Light & Wonder, Inc. · ASX:LNW
Light & Wonder — Q1 2024 Earnings Presentation
28 slides from Light & Wonder's earnings presentation, May 8, 2024
Slide 1: First Quarter 2024 Earnings Presentation
First Quarter 2024 Earnings Presentation May 8, 2024
Slide 2: Forward-Looking Statements
SECTION TITLE, 10PT Forward-Looking Statements In this presentation, Light & Wonder, Inc. (“Light & Wonder,” “L&W” or the “Company”) makes “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectat
Slide 3: Delivered Sustainable Double-Digit Growth Through Execution
Delivered Sustainable Double-Digit Growth Through Execution Consolidated Revenue Consolidated AEBITDA(1) Adjusted NPATA(1) $756 $670 $281 $249 $105 $86 13% 13% 22% 1Q23 1Q24 1Q23 1Q24 1Q23 1Q24 Robust product roadmap and sound execution to strategy driving sustainable growth at Light & Wonder post b
Slide 4: Continued Strong Momentum to Start the Year
Continued Strong Momentum to Start the Year Gaming Maintained Double-Digit Revenue Growth Across Gaming, SciPlay and iGaming • Grew Consolidated Revenue 13%; Consolidated AEBITDA(1) 13% YoY • Gaming Revenue +14% YoY, up 30% in Gaming Machine Sales with growth across Gaming Operations & Systems • Sci
Slide 5: Advancing on Strategic Initiatives to Fuel Further Growth
Advancing on Strategic Initiatives to Fuel Further Growth Execute Invest Optimize Maintain on our growth pillars in our people, business operations a high-performance with differentiated platforms and and processes culture across the product strategy and technology to drive focusing on organization
Slide 6: Operational Highlights
LIGHT & WONDER. Operational Highlights
Slide 7: Capitalizing on Key Market Opportunities in Gaming
Capitalizing on Key Market Opportunities in Gaming IN $MILLIONS Key 1Q24 Gaming Highlights Revenue AEBITDA • Gaming Revenue increased 14% YoY, primarily driven by Global $476 Gaming Machine Sales growth of 30% $419 o Gaming Operations revenue up 3% YoY led by increase in North American Premium insta
Slide 8: Bolstering Results with Strong Performance on Key Metrics
Bolstering Results with Strong Performance on Key Metrics 1Q24 1Q23 Var% Gaming Operations KPI: Key 1Q24 Gaming KPI Highlights U.S. and Canadian: Installed base at period end 31,534 30,675 ▲ 3% • Gaming Operations growth was primarily driven by an increase of $46.72 ▲ (2) Average daily revenue per u
Slide 9: Executing on Robust Hardware and Content Roadmap
Executing on Robust Hardware and Content Roadmap COSMICTM HORIZONTM L7 TRANSPARENT • COSMICTM remains one of the • Launched new large-screen • LANDMARKTM 7000 top selling and performing jumbo cabinet HORIZONTM TRANSPARENT is the portrait cabinets in the latest with DANCING DRUMSTM newest variation o
Slide 10: Achieving Noteworthy Progress in Adjacent Markets
Achieving Noteworthy Progress in Adjacent Markets VLT(1) COAM(2) HHR(3) Class II • Entered Georgia COAM market with • HHR remains a focal point with • Robust performance in Class II Video • Continued VLT success in Illinois the #1 Illinois VLT game pack on the sustained success of ULTIMATE FIRE driv
Slide 11: Leading Industry Growth on Continued Execution at SciPlay
Leading Industry Growth on Continued Execution at SciPlay SciPlay IN $MILLIONS Key 1Q24 SciPlay Highlights Revenue AEBITDA • Revenue of $206 million, up 11% YoY, driven by outperformance at $206 JACKPOT PARTYTM CASINO, QUICK HITTM SLOTS, GOLD FISHTM $186 CASINO and 88 FORTUNESTM SLOTS resulting in 7
Slide 12: Extending SciPlay's Success Through Strategic Initiatives
Extending SciPlay’s Success Through Strategic Initiatives Key 1Q24 SciPlay Highlights • Quarterly record revenues for JACKPOT PARTYTM CASINO, QUICK HITTM SLOTS, GOLD FISHTM CASINO and 88 FORTUNESTM SLOTS o Continuing to enhance monetization through Live Ops and comprehensive product roadmaps o Lever
Slide 13: iGaming Growth Supported by Launches and GGR Expansion
iGaming Growth Supported by Launches and GGR(1) Expansion IN $MILLIONS Key 1Q24 iGaming Highlights Revenue AEBITDA • Achieved record revenue of $74 million, up 14% YoY $74 primarily driven by continued momentum in the U.S. and $65 international markets o U.S. OGS(2) GGR was up 23% and was driven by
Slide 14: Expanding Content and Product Offering to Bolster Portfolio
Expanding Content and Product Offering to Bolster Portfolio Upcoming Roadmap Key 1Q24 iGaming Highlights • Continued first-party content performance and strong game launches driven by proven land-based franchises • ELK which entered the U.S., now live in New Jersey, achieved GGR(1) growth of 34% YoY
