6-K
Brightstar Lottery PLC (BRSL)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For the month of March 2022
Commission File Number 001-36906
INTERNATIONAL GAME TECHNOLOGY PLC
(Translation of registrant’s name into English)
66 Seymour Street, Second Floor
London, W1H 5BT
United Kingdom
(Address of principal executive offices)
| Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: | ||||
|---|---|---|---|---|
| Form 20-F | ☒ | Form 40-F | ☐ | |
| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): | ☐ | |||
| Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): | ☐ |
Fourth Quarter and Full Year 2021 Results of International Game Technology PLC
On March 1, 2022, International Game Technology PLC (NYSE:IGT) (the “Company”) reported results for the quarter and full year ended December 31, 2021.
On March 1, 2022, the Company also announced that the Board of Directors declared a quarterly cash dividend of $0.20 per share on its ordinary shares. The dividend is payable on March 29, 2022 to holders of record as of the close of business on March 15, 2022.
A copy of the news release relating to the above matters is set forth in Exhibit 99.1, which is being furnished herewith. In addition, a slide presentation relating to the results is set forth in Exhibit 99.2, which is being furnished herewith.
The following exhibits are furnished herewith:
| Exhibit Number | Description |
|---|---|
| 99.1 | News Release “International Game Technology PLC Reports Fourth Quarter and Full Year 2021 Results,” dated March 1, 2022 |
| 99.2 | Presentation “International Game Technology PLC 2021 Fourth Quarter and Full Year Results period ended December 31, 2021,” dated March 1, 2022 |
EXHIBIT INDEX
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Date: March 1, 2022 | INTERNATIONAL GAME TECHNOLOGY PLC | |
|---|---|---|
| By: | /s/ Pierfrancesco Boccia | |
| Pierfrancesco Boccia | ||
| Corporate Secretary |
4
Document
NEWS RELEASE
INTERNATIONAL GAME TECHNOLOGY PLC REPORTS
FOURTH QUARTER AND FULL YEAR 2021 RESULTS
•2021 revenue increased 31% to $4.1 billion on double-digit growth across segments; met or exceeded all 2021 financial goals with key financial metrics above 2019 levels
•Full year operating income of $902 million, the highest in Company history, on strong Global Lottery operating leverage and company-wide structural cost savings
•Generated over $1.0 billion in cash from operations and $770 million in free cash flow in 2021, including record-level cash flows for a quarterly period in the fourth quarter, on strong performance and disciplined capital management
•Reduced net debt by $1.4 billion; leverage improves to 3.5x, the lowest level in Company history, achieving the 2022 leverage target a year early
•Reinstated shareholder returns in the fourth quarter with payment of $0.20 quarterly cash dividend and over $40 million in share repurchases
•Reaffirming full-year 2022 guidance provided at recent Investor Day
LONDON – March 1, 2022 – International Game Technology PLC (“IGT”) (NYSE:IGT) today reported financial results for the fourth quarter and full year ended December 31, 2021. Today, at 8:00 a.m. EST, management will host a conference call and webcast to present the results; access details are provided below.
“Our 2021 financial results reflect the best revenue, profit, and cash flow performance in the last four years, meeting or exceeding target levels on strong performance across the portfolio,” said Vince Sadusky, CEO of IGT. “We made important progress on several strategic objectives, and I am excited to be leading IGT in the next chapter of its evolution. We have set aggressive but achievable multi-year goals and we have a focused strategy to maximize value for all stakeholders.”
"Improving leverage to 3.5x a year ahead of schedule enables us to pursue a balanced capital allocation framework that supports investing for growth, continued debt reduction, and the reinstatement of capital returns through quarterly dividends and share repurchases,” said Max Chiara, CFO of IGT. “As we enter 2022, the Company is in a very good place with a solid financial condition and a strong foundation for further growth.”
Overview of Consolidated Fourth Quarter and Full Year 2021 Results
| Y/Y Change (%) | Constant Currency Change (%) | Year Ended | Y/Y Change (%) | Constant Currency Change (%) | |||||
|---|---|---|---|---|---|---|---|---|---|
| All amounts from continuing operations unless otherwise noted | December 31, | ||||||||
| 2020 | 2021 | 2020 | |||||||
| (In millions, unless otherwise noted) | |||||||||
| GAAP Financials: | |||||||||
| Revenue | |||||||||
| Global Lottery | 630 | 9% | 12% | 2,812 | 2,164 | 30% | 28% | ||
| Global Gaming | 222 | 45% | 45% | 1,112 | 837 | 33% | 32% | ||
| Digital & Betting | 33 | 25% | 24% | 165 | 115 | 44% | 40% | ||
| Total revenue | 885 | 19% | 21% | 4,089 | 3,115 | 31% | 29% | ||
| Operating income/(loss) | |||||||||
| Global Lottery | 195 | 11% | 14% | 1,088 | 642 | 69% | 65% | ||
| Global Gaming | (42) | NA | NA | 43 | (212) | NA | NA | ||
| Digital & Betting | 3 | 41% | 19% | 33 | 6 | 421% | 383% | ||
| Corporate support expense | (20) | (66)% | (76)% | (104) | (76) | (37)% | (33)% | ||
| Other(1) | (40) | 2% | 2% | (158) | (468) | 66% | 66% | ||
| Total operating income/(loss) | 96 | 93% | 96% | 902 | (107) | NA | NA | ||
| Operating Income margin | 11% | 22% | (3)% | ||||||
| Net cash provided by operating activities | 251 | 58% | 1,010 | 595 | 70% | ||||
| Cash and cash equivalents | 907 | (35)% | 591 | 907 | (35)% | ||||
| Non-GAAP Financial Measures: | |||||||||
| Adjusted EBITDA | |||||||||
| Global Lottery | 313 | 7% | 10% | 1,545 | 1,086 | 42% | 39% | ||
| Global Gaming | (10) | NA | NA | 173 | (38) | NA | NA | ||
| Digital & Betting | 8 | 12% | 3% | 48 | 22 | 116% | 105% | ||
| Corporate support expense | (16) | (49)% | (62)% | (80) | (62) | (29)% | (24)% | ||
| Total Adjusted EBITDA | 295 | 31% | 33% | 1,686 | 1,008 | 67% | 64% | ||
| Adjusted EBITDA margin | 33% | 41% | 32% | ||||||
| Free cash flow | 201 | 62% | 771 | 340 | 127% | ||||
| Net debt(2) | 5,922 | 7,319 | (19)% |
All values are in US Dollars.
