lesser extent than
recent quarterly periods. Third quarter 2020 results reflect a
significant impact of COVID-19, while 2019 results were unimpacted
by the pandemic.
Randy Taylor, Everi's Chief
Operating Officer, said, "Our strong quarterly financial results
are directly correlated to the continued successful execution of
our strategic growth initiatives, leading to consistent new demand
for our products. A key driver of our operating momentum is the
continued growth of our high-margin, recurring revenue streams,
which increased to more than $131
million, a quarterly record. This strength translates to
improved cash flow, which provides additional capital we can
allocate towards return-focused investments in product innovation
to drive sustainable growth, as well as the flexibility to pursue
and successfully integrate and scale accretive bolt-on
acquisitions.
"Growth in our FinTech business continues to reflect
improvements in financial access services, loyalty and RegTech
software solutions from new and existing customers, as well as
double-digit growth in same-store financial access transactions and
dollars processed. In addition, we are achieving consistent
progress with the rollout of our cashless digital wallet offering,
which is now deployed across four jurisdictions at 15 casinos that
have more than 32,000 gaming machines. This progress demonstrates
our ability to offer industry-leading, integrated solutions that
help our customers operate more efficiently and maximize funds
delivered to their casino floors while providing their guests with
a seamless experience.
"Our Games segment continues to benefit from placements of
our higher-earning premium units, which grew to a record 7,351
units in the quarter, representing 45% of the total installed base.
Third quarter sales of 1,176 electronic gaming machines reflect our
growing ship share of replacement units, which we believe now
approximate double-digit quarterly ship share. The strength
of our for-sale games is also evidenced by the quarterly sequential
growth in replacement sales achieved throughout 2021, compared to
pre-pandemic periods. As the replacement cycle of electronic
gaming machines returns to pre-pandemic levels, we expect the
investments we have made in our Games business have positioned us
to make consistent progress towards our new target of 15% ship
share over the next several years.
"The operating performance of our two segments, together
with a continued focus on costs, led to a record level of recurring
revenue, operating income and Free Cash Flow generation of
$56.3 million."
Games Segment Full Quarter Comparative Results
(unaudited)
|
Three Months Ended September
30,
|
|
2021
|
|
2020
|
|
2019
|
|
(in millions, except unit amounts and
prices)
|
Games
revenues
|
|
|
|
|
|
Gaming
operations
|
$
|
71.6
|
|
|
$
|
47.0
|
|
|
$
|
48.5
|
|
Gaming equipment and
systems
|
24.2
|
|
|
10.2
|
|
|
19.6
|
|
Gaming
other
|
—
|
|
|
—
|
|
|
1.2
|
|
Games total
revenues
|
$
|
95.8
|
|
|
$
|
57.2
|
|
|
$
|
69.3
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$
|
30.2
|
|
|
$
|
(0.4)
|
|
|
$
|
3.1
|
|
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
$
|
57.7
|
|
|
$
|
32.9
|
|
|
$
|
34.6
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
19.3
|
|
|
$
|
17.3
|
|
|
$
|
30.3
|
|
|
|
|
|
|
|
Gaming operations
information:
|
|
|
|
|
|
Units installed at
period end:
|
|
|
|
|
|
Class II
|
9,525
|
|
|
9,115
|
|
|
9,188
|
|
Class III
|
6,896
|
|
|
6,141
|
|
|
5,084
|
|
Total installed base
at period end (2)
|
16,421
|
|
|
15,256
|
|
|
14,272
|
|
|
|
|
|
|
|
Premium units
(2)
|
7,351
|
|
|
6,141
|
|
|
4,395
|
|
|
|
|
|
|
|
Average units
installed during period (2)
|
16,232
|
|
|
15,081
|
|
|
13,979
|
|
|
|
|
|
|
|
Daily win per unit
("DWPU") (3)
|
$
|
42.74
|
|
|
$
|
32.81
|
|
|
$
|
33.95
|
|
|
|
|
|
|
|
Unit sales
information:
|
|
|
|
|
|
Units sold
|
1,176
|
|
|
492
|
|
|
1,040
|
|
Average sales price
("ASP")
|
$
|
18,014
|
|
|
$
|
18,209
|
|
|
$
|
17,983
|
|
|
|
(1)
|
For a reconciliation
of net income (loss) to Adjusted EBITDA, see the Unaudited
Reconciliation of Selected Financial GAAP to Non-GAAP measures
provided at the end of this release.
|
(2)
|
The ending and
average installed base for all three periods includes all units,
whether or not casinos were open and whether or not the games were
active.
|
(3)
|
Daily win per unit
reflects the total of all units installed at casinos, inclusive of
closed casinos and inactive units, where such units would have
recorded no revenue and excludes the impact of the direct costs
associated with the Company's wide-area progressive jackpot
expense.
|
2021 Third Quarter Games Segment
Highlights
Games segment revenues increased to a quarterly record
$95.8 million compared to
$57.2 million and $69.3 million in the third quarter of 2020 and
2019, respectively, primarily reflecting growth in the installed
base and in Daily Win per Unit ("DWPU") in gaming operations, as
well as increased shipments of gaming machines.
Operating income increased to $30.2
million, compared to an operating loss of $0.4 million a year ago and operating income of
$3.1 million in the third quarter
2019. The increase in operating income over the prior-year periods
reflects the benefit of higher revenues, a revenue mix that
includes a greater contribution from the higher-margin gaming
operations business and lower amortization expense. Adjusted EBITDA
increased to a quarterly record $57.7
million, from $32.9 million
and $34.6 million in the third
quarter of 2020 and 2019, respectively.
Gaming operations revenue grew to a quarterly record
$71.6 million, compared to
$47.0 million and $48.5 million in the third quarter of 2020 and
2019, respectively.
- Driven by the strength of higher-performing premium
games, DWPU increased to $42.74 in
the third quarter of 2021, compared to $32.81 and $33.95
in the third quarter of 2020 and 2019, respectively.
- The installed base as of September
30, 2021 was a record 16,421 units, an increase of 8%, or
1,165 units, compared to September 30,
2020. The installed base increased by 170 units on a
quarterly sequential basis despite the previously announced
convert-to-sale of 238 standard units in the 2021 third
quarter.
