In the year 2021, IGT’s overall debt burden lessened, reaching its 2022 financial leverage goal a year ahead of schedule. This accomplishment was credited to a substantial 31.1% rise in earnings, reaching $4.09 billion (£3.07 billion/€3.69 billion), and the divestment of its lottery ticket division.
Of IGT’s three core business units, the Global Lottery division generated $2.81 billion in revenue, representing a significant 30.2% increase compared to the preceding year.
Virtually all lottery revenue stemmed from services, including a net revenue of $2.36 billion from operational and facility management contracts, along with an additional $327 million from other service offerings.
The Global Gaming division, encompassing land-based gaming operations, generated $1.11 billion in revenue, signifying a substantial 33.3% increase from the previous year. Service revenue accounted for $630 million, primarily derived from terminals, while product sales revenue totaled $482 million.
Lastly, the Digital and Betting division generated $165 million in revenue, representing a notable 43.8% increase, with all but $1 million stemming from services.
This signifies that IGT’s total service revenue reached $3.48 billion, a substantial 31.9% increase, while product sales revenue amounted to $606 million, reflecting a 27.3% increase.
Over half of IGT’s revenue originated from the United States and Canada, generating $2.25 billion. Italy contributed a significant $1.3 billion, while the remaining regions contributed $539 million.
Despite the increased revenue, IGT’s operating expenses decreased by 1.2% in 2021, reaching $3.19 billion.
This was primarily due to a $296 million impairment charge related to the effects of the COVID-19 pandemic on the company’s operations in 2020.
Breaking down these operational expenses, the company paid $1.75 billion in service costs, an increase of 7.3% year-on-year, and $377 million in cost of goods sold, a rise of 9.1% year-on-year. Additionally, it paid $810 million in sales, general and administrative costs, an increase of 14.2% year-on-year, and $238 million in research and development costs, a rise of 24.6% year-on-year.
As a result of these costs, IGT achieved an operating profit of $902 million in 2021, compared to a loss of $107 million in 2020.
The supplier paid $341 million in interest expense and $98 million in other expenses, but earned $66 million from foreign exchange rate fluctuations, compared to a loss of $309 million the previous year.
This means that IGT achieved a pre-tax profit of $529 million, after a pre-tax loss of $848 million in 2020.
After paying $274 million in income taxes, its profit from continuing operations was $255 million, compared to a loss of $875 million the previous year.
During the year, the company also sold its Italian B2C business, Lottomatica, to Apollo Global for a total consideration of €950 million. This discontinued operation generated $24 million in revenue, a decrease of 34.5%, before the sale was completed in May, and IGT realized a gain of $391 million from the sale during the year.
Taking this into account, IGT’s final income was $670 million, compared to a loss of $839 million in 2020.
The chief executive of IGT, Vince Sadusky, declared that the firm had a remarkable year in 2021, surpassing revenue, earnings, and cash flow objectives. He emphasized their progress on strategic targets and expressed enthusiasm for the future.
Sadusky underlined their ambitious yet attainable multi-year goals and focused approach to maximizing value for all stakeholders.
The company’s chief financial officer, Max Chiara, echoed this sentiment, stating that IGT is in a strong position with a solid financial base for future growth.
IGT’s achievements in 2022 resulted in a decrease in net debt to $1.4 billion, leading to the lowest leverage ratio in the company’s history.
The final quarter witnessed a substantial increase in revenue, reaching $1.05 billion, an 18.6% surge from the previous year.
IGT’s global lottery business, the primary contributor to revenue, saw a 9.0% rise, reaching $687 million.
The global gaming business experienced even faster growth, with revenue increasing by 44.6% to $321 million.
Digital and betting revenue also saw a notable increase, growing by 25.2% to $42 million.
After accounting for operating expenses of $864 million, IGT achieved an operating income of $186 million, more than double the final quarter of 2020.
While incorporating non-operational expenditures and discontinued ventures, the firm still managed to secure a net gain of $55 million, contrasting with a net deficit of $232 million in the equivalent timeframe last year.
Earlier this week, the company declared its intention to divest its Italian proximity payments enterprise, Lispay, to PostePay – Patrimonio Destinato for €700 million (£523.9 million/$627.2 million).
Sign up for the iGaming newsletter.
