Light & Wonder, Inc. · ASX:LNW
Light & Wonder — Q2 2024 Earnings Presentation
27 slides from Light & Wonder's earnings presentation, Aug 7, 2024
Slide 1: Second Quarter 2024 Earnings Presentation
Second Quarter 2024 Earnings Presentation August 7, 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: Continued Double-Digit Growth on Strong Performance
Continued Double-Digit Growth on Strong Performance Consolidated Revenue Consolidated AEBITDA(1) Adjusted NPATA(1) 13 $1,575 $234 Consecutive Quarters $1,400 $179 $610 Consolidated Revenue Growth $529 YoY $130 $818 $731 $93 $330 $281 8 Consecutive Quarters 12% 13% 17% 15% 40% 31% Double Digit Consol
Slide 4: Achieved Key Operational and Financial Milestones
Achieved Key Operational and Financial Milestones Gaming Achieved Strong Revenue Growth Across Gaming, SciPlay and iGaming, driving Double-Digit Growth in Consolidated Revenue and AEBITDA • Grew Consolidated Revenue 12%; Consolidated AEBITDA(1) 17% YoY • Gaming Revenue +14% YoY, led by 32% growth in
Slide 5: Leveraging Diversified Product Portfolio and Global Scale
Leveraging Diversified Product Portfolio and Global Scale Global Presence with Unmatched Positions Across: • Land-Based Gaming o Slots o Tables o Systems • SciPlay o Social Casino o Mobile/Casual Gaming • iGaming o Content Aggregation o PAM(1) Main Markets o Live Casino Presence in 6 Continents and
Slide 6: Operational Highlights
LIGHT & WONDER. Operational Highlights
Slide 7: Substantial Gaming Growth Fueled by Strong Product Sales
Substantial Gaming Growth Fueled by Strong Product Sales IN $MILLIONS Revenue AEBITDA Key 2Q24 Gaming KPI Highlights $1,016 • Gaming Revenue increased 14% YoY, primarily driven by Global $504 $890 Gaming Machine Sales growth of 32% $438 o Gaming Operations revenue up 5% YoY led by record expansion i
Slide 8: Delivered on Key Gaming Performance Metrics
Delivered on Key Gaming Performance Metrics Key 2Q24 Gaming KPI Highlights 2Q24 2Q23 Var% 1H24 1H23 Var% • Gaming Operations growth was primarily driven by an increase of Gaming Operations KPI: 7% YoY in N.A. installed base, leading to a N.A. installed base U.S. and Canadian: growth of 16 consecutiv
Slide 9: Executing on Robust Hardware and Content Roadmap
Executing on Robust Hardware and Content Roadmap LANDMARKTM L7TM COSMICTM HORIZONTM KASCADATM MURALTM 7000 TRANSPARENT D 3Q24 4Q24 SQUID GAME TM/© Netflix. Used with permission. Dracula is a trademark and copyright of Universal Studios. Licensed by Universal. All Rights Reserved. Frankenstein is a t
Slide 10: Leading Industry Growth Through Ongoing Execution
Leading Industry Growth Through Ongoing Execution IN $MILLIONS Revenue AEBITDA Key 2Q24 SciPlay Highlights • Revenue of $205 million, up 8% YoY, and third consecutive quarter of $411 $132 revenue over $200 million, driven by continued strong performance $376 of JACKPOT PARTYTM CASINO, QUICK HITTM SL
Slide 11: Driving Monetization Through Investments in SciPlay Engine
Driving Monetization Through Investments in SciPlay Engine Key 2Q24 SciPlay Highlights • Outpaced the social casino market for 10 consecutive quarters o Continuing to enhance monetization through Live Ops and comprehensive product roadmaps o Leveraging data science to elevate lifetime values through
Slide 12: Capitalizing on Industry Growth with Robust Original Content
Capitalizing on Industry Growth with Robust Original Content IN $MILLIONS Key 2Q24 iGaming Highlights Revenue AEBITDA • Maintained record revenue of $74 million, up 6% YoY primarily driven by continued momentum in the U.S. $148 $134 o U.S. and Canada OGS(1) GGR(2) was up 25% and was $47 $48 driven b
Slide 13: Leveraging the Scale of Our Established iGaming Platform
Leveraging the Scale of Our Established iGaming Platform OPERATORS CONTENT Key 2Q24 iGaming Highlights OUR STUDIOS • Continued first-party content performance and strong game launches driven by proven land-based franchises • ELK achieved GGR(3) growth of 17% YoY, fueled by strong performance across
Slide 14: Financials
LIGHT & WONDER. Financials
Slide 15: Achieved Double-Digit Top- and Bottom-Line Growth
Achieved Double-Digit Top- and Bottom-Line Growth IN $MILLIONS Consolidated Revenue Consolidated AEBITDA(1) Key 2Q24 Highlights • Achieved 12% YoY Consolidated Revenue growth, with healthy margins across all businesses $1,575 o Gaming growth led primarily by Global Gaming Machine $610 Sales, which r
Slide 16: Optimized Capital Allocation Strategy
Optimized Capital Allocation Strategy Key Highlights • Ended the quarter with a principal face value of debt outstanding of IN $MILLIONS $3.9 billion and maintained net debt leverage ratio(1) of 3.0x, within targeted range(1)(2) of 2.5x to 3.5x • Executed on debt refinancing opportunity to further r
Slide 17: Generated Strong Free Cash Flow
Generated Strong Free Cash Flow(1) IN $MILLIONS 2Q24 2Q23 1H24 1H23 Key Highlights Net cash provided by operating activities $ 141 $ 34 $ 312 $ 219 • Consolidated Free Cash Flow(1) grew 192% to Less: Capital expenditures (86) (59) (153) (112) $70 million, reflective of strong earnings, partially Add
Slide 18: Differentiated Value Proposition To Fuel Sustainable Growth
Differentiated Value Proposition To Fuel Sustainable Growth Streamlined business and healthy balance sheet Unmatched global market positions and cross-platform capabilities Focus on operational excellence driving enhanced shareholder value Leading global games and platform provider with all the majo
Slide 19: Appendix
LIGHT & WONDER. Appendix
Slide 20: 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 21: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Adjusted NPATA is reconciled to Net income (loss) attributable to L&W and includes the following adjustments, as Free Cash Flow applicable: (1) Net income attributable to noncontrolling interest; (2) Amortization of acquired intangible assets; (3) Non-cash ass
Slide 22: 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 27. 22
Slide 23: 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. 23
Slide 24: 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 25: 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 Note: Unaudited, U.S. Dollars in millions. 25
Slide 26: 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 pr
Slide 27: 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. 27