Scientific Games offers positive snapshot of future with IGT partnership
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Las Vegas-based Scientific Games Corp. celebrated a successful end to 2020 with an announcement that the company hopes will translate to a successful future.
Company executives, during a Monday earnings call with investors, touted Scientific Games’ money management, improved free cash flow and revamped R&D department as highlights in a calendar year marred by the COVID-19 pandemic.
The gaming technology company reported total revenues of $2.7 billion in 2020 to follow up its $3.4 billion in 2019. The company reported $762 million in fourth-quarter revenues, down from $863 million in the same period in 2019. Its net loss last year was $548 million, and $84 million for the fourth quarter; 2019 net loss was $118 million, and $37 million for the quarter.
On Monday morning, the gaming technology company announced it had signed a cross-licensing agreement with International Game Technology PLC to share cashless slot gaming technology patents.
“We’re extremely excited around this morning’s announcement,” Scientific Games President and CEO Barry Cottle told investors during the Monday earnings call. “The cross licensing agreement enables us to provide cable operators with access to the gaming industry’s most compelling portfolio of cashless gaming and (intellectual property) technologies.”
‘Cashless gaming is here to stay’
Scientific Games sees the partnership as an opportunity to pool its technologies with IGT’s and facilitate the quick adoption of cashless gaming in casinos. Financial terms of the agreement weren’t disclosed.
Renato Ascoli, IGT’s CEO of global gaming, added in a press release: “Cashless gaming is here to stay, and this strong portfolio of cashless IP can help casino operators ensure the safety of players by reducing cash handling and points of contact with slot games, while considerably improving casino operating efficiencies.”
The company slashed expenses by $150 million in non-revenue-generating costs during the summer of 2020, $50 million of which is expected to be “permanent,” Executive Vice President and Chief Financial Officer Michael Eklund said. The company finished 2020 with a free cash flow of $186 million.
Scientific Games saw year-over-year, fourth-quarter revenue jumps for its lottery, digital business and SciPlay division, the company reported. Over the last three months of 2020, the company generated $256 million in lottery revenues (up 10 percent from the prior period in 2019), $147 million in digital (up 30 percent) and $73 million for its SciPlay social game developer segment (up 1 percent).
Its gaming segment lagged from casino restrictions during the fourth quarter, but still improved over its third quarter results — $286 million compared with $231 million. Fourth quarter revenues in 2019 were $445 million.
