Growth reflects strength and diversity of global technology offerings

First Quarter 2018 Financial Highlights:

• First quarter revenue rose 12 percent to $811.8 million, up from $725.4 million in the year ago period, reflecting the inclusion of $49.2 million in revenue from the NYX Gaming Group Limited ("NYX") acquisition completed on January 5, 2018 (the "NYX acquisition"), along with seven percent growth in lottery revenue and 21 percent growth in social revenue. Gaming revenue increased one percent from the prior year, reflecting a 30 percent increase in gaming machine replacement unit shipments offset by the impact from far fewer new casino openings globally. 
      


• Operating income in the first quarter was $49.4 million compared to $88.0 million in the prior year period, reflecting $52.2 million in restructuring and other charges that included an $18.0 million accrual for contingent consideration associated with higher-than-anticipated results from the 2017 acquisition of Spicerack, a $15.0 million charge related to certain litigation costs, and $13.5 million of acquisition and integration costs related to the NYX acquisition, as well as the unfavorable impact of higher depreciation and amortization expense, inclusive of a $19.0 million facilities impairment charge. These costs were partially offset by the benefit from higher revenue, the inclusion of NYX results and more efficient business processes. Net loss increased to $201.8 million from $100.8 million in the prior year, reflecting the impact of a $93.2 million loss incurred on debt financing transactions associated with our February 2018 refinancing and the change in operating income. 
     


• AttributableEBITDA ("AEBITDA"), a non-GAAP financial measure defined below, increased 12 percent to $320.1 million from $286.6 million in the prior year period, primarily driven by higher revenue, the inclusion of NYX and more efficient business processes throughout the organization. 
      


• Netcash provided by operating activities decreased to $29.9 million from $111.0 million in the year ago period. The change included the impact of $49.5 million associated with a change in accrued interest due to the timing of our February 2018 refinancing and $30.2 million related to the NYX acquisition, including transaction fees and net assumed liabilities.
       


• In the 2018 first quarter, the Company completed refinancing transactions that resulted in an approximately $69 million reduction in annualized cash interest costs at then-prevailing interest rates and extended a portion of its debt maturities from 2022 to 2024, 2025 and 2026.

"Our first quarter results reflect our strength as a global diversified gaming technology provider," said Kevin Sheehan, CEO and President of Scientific Games. "Our results reflect the significant success our team achieved during the quarter such as the inclusion of NYX and our refinancing, as well as the underlying robust business fundamentals, such as the 30 percent increase in gaming machine replacement sales. With improving momentum across all our businesses, we are excited by the prospects and opportunities to smartly grow our revenue and AEBITDA during the remainder of 2018 and beyond."

Michael Quartieri, Chief Financial Officer of Scientific Games, said, "Our continued growth in revenue and AEBITDA, coupled with the lower interest costs resulting from our recent refinancing, establishes a solid platform for increased cash flows. We remain committed to our path of increasing cash flow, de-levering and strengthening our balance sheet."