-
- In the third quarter, the Company extended terms of its
placement fee arrangement with a significant multi-property tribal
casino operator that secures 4,557 games, or 28% of the Company's
current total installed base, until mid-2027 for an additional fee
of $28.9 million to be paid in the
2021 fourth quarter.
- The premium portion of the installed base increased by
20%, or 1,210 units, year over year and by 390 units on a quarterly
sequential basis to a record 7,351 units. This was the 13th
consecutive quarterly sequential increase in premium units. Growth
was in part driven by initial placements of Cashnado™ units
along with incremental placements of the strong-performing The
Vault™ game theme, as well as the Company's industry-leading
premium mechanical reel games. The installed base of Wide-area
Progressive ("WAP") gaming machines, a subcategory of premium
units, grew by 182 units year over year and 101 units on a
quarterly sequential basis to 1,183 machines as of September 30, 2021, due in part to the launch of
the Monsterverse™ game on the Empire DCX® cabinet and
the installation of WAP units into commercial casinos in
Nevada and New Jersey.
- Digital revenue rose 90% to $3.8
million compared to $2.0
million a year ago and more than triple the amount two years
ago. Digital revenue growth reflects increased B2B revenue from the
expanded base of iGaming operator sites featuring Everi's games –
including new customer sites in New
Jersey, Pennsylvania, and
Michigan that went live during the
quarter – along with a growing library of available slot content.
Subsequent to quarter-end, Everi Digital went live in Ontario and Connecticut. The B2B revenue increase more
than offset a decline in B2C revenue as the Company has
de-emphasized its B2C social gaming operations, which it now
expects will be fully closed by the end of 2021.
- Revenues from the New York Lottery systems business
increased to $6.4 million compared to
$1.1 million and $4.8 million in the third quarter of 2020 and
2019, respectively.
Gaming equipment and systems revenues generated from the
sale of gaming units and other related parts and equipment totaled
$24.2 million in the third quarter of
2021, compared to $10.2 million and
$19.6 million in the third quarter of
2020 and 2019, respectively.
- The Company sold 1,176 new units at an average selling
price ("ASP") of $18,014in the 2021
third quarter. This is an increase compared with 492 units at an
ASP of $18,209 in the 2020 third
quarter and 1,040 units at an ASP of $17,983 in the 2019 third quarter. Units sold and
ASP do not include the 238 pre-owned convert-to-sale gaming
machines at a customer location noted above.
Financial Technology Solutions Segment Full Quarter
Comparative Results (unaudited)*
|
Three Months Ended September
30,
|
|
2021
|
|
2020
|
|
2019
|
|
(in millions, unless otherwise
noted)
|
FinTech
revenues
|
|
|
|
|
|
Financial access
services
|
$
|
46.4
|
|
|
$
|
34.0
|
|
|
$
|
43.1
|
|
Software and
other
|
17.0
|
|
|
14.6
|
|
|
12.0
|
|
Hardware
|
9.0
|
|
|
6.2
|
|
|
10.2
|
|
FinTech total
revenues
|
$
|
72.4
|
|
|
$
|
54.9
|
|
|
$
|
65.3
|
|
|
|
|
|
|
|
Operating
income
|
$
|
24.9
|
|
|
$
|
20.2
|
|
|
$
|
24.2
|
|
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
$
|
32.9
|
|
|
$
|
26.8
|
|
|
$
|
30.1
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
4.8
|
|
|
$
|
5.0
|
|
|
$
|
5.7
|
|
|
|
|
|
|
|
Value of financial
access transactions:
|
|
|
|
|
|
Funds advanced
|
$
|
2,352.7
|
|
|
$
|
1,767.6
|
|
|
$
|
1,909.0
|
|
Funds dispensed
|
7,164.0
|
|
|
4,906.4
|
|
|
5,402.2
|
|
Check warranty
|
393.2
|
|
|
262.6
|
|
|
361.6
|
|
Total value
processed
|
$
|
9,909.9
|
|
|
$
|
6,936.6
|
|
|
$
|
7,672.8
|
|
|
|
|
|
|
|
Number of financial
access transactions:
|
|
|
|
|
|
Funds advanced
|
3.3
|
|
|
2.6
|
|
|
3.0
|
|
Funds dispensed
|
28.6
|
|
|
21.1
|
|
|
25.0
|
|
Check warranty
|
0.9
|
|
|
0.7
|
|
|
0.9
|
|
Total transactions
completed
|
32.8
|
|
|
24.4
|
|
|
28.9
|
|
|
|
*
|
Rounding may cause
variances.
|
(1)
|
For a reconciliation
of net income (loss) to Adjusted EBITDA, see the Unaudited
Reconciliation of Selected Financial GAAP to Non-GAAP Measures
provided at the end of this release.
|
2021 Third Quarter Financial Technology Solutions
Segment Highlights
FinTech revenues for the 2021 third quarter increased to a
record $72.4 million compared to
$54.9 million and $65.3 million in the third quarter of 2020 and
2019, respectively. The growth over both years primarily reflects
an increase in revenues from financial access services and software
and other.
Operating income rose to $24.9
million compared to $20.2
million and $24.2 million in
the third quarter of 2020 and 2019, respectively. The increase
primarily reflects the benefit of higher revenues partially offset
by an increase in research and development expense driven by an
acceleration of new product development efforts, including new and
enhanced loyalty products, the Company's CashClub
Wallet® digital technology solution and new RegTech
offerings. Adjusted EBITDA was $32.9
million compared to $26.8
million and $30.1 million in
the third quarter of 2020 and 2019, respectively.
- Financial access services revenues, which include
cashless and cash-dispensing debit and credit card transactions and
check services, increased on a quarterly sequential basis to
$46.4 million from $44.8 million in the second quarter 2021,
reflecting continued strength in casino activity; and were up 8%
from the third quarter of 2019. Transactional activity on a
same-store basis increased in the third quarter 2021 by a mid-teens
percentage rate over the pre-COVID third quarter of
2019.