Slide 15: Financials
LIGHT & WONDER. Financials
Slide 16: Delivered Double-Digit Top- and Bottom-Line Growth
Delivered Double-Digit Top- and Bottom-Line Growth IN $MILLIONS Consolidated Revenue Consolidated AEBITDA(1) Key 1Q24 Highlights $756 • Achieved 13% YoY Consolidated Revenue growth, with healthy $670 margins across all businesses o Gaming growth led by Global Gaming Machine Sales, which remained rob
Slide 17: Optimizing Capital Allocation Strategies
Optimizing Capital Allocation Strategies IN $MILLIONS Key Highlights Net Debt Interest • Ended the quarter with a principal face value of debt outstanding of $3.9 billion and net debt leverage ratio(1) of Leverage Ratio(1) Expense 3.0x, in targeted range(1)(2) of 2.5x to 3.5x • Executed on debt refi
Slide 18: Generated Strong Free Cash Flow
Generated Strong Free Cash Flow(1) IN $MILLIONS Key Highlights 1Q24 1Q23 • Consolidated Free Cash Flow grew 26% to $93 Net cash provided by operating million, reflective of strong earnings, partially activities $171 $185 offset by less favorable changes in working capital compared to the prior year
Slide 19: Differentiated Value Proposition Driving Sustainable Growth
Differentiated Value Proposition Driving Sustainable Growth Streamlined business and transformed balance sheet Unmatched market positions and cross-platform capabilities Focus on operational excellence driving enhanced shareholder value Leading global games and platform provider with all the major p
Slide 20: Appendix
LIGHT & WONDER. Appendix
Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures The Company’s management (“Management”) uses the following non-GAAP financial measures in conjunction with Consolidated AEBITDA (representing AEBITDA from continuing operations) GAAP financial measures: Consolidated AEBITDA (representing continuing operations), Consolidat
Slide 22: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Adjusted NPATA is reconciled to Net income and includes the following adjustments, as applicable: (1) Amortization Free Cash Flow of acquired intangible assets; (2) Non-cash asset and goodwill impairments; (3) Restructuring and other, which includes charges or
Slide 23: L&W Reconciliation of Consolidated AEBITDA, AEBITDA from Discontinued Operations and Combined AEBITDA
L&W Reconciliation of Consolidated AEBITDA, AEBITDA from Discontinued Operations and Combined AEBITDA Note: Unaudited, U.S. Dollars in millions. 1. EBITDA from equity investments is a non-GAAP financial measure reconciled to Earnings from equity investments on slide 28. 23
Slide 24: L&W Reconciliation of Adjusted NPATA
L&W Reconciliation of Adjusted NPATA Note: Unaudited, U.S. Dollars in millions. (1) Refer to the Adjusted NPATA definition above for a description of items included in restructuring and other. 24
Slide 25: L&W Reconciliation of Principal Face Value of Debt Outstanding to Net Debt Leverage Ratio
L&W Reconciliation of Principal Face Value of Debt Outstanding to Net Debt Leverage Ratio Note: Unaudited, U.S. Dollars in millions. 1. Combined AEBITDA consists of Consolidated AEBITDA, AEBITDA from discontinued operations and EBITDA from equity investments included in continuing operations. Refer
Slide 26: L&W Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
L&W Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Three Months Ended March 31, 2024 2023 Net cash provided by operating activities $ 171 $ 185 Less: Capital expenditures (66) (53) Less: Payments on license obligations (5) (12) Less: Change in restricted cash impacting
Slide 27: L&W Reconciliation of Consolidated AEBITDA Margin
L&W Reconciliation of Consolidated AEBITDA Margin Note: Unaudited, U.S. Dollars in millions. 1. Refer to the reconciliation of Consolidated AEBITDA included in the table titled "L&W Reconciliation of Consolidated AEBITDA, AEBITDA from Discontinued Operations and Combined AEBITDA” for the periods pre
Slide 28: L&W Reconciliation of Earnings from Equity Investments to EBITDA from Equity Investments
L&W Reconciliation of Earnings from Equity Investments to EBITDA from Equity Investments Note: Unaudited, U.S. Dollars in millions. (1) Combined EBITDA from equity investments consists of EBITDA from both discontinued and continuing operations equity investments. 28