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LAS VEGAS--(BUSINESS WIRE)--Nov 9, 2022--
SciPlay Corporation (NASDAQ: SCPL) (“SciPlay” or the “Company”) today reported results for the third quarter ended September 30, 2022.
Josh Wilson, Chief Executive Officer of SciPlay, commented, “SciPlay achieved record revenue and strong profitability in the third quarter. We outperformed the overall social casino market for the second consecutive quarter. SciPlay’s durable growth is the direct result of our long-term strategy, strategic investments and strong execution on our operating plan.”
“We’ve continued to enhance monetization and achieved multiple quarterly records fueled by our evergreen social casino franchises, demonstrating their longevity and ability to drive sustainable growth. With our investments, we are delivering better gaming content and experiences than ever before, deepening players’ engagement and boosting player life-time value.”
“Our strategic investments, including in the SciPlay Engine and our upcoming direct-to-consumer platform, will enhance our ability to drive growth and long-term margin expansion as we continue to scale ARPDAU and take a competitive leap in the current business environment. Given our strong performance this quarter, we are maintaining our full year 2022 revenue growth and AEBITDA margin (2) targets. We see an unparalleled combination of opportunities to grow and scale our business over the long-term and drive increased shareholder value.”
Daniel O'Quinn, Interim Chief Financial Officer of SciPlay, added "The records we achieved this quarter were the result of the strong execution from our teams and our continuing focus on great content and engaging our players. We also made significant progress advancing our capital allocation priorities, including investing in our core capabilities to fuel long-term growth while also buying stock under our share repurchase program. To date, we have repurchased approximately $28 million (1) or nearly half of the total program authorization in the first five months. We have a strong balance sheet, with ample liquidity, and anticipate continuing to repurchase our shares given the compelling value."
_________________
(1)The amount as of November 4, 2022.
(2) Represents a non-GAAP financial measure. Additional information on non-GAAP financial measures (including targets) presented herein is available at the end of this release.
SUMMARY RESULTS
| Three Months Ended | ||||||
($ in millions) | September 30, | ||||||
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| 2022 |
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| 2021 |
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Revenue | $ | 170.8 |
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| $ | 146.6 |
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Net income |
| 33.7 |
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| 37.0 |
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Net income margin |
| 19.7 | % |
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| 25.2 | % |
Net cash provided by operating activities |
| 21.0 |
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| 58.0 |
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Capital expenditures |
| 3.5 |
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| 0.9 |
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Non-GAAP Financial Measures(1) |
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Adjusted EBITDA (“AEBITDA”) | $ | 42.8 |
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| $ | 44.7 |
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AEBITDA margin |
| 25.1 | % |
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| 30.5 | % |
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| ||||
| As of September 30, |
| As of December 31, | ||||
Balance Sheet Measures |
| 2022 |
|
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| 2021 |
|
Cash and cash equivalents | $ | 299.2 |
|
| $ | 364.4 |
|
Available liquidity (2) |
| 449.2 |
|
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| 514.4 |
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(1) The financial measures “AEBITDA” and “AEBITDA margin” are non-GAAP financial measures defined below under “Non-GAAP Financial Measures” and are reconciled to the most directly comparable GAAP measures in the accompanying supplemental tables at the end of this release. | |||||||
(2) Available liquidity is calculated as cash and cash equivalents plus the undrawn capacity on our revolver. |
Key Performance Indicators
(in millions, except Average Revenue Per Daily Active Users ("ARPDAU"), Average Monthly Revenue Per Paying User ("AMRPPU"), and percentages; KPIs include only in-app purchases) | |||||
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| Three Months Ended |
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| September 30, |
| Increase / | ||
| 2022 |
| 2021 |
| (Decrease) |
Mobile Penetration | 90% |
| 89% |
| 1.0pp |
Average Monthly Active Users | 5.9 |
| 6.1 |
| (0.2) |
Average Daily Active Users | 2.2 |
| 2.3 |
| (0.1) |
ARPDAU | $0.80 |
| $0.69 |
| $0.11 |
Average Monthly Paying Users | 0.6 |
| 0.5 |
| 0.1 |
AMRPPU | $95.45 |
| $93.67 |
| $1.78 |
Payer Conversion Rate | 9.7% |
| 8.5% |
| 1.2pp |
pp = percentage points. |
Third Quarter 2022 Financial Highlights
Third Quarter Key Performance Highlights
About SciPlay
SciPlay Corporation (NASDAQ: SCPL) is a leading developer and publisher of digital games on mobile and web platforms. SciPlay currently offers social casino games Jackpot Party® Casino, Gold Fish® Casino, Quick Hit® Slots, 88 Fortunes® Slots, MONOPOLY® Slots, and Hot Shot Casino®, casual games Bingo Showdown®, Solitaire Pets™ Adventure, and Backgammon Live and a variety of hyper-casual games such as Rob Master 3D™, Deep Clean Inc.™ and Oh God™. All of SciPlay's games are offered and played on multiple platforms, including Apple, Google, Facebook, and Amazon. In addition to developing original games, SciPlay has access to a library of more than 1,500 real-world slot and table games provided by Light & Wonder, Inc. and its Subsidiaries. For more information, please visit SciPlay.com.