- Software and other revenues, which include loyalty and
RegTech software, product subscriptions, kiosk maintenance
services, and other revenue, rose to a record $17.0 million, of which approximately 77% were of
a recurring nature. This compares to total revenue of
$14.6 million in the third quarter
2020, of which 76% were of a recurring nature, and $12.0 million in the third quarter 2019, of which
73% were of a recurring nature.
- Hardware sales revenues were $9.0
million, inclusive of significant shipments of self-service
kiosks and other loyalty and financial access equipment for new
casino openings and major expansions, in the third quarter 2021,
compared to $6.2 million and
$10.2 million in the third quarter of
2020 and 2019, respectively.
Balance Sheet and Liquidity
- During the 2021 third quarter, the Company completed a
refinancing that reduced total debt by $144.6 million to $1.0
billion, decreased annual cash interest costs and extended
maturities.
- As of September 30, 2021,
the Company had cash and cash equivalents of $215.6 million and a Net Cash Position of
$88.6 million.
- Early in the 2021 fourth quarter, the Company paid
$28.9 million in a single lump sum to
extend the term of its placement fee agreement with a significant
customer.
Outlook
Everi today raised its previous guidance for full year
2021 results. The Company now expects net income of $98 million to $100
million, Adjusted EBITDA of $342
million to $346 million, and
Free Cash Flow of $155 million to
$160 million (inclusive of the
$28.9 million fourth quarter
placement fee noted above). The factors considered in Everi's 2021
outlook include:
- Continued year-over-year growth in gaming operations
revenues. Reflecting the recent increase in installed base and the
additional growth anticipated in the later part of the fourth
quarter, the Company expects the 2021 year-end installed base will
approach or slightly exceed 17,000 units, inclusive of ongoing
growth in premium unit placements. While reflecting usual fourth
quarter influences, recent record-high DWPU is anticipated to
remain above $40.00.
- Capital expenditures and placement fees collectively are
expected to be $132 million to
$134 million.
- Although not factored into its guidance, the Company is
currently evaluating a potential significant change to income taxes
related to the possible reversal of some portion of the Company's
deferred tax asset valuation allowances during the 2021 fourth
quarter. To the extent this materializes, a significant non-cash
income tax benefit may be realized, which would likely result in a
substantial full year income tax benefit and increased net income
for the Company while not affecting cash taxes paid or Free Cash
Flow.
- The Company's 2021 outlook does not contemplate any
additional meaningful impact from a macroeconomic or
pandemic-related setback; it does reflect, however, the likelihood
of receding government stimulus benefits and an increase in
pressure on consumer discretionary spending.
A summary and reconciliation of the financial targets are
included in a supplemental table at the end of this
release.
Investor Conference Call and Webcast
The Company will host an investor conference call to
discuss its 2021 third quarter results at 11:00 a.m. ET (8:00 a.m.
PT) today. The conference call may be accessed live by phone
by dialing (201) 689-8471. A replay of the call will be available
beginning at 3:00 p.m. ET today and
may be accessed by dialing +1 (412) 317-6671; the PIN number is
13724406. A replay will be available until November 10, 2021. The call also will be webcast
live and archived on www.everi.com (select "Investors" followed by
"Events & Contact").
Non-GAAP Financial Information
In order to enhance investor understanding of the
underlying trends in our business, our cash balance, and cash
available for our operating needs, and to provide for better
comparability between periods in different years, we are providing
in this press release Adjusted EBITDA, Free Cash Flow, Net Cash
Position and Net Cash Available, which are not measures of our
financial performance or position under United States Generally
Accepted Accounting Principles ("GAAP"). Accordingly, Adjusted
EBITDA, and Free Cash Flow should not be considered in isolation or
as a substitute for measures prepared in accordance with
GAAP. These measures should be read in conjunction with our
net earnings, operating income, and cash flow data prepared in
accordance with GAAP. With respect to Net Cash Position and Net
Cash Available, these measures should be read in conjunction with
cash and cash equivalents prepared in accordance with
GAAP.
We define Adjusted EBITDA as earnings (loss) before
interest, taxes, depreciation and amortization, loss on
extinguishment of debt, non-cash stock compensation expense,
accretion of contract rights, write-downs of inventory, property
and equipment and intangible assets, employee severance costs and
other related expenses, litigation settlement received net of legal
costs, foreign exchange loss, asset acquisition expense,
non-recurring professional fees, and one-time charges. We present
Adjusted EBITDA, as we use this measure to manage our business and
consider this measure to be supplemental to our operating
performance. We also make certain compensation decisions based, in
part, on our operating performance, as measured by Adjusted EBITDA;
and our current credit facility and existing senior unsecured notes
require us to comply with a consolidated secured leverage ratio
that includes performance metrics substantially similar to Adjusted
EBITDA.
We define Free Cash Flow as Adjusted EBITDA less cash paid
for interest, cash paid for capital expenditures, cash paid for
placement fees, and cash paid for taxes net of refunds. We
present Free Cash Flow as a measure of performance and believe it
provides investors with another indicator of our operating
performance. It should not be inferred that the entire Free Cash
Flow amount is available for discretionary expenditures.
A reconciliation of the Company's net income (loss) per
GAAP to Adjusted EBITDA and Free Cash Flow is included in the
Unaudited Reconciliation of Selected Financial GAAP to Non-GAAP
Measures provided at the end of this release. Additionally, a
reconciliation of each segment's operating income to EBITDA and
Adjusted EBITDA is also included. On a segment level, operating
income per GAAP, rather than net earnings per GAAP, is reconciled
to EBITDA and Adjusted EBITDA as the Company does not report net
earnings by segment. Management believes that this presentation is
meaningful to investors in evaluating the performance of the
Company's segments.
We define (i) Net Cash Position as cash and cash
equivalents plus settlement receivables less settlement liabilities
and (ii) Net Cash Available as Net Cash Position plus undrawn
amounts available under our revolving credit facility. We present
Net Cash Position because our cash position, as measured by cash
and cash equivalents, depends upon changes in settlement
receivables and the timing of payments related to settlement
liabilities. As such, our cash and cash equivalents can change
substantially based upon the timing of our receipt of payments for
settlement receivables and payments we make to customers for our
settlement liabilities. We present Net Cash Available as
management monitors this amount in connection with its forecasting
of cash flows and future cash requirements.