(1) Primarily includes purchase price amortization
(2) Historical net debt recast to only reflect continuing operations
Note: Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are provided at the end of this news release
Fourth Quarter and Full Year 2021 Key Highlights:
•Hosted Investor Day introducing Grow, Innovate, and Optimize strategic initiatives to deliver compelling 2025 financial targets
◦Mid-single digit organic revenue and mid-teens operating income compound annual growth rates from 2021 - 2025
◦Cumulative cash from operations of approximately $4.0 billion and free cash flow of about $2.4 billion from 2022 - 2025
•Completed sale of Italy B2C gaming businesses; net proceeds used to reduce debt
•Created stand-alone Digital & Betting segment; strengthened leadership with appointments of Joe Asher and Gil Rotem
•Achieved over $200 million in OPtiMa structural cost savings versus 2019
•Reinstated $0.20 per common share quarterly cash dividend; repurchased 1.5 million shares for $41 million at an average price of $27.22 per share
•Awarded 10-year lottery contract with Connecticut Lottery Corporation, replacing an incumbent following a competitive procurement
•Won "Casino Supplier of the Year" award in 2021 Global Gaming Awards London
•Extended cashless momentum with several deployments and regulatory approval in Nevada
•Company's lottery operations re-certified by World Lottery Association for Corporate Social Responsibility Standards and Responsible Gaming Framework for Suppliers
Full Year 2021 Financial Highlights:
Revenue of $4.1 billion, up 31% from $3.1 billion in the prior year, driven by impressive growth across segments
•Global Lottery revenue of $2.8 billion, up from $2.2 billion, driven by 20% same-store sales growth and including around $165 million in benefits from certain discrete items in the first half of 2021
•Global Gaming revenue rises 33% to $1.1 billion, as continued recovery drives key performance indicators higher
•Digital & Betting revenue increases to $165 million, up 44%, propelled by new jurisdictions and customers
Operating income of $902 million, versus operating loss of $107 million in the prior-year period
•Driven by double-digit revenue growth
•Strong profit flow-through in Global Lottery segment enhanced by positive mix of high-margin Italy lottery sales; contribution of about $140 million from certain discrete items in the first half of 2021
•Improved operating leverage from revenue growth coupled with benefit of structural cost savings in Global Gaming
•Digital & Betting increases significantly on solid operating leverage
Net interest expense of $341 million, compared to $398 million in the prior year
•Net proceeds from asset sale and free cash flow generation drove lower average debt balances
•Proactive liability management actions lowered the average cost of debt
Provision for income taxes of $274 million versus $28 million in the prior year driven by significant increase in operating profitability and valuation allowances on deferred tax assets
Net income of $670 million compared to net loss of $839 million in the prior-year period
•Significant increase in profit
•Gain on sale of Italy gaming businesses
•Goodwill impairment and non-cash foreign exchange losses in prior year
Adjusted EBITDA totaled nearly $1.7 billion, up 67% compared to the prior year; Adjusted EBITDA margin of 41%, among the highest level in Company history
Cash from operations was $1.0 billion compared to $595 million in the prior-year period
•Strong performance and rigorous management of invested capital
•Record free cash flow of $771 million, up from $340 million
Shareholder returns reinstated with $41 million deployed for $0.20 per share quarterly cash dividend and $41 million for share repurchases
Net debt of $5.9 billion, down $1.4 billion from $7.3 billion at December 31, 2020
•Strong cash flow generation
•Proceeds from sale of Italy B2C gaming businesses
•Net debt leverage of 3.5x, down from 6.4x at December 31, 2020, the lowest level in Company history and achieving the 2022 leverage target a year early
Fourth Quarter 2021 Financial Highlights:
Consolidated revenue of $1.0 billion, up 19% from $885 million in the prior-year period, on double-digit, constant currency growth across segments
•Global Lottery revenue totals $687 million, up from $630 million in the prior year, on 8% same-store sales growth
•Global Gaming revenue of $321 million, up 45% from the prior year, primarily driven by higher replacement unit sales and average selling prices
•Digital & Betting revenue rises to $42 million compared to $33 million in the prior year, propelled by new jurisdictions and customers
Operating income of $186 million, nearly doubling from $96 million in the prior year
•Revenue growth with strong profit flow-through
•Sustained focus on cost discipline/avoidance
Net interest expense of $77 million, down from $101 million in the prior-year
•Lower average debt balances
•Proactive liability management actions lowered the average cost of debt
Provision for income taxes of $56 million, down from $73 million, as prior year impacted by non-deductible foreign exchange losses and valuation allowances on deferred tax assets
Net income was $55 million versus a net loss of $220 million due to increased profit and lower non-cash foreign exchange losses
Adjusted EBITDA of $387 million, up 31% from $295 million in the prior year
Cash from operations of $396 million, up 58% from $251 million in the prior-year period
•Solid financial performance and invested capital management
•Free cash flow of $326 million, up from $201 million
•Record-level quarterly cash flow generation
Cash and Liquidity Update
Total liquidity of $2.3 billion as of December 31, 2021; $591 million in unrestricted cash and $1.7 billion in additional borrowing capacity
Recently received credit rating upgrades with Standard & Poor's rising to BB+ and Moody's to Ba2, both with a stable outlook
Other Developments
On January 20, 2022, the Company announced several Executive and Board leadership changes
•Lorenzo Pellicioli to retire as Chairperson of the Board of Directors
•Marco Sala appointed Executive Chair of the Board of Directors
•Vincent Sadusky appointed CEO and Executive Director
•Maria Pinelli appointed to the Board of Directors and Chair of the Audit Committee
•Ashley M. Hunter appointed to the Board of Directors and Nominating and Corporate Governance Committee
Yesterday, the Company announced an agreement to sell its Italian proximity payment business
•€700 million purchase price; €630M enterprise value
•Net proceeds primarily used to reduce debt
•Transaction expected to close during the third quarter of 2022
The Company's Board of Directors declared a quarterly cash dividend of $0.20 per common share
•Ex-dividend date of March 14, 2022
•Record date of March 15, 2022
•Payment date of March 29, 2022
Reaffirming Full-year and Introducing First Quarter 2022 Outlook
Full-year
•Revenue of ~$4.1 billion - $4.3 billion
•Operating income margin of 20% - 22%
•Cash from operations of $850 million - $1,000 million
•Capital expenditures of $400 million - $450 million
First quarter
•Revenue of ~$1.0 billion - $1.1 billion
•Operating income margin of 20% - 22%
Outlook not adjusted for announced sale of Italian proximity payment business or any impact from the Russia/Ukraine conflict
Earnings Conference Call and Webcast:
March 1, 2022, at 8:00 a.m. EST
To register to participate in the conference call, or to listen to the live audio webcast, please visit the "Events Calendar" on IGT's Investor Relations website at www.IGT.com. A replay will be available on the website following the live event.
Note: Certain totals in the tables included in this press release may not add due to rounding
Comparability of Results
All figures presented in this news release are prepared under U.S. GAAP, unless noted otherwise. Adjusted figures exclude the impact of items such as purchase accounting, impairment charges, restructuring expense, foreign exchange, and certain one-time, primarily transaction-related items. Reconciliations to the most directly comparable U.S. GAAP measures are included in the tables in this news release. Constant currency changes for 2021 are calculated using the same foreign exchange rates as the corresponding 2020 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes,
and to evaluate the Company’s financial performance. Management believes these non-GAAP financial measures reflect the Company’s ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company’s reported results prepared in accordance with U.S. GAAP. Amounts reported in millions are computed based on amounts in thousands. As a result, the sum of the components may not equal the total amount reported in millions due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages and earnings per share amounts presented are calculated from the underlying unrounded amounts.
About IGT
IGT (NYSE:IGT) is a global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivalled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 10,500 employees. For more information, please visit www.IGT.com.
Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the “Company”) and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “would,” “should,” “shall”, “continue,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company’s control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the factors and risks described in the Company’s annual report on Form 20-F for the financial year ended December 31, 2020 and other documents filed from time to time with the SEC, which are available on the SEC’s website at www.sec.gov and on the investor relations section of the Company’s website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company’s business. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance or International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.
Non-GAAP Financial Measures
Management supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP
measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.
Adjusted EBITDA represents net income (loss) from continuing operations (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), other non-operating expenses, depreciation, impairment losses, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income) and certain other non-recurring items.
Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash equivalents. Cash and cash equivalents are subtracted from the GAAP measure because they could be used to reduce the Company’s debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet.
Net debt leverage and Leverage are non-GAAP financial measures that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months (“LTM”) prior to such date. Prior to the disposal of the Italian B2C gaming businesses in the second quarter of 2021, management calculated the Net debt leverage ratio as the ratio of Net debt as of a particular balance sheet date to the LTM of Adjusted EBITDA – combined prior to such date. Management believes that Net debt leverage is a useful measure to assess our financial strength and ability to incur incremental indebtedness when making key investment decisions.
Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing IGT’s ability to fund its activities, including debt service and distribution of earnings to shareholders.
Constant currency is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the exchange rates used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates.
A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.