You can access our filings with the SEC through the SEC website at www.sec.gov or through our website, and we strongly encourage you to do so. We routinely post information that may be important to investors on our website at investors.sciplay.com, and we use our website as a means of disclosing material information to the public in a broad, non-exclusionary manner for purposes of the SEC's Regulation Fair Disclosure (Reg FD). The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this or any other document, and shall not be deemed "filed" under the Securities Exchange Act of 1934, as amended.
All ® and © notices signify marks registered in the United States by SciPlay Games, LLC and/or SG Gaming, Inc., and or their respective affiliates.
© 2022 SciPlay Corporation. All Rights Reserved.
Forward-Looking Statements
Throughout this press release, we make “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectations, plans, results or strategies and can often be identified by the use of terminology such as “may,” “will,” “estimate,” “intend,” “plan,” “continue,” “believe,” “expect,” “anticipate,” “target,” “should,” “could,” “potential,” “opportunity,” “goal,” or similar terminology. These statements are based upon management’s current expectations, assumptions and estimates and are not guarantees of timing, future results or performance. Therefore, you should not rely on any of these forward-looking statements as predictions of future events. Actual results may differ materially from those contemplated in these statements due to a variety of risks and uncertainties and other factors, including, among other things:
Additional information regarding risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated in forward-looking statements is included from time to time in our filings with the SEC, including the Company's current reports on Form 8-K, quarterly reports on Form 10-Q and annual reports on Form 10-K, including the latest annual report filed with the SEC on March 2, 2022 ("2021 Form 10-K") (including under the headings "Forward Looking Statements" and "Risk Factors"). Forward-looking statements speak only as of the date they are made and, except for our ongoing obligations under the U.S. federal securities laws, we undertake no and expressly disclaim any obligation to publicly update any forward-looking statements whether as a result of new information, future events or otherwise.
This press release may contain references to industry market data and certain industry forecasts. Industry market data and industry forecasts are obtained from publicly available information and industry publications. Industry publications generally state that the information contained therein has been obtained from sources believed to be reliable, but that the accuracy and completeness of that information is not guaranteed. Although we believe industry information to be accurate, it is not independently verified by us and we do not make any representation as to the accuracy of that information. In general, we believe there is less publicly available information concerning international social gaming industries than the same industries in the U.S. Some data is also based on our good faith estimates, which are derived from our review of internal surveys or data, as well as the independent sources referenced above. Assumptions and estimates of our and our industry's future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described under “Risk Factors” in Part II, Item 1A of our Quarterly Reports on Form 10-Q and Part I, Item 1A “Risk Factors” in our 2021 Form 10-K. These and other factors could cause future performance to differ materially from our assumptions and estimates.
Due to rounding, certain numbers presented herein may not precisely recalculate.
