In addition, the Company announced the completion of financing transactions which will result in an approximate $30 million reduction in annualized cash interest costs at current rates, an extension of a substantial portion of its debt maturities into 2021 and 2022, and a reduction in exposure to variable interest rates.
Scientific Games also announced its full year results for 2016, reporting a revenue increase of 5 percent, or $124.6 million, year-on-year to $2,883.4 million and operating income of $130.6 million.
During 2016, the Company reduced the principal amount of its total debt by $169.4 million. To view the complete Q4 2016 and full year results, visit the Scientific Games website.
Scientific Games CEO, Kevin Sheehan, said: “2016 was another year of growth, progress and industry-leading product innovation for Scientific Games. The 2016 fourth quarter was the fifth consecutive quarter of growth with year-over-year revenue growth besting last year’s strong performance.”
Scientific Games CEO, Kevin Sheehan
He continued: “Our Gaming division continues to lead with innovation and strong execution, including the launch of the Gamescape™ platform, which in the fourth quarter helped drive the first quarterly sequential increase in our wide-area progressive (“WAP”) premium participation installed base in more than three years, as well as the initial very promising performance of our innovative TwinStar™ J43 for-sale gaming cabinet.
“Our Lottery division extended its steady momentum with several big contract wins and successful systems launches in the U.S. and around the world. Our SG Interactive® performance remains stellar, with the exciting play of our social game apps driving social B2C gaming revenue up 52 percent versus the year-ago quarter. A third-party report estimates that the rapid growth of SG Interactive in its B2C business has led to five consecutive quarters of outperforming the social casino market, including fourth quarter 2016 year-over-year growth that was five times the social gaming industry growth.”
Sheehan concluded: “With 2017 off and running, we are maintaining focus on playing smart to galvanize our business growth. We are driving innovation to create new, differentiated products for our customers, improve financial performance to accelerate deleveraging, and build a culture open to new ideas and committed to exceeding the expectations of our customers and stakeholders.”
Commenting on the results Scientific Games CFO, Michael Quartieri, said: “We continue to refine our business processes to yield greater financial discipline, while ensuring continued investment in innovation to drive profitable growth. While improvement initiatives implemented in the fourth quarter had a cash cost of $6 million, we expect these actions will expand our margins and cash flow in 2017.”
He added: “Importantly, in early 2017 we took steps that reduced our annual cash interest burden by approximately $30 million at current rates, while extending the average maturity of our capital structure. We expect these steps will yield a planned increase in cash flow that supports our goal of additional deleveraging in 2017.”