Scientific Games Releases Q2 2021 Results

Scientific Games and Bally’s Corporation Release Q2 2021 Results. Both companies reported historical revenues for this quarter. (Image by Chris Liverani on Unsplash)

Scientific Games Corporation recently released its Q2 results for the period of June 30, 2021. It pointed out how far it had gone in fulfilling its core objective of moving towards digital markets, content, and recording growth across lottery, gaming, and digital.

The second-quarter consolidated revenue has an outstanding 63% year-on-year increase at $800m, as opposed to the 2020 figure of $539m. Gaming business, on the other hand, experienced a 300% growth in comparison to the 50% growth of the previous quarter.

This rise can be credited to the strength of its new product roadmap, its rebound in Europe and the UK, and its US gross gaming revenue. Plus, Scientific Games will soon have Evolution’s live Lightning roulette in land-based casinos which should also boost revenue + profits.

Statement from the President and Chief Executive Officer of Scientific Games

The President and Chief Executive Officer of Scientific Games, Barry Cottle, stated that:

He was pleased that they were constantly making huge progress on all of their core strategic areas while also experiencing tremendous growth in the quarter. He also added that the company rose from the pandemic stronger, with a huge amount of momentum.

Cottle went on to note that all their businesses experienced simultaneous growth on both the bottom and top lines of the quarter. Gaming brought in high revenue, and this has not happened since the fourth quarter of 2019. Digital and Lottery also set all-time results, and SciPlay made another record by bringing in the second-highest revenue quarter ever. Furthermore, he added that amid their strategic review, their main focus would be to become a top cross-platform game company that focuses on digital markets and content. He wrapped up by stating that they were rapidly making moves to change their company and that he was very optimistic about their direction going forward.

Statement from the Chief Financial Officer and Vice President of Scientific Games

The Chief Financial Officer and Vice President of Scientific Games, Michael Eklund, also had something to say. He added that:

In concert with their board, they revealed a strategic plan to change the company for the better and unlock value. He added that they are making decisive moves to invest, grow, and optimize their portfolio.

He went on further to note that he was encouraged by the ongoing discussions and interests around their proposed plans, and they were making amazing progress as they moved to unlock value for shareholders. He concluded by saying they were proud of the team as they kept on executing during this amazing period and delivering a very good quarter revenue and profit.

Scientific Games Q2 2021 Major Financial Highlights

  • Second Quarter Consolidated Revenue. Rose to $800m in comparison to $539m the previous year. This is a 63% increase as opposed to the past year. The Gaming business of the company delivered growth of more than 300% in comparison to the year before, along with a 50% growth in comparison to the last quarter. This was encouraged by the record gross gaming revenue in the US and a rebound in Europe and UK. In addition, the FOBT recovery also made gaming revenue benefit by $38m. Lastly, digital businesses and lottery both delivered record-breaking quarters.
  • Net Income. This was $133million as opposed to a $198m net loss the previous year. This was majorly due to the powerful revenues in the area of Gaming business which were drastically affected by the disruptions from COVID-19 the year before. In addition, there was a $63 million non-cash gain linked with the purchase of SportCast.
  • Consolidated AEBITDA. Was $383 million in comparison to $121million the previous year, indicating a 217% increase. It was driven by AEBITDA growth in Lottery, Gaming, and digital, and this was the company’s highest consolidated AEBITDA in history.

Scientific Games has made numerous profitable deals these past months, and in July alone, it made moves to take over Sciplay, and signed a global distribution partnership deal with Playtech. These may also have contributed to its growing financials and we anticipate more of these great moves before the year runs out.

Bally’s Corporation Q2 Results

The President and Chief Executive Officer of Bally’s Corporation, George Papanier,  stated that:

They had a record earning performance and revenue in the quarter and are confident they will go on to benefit from the constant demand in their land-based portfolio.

He added that their disciplined operating strategy, enhanced customer confidence, and minimal restrictions to capacity all helped in contributing to their strong numbers in the second quarter. He further added that the completion of the acquisition of BetWorks was another major step in their growth to becoming a leading provider.

Bally’s Corporation Q2 2021 Major Financial Highlights

Bally’s Corporation revealed its Q2 results for 2021, with its revenue increasing to $267.7million from $238.8 million the year before. This was a $28.9million increase which is quite decent. The majority of this increase was due to the reduction of the restrictions from COVID-19 in most states. Now, all of its properties are operating at maximum capacity as opposed to 2020, when they remain closed from mid-march to June. In addition:

  • The West segment experienced a revenue increase from $109.7 to $127.9 million during the same period last year. In contrast, the East segment increased to $132.4 million from $122.0 million in comparison to the same period last year. These increases mark a record revenue quarter increase.
  • Revenue from the numerous acquisitions completed in the Q2 of 2020, alongside those purchased in the Q1 of 2021, added to the overall revenue of $134.6 million in the Q2 of 2021. The company also experienced strong operational efficiencies that had a positive impact on margins, which is a trend it experienced since it re-opened after the pandemic.
  • Earnings from the Q2 of 2021 went up from $80.5 million to $101.5 million, while there was a 30.1% increase in operating margins as opposed to 72.5% last year during the same period. Promotional spending, labor savings, reduced marketing, and the restricted offerings of amenities due to the safety protocols attached to COVID-19 continued to encourage improvements in the margin.
  • Net Income for the 2021 second quarter also increased from $68.9million to $92.5million. The net income for this quarter increased due to numerous one-time items, including a $77.5million pre-tax gain that came from some of the acquisitions made by the company.
  • Adjusted EBITDA for Q2 was $83.8 million, which was better than the $94.5 million with a negative of $10.7 million from the Q2 of the previous year. The Adjusted EBITDA for the east segment was $41.6 million from a $10.3 million negative figure the previous year. In contrast, the Adjusted EBITDA of the West segment went to $52.1million from $4.7 million in the Q2 of the previous year.

 

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