SCIPLAY CORPORATION | ||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||
(Unaudited, in millions, except per share amounts) | ||||||||||||
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| Three Months Ended |
| Nine Months Ended | |||||||||
| September 30, |
| September 30, | |||||||||
|
| 2022 |
|
| 2021 |
|
| 2022 |
|
| 2021 |
|
Revenue | $ | 170.8 |
| $ | 146.6 |
| $ | 488.9 |
| $ | 451.7 |
|
Operating expenses: |
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|
| |||||
Cost of revenue (1) |
| 52.0 |
|
| 46.2 |
|
| 148.1 |
|
| 141.3 |
|
Sales and marketing (1) |
| 49.5 |
|
| 32.9 |
|
| 136.1 |
|
| 101.7 |
|
General and administrative (1) |
| 17.4 |
|
| 13.1 |
|
| 48.8 |
|
| 46.8 |
|
Research and development (1) |
| 11.8 |
|
| 9.8 |
|
| 34.6 |
|
| 28.8 |
|
Depreciation and amortization |
| 5.6 |
|
| 4.4 |
|
| 15.8 |
|
| 11.3 |
|
Restructuring and other |
| 1.1 |
|
| 1.7 |
|
| 4.4 |
|
| 3.1 |
|
Operating income |
| 33.4 |
|
| 38.5 |
|
| 101.1 |
|
| 118.7 |
|
Other income (expense), net |
| 1.4 |
|
| 0.1 |
|
| 0.9 |
|
| (0.4 | ) |
Net income before income taxes |
| 34.8 |
|
| 38.6 |
|
| 102.0 |
|
| 118.3 |
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Income tax expense |
| 1.1 |
|
| 1.6 |
|
| 4.0 |
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| 5.5 |
|
Net income |
| 33.7 |
|
| 37.0 |
|
| 98.0 |
|
| 112.8 |
|
Less: Net income attributable to the noncontrolling interest |
| 28.9 |
|
| 31.1 |
|
| 83.1 |
|
| 95.7 |
|
Net income attributable to SciPlay | $ | 4.8 |
| $ | 5.9 |
| $ | 14.9 |
| $ | 17.1 |
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Basic and diluted net income attributable to SciPlay per share: |
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| |||||
Basic | $ | 0.20 |
| $ | 0.24 |
| $ | 0.61 |
| $ | 0.71 |
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Diluted | $ | 0.20 |
| $ | 0.24 |
| $ | 0.61 |
| $ | 0.69 |
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Weighted average number of shares of Class A common stock used in per share calculation: |
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Basic shares |
| 23.7 |
|
| 24.5 |
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| 24.3 |
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| 24.0 |
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Diluted shares |
| 24.0 |
|
| 24.8 |
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| 24.6 |
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| 24.9 |
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(1) Excludes depreciation and amortization. |
SCIPLAY CORPORATION | |||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||
(Unaudited, in millions, except par value) | |||||
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| As of | ||||
| September 30, 2022 |
| December 31, 2021 | ||
ASSETS |
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Current assets: |
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Cash and cash equivalents | $ | 299.2 |
| $ | 364.4 |
Accounts receivable, net |
| 43.6 |
|
| 39.6 |
Prepaid expenses and other current assets |
| 7.7 |
|
| 6.4 |
Total current assets |
| 350.5 |
|
| 410.4 |
Property and equipment, net |
| 3.0 |
|
| 3.5 |
Operating lease right-of-use assets |
| 5.3 |
|
| 6.8 |
Goodwill |
| 217.5 |
|
| 131.1 |
Intangible assets and software, net |
| 77.4 |
|
| 49.6 |
Deferred income taxes |
| 73.8 |
|
| 78.5 |
Other assets |
| 1.6 |
|
| 1.7 |
Total assets | $ | 729.1 |
| $ | 681.6 |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable | $ | 17.1 |
| $ | 20.0 |
Accrued liabilities |
| 27.7 |
|
| 50.2 |
Due to affiliate |
| 3.5 |
|
| 1.6 |
Total current liabilities |
| 48.3 |
|
| 71.8 |
Operating lease liabilities |
| 3.6 |
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| 5.4 |
Liabilities under TRA |
| 60.2 |
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| 64.7 |
Other long-term liabilities |
| 38.4 |
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| 14.7 |
Total stockholders’ equity (1) |
| 578.6 |
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| 525.0 |
Total liabilities and stockholders’ equity | $ | 729.1 |
| $ | 681.6 |
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(1) Includes $472.1 million and $426.4 million in noncontrolling interest as of September 30, 2022 and December 31, 2021, respectively. |
SCIPLAY CORPORATION | |||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||
(Unaudited, in millions) | |||||||||||||||
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| Three Months Ended |
| Nine Months Ended | ||||||||||||
| September 30, |
| September 30, | ||||||||||||
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| 2022 |
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| 2021 |
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| 2022 |
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| 2021 |
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Net cash provided by operating activities | $ | 21.0 |
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| $ | 58.0 |
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| $ | 95.2 |
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| $ | 126.3 |
