Scientific Games received $301M through SciPlay Corp. IPO

Las Vegas-based Scientific Games Corp.’s first-quarter revenue increased and the company narrowed losses with the formation of a new public subsidiary, company executives reported Tuesday.

Revenue rose 3 percent to $837 million for the quarter that ended March 31.

Scientific Games received $301 million through Tuesday’s completion of the initial public offering of Nasdaq-traded SciPlay Corp. Scientific owns a 17.4 percent minority interest in the social gaming business.

“We are focused on effectively operating our businesses, reducing costs and building upon the strong foundation for profitable growth that we see today,” said Scientific President and CEO Barry Cottle.

“Last week, we successfully took SciPlay public as a new company, which accelerates our ability to pay down debt,” he said. “All of these actions support our steadfast commitment to smartly grow our business, drive free cash flow and create meaningful value for our stakeholders.”

The company’s first-quarter revenue beat analyst’s expectations. A survey of 11 Wall Street analysts on average anticipated revenue of $832.3 million for the quarter. But analysts also expected a loss of 4 cents a share instead of the posted 26 cents a share. Still, it was a massive improvement from a year ago when the company lost $202 million, or $2.24 a share.

The prior year net loss included a $93 million charge taken in February 2018 to refinance debt.

Company officials are optimistic about the company’s future.

Chief Financial Officer Michael Quartieri said the company paid down $145 million in debt and completed a major refinancing that lowered borrowing costs and extended debt maturities.

The company increased quarterly gaming machine sales to 4,801 from 4,667 in the first quarter of 2018, in part due to sales to the soon-to-open Encore Boston Harbor project due in June by Wynn Resorts Ltd. The company is now selling games in its new Wave XL cabinets. In Tuesday’s conference call, executives said the company would be rolling out a new complement of themed games based on the James Bond character.

Scientific also in April announced a new partnership for a platform to roll out internet gaming and sports wagering with Wynn Resorts.

Scientific Games stock was on a roller-coaster ride Tuesday. The Nasdaq issue closed down $1.83, 8.8 percent, to $18.87 a share on volume about 1½ times the average. After hours, the price rebounded by $1.48, 7.8 percent, to end at $20.35 a share, well below its 52-week peak of $62.80.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.