Contact:
Phil O’Shaughnessy, Global Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452
Francesco Luti, +39 06 5189 9184; for Italian media inquiries
James Hurley, Investor Relations, +1 (401) 392-7190
Select Performance and KPI data: (In $ millions, unless otherwise noted)
| GLOBAL LOTTERY | Q4'21 | Q4'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | FY'21 | FY'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | ||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | ||||||||||||
| Service | ||||||||||||
| Operating and facilities management contracts | 608 | 549 | 11% | 13% | 2,569 | 1,944 | 32% | 30% | ||||
| Upfront license fee amortization | (50) | (52) | 5% | —% | (206) | (200) | (3)% | —% | ||||
| Operating and facilities management contracts, net | 558 | 497 | 12% | 15% | 2,363 | 1,744 | 35% | 33% | ||||
| Other | 87 | 86 | 1% | 6% | 327 | 299 | 10% | 7% | ||||
| Total service revenue | 646 | 583 | 11% | 13% | 2,690 | 2,043 | 32% | 29% | ||||
| Product sales | 42 | 47 | (11)% | (10)% | 123 | 121 | 1% | —% | ||||
| Total revenue | 687 | 630 | 9% | 12% | 2,812 | 2,164 | 30% | 28% | ||||
| Operating income | 217 | 195 | 11% | 14% | 1,088 | 642 | 69% | 65% | ||||
| Adjusted EBITDA(1) | 336 | 313 | 7% | 10% | 1,545 | 1,086 | 42% | 39% | ||||
| Global same-store sales growth (%) | ||||||||||||
| Instant ticket & draw games | 6.6 | % | 8.2 | % | 18.1 | % | 1.6 | % | ||||
| Multi-jurisdiction jackpots | 21.7 | % | 4.5 | % | 46.4 | % | (17.0 | %) | ||||
| Total | 7.7 | % | 7.9 | % | 20.1 | % | 0.1 | % | ||||
| North America and Rest of world same-store sales growth (%) | ||||||||||||
| Instant ticket & draw games | 6.3 | % | 10.7 | % | 12.7 | % | 7.3 | % | ||||
| Multi-jurisdiction jackpots | 21.7 | % | 4.5 | % | 46.4 | % | (17.0 | %) | ||||
| Total | 7.8 | % | 10.1 | % | 15.6 | % | 4.7 | % | ||||
| Italy same-store sales growth (%) | ||||||||||||
| Instant ticket & draw games | 7.7 | % | 0.4 | % | 38.9 | % | (16.1 | %) | ||||
| (1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | ||||||||||||
| GLOBAL GAMING | Q4'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | FY'21 | FY'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | |||||
| --- | --- | --- | --- | --- | --- | --- | --- | |||||
| Revenue | ||||||||||||
| Service | ||||||||||||
| Terminal | 85 | 29% | 29% | 424 | 298 | 42% | 42% | |||||
| Systems, software, and other | 48 | 12% | 13% | 206 | 186 | 11% | 11% | |||||
| Total service revenue | 133 | 23% | 24% | 630 | 483 | 30% | 30% | |||||
| Product sales | ||||||||||||
| Terminal | 59 | 85% | 87% | 339 | 205 | 65% | 63% | |||||
| Other | 30 | 60% | 61% | 143 | 148 | (4)% | (5)% | |||||
| Total product sales revenue | 89 | 77% | 78% | 482 | 354 | 36% | 34% | |||||
| Total revenue | 222 | 45% | 45% | 1,112 | 837 | 33% | 32% | |||||
| Operating income (loss) | (42) | NA | NA | 43 | (212) | NA | NA | |||||
| Adjusted EBITDA(1) | (10) | NA | NA | 173 | (38) | NA | NA | |||||
| Installed base units | ||||||||||||
| Casino | 48,232 | (1%) | 47,732 | 48,232 | (1%) | |||||||
| Casino - L/T lease (2) | 1,068 | 5% | 1,117 | 1,068 | 5% | |||||||
| Total installed base units | 49,300 | (1%) | 48,849 | 49,300 | (1%) | |||||||
| Installed base units (by geography) | ||||||||||||
| US & Canada | 34,275 | (2%) | 33,437 | 34,275 | (2%) | |||||||
| Rest of world | 15,025 | 3% | 15,412 | 15,025 | 3% | |||||||
| Total installed base units | 49,300 | (1%) | 48,849 | 49,300 | (1%) | |||||||
| Yields (by geography)(3), in absolute | ||||||||||||
| US & Canada | $27.88 | 40% | $37.62 | $24.34 | 55% | |||||||
| Rest of world | $3.33 | 62% | $4.42 | $3.67 | 20% | |||||||
| Total yields | $20.32 | 39% | $27.11 | $18.06 | 50% | |||||||
| Global machine units sold | ||||||||||||
| New/expansion | 666 | NA | 3,049 | 3,046 | —% | |||||||
| Replacement | 3,662 | 101% | 20,758 | 11,616 | 79% | |||||||
| Total machine units sold | 4,328 | 70% | 23,807 | 14,662 | 62% | |||||||
| US & Canada machine units sold | ||||||||||||
| New/expansion | 668 | NA | 1,335 | 2,753 | (52%) | |||||||
| Replacement | 2,636 | 110% | 14,759 | 8,009 | 84% | |||||||
| Total machine units sold | 3,304 | 54% | 16,094 | 10,762 | 50% | |||||||
| (1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | ||||||||||||
| (2) Excluded from yield calculations due to treatment as sales-type leases | ||||||||||||
| (3) Excludes Casino L/T lease units due to treatment as sales-type leases, comparability on a Y/Y basis hindered due to fewer active units |
All values are in US Dollars.
| GLOBAL GAMING (Continued) | Q4'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | FY'21 | FY'20 | Y/Y Change (%) | Constant Currency Change (%) (1) |
|---|---|---|---|---|---|---|---|
| Rest of world machine units sold | |||||||
| New/expansion | (2) | NA | 1,714 | 293 | 485% | ||
| Replacement | 1,026 | 78% | 5,999 | 3,607 | 66% | ||
| Total machine units sold | 1,024 | 122% | 7,713 | 3,900 | 98% | ||
| Average selling price (ASP), in absolute | |||||||
| US & Canada | 14,200 | 8% | 14,300 | 14,200 | 1% | ||
| Rest of world | 10,400 | 29% | 13,500 | 12,400 | 9% | ||
| Total ASP | 13,300 | 11% | 14,100 | 13,800 | 2% | ||
| Gaming systems revenue | 38 | 11% | 149 | 136 | 9% |
All values are in US Dollars.
| DIGITAL & BETTING | Q4'21 | Q4'20 | Y/Y Change (%) | Constant Currency Change (%) (1) | FY'21 | FY'20 | Y/Y Change (%) | Constant Currency Change (%) (1) |
|---|---|---|---|---|---|---|---|---|
| Revenue | ||||||||
| Service | 41 | 33 | 24% | 22% | 163 | 114 | 44% | 39% |
| Product sales | 1 | — | 347% | 348% | 1 | 1 | 55% | 55% |
| Total revenue | 42 | 33 | 25% | 24% | 165 | 115 | 44% | 40% |
| Operating income | 5 | 3 | 41% | 19% | 33 | 6 | 421% | 383% |
| Adjusted EBITDA(1) | 9 | 8 | 12% | 3% | 48 | 22 | 116% | 105% |
| CONSOLIDATED | ||||||||
| Revenue (by geography) | ||||||||
| US & Canada | 591 | 490 | 21% | 20% | 2,250 | 1,748 | 29% | 28% |
| Italy | 305 | 266 | 15% | 20% | 1,300 | 862 | 51% | 46% |
| Rest of world | 154 | 130 | 19% | 22% | 539 | 505 | 7% | 4% |
| Total revenue | 1,050 | 885 | 19% | 21% | 4,089 | 3,116 | 31% | 29% |
| (1) Non-GAAP measure; see disclaimer on page 6 and reconciliations to the most directly comparable GAAP measure in Appendix for further details | ||||||||
| International Game Technology PLC | ||||||||
| --- | --- | --- | --- | |||||
| Consolidated Statements of Operations | ||||||||
| ( in millions and shares in thousands, except per share amounts) | ||||||||
| Unaudited | ||||||||
| For the year ended | ||||||||
| December 31, | ||||||||
| 2020 | 2021 | 2020 | ||||||
| Service revenue | 749 | 3,483 | 2,640 | |||||
| Product sales | 136 | 606 | 476 | |||||
| Total revenue | 885 | 4,089 | 3,115 | |||||
| Cost of services | 440 | 1,754 | 1,634 | |||||
| Cost of product sales | 103 | 377 | 346 | |||||
| Selling, general and administrative | 196 | 810 | 707 | |||||
| Research and development | 51 | 238 | 191 | |||||
| Restructuring | (2) | 6 | 45 | |||||
| Goodwill impairment | — | — | 296 | |||||
| Other operating expense | 1 | 1 | 4 | |||||
| Total operating expenses | 789 | 3,187 | 3,223 | |||||
| Operating income (loss) | 96 | 902 | (107) | |||||
| Interest expense, net | 101 | 341 | 398 | |||||
| Foreign exchange (gain) loss, net | 155 | (66) | 309 | |||||
| Other expense (income), net | (1) | 98 | 33 | |||||
| Total non-operating expenses | 255 | 373 | 740 | |||||
| Income (loss) from continuing operations before provision for income taxes | (159) | 529 | (848) | |||||
| Provision for income taxes | 73 | 274 | 28 | |||||
| Income (loss) from continuing operations | (232) | 255 | (875) | |||||
| Income from discontinued operations, net of tax | 12 | 24 | 37 | |||||
| Gain on sale of discontinued operations, net of tax | — | 391 | — | |||||
| Income from discontinued operations | 12 | 415 | 37 | |||||
| Net income (loss) | (220) | 670 | (839) | |||||
| Less: Net income attributable to non-controlling interests from continuing operations | 24 | 190 | 64 | |||||
| Less: Net (loss) income attributable to non-controlling interests from discontinued operations | (2) | (2) | (5) | |||||
| Net income (loss) attributable to IGT PLC | (242) | 482 | (898) | |||||
| Net income (loss) from continuing operations attributable to IGT PLC per common share - basic | (1.25) | 0.32 | (4.59) | |||||
| Net income (loss) from continuing operations attributable to IGT PLC per common share - diluted | (1.25) | 0.31 | (4.59) | |||||
| Net income (loss) attributable to IGT PLC per common share - basic | (1.18) | 2.35 | (4.39) | |||||
| Net income (loss) attributable to IGT PLC per common share - diluted | (1.18) | 2.33 | (4.39) | |||||
| Weighted-average shares - basic | 204,857 | 204,954 | 204,725 | |||||
| Weighted-average shares - diluted | 204,857 | 206,795 | 204,725 |
All values are in US Dollars.