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Net cash provided by (used in) investing activities |
| 0.8 |
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| (6.6 | ) |
|
| (110.5 | ) |
|
| (13.7 | ) |
Net cash used in financing activities |
| (38.4 | ) |
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| (21.5 | ) |
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| (49.1 | ) |
|
| (50.7 | ) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
| (0.3 | ) |
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| 0.1 |
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| (0.8 | ) |
|
| — |
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(Decrease) increase in cash, cash equivalents and restricted cash |
| (16.9 | ) |
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| 30.0 |
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| (65.2 | ) |
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| 61.9 |
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Cash, cash equivalents and restricted cash, beginning of period |
| 316.1 |
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| 300.8 |
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| 364.4 |
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| 268.9 |
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Cash, cash equivalents and restricted cash, end of period | $ | 299.2 |
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| $ | 330.8 |
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| $ | 299.2 |
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| $ | 330.8 |
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Supplemental cash flow information: |
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Cash paid for income taxes | $ | 1.1 |
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| $ | 0.4 |
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| $ | 3.1 |
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| $ | 4.5 |
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Supplemental non-cash transactions: |
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Non-cash additions to intangible assets related to license agreements | $ | 0.5 |
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| $ | 3.5 |
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| $ | 1.3 |
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| $ | 16.8 |
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SCIPLAY CORPORATION | |||||||||||||||
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO SCIPLAY TO AEBITDA | |||||||||||||||
(Unaudited, in millions) | |||||||||||||||
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| Three Months Ended |
| Nine Months Ended | ||||||||||||
| September 30, |
| September 30, | ||||||||||||
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| 2022 |
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| 2021 |
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| 2022 |
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| 2021 |
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Net income attributable to SciPlay | $ | 4.8 |
|
| $ | 5.9 |
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| $ | 14.9 |
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| $ | 17.1 |
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Net income attributable to noncontrolling interest |
| 28.9 |
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| 31.1 |
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| 83.1 |
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| 95.7 |
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Net income |
| 33.7 |
|
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| 37.0 |
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| 98.0 |
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| 112.8 |
|
Restructuring and other (1) |
| 1.1 |
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| 1.7 |
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| 4.4 |
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| 3.1 |
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Depreciation and amortization |
| 5.6 |
|
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| 4.4 |
|
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| 15.8 |
|
|
| 11.3 |
|
Income tax expense |
| 1.1 |
|
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| 1.6 |
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| 4.0 |
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| 5.5 |
|
Stock-based compensation |
| 2.7 |
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|
| 0.1 |
|
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| 6.8 |
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| 5.4 |
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Other (income) expense, net |
| (1.4 | ) |
|
| (0.1 | ) |
|
| (0.9 | ) |
|
| 0.4 |
|
AEBITDA | $ | 42.8 |
|
| $ | 44.7 |
|
| $ | 128.1 |
|
| $ | 138.5 |
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Revenue | $ | 170.8 |
|
| $ | 146.6 |
|
| $ | 488.9 |
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| $ | 451.7 |