A reconciliation of the Company's cash and cash
equivalents per GAAP to Net Cash Position and Net Cash Available is
included in the Unaudited Reconciliation of Cash and Cash
Equivalents to Net Cash Position and Net Cash Available provided at
the end of this release.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains "forward-looking statements"
as defined in the U.S. Private Securities Litigation Reform Act of
1995. In this context, forward-looking statements address our
expected future business and financial performance, and often
contain words such as "goal," "target," "indication," "future,"
"assume," "estimate," "expect," "anticipate," "intend," "plan,"
"believe," "seek," "project," "may," "should," "will," "can," "aim
to," "designed to," "will provide," or "favorably positioned" or
similar expressions to identify forward-looking statements.
Examples of forward-looking statements include, among others,
statements regarding our ability to execute on key initiatives and
deliver ongoing operating and financial improvements including
guidance related to 2021 financial and operational metrics; regain
or maintain revenue, earnings and Free Cash Flow momentum; sustain
our overall growth; drive growth of the gaming operations installed
base and DWPU; continue expanding the portions of the gaming floor
the Company's games address; successfully perform obligations
required by acquisition agreements; and create incremental value
for our shareholders, as well as statements regarding our
expectations for the industry environment and the adoption of our
products and technologies.
Forward-looking statements are neither historical facts
nor assurances of future performance. Instead, they are based only
on our current beliefs, expectations, and assumptions regarding the
future of our business, future plans and strategies, projections,
anticipated events and trends, the economy and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent risks, uncertainties and
changes in circumstances that are often difficult to predict and
many of which are beyond our control. Our actual results and
financial condition may differ materially from those indicated in
forward-looking statements. Important factors that could cause our
actual results and financial condition to differ materially from
those indicated in the forward-looking statements include, without
limitation, the impact of the ongoing COVID-19 global pandemic on
our business, operations and financial condition, our history of
net losses and our ability to generate profits in the future; our
debt leverage and the related covenants that restrict our
operations; our ability to generate sufficient cash to service all
of our indebtedness and fund working capital and capital
expenditures; our ability to withstand unanticipated impacts of a
pandemic outbreak of uncertain duration; our ability to withstand
the loss of revenue during the closure of our customers'
facilities; our ability to maintain our current customers; our
ability to compete in the gaming industry; our ability to execute
on mergers, acquisitions and/or strategic alliances, including the
timing and closing of acquisitions and our ability to integrate and
operate such acquisitions consistent with our forecasts; our
ability to access the capital markets to raise funds; expectations
regarding our existing and future installed base and daily win per
day; expectations regarding development and placement fee
arrangements; inaccuracies in underlying operating assumptions;
expectations regarding customers' and gaming patrons' preferences
and demands for future services and product offerings; the overall
growth of the gaming industry, if any; our ability to replace
revenue associated with terminated customer contracts; margin
degradation from contract renewals; technological obsolescence; our
ability to comply with the Europay, MasterCard and Visa global
standard for cards equipped with security chip technology; our
ability to introduce new and enhanced products and services,
including third-party licensed content; our ability to prevent,
mitigate or timely recover from cybersecurity breaches, attacks and
compromises; the level of our capital expenditures and product
development; anticipated sales performance; employee turnover;
national and international economic conditions; global supply chain
disruption; changes in global market, business and regulatory
conditions arising as a result of the COVID-19 global pandemic;
changes in gaming regulatory, card association and statutory
requirements; regulatory and licensing difficulties that we may
face; competitive pressures in the gaming and financial technology
sectors; the impact of changes to tax laws; uncertainty of
litigation outcomes; interest rate fluctuations; unanticipated
expenses or capital needs and those other risks and uncertainties
discussed in our most recent Annual Report on Form 10-K filed with
the U.S. Securities and Exchange Commission on March 15, 2021. Given these risks and
uncertainties, there can be no assurance that the forward-looking
information contained in this press release will in fact transpire
or prove to be accurate. Readers are cautioned not to place undue
reliance on the forward-looking statements contained herein, which
are based only on information currently available to us and speak
only as of the date hereof.
This press release should be read in conjunction with our
Annual Report on Form 10-K for the year ended December 31, 2020, and with the information
included in our other press releases, reports and other filings
with the SEC. Understanding the information contained in these
filings is important in order to fully understand our reported
financial results and our business outlook for future
periods.
About Everi
Everi's mission is to lead the gaming industry through the
power of people, imagination and technology. With a focus on player
engagement and helping casino customers operate more efficiently,
the Company develops entertaining game content and gaming machines,
gaming systems, and services for land-based and iGaming operators.
The Company is also a preeminent and comprehensive provider of
trusted financial technology solutions that power the casino floor
while improving operational efficiencies and fulfilling regulatory
compliance requirements, including products and services that
facilitate convenient and secure cash and cashless financial
transactions, self-service player loyalty tools and applications,
and regulatory and intelligence software. For more information,
please visit www.everi.com, which is updated regularly
with financial and other information about the Company.
Investor Relations Contacts:
Everi Holdings Inc.
