nternational Game Technology (IGT) reported Monday its financial results for the first quarter ended March 31, 2020. The company said the results were affected by COVID-19-related lockdowns beginning in March, and it is withdrawing its previous 2020 outlook due to COVID-19 uncertainty.
Revenue was reported at $940 million, down 18% from the same period of the prior year as global closure of casinos and gaming halls and widespread mobility restrictions significantly hinder service revenue generation. Net loss of $248 million includes $296 million non-cash goodwill impairment charge. Adjusted EBITDA of $309 million was down 26% from the prior-year period.
The company also reported $2.2 billion in liquidity, comprised of $1.5 billion in unrestricted cash and $743 million in capacity under revolving credit facilities.
"After a solid start in the first two months of the year, we quickly shifted our focus to the global COVID-19 health crisis in March," Marco Sala, CEO of IGT, said in a release. "The safety and well-being of our people, customers, and communities have been our highest priority since day one. We implemented robust business continuity plans and maintain service levels at our normal, high standards. I am grateful for the passion and perseverance the entire IGT team has demonstrated during these unprecedented times and I am confident IGT is well positioned to emerge from the crisis a stronger, even more competitive organization."
"We've taken swift actions across all non-essential costs and are now switching our focus to structural cost savings initiatives. At the same time, we have adopted strict measures to preserve liquidity in the current environment," said Max Chiara, CFO of IGT. "Given the uncertainty created by COVID-19, we are withdrawing our previous financial outlook for 2020, but we are confident that with $2.2 billion of liquidity, we are geared with sound financial flexibility to weather the storm caused by the COVID-19 pandemic."
IGT said lottery service revenue was lower on reduced traffic to points of sale, and gaming product sales reflect fewer unit shipments in North America and International, partly offset by higher non-terminal revenue. Lottery product sales growth was driven by increased non-terminal revenue.
The firm saw an operating loss of $197 million, down from income of $178 million in the prior year, driven by lower near-term forecasts as a result of COVID-19. It includes non-cash, non-tax-deductible goodwill impairment charge of $296 million, reducing the carrying value of the International and North America Gaming & Interactive segments.
There was no impact on the company's operations, cash flow, ability to service debt, compliance with financial covenants, or underlying liquidity.
During the quarter and at maturity, IGT redeemed in full its €388 million, 4.750% Senior Secured Euro Notes. As announced on May 13, the terms of the company's revolving credit facilities and term loan were amended, providing increased flexibility to navigate through the uncertainty caused by the COVID-19 pandemic.
Furthermore, about $500 million in cost savings or capital spending avoidance have been identified to help mitigate the impact of COVID-19 in 2020. The actions taken include: temporary, company-wide salary reductions; cancellation of 2020 salary increases and short-term incentive compensation programs; furloughs and hiring freeze.
Also, there were significant reductions in discretionary costs such as marketing, travel, and outside services; and an over one-third reduction in planned maintenance capital expenditures for the balance of the year.