North America accounted for most of the business’ revenue, at $556m, up 25.5%, while Italy was IGT’s next biggest market, bringing in $294m, up 18.5%. The rest of the world delivered $134m in revenue, up 7.2%.
After operating expenses of $772m, total operating income for the quarter was $212m, up significantly from $87m in Q3 2020. Total adjusted EBITDA for the period was $407m, up from $287, giving an EBITDA margin of 41.4%, up from 35.2% last year.
Cost of services was IGT’s biggest expense, at $422m, followed by selling, general and administrative costs of $195m.
Cost of product sales came to $93m, research and development costs were $63m, and the business gained a $1m benefit from restructuring.
Interest expenses cost $79m, and with $1m in other expenses in addition to a $6m gain on foreign exchanges, total non-operating expenses came to $74m.
Income from continuing operations before provision for income taxes came to $138m, and with a $37m tax provision, net income from continuing operations stood at $101m.
After removing $36m in net income attributable to non-controlling interests from continuing operations, net income attributable to IGT was $65m – up from a $128m net loss in Q3 2020. This brings net income for the year-to-date to $462m.
Net debt for the business stands at $6.11bn, down from $7.25bn in the same period last year.As a result of the growth seen during the quarter, IGR raised its full year 2021 outlook, which is now predicted to bring around $4.1bn in revenue.
The outlook for operating income has increased from around $800m to around $900m, with the net debt leverage expected to stay below four times. Depreciation and amortisation for the full year 2021 are expected to cost between $700m and $725m.
The business has signed new partner deals during the quarter, including a ten-year lottery contract with Connecticut Lottery Corporation and a seven-year deal with La Française des Jeux, operator of the French National Lottery, to upgrade its lottery central system to IGT’s Aurora platform.
It has also announced several turnkey sports betting solutions, including full retail and mobile services for Angel Of The Winds Casino Resort, Oneida Casino, and Snoqualmie Casino, in addition to extending the reach of its cashless technology, with agreements to deploy its Resort Wallet and IGTPay solutions at Agua Caliente Casino and Indigo Sky properties.
“Broad-based momentum across our Lottery, Gaming, and Digital & Betting activities drove significant improvement in key financial and performance metrics in the third quarter,” said Marco Sala, CEO of IGT.
“Revenue grew over 20% and operating income more than doubled, highlighting the strength of our portfolio. Based on our excellent year-to-date results and our solid financial condition, the Board reinstated a quarterly cash dividend, signalling their confidence in the Company’s prospects.”
Max Chiara, the business’ chief financial officer, added: “We are supporting strong top-line growth with strategic investments in the business while still making good progress on optimizing our cost structure.”
“Achieving our goal of reducing net debt leverage below 4.0x was a big accomplishment in the quarter. We look forward to sharing our strategy, long-term growth initiatives, and capital allocation plans during our upcoming investor day on November 16, 2021.”