| International Game Technology PLC | |
|---|---|
| Consolidated Balance Sheets | |
| ( in millions) | |
| Unaudited | |
| 2020 | |
| Assets | |
| Current assets: | |
| Cash and cash equivalents | 907 |
| Restricted cash and cash equivalents | 199 |
| Trade and other receivables, net | 846 |
| Inventories | 169 |
| Other current assets | 480 |
| Assets held for sale | 839 |
| Total current assets | 3,440 |
| Systems, equipment and other assets related to contracts, net | 1,068 |
| Property, plant and equipment, net | 132 |
| Operating lease right-of-use assets | 288 |
| Goodwill | 4,713 |
| Intangible assets, net | 1,577 |
| Other non-current assets | 1,774 |
| Total non-current assets | 9,552 |
| Total assets | 12,992 |
| Liabilities and shareholders’ equity | |
| Current liabilities: | |
| Accounts payable | 1,126 |
| Current portion of long-term debt | 393 |
| Short-term borrowings | — |
| Other current liabilities | 846 |
| Liabilities held for sale | 250 |
| Total current liabilities | 2,615 |
| Long-term debt, less current portion | 7,857 |
| Deferred income taxes | 333 |
| Operating lease liabilities | 266 |
| Other non-current liabilities | 360 |
| Total non-current liabilities | 8,816 |
| Total liabilities | 11,431 |
| Commitments and contingencies | |
| IGT PLC’s shareholders’ equity | 777 |
| Non-controlling interests | 784 |
| Total shareholders' equity | 1,561 |
| Total liabilities and shareholders’ equity | 12,992 |
All values are in US Dollars.
| International Game Technology PLC | |||
|---|---|---|---|
| Consolidated Statements of Cash Flows | |||
| ( in millions) | |||
| Unaudited | |||
| For the year ended | |||
| December 31, | |||
| 2020 | 2021 | 2020 | |
| Cash flows from operating activities | |||
| Net income (loss) | (220) | 670 | (839) |
| Less: Income from discontinued operations | 12 | 415 | 37 |
| Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities from continuing operations: | |||
| Depreciation | 90 | 325 | 355 |
| Amortization of upfront license fees | 55 | 216 | 210 |
| Amortization | 51 | 201 | 211 |
| Loss on extinguishment of debt | — | 92 | 28 |
| Deferred income taxes | 28 | 38 | (78) |
| Stock-based compensation | 4 | 35 | (7) |
| Debt issuance cost amortization | 6 | 19 | 21 |
| Goodwill impairment | — | — | 296 |
| Gain on sale of assets | — | (9) | — |
| Foreign exchange (gain) loss, net | 155 | (66) | 309 |
| Other non-cash items, net | (1) | 7 | (2) |
| Changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions: | |||
| Trade and other receivables | (95) | (95) | 74 |
| Inventories | 26 | (13) | 17 |
| Accounts payable | 49 | (36) | 5 |
| Other assets and liabilities | 116 | 41 | 31 |
| Net cash provided by operating activities from continuing operations | 251 | 1,010 | 595 |
| Net cash provided by (used in) operating activities from discontinued operations | 4 | (31) | 271 |
| Net cash provided by operating activities | 255 | 978 | 866 |
| Cash flows from investing activities | |||
| Capital expenditures | (50) | (238) | (255) |
| Proceeds from sale of assets | 3 | 21 | 9 |
| Other | — | 1 | 12 |
| Net cash used in investing activities from continuing operations | (48) | (216) | (233) |
| Net cash (used in) provided by investing activities from discontinued operations | (14) | 852 | (35) |
| Net cash (used in) provided by investing activities | (62) | 636 | (269) |
| Cash flows from financing activities | |||
| Principal payments on long-term debt | — | (2,846) | (959) |
| Payments in connection with the extinguishment of debt | — | (85) | (25) |
| Net receipts from (payments of) financial liabilities | (29) | (50) | 67 |
| Payments of debt issuance costs | — | (14) | (22) |
| Net (repayments of) proceeds from Revolving Credit Facilities | (175) | 17 | (29) |
| Net proceeds from (payments of) short-term borrowings | — | 51 | (7) |
| Proceeds from long-term debt | — | 1,339 | 750 |
| Repurchases of common stock | — | (41) | — |
| Dividends paid | — | (41) | (41) |
| Dividends paid - non-controlling interests | — | (91) | (136) |
| Return of capital - non-controlling interests | (32) | (127) | (32) |
| Capital increase - non-controlling interests | 5 | 12 | 8 |
| Other | (3) | (23) | (11) |
| Net cash used in financing activities | (234) | (1,898) | (438) |
| Net increase (decrease) in cash and cash equivalents and restricted cash and cash equivalents | (40) | (284) | 159 |
| Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents | 30 | (37) | 76 |
| Cash and cash equivalents and restricted cash and cash equivalents at the beginning of the period | 1,140 | 1,129 | 894 |
| Cash and cash equivalents and restricted cash and cash equivalents at the end of the period | 1,129 | 808 | 1,129 |
| Less: Cash and cash equivalents and restricted cash and cash equivalents of discontinued operations | 23 | — | 23 |
| Cash and cash equivalents and restricted cash and cash equivalents at the end of the period of continuing operations | 1,106 | 808 | 1,106 |
| Supplemental Cash Flow Information: | |||
| Interest paid | 37 | 369 | 410 |
| Income taxes paid | 51 | 188 | 89 |
All values are in US Dollars.
| International Game Technology PLC | |
|---|---|
| Net Debt | |
| ( in millions) | |
| Unaudited | |
| 2020 | |
| 6.250% Senior Secured U.S. Dollar Notes due February 2022 | 1,004 |
| 4.750% Senior Secured Euro Notes due February 2023 | 1,038 |
| 5.350% Senior Secured U.S. Dollar Notes due October 2023 | 61 |
| 3.500% Senior Secured Euro Notes due July 2024 | 610 |
| 6.500% Senior Secured U.S. Dollar Notes due February 2025 | 1,092 |
| 4.125% Senior Secured U.S. Dollar Notes due April 2026 | — |
| 3.500% Senior Secured Euro Notes due June 2026 | 913 |
| 6.250% Senior Secured U.S. Dollar Notes due January 2027 | 744 |
| 2.375% Senior Secured Euro Notes due April 2028 | 608 |
| 5.250% Senior Secured U.S. Dollar Notes due January 2029 | 743 |
| Senior Secured Notes | 6,813 |
| Euro Term Loan Facilities due January 2027 | 1,044 |
| Long-term debt, less current portion | 7,857 |
| Euro Term Loan Facilities due January 2027 | 393 |
| Current portion of long-term debt | 393 |
| Short-term borrowings | — |
| Total debt | 8,250 |
| Less: Cash and cash equivalents | 907 |
| Less: Debt issuance costs, net - Revolving Credit Facilities due July 2024 | 24 |
| Net debt | 7,319 |
| Note: Net debt is a non-GAAP financial measure |
All values are in US Dollars.
| International Game Technology PLC | |||||
|---|---|---|---|---|---|
| Reconciliation of Non-GAAP Financial Measures | |||||
| ( in millions) | |||||
| Unaudited | |||||
| Global Gaming | Digital & Betting | Business Segment Total | Corporate and Other | Total IGT PLC | |
| Income from continuing operations | 55 | ||||
| Provision for income taxes | 56 | ||||
| Interest expense, net | 77 | ||||
| Foreign exchange gain, net | (4) | ||||
| Other non-operating expense, net | 2 | ||||
| Operating income (loss) | 36 | 5 | 258 | (72) | 186 |
| Depreciation | 29 | 4 | 79 | — | 79 |
| Amortization - service revenue (1) | — | — | 53 | — | 53 |
| Amortization - non-purchase accounting | 1 | — | 11 | 1 | 12 |
| Amortization - purchase accounting | — | — | — | 39 | 39 |
| Restructuring | (4) | — | 4 | 3 | 7 |
| Stock-based compensation | 4 | — | 7 | 6 | 13 |
| Adjusted EBITDA | 66 | 9 | 411 | (24) | 387 |
| Cash flows from operating activities - continuing operations | 396 | ||||
| Capital expenditures | (71) | ||||
| Free Cash Flow | 326 | ||||
| (1) Includes amortization of upfront license fees |
All values are in US Dollars.
| International Game Technology PLC | |||||
|---|---|---|---|---|---|
| Reconciliation of Non-GAAP Financial Measures | |||||
| ( in millions) | |||||
| Unaudited | |||||
| Global Gaming | Digital & Betting | Business Segment Total | Corporate and Other | Total IGT PLC | |
| Loss from continuing operations | (232) | ||||
| Provision for income taxes | 73 | ||||
| Interest expense, net | 101 | ||||
| Foreign exchange loss, net | 155 | ||||
| Other non-operating income, net | (1) | ||||
| Operating income (loss) | (42) | 3 | 156 | (60) | 96 |
| Depreciation | 32 | 4 | 90 | — | 90 |
| Amortization - service revenue (1) | — | — | 55 | — | 55 |
| Amortization - non-purchase accounting | 2 | — | 10 | 1 | 11 |
| Amortization - purchase accounting | — | — | — | 40 | 40 |
| Restructuring | (2) | 1 | (2) | — | (2) |
| Stock-based compensation | 1 | — | 2 | 2 | 4 |
| Other (2) | — | — | — | 1 | 1 |
| Adjusted EBITDA | (10) | 8 | 311 | (16) | 295 |
| Cash flows from operating activities - continuing operations | 251 | ||||
| Capital expenditures | (50) | ||||
| Free Cash Flow | 201 | ||||
| (1) Includes amortization of upfront license fees | |||||
| (2) Primarily includes transaction-related costs |
All values are in US Dollars.
