US-based digital casino products and player loyalty solutions provider Everi Holdings Inc says it expects to report improved revenues and EBITDA for the three months to 31 December 2020, buoyed by new product releases and cost-saving initiatives since the start of the global COVID-19 pandemic.
While the company’s full fourth quarter results aren’t yet finalized, it did provide an early preview of expected ranges on Tuesday as part of an announcement around debt with Everi stating it plans to take advantage of “favorable market conditions” to lower its cost of debt by renegotiating and repricing US$735.5 million of its First Lien Term Loan due 2024.
Despite an increasing number of casino closures around the world in 4Q20 due to new waves of COVID-19, Everi said revenues are expected to be between US$117 million and US$121 million year-on-year, down from US$145.2 million in the fourth quarter of 2019 but improved from US$112.1 million in Q3.
Adjusted EBITDA is also expected to be up sequentially from US$59.8 million to between US$60 million and US$62 million for the 2020 fourth quarter – only slightly below the US$63.2 million in Adjusted EBITDA in 4Q19.
Net loss will likely be somewhere between US$300,000 and US$1.4 million, inclusive of approximately US$1.5 million in pre-tax charges related to the consolidation of certain facilities and the write-off of certain inventory, Everi explained.
For FY20 and reflecting the impact of the pandemic, revenue is expected to be in a range of US$381 million to US$385 million with net loss of US$83 million to US$85 million. That compares with revenues of US$533.2 million and net income of US$16.5 million in 2019.
“Our preliminary 2020 fourth quarter results reflect quarterly sequential improvement highlighting the ongoing strength and balance of our business, as well as the benefit of our focus on consistent improvement in our operating execution,” said Everi CEO Michael Rumbolz.
“Even with increased casino closures and further restrictions on certain casino activities in the fourth quarter, the sequential progress of our expected financial and operating results demonstrate the significant improvements to our Games and FinTech product portfolios over the last several years. This includes our efforts to innovate new products that help our customers extend the connection with their guests and operate more efficiently.
“The combination of our improved operating performance and the ongoing benefits of our cost-enhancement initiatives is expected to result in Free Cash Flow that is approximately triple the amount we reported in last year’s fourth quarter.
“We expect our operating strength and momentum to continue in the 2021 first quarter, as casinos again begin to reopen and casino activities improve compared to 2020 fourth quarter levels.”