|
JCIR
|
William
Pfund
|
Richard Land, James
Leahy
|
SVP, Investor
Relations
|
212-835-8500 or
evri@jcir.com
|
702-676-9513 or
william.pfund@everi.com
|
|
|
|
Join Everi on Social Media
|
|
Twitter:
https://twitter.com/everi_inc
|
|
LinkedIn:
https://www.linkedin.com/company/everi
|
|
Facebook:
https://www.facebook.com/EveriHoldingsInc/
|
|
Instagram:
https://www.instagram.com/everi_inc
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
(In thousands, except earnings (loss) per share
amounts)
|
|
|
Three Months Ended September
30,
|
|
Nine Months Ended September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Revenues
|
|
|
|
|
|
|
|
Games revenues
|
|
|
|
|
|
|
|
Gaming
operations
|
$
|
71,580
|
|
|
$
|
46,968
|
|
|
202,941
|
|
|
106,513
|
|
Gaming equipment and
systems
|
24,220
|
|
|
10,229
|
|
|
68,298
|
|
|
28,795
|
|
Gaming
other
|
33
|
|
|
44
|
|
|
82
|
|
|
76
|
|
Games total revenues
|
95,833
|
|
|
57,241
|
|
|
271,321
|
|
|
135,384
|
|
FinTech revenues
|
|
|
|
|
|
|
|
Financial access
services
|
46,421
|
|
|
33,979
|
|
|
129,973
|
|
|
80,986
|
|
Software and
other
|
17,024
|
|
|
14,630
|
|
|
49,874
|
|
|
31,748
|
|
Hardware
|
9,024
|
|
|
6,248
|
|
|
28,829
|
|
|
16,004
|
|
FinTech total revenues
|
72,469
|
|
|
54,857
|
|
|
208,676
|
|
|
128,738
|
|
Total revenues
|
168,302
|
|
|
112,098
|
|
|
479,997
|
|
|
264,122
|
|
Costs and expenses
|
|
|
|
|
|
|
|
Games cost of
revenues(1)
|
|
|
|
|
|
|
|
Gaming
operations
|
5,675
|
|
|
4,245
|
|
|
15,776
|
|
|
10,471
|
|
Gaming equipment and
systems
|
13,503
|
|
|
5,730
|
|
|
39,058
|
|
|
16,625
|
|
Gaming
other
|
—
|
|
|
—
|
|
|
—
|
|
|
456
|
|
Games total cost of revenues
|
19,178
|
|
|
9,975
|
|
|
54,834
|
|
|
27,552
|
|
FinTech cost of
revenues(1)
|
|
|
|
|
|
|
|
Financial access
services
|
1,830
|
|
|
1,161
|
|
|
4,863
|
|
|
5,227
|
|
Software and
other
|
1,063
|
|
|
859
|
|
|
3,196
|
|
|
2,057
|
|
Hardware
|
5,380
|
|
|
3,548
|
|
|
17,078
|
|
|
9,452
|
|
FinTech total cost of revenues
|
8,273
|
|
|
5,568
|
|
|
25,137
|
|
|
16,736
|
|
Operating
expenses
|
47,121
|
|
|
34,927
|
|
|
133,320
|
|
|
115,428
|
|
Research and
development
|
9,598
|
|
|
7,034
|
|
|
26,799
|
|
|
20,958
|
|
Depreciation
|
14,463
|
|
|
16,163
|
|
|
46,571
|
|
|
48,700
|
|
Amortization
|
14,596
|
|
|
18,693
|
|
|
43,680
|
|
|
57,312
|
|
Total costs and expenses
|
113,229
|
|
|
92,360
|
|
|
330,341
|
|
|
286,686
|
|
Operating income (loss)
|
55,073
|
|
|
19,738
|
|
|
149,656
|
|
|
(22,564)
|
|
Other expenses
|
|
|
|
|
|
|
|
Interest expense, net
of interest income
|
14,257
|
|
|
18,905
|
|
|
50,488
|
|
|
56,226
|
|
Loss on extinguishment
of debt
|
34,389
|
|
|
—
|
|
|
34,389
|
|
|
7,457
|
|
Total other expenses
|
48,646
|
|
|
18,905
|
|
|
84,877
|
|
|
63,683
|
|
Income (loss) before income tax
|
6,427
|
|
|
833
|
|
|
64,779
|
|
|
(86,247)
|
|
Income tax (benefit)
provision
|
(319)
|
|
|
1,711
|
|
|
1,285
|
|
|
(3,434)
|
|
Net income (loss)
|
6,746
|
|
|
(878)
|
|
|
63,494
|
|
|
(82,813)
|
|
Foreign currency
translation
|
(442)
|
|
|
359
|
|
|
(335)
|
|
|
(1,295)
|
|
Comprehensive income (loss)
|
$
|
6,304
|
|
|
$
|
(519)
|
|
|
$
|
63,159
|
|
|
$
|
(84,108)
|
|
|
(1) Exclusive of
depreciation and amortization.
|
|
Three Months Ended September
30,
|
|
Nine Months Ended September 30,
|
|
2021
|
|
2020
|
|
2021
|
|
2020
|
Earnings (loss) per share
|
|
|
|
|
|
|
|
Basic
|
$
|
0.07
|
|
|
$
|
(0.01)
|
|
|
$
|
0.72
|
|
|
$
|
(0.97)
|
|
Diluted
|
$
|
0.07
|
|
|
$
|
(0.01)
|
|
|
$
|
0.64
|
|
|
$
|
(0.97)
|
|
Weighted average common shares
outstanding
|
|
|
|
|
|
|
|
Basic
|
90,322
|
|
|
85,556
|
|
|
88,688
|
|
|
85,102
|
|
Diluted
|
101,359
|
|
|
85,556
|
|
|
99,581
|
|
|
85,102
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except par value
amounts)
|
|
|
At September 30,
|
|
At December 31,
|
|
2021
|
|
2020
|
ASSETS
|
|
|
|
Current assets
|
|
|
|
Cash and cash
equivalents
|
$
|
215,551
|
|
|
$
|
251,706
|
|
Settlement
receivables
|
50,596
|
|
|
60,652
|
|
Trade and other
receivables, net of allowances for credit losses of $4,788 and
$3,689 at September 30, 2021 and December 31, 2020,
respectively
|
95,200
|
|
|
74,191
|
|
Inventory
|
31,690
|
|
|
27,742
|
|
Prepaid expenses and
other current assets
|
25,218
|
|
|
17,348
|
|
Total current assets
|
418,255
|
|
|
431,639
|
|
Non-current assets
|
|
|
|
Property and
equipment, net
|
114,943
|
|
|
112,323
|
|
Goodwill
|
681,975
|
|
|
681,974
|
|
Other intangible
assets, net
|
216,621
|
|
|
214,627
|
|
Other
receivables
|
14,068
|
|
|
14,620
|
|
Other
assets
|
20,181
|
|
|
21,996
|
|
Total non-current assets
|
1,047,788
|
|
|
1,045,540
|
|
Total assets
|
$
|
1,466,043
|
|
|
$
|
1,477,179
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
|
|
|
|
Current liabilities
|
|
|
|
Settlement
liabilities
|
$
|
177,582
|
|
|
$
|
173,211
|
|
Accounts payable
and accrued expenses
|
199,254
|
|
|
145,029
|
|
Current portion
of long-term debt
|
6,000
|
|
|
1,250
|
|
Total current liabilities
|
382,836
|
|
|
319,490
|
|
Non-current liabilities
|
|
|
|
Long-term debt, less
current portion
|
976,407
|
|
|
1,128,003
|
|
Deferred tax
liability, net
|
19,782
|
|
|
19,956
|
|
Other accrued expenses
and liabilities
|