| International Game Technology PLC | |||||
|---|---|---|---|---|---|
| Reconciliation of Non-GAAP Financial Measures | |||||
| ( in millions) | |||||
| Unaudited | |||||
| Global Gaming | Digital & Betting | Business Segment Total | Corporate and Other | Total IGT PLC | |
| Income from continuing operations | 255 | ||||
| Provision for income taxes | 274 | ||||
| Interest expense, net | 341 | ||||
| Foreign exchange gain, net | (66) | ||||
| Other non-operating expense, net | 98 | ||||
| Operating income (loss) | 43 | 33 | 1,164 | (262) | 902 |
| Depreciation | 121 | 15 | 326 | (1) | 325 |
| Amortization - service revenue (1) | — | — | 216 | — | 216 |
| Amortization - non-purchase accounting | 5 | — | 40 | 3 | 43 |
| Amortization - purchase accounting | — | — | — | 158 | 158 |
| Restructuring | (4) | (1) | 3 | 2 | 6 |
| Stock-based compensation | 8 | 1 | 17 | 18 | 35 |
| Other (2) | — | — | — | 1 | 1 |
| Adjusted EBITDA | 173 | 48 | 1,766 | (80) | 1,686 |
| Cash flows from operating activities - continuing operations | 1,010 | ||||
| Capital expenditures | (238) | ||||
| Free Cash Flow | 771 | ||||
| (1) Includes amortization of upfront license fees | |||||
| (2) Primarily includes transaction-related costs |
All values are in US Dollars.
| International Game Technology PLC | |||||
|---|---|---|---|---|---|
| Reconciliation of Non-GAAP Financial Measures | |||||
| ( in millions) | |||||
| Unaudited | |||||
| Global Gaming | Digital & Betting | Business Segment Total | Corporate and Other | Total IGT PLC | |
| Loss from continuing operations | (875) | ||||
| Provision for income taxes | 28 | ||||
| Interest expense, net | 398 | ||||
| Foreign exchange loss, net | 309 | ||||
| Other non-operating expense, net | 33 | ||||
| Operating income (loss) | (212) | 6 | 436 | (544) | (107) |
| Goodwill impairment | — | — | — | 296 | 296 |
| Depreciation | 138 | 14 | 354 | 1 | 355 |
| Amortization - service revenue (1) | — | — | 210 | — | 210 |
| Amortization - non-purchase accounting | 7 | — | 38 | 3 | 41 |
| Amortization - purchase accounting | — | — | — | 170 | 170 |
| Restructuring | 32 | 2 | 39 | 6 | 45 |
| Stock-based compensation | (4) | — | (7) | — | (7) |
| Other (2) | — | — | — | 4 | 4 |
| Adjusted EBITDA | (38) | 22 | 1,070 | (62) | 1,008 |
| Cash flows from operating activities - continuing operations | 595 | ||||
| Capital expenditures | (255) | ||||
| Free Cash Flow | 340 | ||||
| (1) Includes amortization of upfront license fees | |||||
| (2) Primarily includes transaction-related costs |
All values are in US Dollars.
19
q421earningsslidedeck
1 International Game Technology PLC 2021 Fourth Quarter and Full Year Results Period ended December 31, 2021 March 1, 2022
2 Cautionary Statement Regarding Forward-Looking Statements This presentation may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the “Company”) and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as “aim,” “anticipate,” “believe,” “plan,” “could,” “would,” “should,” “shall”, “continue,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “will,” “possible,” “potential,” “predict,” “project” or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company’s control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the uncertainty of the duration, extent and effects of the COVID-19 pandemic and the response to governments, including government-mandated property closures and travel restrictions, and other third parties on the Company's business, results of operations, cash flows, liquidity and development prospects and the factors and risks described in the Company’s annual report on Form 20-F for the financial year ended December 31, 2020 and other documents filed from time to time with the SEC, which are available on the SEC’s website at www.sec.gov and on the investor relations section of the Company’s website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company’s business. Nothing in this presentation is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance of International Game Technology PLC, as applicable. All forward-looking statements contained in this presentation are qualified in their entirety by this cautionary statement. All subsequent written or oral forward- looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement. Comparability of Results All figures presented in this release are prepared under U.S. GAAP, unless otherwise noted. Non-GAAP Financial Measures - definitions for certain defined terms used throughout this presentation are provided by footnote reference upon their first use in the presentation Management supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure. Adjusted EBITDA represents net income (loss) from continuing operations (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), other non-operating expenses, depreciation, impairment losses, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income) and certain other non-recurring items. Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash equivalents. Cash and cash equivalents are subtracted from the GAAP measure because they could be used to reduce the Company’s debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet. Net debt leverage and Leverage are non-GAAP financial measures that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months (“LTM”) prior to such date. Prior to the disposal of the Italian B2C gaming businesses in the second quarter of 2021, management calculated the Net debt leverage ratio as the ratio of Net debt as of a particular balance sheet date to the LTM of Adjusted EBITDA – combined prior to such date. Management believes that Net debt leverage is a useful measure to assess our financial strength and ability to incur incremental indebtedness when making key investment decisions. Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing IGT’s ability to fund its activities, including debt service and distribution of earnings to shareholders. Constant currency is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the exchange rates used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates. A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.
3 Business Update
2021 Financial Goals 2021 Actual Achievement Revenue $4.1B $4.1B Operating Income ~$900M $902M Operating Income Margin 22% 22.1% Cash from Operations $850 - $900M $1.0B CapEx <$300M $238M Net Debt Leverage(1) <4.0x 3.5x 4 2021: Achieved/Exceeded All Financial Goals During A Year of Important Strategic Progress Sustained investment in innovation driving strong growth across all verticals Creation of standalone Digital & Betting segment; strengthened team with new talent Sale of Italy B2C gaming machine and sports betting activities Achieved over $200M in OPtiMa structural cost savings Optimization of capital structure Re-initiated capital returns to shareholders with quarterly dividend and the Company’s first-ever share repurchase program Progress on Key Strategic Initiatives All amounts from continuing operations (1) Non-GAAP measure; see disclaimer on page 2 for further details
5 Marco Sala Executive Chair, IGT PLC
6 Vince Sadusky CEO, IGT PLC
7 (1) Revenue and operating income CAGRs are 2021-2025; cash flow goals are 2022-2025 Global leadership in large, regulated gaming markets with secular tailwinds and accelerating digital growth Set aggressive but achievable multi-year financial goals(1) ◦ Mid-single digit organic revenue CAGR ◦ Mid-teens operating income CAGR ◦ ~$4.0 billion in cumulative cash from operations ◦ ~$2.4 billion in cumulative free cash flow Capital allocation strategy to maximize value for all stakeholders ◦ Support existing portfolio, especially Digital & Betting and iLottery activities ◦ Continue to delever, achieving 2.5x-3.5x net debt leverage across investment cycles ◦ Return capital to shareholders via dividends and share repurchases Well-Positioned to Create Value for All Stakeholders with Focused Strategy to Grow, Innovate, and Optimize
8 Diverse and resilient ◦ Aligned with attractive end-markets ◦ Creates a natural hedge against variability across segments Unique and sustainable competitive advantages Content and technology synergies, cross-selling, and operational efficiencies provide compelling, enterprise-wide leverage Announced sale of Italy commercial services business monetizes a non-core asset at attractive valuation ◦ €700 million purchase price; €630M enterprise value ◦ Net proceeds primarily used to reduce debt Continue to assess strategic optionality with Digital & Betting and the potential for a separate listing Maximizing the Power of the Portfolio
