IGT revenue falls 10% during Q1

IGT's financial report explained that the decline in revenue was due to high jackpot levels of the prior year, new Italy Lotto concession dynamics and lower gaming product sales.

 "Our revenue and profit are consistent with the pattern of the year that we described in March. Year to date, we've strengthened our leading positions in global lotteries and begun the rollout of a new generation of gaming machines. We are monetizing non-core assets that will allow us to significantly reduce debt, and we are adopting a new business model for our future participation in the social casino space," Marco Sala, CEO of IGT.

"As we noted in March, a unique combination of elements affected first quarter revenue and profit comparisons, including record jackpot activity in 2016," said Alberto Fornaro, CFO of IGT. "Disciplined asset and operational management are a top priority for the Company, and this is evident in the strong first quarter cash flow. We are updating our outlook to incorporate the DoubleDown transaction and the impact of increased taxation on gaming machines in Italy."

Gaming service revenue was impacted by lower DoubleDown revenue, and gaming product sales were down due to large system and software sales in the first quarter of 2016. The Company shipped 5,953 gaming machines worldwide during the first quarter, and the global installed base rose to 59,034.

Adjusted EBITDA of $371 million was 19% below the first quarter of 2016. Operating income was $119 million compared to $188 million in the first quarter of 2016, and Adjusted operating income was $238 million compared to $310 million. The declines in Adjusted EBITDA and Adjusted operating income primarily reflect lower revenues, International segment performance, and unfavorable foreign exchange translation.

In the first three months of the year, cash from operations was $284 million and capital expenditures were $172 million.