14,250
|
|
|
17,628
|
|
Total non-current liabilities
|
1,010,439
|
|
|
1,165,587
|
|
Total liabilities
|
1,393,275
|
|
|
1,485,077
|
|
Commitments and contingencies
|
|
|
|
Stockholders' equity (deficit)
|
|
|
|
Convertible preferred
stock, $0.001 par value, 50,000 shares authorized and no shares
outstanding at September 30, 2021 and December 31, 2020,
respectively
|
—
|
|
|
—
|
|
Common stock, $0.001
par value, 500,000 shares authorized and 116,357 and 90,692 shares
issued and outstanding at September 30, 2021, respectively,
and 111,872 and 86,683 shares issued and outstanding at
December 31, 2020, respectively
|
116
|
|
|
112
|
|
Additional paid-in
capital
|
493,022
|
|
|
466,614
|
|
Accumulated
deficit
|
(231,126)
|
|
|
(294,620)
|
|
Accumulated other
comprehensive loss
|
(1,526)
|
|
|
(1,191)
|
|
Treasury stock, at
cost, 25,664 and 25,190 shares at September 30, 2021 and
December 31, 2020, respectively
|
(187,718)
|
|
|
(178,813)
|
|
Total stockholders' equity
(deficit)
|
72,768
|
|
|
(7,898)
|
|
Total liabilities and stockholders' equity
(deficit)
|
$
|
1,466,043
|
|
|
$
|
1,477,179
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS
(In thousands)
|
|
|
Nine Months Ended September 30,
|
|
2021
|
|
2020
|
Cash flows from operating
activities
|
|
|
|
Net income
(loss)
|
$
|
63,494
|
|
|
$
|
(82,813)
|
|
Adjustments to
reconcile net income (loss) to cash provided by (used in) operating
activities:
|
|
|
|
Depreciation
|
46,571
|
|
|
48,700
|
|
Amortization
|
43,680
|
|
|
57,312
|
|
Non-cash lease
expense
|
3,400
|
|
|
3,615
|
|
Amortization of
financing costs and discounts
|
3,234
|
|
|
3,111
|
|
Loss on sale or
disposal of assets
|
1,616
|
|
|
111
|
|
Accretion of contract
rights
|
6,966
|
|
|
5,345
|
|
Provision for credit
losses
|
5,499
|
|
|
6,925
|
|
Deferred income
taxes
|
(174)
|
|
|
(3,788)
|
|
Reserve for inventory
obsolescence
|
1,610
|
|
|
1,810
|
|
Write-down of
assets
|
—
|
|
|
11,281
|
|
Loss on extinguishment
of debt
|
34,389
|
|
|
7,457
|
|
Stock-based
compensation
|
12,404
|
|
|
10,108
|
|
Other non-cash
items
|
—
|
|
|
456
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Settlement
receivables
|
10,056
|
|
|
36,922
|
|
Trade and other
receivables
|
(25,522)
|
|
|
6,682
|
|
Inventory
|
(5,569)
|
|
|
(10,614)
|
|
Prepaid expenses and
other assets
|
(8,068)
|
|
|
(4,952)
|
|
Settlement
liabilities
|
4,371
|
|
|
(93,622)
|
|
Accounts payable and
accrued expenses
|
45,543
|
|
|
(5,814)
|
|
Net cash provided by (used in) operating
activities
|
243,500
|
|
|
(1,768)
|
|
Cash flows from investing
activities
|
|
|
|
Capital
expenditures
|
(73,288)
|
|
|
(52,428)
|
|
Acquisitions, net of
cash acquired
|
(15,000)
|
|
|
(15,000)
|
|
Proceeds from sale of
property and equipment
|
215
|
|
|
141
|
|
Placement fee
agreements
|
—
|
|
|
(3,021)
|
|
Net cash used in investing
activities
|
(88,073)
|
|
|
(70,308)
|
|
Cash flows from financing
activities
|
|
|
|
Proceeds from new term
loan
|
600,000
|
|
|
—
|
|
Repayments of prior
term loan
|
(735,500)
|
|
|
(13,500)
|
|
Proceeds from prior
incremental term loan
|
—
|
|
|
125,000
|
|
Repayment of prior
incremental term loan
|
(124,375)
|
|
|
(313)
|
|
Proceeds from prior
revolver
|
—
|
|
|
35,000
|
|
Repayments of prior
revolver
|
—
|
|
|
(35,000)
|
|
Proceeds from 2021
unsecured notes
|
400,000
|
|
|
—
|
|
Repayments of 2017
unsecured notes
|
(285,381)
|
|
|
(89,619)
|
|
Fees associated with
debt transactions - new debt
|
(19,797)
|
|
|
—
|
|
Fees associated with
debt transactions - prior debt
|
(20,828)
|
|
|
(11,128)
|
|
Proceeds from exercise
of stock options
|
14,012
|
|
|
3,509
|
|
Treasury
stock
|
(8,909)
|
|
|
(1,097)
|
|
Payment of acquisition
contingent consideration
|
(9,875)
|
|
|
—
|
|
Net cash (used in) provided by financing
activities
|
(190,653)
|
|
|
12,852
|
|
Effect of exchange
rates on cash and cash equivalents
|
(237)
|
|
|
(1,370)
|
|
Cash, cash equivalents and restricted
cash
|
|
|
|
Net decrease for the
period
|
(35,463)
|
|
|
(60,594)
|
|
Balance, beginning of
the period
|
252,349
|
|
|
296,610
|
|
Balance, end of the period
|
$
|
216,886
|
|
|
$
|
236,016
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF CASH AND CASH
EQUIVALENTS
TO NET CASH POSITION AND NET CASH
AVAILABLE
(In thousands)
|
|
|
At September 30,
|
|
At December 31,
|
|
At September 30,
|
|
A September 30,
|
|
2021
|
|
2020
|
|
2020
|
|
2019
|
Cash available
|
|
|
|
|
|
|
|
Cash and cash
equivalents (1)
|
$
|
215,551
|
|
|
$
|
251,706
|
|
|
$
|
235,407
|
|
|
$
|
275,706
|
|
Settlement
receivables
|
50,596
|
|
|
60,652
|
|
|
33,126
|
|
|
56,035
|
|
Settlement
liabilities
|
(177,582)
|
|
|
(173,211)
|
|
|
(140,229)
|
|
|
(298,490)
|
|
Net Cash Position
|
88,565
|
|
|
139,147
|
|
|
128,304
|
|
|
33,251
|
|
|
|
|
|
|
|
|
|
Undrawn revolving
credit facility
|
125,000
|
|
|
35,000
|
|
|
35,000
|
|
|
35,000
|
|
Net Cash Available
|
$
|
213,565
|
|
|
$
|
174,147
|
|
|
$
|
163,304
|
|
|
$
|
68,251
|
|
|
|
(1)
|
Cash and cash
equivalents does not include $1.3 million, $0.6 million,
$0.6 million, and $8.4 million of restricted cash at
September 30, 2021 December 31, 2020, September 30,
2020, and September 30, 2019, respectively.