Global Lottery: Strong Performance and Outlook on Accelerated Growth and Emerging, Incremental Opportunities 9 Global same-store sales up 20+% vs. 2020 and 2019; impressive operating leverage in business ◦ Consolidating higher baseline play levels ◦ Strong performance across games ◦ Operating income grew >2x faster than revenue in 2021 Driving iLottery growth through innovation ◦ Global iLottery SSS up 60+% in 2021, nearly doubling in the U.S. ◦ iLottery penetration in IGT-served U.S. markets reaches 12% in Q4’21 ◦ Successful deployment of industry’s first cloud-based einstants platform Instant ticket services up on 35+% growth in standard units produced, including new contract wins Compelling multi-year Global Lottery outlook ◦ Accelerated growth through innovation and higher player consumption ◦ Favorable contract renewal cycle ◦ Investing to capitalize on multiple, focused growth initiatives
Global Gaming: Focused Product Strategies, Market Recovery Enhanced by Structural Margin Improvement Initiatives 10 Strong rebound in full-year sales and profits; continued, sequential improvement in Q4’21 period ◦ Significant improvement in unit sales ◦ Stability in casino installed base ◦ Important contribution from structural cost savings Key progress on targeted gaming machine product strategies ◦ Growing acceptance of new hardware (Peak family, DiamondRSTM) ◦ Delivered innovative game mechanics (Hexbreaker3™, Regal Riches) ◦ Expanding MLP portfolio driving higher unit sales and yields ◦ Improved average selling prices Nevada regulatory approval for award-winning Resort Wallet™ cashless technology a major milestone for industry adoption Expect double-digit revenue and profit CAGR through 2025 ◦ Market share gains in key product categories ◦ Structural cost savings
Digital & Betting: Building the Foundation for High Growth and Value Creation 11 Vitality of IGT’s solutions evident in 35% revenue CAGR for 2019-2021 period Investing to bolster leadership positions ◦ Increasing investment in talent and R&D to drive growth ◦ Significant increase in new proprietary titles in 2022; establishing distribution partnerships with third parties ◦ PlaySports solution named "Platform Provider of the Year" at SBC Awards North America; turnkey solution gaining traction with recent deployments and robust pipeline heading into 2022 High-growth outlook enhanced by attractive margin profile ◦ Organic growth in existing markets; contribution from new markets ◦ SaaS model delivers compelling profit margins with growing scale Legal entity and organizational realignment underway ◦ Tax and legal structuring progressing subject to licensing requirements ◦ Operational and financial carve out well advanced
Maintaining 2022 Outlook Range with Clearly Defined Initiatives to Mitigate Near-Term Market Dynamics 12 Omicron impact on Italy lottery sales and casino closures/restrictions worldwide COVID-related impacts on lottery sales have proved to be short-lived; casino GGR trends and sales funnel remain strong in North America 2022 Headwinds 2022 Tailwinds/Mitigating Actions Increased pressure on deliveries as demand grows (longer lead times, component availability) Labor shortages (low unemployment rate, attrition) Cost inflation (components, freight, wages); FX (€/$) Investing in human capital; talent acquisition/retention is a priority; IGT’s culture is an important advantage Prioritizing key products and customer deliveries Sustained focus on cost discipline/avoidance Potential impact from Russia/Ukraine conflict Minimal direct exposure to the affected region
13 Financial Results
40 96 186 Q4'19 Q4'20 Q4'21 365 295 387 Q4'19 Q4'20 Q4'21 14 $ in millions; EUR/USD FX daily average: 1.14 in Q4'21, 1.19 in Q4'20, 1.11 in Q4'19; all amounts presented reflect continuing operations Adjusted EBITDA 1,044 885 1,050 Q4'19 Q4'20 Q4'21 Q4'21 Q4'21: Significant Revenue and Profit Growth Y/Y and Compared to 2019 Includes $99M in non-cash goodwill impairment charges Cash Flow 278 251 396 186 201 326 Cash from operations Free Cash Flow Q4'19 Q4'20 Q4'21 Revenue Operating Income
15 $ in millions; EUR/USD FX daily average: 1.18 in 2021, 1.14 in 2020, 1.12 in 2019; all amounts presented reflect continuing operations FY'21 4,032 3,115 4,089 2019 2020 2021 478 (107) 902 2019 2020 2021 1,454 1,008 1,686 2019 2020 2021 FY'21: Robust Cash Flows Driven by Growth Across Segments and Strong Operating Leverage Includes $296M in non-cash goodwill impairment charge in 2020; $99M in 2019 907 595 1,010 530 340 771 Cash from operations Free Cash Flow 2019 2020 2021 Revenue Operating Income Adjusted EBITDA Cash Flow
Exceptional 20%+ global SSS growth compared to PY and 2019 • Lottery service up on increased player demand across games • ~$165M benefit from some discrete items in H1'21 Operating income exceeds $1B, up 69% Y/Y • High flow-through of SSS growth • Positive geographic mix • Discrete items contribute ~$140M Solid Q4'21 performance • Revenue higher on 8% global SSS growth; SSS up 17% vs Q4'19 • Operating income margins increase to 32% 2,164 549 51 1 2,765 47 2,812 2020 Lottery Service Other Service Product Sales Excluding FX FX 2021 Global Lottery: Record Financial Results Achieved in 2021 16 Note: $ in millions, except where noted otherwise; all amounts presented reflect continuing operations Revenue 30% 39%Operating Income Margin Global SSS growth (at constant FX) Q4'21 % change Q4'21 % change vs. 2019 FY'21 % change FY'21 % change vs. 2019 Instants & Draw Games 6.6% 15.6% 18.1% 20.8% Multi-jurisdiction jackpots 21.7% 27.0% 46.4% 21.8% Total 7.7% 16.5% 20.1% 20.9% Q4'21 Q4'20 % change Revenue 687 630 9% Operating Income 217 195 11% Adjusted EBITDA 336 313 7% FY'21 FY'20 FY'19 Y/Y % change % change vs. 2019 Revenue 2,812 2,164 2,293 30% 23% Operating Income 1,088 642 697 69% 56% Adjusted EBITDA 1,545 1,086 1,136 42% 36%
Meaningful Y/Y increase in revenue and profit in 2021 • Terminal service primarily driven by higher number of active units and yields up more than 50% • Terminal product sales up on significant Y/Y increase of over 9,000 machine units sold and higher ASPs • Profitability propelled by revenue growth and structural cost savings as part of OPtiMa 1.0 Q4'21 results highlight continued recovery • Revenue up 45%, primarily driven by higher replacement units and ASPs • Operating income margin of 11%, approaching 12% pre-pandemic level Global Gaming: Innovation and Market Rebound Drive Significant Revenue and Profit Recovery 17 Machine Units Sold FY'21 FY'20 FY'19 New & expansion 3,049 3,046 5,814 Replacement 20,758 11,616 36,262 Total 23,807 14,662 42,076 Average selling price $14,100 $13,800 $13,400 Note: $ in millions, except where noted otherwise; all amounts presented reflect continuing operations (1) Excludes L/T lease units treated as sales-type leases; comparability on a Y/Y basis hindered due to fewer active units Installed Base (units) FY'21 FY'20 FY'19 US & Canada 33,437 34,275 35,977 Rest of world 15,412 15,025 14,857 Total 48,849 49,300 50,834 Yields(1) $27.11 $18.06 $31.45 Q4'21 Q4'20 % change Revenue 321 222 45% Operating income/(loss) 36 (42) NA Adjusted EBITDA 66 (10) NA Revenue 837 125 20 130 (8) 1,104 8 1,112 2020 Terminal Service Other Service Terminal Product Sales Other Product Sales Excluding FX FX 2021 (25)% 4%Operating Income Margin FY'21 FY'20 FY'19 Y/Y % change % change vs. 2019 Revenue 1,112 837 1,648 33% (33)% Operating income/(loss) 43 (212) 222 NA (81)% Adjusted EBITDA 173 (38) 404 NA (57)%
New jurisdictions and customers propel double- digit revenue growth across verticals in full-year period • Successfully launched iGaming in MI and CT • Powering over 60 retail sports books Solid profit contribution from emerging business; Operating income up on strong revenue flow through with margins increasing to 20% Delivered double-digit growth in revenue and profit in Q4'21 • Revenue rises to $42M • Operating income demonstrates strong leverage profile even with increased investment in the business Digital & Betting: Emerging Business Delivers Strong Revenue and Profit Growth 18 $ in millions, except where noted otherwise; all amounts presented reflect continuing operations Revenue 115 45 160 5 165 2020 Service Excluding FX FX 2021 Q4'21 Q4'20 Y/Y % change Revenue 42 33 25% Operating income (loss) 5 3 41% Adjusted EBITDA 9 8 12% Operating Income Margin 6% 20% FY'21 FY'20 FY'19 Y/Y % change vs. 2020 Y/Y % change vs. 2019 Revenue 165 115 91 44% 81% Operating income (loss) 33 6 (43) 421% NA Adjusted EBITDA 48 22 (8) 116% NA
