Slot machine and lottery company International Game Technology reported its fourth-quarter and full-year earnings on Thursday.
Company: International Game Technology PLC (NYSE: IGT)
Revenue: $1.37 billion for the fourth quarter, up 44 percent from the same time period in 2014.
The company was created by the $6.4 billion merger between Gtech, an Italian lottery operator, and IGT, a slot machine company. Gtech acquired IGT in the merger, which wrapped up in April, and the combined company assumed the IGT name.
On a more comparable “constant currency” basis that presents the combined results of both companies, revenue grew 5 percent year over year in the fourth quarter. For the full year, revenue fell 4 percent from 2014 using the same type of comparison.
The company attributed the annual decline mainly to lower gaming product sales and service revenues.
Earnings/loss: IGT reported net income of $73.5 million for the fourth quarter, compared to a $150.6 million net loss in the fourth quarter of 2014. For the full year, the company reported a net loss of $75.6 million, compared to net income of $86.2 million in 2014.
Earnings/loss per share: The company reported earnings of 37 cents per share in the fourth quarter, compared to a loss of 87 cents per share in 2014. For the full year, IGT reported a loss of 39 cents per share, compared to earnings of 49 cents per share in 2014.
What it means: CEO Marco Sala said 2015 was a “year of transformation” that ended with a strong fourth quarter.
“We established IGT as the global gaming leader with a commitment to being a customer-first organization and to deliver the content, technology, and expertise that drives player demand,” he said in a statement. “We are confident that we have established a solid foundation from which we can continue to lead the gaming industry and grow our business.”
IGT’s business is separated into four main operating segments: North American gaming and interactive, North American lottery, Italy and international outside North America and Italy.
IGT said its North American gaming and interactive segment reported revenue of $378 million in the fourth quarter, compared to $45 million a year earlier.
But on a more comparable “constant currency” basis combining IGT and Gtech in 2014, too, revenue was down 1 percent year over year. The company said its comparable service revenue fell 4 percent from 2014 because of a lower installed base, although product sales grew 6 percent.
Revenue from the North American lottery segment was $269 million in the fourth quarter, 20 percent higher than 2014 on a reported basis and 10 percent higher when combining Gtech and IGT for both periods.
Comparable service revenue grew 8 percent, partly because of favorable same-store revenue growth driven by “strong instant ticket sales and solid draw-based game performance,” the company said. Strong Powerball sales were “more than offset” by a drop in Mega Millions sales, according to IGT, but product sales were almost twice as much as in 2014.
In Italy, meanwhile, IGT reported $455 million in revenue for the fourth quarter, compared to $489 million in 2014, which the company said was due to the U.S. dollar’s improved strength against the euro. Currency translation aside, Italian revenue rose 6 percent.
International revenue for the fourth quarter was $265 million, down 38 percent from 2014 on a reported basis and up 5 percent on a more comparable “constant currency” basis, “primarily on strong gaming product sales,” according to the company.