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Three Months Ended September 30,
2021
|
|
Games
|
|
FinTech
|
|
Total
|
Net income
|
|
|
|
|
$
|
6,746
|
|
Income tax
benefit
|
|
|
|
|
(319)
|
|
Loss on
extinguishment of debt
|
|
|
|
|
34,389
|
|
Interest expense, net
of interest income
|
|
|
|
|
14,257
|
|
Operating income
|
$
|
30,199
|
|
|
$
|
24,874
|
|
|
$
|
55,073
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
23,300
|
|
|
5,759
|
|
|
29,059
|
|
EBITDA
|
$
|
53,499
|
|
|
$
|
30,633
|
|
|
$
|
84,132
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
1,904
|
|
|
2,048
|
|
|
3,952
|
|
Accretion of contract
rights
|
2,330
|
|
|
—
|
|
|
2,330
|
|
Non-recurring
professional fees and other
|
—
|
|
|
184
|
|
|
$
|
184
|
|
Adjusted EBITDA
|
$
|
57,733
|
|
|
$
|
32,865
|
|
|
$
|
90,598
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(9,858)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(24,054)
|
|
Cash paid for income
taxes, net
|
|
|
|
|
(409)
|
|
Free Cash Flow
|
|
|
|
|
$
|
56,277
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Three Months Ended September 30,
2020
|
|
Games
|
|
FinTech
|
|
Total
|
Net loss
|
|
|
|
|
$
|
(878)
|
|
Income tax
provision
|
|
|
|
|
1,711
|
|
Interest expense, net
of interest income
|
|
|
|
|
18,905
|
|
Operating (loss) income
|
$
|
(430)
|
|
|
$
|
20,167
|
|
|
$
|
19,738
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
29,615
|
|
|
5,242
|
|
|
34,857
|
|
EBITDA
|
$
|
29,185
|
|
|
$
|
25,409
|
|
|
$
|
54,595
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
1,549
|
|
|
1,436
|
|
|
2,985
|
|
Accretion of contract
rights
|
2,175
|
|
|
—
|
|
|
2,175
|
|
Adjusted EBITDA
|
$
|
32,909
|
|
|
$
|
26,845
|
|
|
$
|
59,755
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(12,375)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(22,294)
|
|
Cash paid for
placement fees
|
|
|
|
|
(2,146)
|
|
Cash paid for income
taxes, net
|
|
|
|
|
(133)
|
|
Free Cash Flow
|
|
|
|
|
$
|
22,807
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Three Months Ended September 30,
2019
|
|
Games
|
|
FinTech
|
|
Total
|
Net income
|
|
|
|
|
$
|
9,315
|
|
Income tax
benefit
|
|
|
|
|
(1,319)
|
|
Interest expense, net
of interest income
|
|
|
|
|
19,297
|
|
Operating income
|
$
|
3,073
|
|
|
$
|
24,220
|
|
|
$
|
27,293
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
28,678
|
|
|
4,493
|
|
|
33,171
|
|
EBITDA
|
$
|
31,751
|
|
|
$
|
28,713
|
|
|
$
|
60,464
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
602
|
|
|
1,379
|
|
|
1,981
|
|
Accretion of contract
rights
|
2,221
|
|
|
—
|
|
|
2,221
|
|
Adjusted EBITDA
|
$
|
34,574
|
|
|
$
|
30,092
|
|
|
$
|
64,666
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(12,528)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(35,959)
|
|
Cash paid for
placement fees
|
|
|
|
|
(5,454)
|
|
Cash refunded for
income taxes, net
|
|
|
|
|
362
|
|
Free Cash Flow
|
|
|
|
|
$
|
11,087
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Nine Months Ended September 30,
2021
|
|
Games
|
|
FinTech
|
|
Total
|
Net income
|
|
|
|
|
$
|
63,494
|
|
Income tax
provision
|
|
|
|
|
1,285
|
|
Loss on
extinguishment of debt
|
|
|
|
|
34,389
|
|
Interest expense, net
of interest income
|
|
|
|
|
50,488
|
|
Operating income
|
$
|
76,064
|
|
|
$
|
73,592
|
|
|
$
|
149,656
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
73,586
|
|
|
16,665
|
|
|
90,251
|
|
EBITDA
|
$
|
149,650
|
|
|
$
|
90,257
|
|
|
$
|
239,907
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
6,075
|
|
|
6,329
|
|
|
12,404
|
|
Accretion of contract
rights
|
6,966
|
|
|
—
|
|
|
6,966
|
|
Litigation
settlement, net
|
—
|
|
|
(1,107)
|
|
|
(1,107)
|
|
Asset acquisition
expense, non-recurring professional fees and other
|
—
|
|
|
268
|
|
|
268
|
|
Adjusted EBITDA
|
$
|
162,691
|
|
|
$
|
95,747
|
|
|
$
|
258,438
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(45,167)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(73,288)
|
|
Cash paid for income
taxes, net
|
|
|
|
|
(975)
|
|
Free Cash Flow
|
|
|
|
|
$
|
139,008
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Nine Months Ended September 30,
2020
|
|
Games
|
|
FinTech
|
|
Total
|
