AGS highest quarterly EGM units sale drives revenue 5% up in Q3

AGS reported Thursday its operating results for the third quarter of 2019. Total revenue of $79.4 million represented a growth of 5% year-over-year, driven by record EGM unit sales and increased gaming operations revenue in the EGM and Table Products segments. Total adjusted EBITDA increased by 10% to $36.8 million, boosted by increased revenue from the EGM and Table Products segments as well as reduced operating costs in AGS’ Interactive social gaming business.

“Our third quarter performance was underscored by the sale of nearly 1,400 EGMs – the most in our company’s history – as well as record performance in our Table Products segment. 92% of domestic EGM unit sales were from our Orion family of cabinets, including our latest addition, the Orion Upright, which accounted for approximately 300 sold units in the quarter,” said David Lopez, President and Chief Executive Officer. “After a successful G2E last month, we are looking forward to launching our premium lease-only Orion Rise cabinet and Starwall LED merchandising display, as well as our highly anticipated Orion 49C, Pax S card shuffler, and Bonus Spin Xtreme progressive system. We believe this robust suite of products will help drive growth in 2020 and beyond.”

Gaming operations revenue, or recurring revenue, grew to $52.5 million, or 4% year-over-year, driven by an increase in the company’s domestic and international EGM installed base, and growth in its Table Products installed base.

EGM sold units increased by 4% to 1,391, compared to 1,332 in the prior year, marking an all-time record for AGS, led by sales of the Orion Portrait and the successful launch of its new Orion Upright cabinets. Table Products revenue increased 39% to $2.9 million, driven by increased progressive table game placements and an increased footprint of the recently introduced Dex S card shuffler.

Net loss of $5.5 million decreased year-over-year from net income of $4.3 million in the prior year due to increases in non-cash depreciation and amortization as well as an increase in tax expense compared to the prior year period.

Total Adjusted EBITDA margin increased to 46% in the third quarter of 2019 compared to 44% in the prior year, driven by several different factors, most notably due to improved operating performance of AGS’ Table Products and Interactive segments.