▪ Generated record cash flows of over $1.0B in cash from operations and $770M in free cash flow • Exceptional performance and diligent capital management • 60% cash conversion rate(2), among the highest in Company history ▪ Reduced net debt by $1.4B; leverage improves to 3.5x • ~$900M in net cash proceeds from sale of Italy gaming businesses • Achieved lowest leverage in Company history ▪ Delivered over $80M to shareholders in Q4'21 via dividend and share repurchases • Paid $0.20 per common share quarterly dividend; annualized dividend yield of ~3%(3) • Repurchased 1.5M shares for ~$40M at an average price of $27.22 per share Balanced Capital Allocation Framework on Display; Achieved 2022 Net Debt Leverage Target a Year Early 19 Note: $ in millions, except where noted otherwise; all amounts presented represent continuing operations (1) Leverage defined as Net Debt divided by LTM Adjusted EBITDA (2) Cash conversion defined as Cash from Operations divided by Adjusted EBITDA (3) Based on December 31, 2021 closing stock price of $28.91 7,390 7,319 5,922 2019 2020 2021 6.4x 3.5x4.3x 907 595 1,010 530 340 771 Cash from operations Free Cash Flow 2019 2020 2021 Share repurchases Dividends to shareholders Net debt reduction Minority payments Capital expenditures50% Cash Flows Net Debt Capital Allocation 11% 9% 19% Q4'21 Leverage(1) 11%
Total liquidity of $2.3B as of 12/31/21; $0.6B in unrestricted cash; $1.7B in additional borrowing capacity Continued strategic liability management initiatives in FY'21; Y/Y interest reduced ~$60M • In March, refinanced ~$1.0B 6.25% Notes due 2022 with $750M 4.125% Notes due 2026 and revolvers • In May, redeemed ~$1.0B 4.75% Euro bonds due 2023 • In July, successfully amended and extended term loan facility Credit ratings restored to pre-pandemic levels with recent upgrades • S&P to BB+ on 2/16/22 • Moody's to Ba2 on 2/11/22 Solid Liquidity Position; Predominately Fixed Rate Debt with No Near Term Maturities 20 Note: $ in millions, except where noted otherwise Fixed Variable 82% 18% 227 227 227 453 566 1,100 1,599 750 566 750 1,737 Bank Debt Bonds Undrawn RCF 2022 2023 2024 2025 2026 2027 2028 2029 6131 Debt Maturity Profile at December 31, 2021
Summary of Key Takeaways 21 Achieved or Exceeded 2021 Financial Goals Significantly Reduced Debt and Leverage Capital Returns to Shareholders Good Progress on Strategic Initiatives • Exceeded targets for cash from operations and leverage • Delivered on revenue, operating income, and CapEx targets • Reduced net debt by $1.4B • Achieved 2022 target leverage a year early • Paid ~$40M in dividends; annualized yield of ~3% • Repurchased 1.5M shares for ~$40M • Growth in iLottery and instant ticket services • Expanded portfolio of MLPs with solid pipeline of games; NV regulatory approval of cashless solution • Digital & Betting legal entity and organizational realignment underway
22 Affirming FY'22 and Introducing Q1'22 Outlook Revenue Operating Income Margin Cash from Operations Revenue Operating Income Margin ~$4.1B - ~$4.3B 20% - 22% $850M - $1,000M ~$1.0B - ~$1.1B 20% - 22% FY'22 Outlook Q1'22 Outlook Outlook Assumptions FY'22: • Double-digit Global Lottery SSS growth vs 2019; lower revenue Y/Y due to benefit from some discrete items in H1'21 • Global Gaming benefits from strong sales funnel with supply chain being key variable • Digital & Betting top-line revenue continues to grow at double- digit rate; making investments to fund future growth and strategic optionality • Current headwinds due to Omicron restrictions, supply chain constraints, and cost inflation addressed with benefits from incremental product sales, financial rigor on costs, and lower D&A • FX remaining a headwind for P&L but a tailwind for Net Debt Q1'22: • Q1'22 sequentially stronger with respect to revenue and profit Capital Expenditures $400M - $450M Note: EUR/USD FX @ 1.14; outlook not adjusted for announced sale of Italy commercial services or any material impact from the Russia/Ukraine conflict
23 Q&A
24 Appendix
$ millions except otherwise noted (1) Non-GAAP measure; see disclaimer on page 2 and reconciliations to the most directly comparable GAAP measures in Appendix for further details Q4'21 and FY'21 Select Performance and KPI Data 25 GLOBAL LOTTERY Q4'21 Q4'20 Y/Y Change (%) Constant Currency Change (%) (1) FY'21 FY'20 Y/Y Change (%) Constant Currency Change (%) (1) Revenue Service Operating and facilities management contracts 608 549 11% 13% 2,569 1,944 32% 30% Upfront license fee amortization (50) (52) 5% —% (206) (200) (3%) —% Operating and facilities management contracts, net 558 497 12% 15% 2,363 1,744 35% 33% Other 87 86 1% 6% 327 299 10% 7% Total service revenue 646 583 11% 13% 2,690 2,043 32% 29% Product sales 42 47 (11%) (10%) 123 121 1% —% Total revenue 687 630 9% 12% 2,812 2,164 30% 28% Operating income 217 195 11% 14% 1,088 642 69% 65% Adjusted EBITDA 336 313 7% 10% 1,545 1,086 42% 39% Q4'21 Constant Currency Change (%) (1) Q4'20 Constant Currency Change (%) (1) FY'21 Constant Currency Change (%) (1) FY'20 Constant Currency Change (%) (1) Global same-store sales growth (%) Instant ticket & draw games 6.6% 8.2% 18.1% 1.6% Multi-jurisdiction jackpots 21.7% 4.5% 46.4% (17.0%) Total 7.7% 7.9% 20.1% 0.1% North America and Rest of world same-store sales growth (%) Instant ticket & draw games 6.3% 10.7% 12.7% 7.3% Multi-jurisdiction jackpots 21.7% 4.5% 46.4% (17.0%) Total 7.8% 10.1% 15.6% 4.7% Italy same-store sales growth (%) Instant ticket & draw games 7.7% 0.4% 38.9% (16.1%)
$ millions except otherwise noted (1) Excluded from yield calculations due to treatment as sales-type leases Q4'21 and FY'21 Select Performance and KPI Data 26 GLOBAL GAMING Q4'21 Q4'20 Y/Y Change (%) Constant Currency Change (%) FY'21 FY'20 Y/Y Change (%) Constant Currency Change (%) Revenue Service Terminal 109 85 29% 29% 424 298 42% 42% Systems, software, and other 54 48 12% 13% 206 186 11% 11% Total service revenue 163 133 23% 24% 630 483 30% 30% Product sales Terminal 110 59 85% 87% 339 205 65% 63% Other 48 30 60% 61% 143 148 (4%) (5%) Total product sales revenue 158 89 77% 78% 482 354 36% 34% Total revenue 321 222 45% 45% 1,112 837 33% 32% Operating income (loss) 36 (42) NA NA 43 (212) NA NA Adjusted EBITDA 66 (10) NA NA 173 (38) NA NA Installed base units Casino 47,732 48,232 (1%) 47,732 48,232 (1%) Casino - L/T lease(1) 1,117 1,068 5% 1,117 1,068 5% Total installed base units 48,849 49,300 (1%) 48,849 49,300 (1%) Installed base units (by geography) US & Canada 33,437 34,275 (2%) 33,437 34,275 (2%) Rest of world 15,412 15,025 3% 15,412 15,025 3% Total installed base units 48,849 49,300 (1%) 48,849 49,300 (1%)
$ millions except otherwise noted (1) Excludes Casino L/T lease units due to treatment as sales-type leases; comparability on a Y/Y basis hindered due to fewer active units Q4'21 and FY'21 Select Performance and KPI Data 27 GLOBAL GAMING (Continued) Q4'21 Q4'20 Y/Y Change (%) FY'21 FY'20 Y/Y Change (%) Yields (by geography)(1), in absolute $ US & Canada $38.95 $27.88 40% $37.62 $24.34 55% Rest of world $5.39 $3.33 62% $4.42 $3.67 20% Total yields $28.27 $20.32 39% $27.11 $18.06 50% Global machine units sold New/expansion (11) 666 NA 3,049 3,046 —% Replacement 7,377 3,662 101% 20,758 11,616 79% Total machine units sold 7,366 4,328 70% 23,807 14,662 62% US & Canada machine units sold New/expansion (452) 668 NA 1,335 2,753 (52%) Replacement 5,547 2,636 110% 14,759 8,009 84% Total machine units sold 5,095 3,304 54% 16,094 10,762 50% Rest of world machine units sold New/expansion 441 (2) NA 1,714 293 485% Replacement 1,830 1,026 78% 5,999 3,607 66% Total machine units sold 2,271 1,024 122% 7,713 3,900 98% Average selling price (ASP), in absolute $ US & Canada $15,300 $14,200 8% $14,300 $14,200 1% Rest of world $13,400 $10,400 29% $13,500 $12,400 9% Total ASP $14,700 $13,300 11% $14,100 $13,800 2% Gaming systems revenue 42 38 11% 149 136 9%