Net loss
|
|
|
|
|
$
|
(82,813)
|
|
Income tax
benefit
|
|
|
|
|
(3,434)
|
|
Loss on
extinguishment of debt
|
|
|
|
|
7,457
|
|
Interest expense, net
of interest income
|
|
|
|
|
56,226
|
|
Operating (loss) income
|
$
|
(47,671)
|
|
|
$
|
25,107
|
|
|
$
|
(22,564)
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
90,087
|
|
|
15,926
|
|
|
106,013
|
|
EBITDA
|
$
|
42,416
|
|
|
$
|
41,033
|
|
|
$
|
83,449
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
5,237
|
|
|
4,871
|
|
|
10,108
|
|
Accretion of contract
rights
|
5,345
|
|
|
—
|
|
|
5,345
|
|
Write-down of
inventory, property and equipment and intangible assets
|
9,232
|
|
|
1,801
|
|
|
11,033
|
|
Employee severance
costs and other expenses
|
1,578
|
|
|
1,122
|
|
|
2,700
|
|
Foreign exchange
loss
|
83
|
|
|
1,199
|
|
|
1,282
|
|
Non-recurring
professional fees
|
30
|
|
|
932
|
|
|
962
|
|
Other one-time
charges
|
456
|
|
|
—
|
|
|
456
|
|
Adjusted EBITDA
|
$
|
64,377
|
|
|
$
|
50,958
|
|
|
$
|
115,335
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(45,331)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(52,428)
|
|
Cash paid for
placement fees
|
|
|
|
|
(3,021)
|
|
Cash paid for income
taxes, net
|
|
|
|
|
(81)
|
|
Free Cash Flow
|
|
|
|
|
$
|
14,474
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
UNAUDITED RECONCILIATION OF SELECTED FINANCIAL GAAP
TO NON-GAAP MEASURES
(In thousands)
|
|
|
Nine Months Ended September 30,
2019
|
|
Games
|
|
FinTech
|
|
Total
|
Net income
|
|
|
|
|
$
|
20,661
|
|
Income tax
benefit
|
|
|
|
|
(2,747)
|
|
Interest expense, net
of interest income
|
|
|
|
|
60,130
|
|
Operating income
|
$
|
8,729
|
|
|
$
|
69,315
|
|
|
$
|
78,044
|
|
|
|
|
|
|
|
Plus: depreciation
and amortization
|
83,927
|
|
|
13,278
|
|
|
97,205
|
|
EBITDA
|
$
|
92,656
|
|
|
$
|
82,593
|
|
|
$
|
175,249
|
|
|
|
|
|
|
|
Non-cash stock
compensation expense
|
1,895
|
|
|
4,246
|
|
|
6,141
|
|
Accretion of contract
rights
|
6,539
|
|
|
—
|
|
|
6,539
|
|
Write-down of
inventory, property and equipment and intangible assets
|
843
|
|
|
—
|
|
|
843
|
|
Non-recurring
professional fees
|
484
|
|
|
790
|
|
|
1,274
|
|
Adjusted EBITDA
|
$
|
102,417
|
|
|
$
|
87,629
|
|
|
$
|
190,046
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
|
|
|
(52,077)
|
|
Cash paid for capital
expenditures
|
|
|
|
|
(81,642)
|
|
Cash paid for
placement fees
|
|
|
|
|
(17,102)
|
|
Cash refunded for
income taxes, net
|
|
|
|
|
69
|
|
Free Cash Flow
|
|
|
|
|
$
|
39,294
|
|
EVERI HOLDINGS INC. AND
SUBSIDIARIES
RECONCILIATION OF PROJECTED NET INCOME TO PROJECTED
EBITDA AND PROJECTED ADJUSTED EBITDA FOR THE YEAR ENDING DECEMBER
31, 2021
(In thousands)
|
|
|
2021 Guidance Range
(1)
|
|
Low
|
|
High
|
Revenues
|
$
|
645,000
|
|
|
$
|
653,000
|
|
|
|
|
|
Projected net
income
|
98,000
|
|
|
100,000
|
|
Projected income tax
provision
|
3,000
|
|
|
4,000
|
|
Projected loss on
extinguishment of debt
|
34,400
|
|
|
34,400
|
|
Projected interest
expense, net of interest income
|
64,600
|
|
|
62,600
|
|
Projected operating income
|
$
|
200,000
|
|
|
$
|
201,000
|
|
|
|
|
|
Plus: projected
depreciation and amortization
|
119,000
|
|
|
120,000
|
|
Projected EBITDA
|
$
|
319,000
|
|
|
$
|
321,000
|
|
|
|
|
|
Projected non-cash
stock compensation expense
|
14,800
|
|
|
15,800
|
|
Projected accretion
of contract rights
|
9,000
|
|
|
10,000
|
|
Projected asset
acquisition expense and non-recurring professional fees
|
300
|
|
|
300
|
|
Projected litigation
settlement, net
|
(1,100)
|
|
|
(1,100)
|
|
Projected Adjusted EBITDA
|
$
|
342,000
|
|
|
$
|
346,000
|
|
|
|
|
|
Projected cash paid
for interest
|
(52,000)
|
|
|
(51,000)
|
|
Projected cash paid
for capital expenditures
|
(100,000)
|
|
|
(102,000)
|
|
Projected cash paid
for placement fees
|
(32,000)
|
|
|
(32,000)
|
|
Projected cash paid
for income taxes, net of refunds
|
(3,000)
|
|
|
(1,000)
|
|
Projected Free Cash Flow
|
$
|
155,000
|
|
|
$
|
160,000
|
|
|
|
(1)
|
All figures presented
are projected estimates for the year ending December 31,
2021.
|
(2)
|
This guidance assumes
no change in deferred tax valuation allowances.
|
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SOURCE Everi Holdings Inc.