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Net income margin (Net income/Revenue) |
| 19.7 | % |
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| 25.2 | % |
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| 20.0 | % |
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| 25.0 | % |
AEBITDA margin (AEBITDA/Revenue) |
| 25.1 | % |
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| 30.5 | % |
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| 26.2 | % |
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| 30.7 | % |
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(1) Refer to AEBITDA definition for a description of items included in restructuring and other. |
RECONCILIATION OF NET INCOME MARGIN | ||||||||||||
TO AEBITDA MARGIN | ||||||||||||
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| Three Months Ended |
| Nine Months Ended | ||||||||
|
| September 30, |
| September 30, | ||||||||
|
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||
Net income margin (Net income/Revenue) |
| 19.7 | % |
| 25.2 | % |
| 20.0 | % |
| 25.0 | % |
Restructuring and other |
| 0.6 | % |
| 1.2 | % |
| 0.9 | % |
| 0.7 | % |
Depreciation and amortization |
| 3.3 | % |
| 3.0 | % |
| 3.2 | % |
| 2.5 | % |
Income tax expense |
| 0.7 | % |
| 1.1 | % |
| 0.8 | % |
| 1.2 | % |
Stock-based compensation |
| 1.6 | % |
| 0.1 | % |
| 1.4 | % |
| 1.1 | % |
Other (income) expense, net |
| (0.8 | )% |
| (0.1 | )% |
| (0.1 | )% |
| 0.1 | % |
AEBITDA margin (AEBITDA/Revenue) |
| 25.1 | % |
| 30.5 | % |
| 26.2 | % |
| 30.7 | % |
Non-GAAP Financial Measures
Adjusted EBITDA, or AEBITDA, as used herein, is a non-GAAP financial measure that is presented as supplemental disclosure and is reconciled to net income attributable to SciPlay as the most directly comparable GAAP measure as set forth in the above table. We define AEBITDA to include net income attributable to SciPlay before: (1) net income attributable to noncontrolling interest; (2) interest expense; (3) income tax expense; (4) depreciation and amortization; (5) restructuring and other, which includes charges or expenses attributable to: (a) employee severance; (b) management changes; (c) restructuring and integration; (d) M&A and other, which includes: (i) M&A transaction costs; (ii) purchase accounting adjustments (including contingent acquisition consideration); (iii) unusual items (including legal settlements related to major litigation) and (iv) other non-cash items; and (e) cost-savings initiatives; (6) stock-based compensation; (7) loss (gain) on debt financing transactions; and (8) other expense (income) including foreign currency (gains) and losses. We also use AEBITDA margin, a non-GAAP measure, which we calculate as AEBITDA as a percentage of revenue.
Our management uses AEBITDA and AEBITDA margin to, among other things: (i) monitor and evaluate the performance of our business operations; (ii) facilitate our management’s internal comparisons of our historical operating performance and (iii) analyze and evaluate financial and strategic planning decisions regarding future operating investments and operating budgets. In addition, our management uses AEBITDA and AEBITDA margin to facilitate management’s external comparisons of our results to the historical operating performance of other companies that may have different capital structures and debt levels. Our management believes that AEBITDA and AEBITDA margin are useful as they provide investors with information regarding our financial condition and operating performance that is an integral part of our management’s reporting and planning processes. In particular, our management believes that AEBITDA is helpful because this non-GAAP financial measure eliminates the effects of restructuring, transaction, integration or other items that management believes have less bearing on our ongoing underlying operating performance. Management believes AEBITDA margin is useful as it provides investors with information regarding the underlying operating performance and margin generated by our business operations. The forward-looking non-GAAP financial measure AEBITDA margin target range is presented on a supplemental basis. We are not providing a forward-looking quantitative reconciliation of AEBITDA margin target range to the most directly comparable GAAP measure because we are unable to predict with reasonable certainty the ultimate outcome of certain significant items without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the relevant period.
View source version on businesswire.com:https://www.businesswire.com/news/home/20221109005921/en/
CONTACT: Media Relations
Andrea Schneider +1 917-769-6060
Director, Global Communications
SciPlayPress@sciplay.comInvestor Relations
Robert Weiner +1 904-495-8227
Vice President, Investor Relations
SciPlayIR@sciplay.com
KEYWORD: NEVADA UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: ELECTRONIC GAMES APPS/APPLICATIONS TECHNOLOGY CASINO/GAMING ENTERTAINMENT ONLINE MOBILE ENTERTAINMENT SOFTWARE INTERNET
SOURCE: SciPlay Corporation
Copyright Business Wire 2022.
PUB: 11/09/2022 04:15 PM/DISC: 11/09/2022 04:17 PM
http://www.businesswire.com/news/home/20221109005921/en