$ millions except otherwise noted Q4'21 and FY'21 Select Performance and KPI Data 28 DIGITAL & BETTING Q4'21 Q4'20 Y/Y Change (%) Constant Currency Change (%) FY'21 FY'20 Y/Y Change (%) Constant Currency Change (%) Revenue Service 41 33 24% 22% 163 114 44% 39% Product sales 1 — 347% 348% 1 1 55% 55% Total revenue 42 33 25% 24% 165 115 44% 40% Operating income 5 3 41% 19% 33 6 421% 383% Adjusted EBITDA 9 8 12% 3% 48 22 116% 105% CONSOLIDATED Revenue (by geography) US & Canada 591 490 21% 20% 2,250 1,748 29% 28% Italy 305 266 15% 20% 1,300 862 51% 46% Rest of world 154 130 19% 22% 539 505 7% 4% Total revenue 1,050 885 19% 21% 4,089 3,116 31% 29%
29 Quarter Ended % % December 31, Change Change 2021 2020 2019 vs. 2020 vs. 2019 GAAP Financials: Revenue 1,050 885 1,044 19% 1% Operating income 186 96 40 93% 365% Operating income margin 18% 11% 4% Net income (loss) 55 (232) (138) NA NA Net income (loss) attributable to IGT PLC per common share - diluted $0.09 $(1.25) $(0.96) NA NA Net cash provided by operating activities 396 251 278 55% 42% Non-GAAP Financial Measures: Adjusted EBITDA(1) 387 295 365 31% 6% Adjusted EBITDA(1) margin 37% 33% 35% Free cash flow(1) 326 201 186 62% 75% Net debt(1) 5,922 7,319 7,390 (19)% (20)% Q4'21: Significant Revenue and Profit Growth Y/Y and Compared to 2019 $ in millions, except where noted otherwise, all amounts from continuing operations (1) Non-GAAP measure; see disclaimer on page 2 and QTD/YTD reconciliations to the most directly comparable GAAP measures in Appendix for further details
30 Year Ended % % December 31, Change Change 2021 2020 2019 vs. 2020 vs. 2019 GAAP Financials: Revenue 4,089 3,115 4,032 31% 1% Operating income/(loss) 902 (107) 478 NA 89% Operating income margin 22% (3)% 12% Net income (loss) 255 (875) (3) NA NA Net income (loss) attributable to IGT PLC per common share - diluted $0.31 $(4.59) $(0.63) NA NA Net income (loss) attributable to IGT PLC per common share - diluted (including discontinued operations) $2.33 $(4.39) $(0.09) NA NA Net cash provided by operating activities 1,010 595 907 13% 11% Non-GAAP Financial Measures: Adjusted EBITDA 1,686 1,008 1,454 67% 16% Adjusted EBITDA margin 41% 32% 36% Free cash flow 771 340 530 127% 45% Net debt 5,922 7,319 7,390 (19)% (20)% 2021 Results Highlight Resilience of Business with All Key Financial Metrics Exceeding 2019 Levels $ in millions, except where noted otherwise, all amounts from continuing operations
$ millions except per share amounts; all amounts presented reflect continuing operations Q4'21 and FY'21 Income Statement 31 Q4'21 Q4'20 Y/Y Change (%) FY'21 FY'20 Y/Y Change (%) Service revenue 850 749 13% 3,483 2,640 32% Product sales 200 136 47% 606 476 27% Total revenue 1,050 885 19% 4,089 3,115 31% Adjusted EBITDA 864 789 10% 3,187 3,223 (1%) Operating income (loss) 186 96 93% 902 (107) N/A Interest expense, net 77 101 341 398 Foreign exchange (gain) loss, net (4) 155 (66) 309 Other expense (income), net 2 (1) 98 33 Total non-operating expenses 75 255 373 740 Income (loss) from continuing operations before provision for income taxes 111 (159) 529 (848) Provision for income taxes 56 73 274 28 Income (loss) from continuing operations 55 (232) 255 (875) Income from discontinued operations — 12 415 37 Net income (loss) 55 (220) 670 (839) Net income (loss) attributable to IGT PLC per common share - basic $0.10 $(1.18) $2.35 $(4.39)
Q4'21 and FY'21 Cash Flow Statement 32 Q4'21 Q4'20 FY'21 FY'20 Net cash provided by operating activities 396 251 1,010 595 Capital expenditures (71) (50) (238) (255) Free cash flow 326 201 771 340 Debt proceeds/(repayment), net 33 (175) (1,439) (246) Dividends to shareholders (41) — (41) (41) Share repurchases (41) — (41) — Other - Net (38) (57) (355) (130) Other Investing/Financing Activities (88) (231) (1,876) (416) Net Cash Flow 238 (31) (1,105) (76) Effect of Exchange Rates/Other (17) 30 (37) 76 Net Change in Cash and Restricted Cash 221 (1) (1,142) (1) Cash and cash equivalents at end of period 591 907 591 907 Restricted cash and cash equivalents at end of period 218 199 218 199 Total cash, cash equivalents, and restricted cash at end of period 808 1,106 808 1,106 $ millions except per share amounts; all amounts presented reflect continuing operations
Q4'21 Reconciliations of Non-GAAP Measures 33 For the three months ended December 31, 2021 Global Lottery Global Gaming Digital & Betting Business Segment Total Corporate and Other Total IGT PLC Income from continuing operations 55 Provision for income taxes 56 Interest expense, net 77 Foreign exchange gain, net (4) Other non-operating expense, net 2 Operating income (loss) 217 36 5 258 (72) 186 Goodwill impairment — — — — — — Depreciation 47 29 4 79 — 79 Amortization - service revenue (1) 53 — — 53 — 53 Amortization - non-purchase accounting 9 1 — 11 1 12 Amortization - purchase accounting — — — — 39 39 Restructuring 8 (4) — 4 3 7 Stock-based compensation 3 4 — 7 6 13 Other (2) — — — — — — Adjusted EBITDA 336 66 9 411 (24) 387 Cash flows from operating activities - continuing operations 396 Capital expenditures (71) Free Cash Flow 326 $ millions; all amounts presented reflect continuing operations (1) Includes amortization of upfront license fees (2) Primarily includes transaction-related costs
Q4'20 Reconciliations of Non-GAAP Measures 34 $ millions; all amounts presented reflect continuing operations (1) Includes amortization of upfront license fees (2) Primarily includes transaction-related costs For the three months ended December 31, 2020 Global Lottery Global Gaming Digital & Betting Business Segment Total Corporate and Other Total IGT PLC Loss from continuing operations (232) Provision for income taxes 73 Interest expense, net 101 Foreign exchange loss, net 155 Other non-operating income, net (1) Operating income (loss) 195 (42) 3 156 (60) 96 Goodwill impairment — — — — — — Depreciation 54 32 4 90 — 90 Amortization - service revenue (1) 55 — — 55 — 55 Amortization - non-purchase accounting 8 2 — 10 1 11 Amortization - purchase accounting — — — — 40 40 Restructuring — (2) 1 (2) — (2) Stock-based compensation 1 1 — 2 2 4 Other (2) — — — — 1 1 Adjusted EBITDA 313 (10) 8 311 (16) 295 Cash flows from operating activities - continuing operations 251 Capital expenditures (50) Free Cash Flow 201
FY'21 Reconciliations of Non-GAAP Measures 35 $ millions; all amounts presented reflect continuing operations (1) Includes amortization of upfront license fees (2) Primarily includes transaction-related costs For the year ended December 31, 2021 Global Lottery Global Gaming Digital & Betting Business Segment Total Corporate and Other Total IGT PLC Loss from continuing operations 255 Provision for income taxes 274 Interest expense, net 341 Foreign exchange loss, net (66) Other non-operating income, net 98 Operating income (loss) 1,088 43 33 1,164 (262) 902 Goodwill impairment — — — — — — Depreciation 191 121 15 326 (1) 325 Amortization - service revenue (1) 216 — — 216 — 216 Amortization - non-purchase accounting 34 5 — 40 3 43 Amortization - purchase accounting — — — — 158 158 Restructuring 8 (4) (1) 3 2 6 Stock-based compensation 8 8 1 17 18 35 Other (2) — — — — 1 1 Adjusted EBITDA 1,545 173 48 1,766 (80) 1,686 Cash flows from operating activities - continuing operations 1,010 Capital expenditures (238) Free Cash Flow 771
FY'20 Reconciliations of Non-GAAP Measures 36 $ millions; all amounts presented reflect continuing operations (1) Includes amortization of upfront license fees (2) Primarily includes transaction-related costs For the year ended December 31, 2020 Global Lottery Global Gaming Digital & Betting Business Segment Total Corporate and Other Total IGT PLC Loss from continuing operations (875) Provision for income taxes 28 Interest expense, net 398 Foreign exchange loss, net 309 Other non-operating expense, net 33 Operating income (loss) 642 (212) 6 436 (544) (107) Goodwill impairment — — — — 296 296 Depreciation 201 138 14 354 1 355 Amortization - service revenue (1) 210 — — 210 — 210 Amortization - non-purchase accounting 30 7 — 38 3 41 Amortization - purchase accounting — — — — 170 170 Restructuring 5 32 2 39 6 45 Stock-based compensation (3) (4) — (7) — (7) Other (2) — — — — 4 4 Adjusted EBITDA 1,086 (38) 22 1,070 (62) 1,008 Cash flows from operating activities - continuing operations 595 Capital expenditures (255) Free Cash Flow 340