Light & Wonder, Inc. · ASX:LNW
Light & Wonder — Q3 2024 Earnings Presentation
28 slides from Light & Wonder's earnings presentation, Nov 12, 2024
Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 Earnings Presentation November 12, 2024
Slide 2: Forward-Looking Statements
SECTION TITLE, 10PT Forward-Looking Statements In this presentation, Light & Wonder, Inc. (“Light & Wonder,” “L&W” or the “Company”) makes “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements describe future expectat
Slide 3: Driving Strong Performance and Sustainable Growth
Driving Strong Performance and Sustainable Growth IN $MILLIONS Consolidated Revenue Consolidated AEBITDA(1) Adjusted NPATA(1) $2,391 $929 $354 14 Consecutive Quarters $2,131 $278 $815 Consolidated Revenue Growth YoY $122 $817 $731 $99 $319 $286 9 Consecutive Quarters 12% 12% 12% 14% 23% 27% Double D
Slide 4: Achieving Results with Strong Quarterly Performance
Achieving Results with Strong Quarterly Performance Gaming Delivered Strong Revenue Growth Across Gaming, SciPlay, and iGaming, Driving Double-Digit Growth in Consolidated Revenue and Consolidated AEBITDA(1) • Achieved 12% YoY growth in both Consolidated Revenue and Consolidated AEBITDA(1) • Gaming
Slide 5: Leveraging R&D across Content, Hardware and Markets
Leveraging R&D across Content, Hardware and Markets Showed 80+ unique titles at G2E across various hardware configurations and cross-platform capabilities Markets Content Hardware 6 Continents, 100+ Countries Licenses Jumbo Screen HorizonTM Core Low Denomination Internal Brands Stepper Adjacencies H
Slide 6: Operational Highlights
Operational Highlights 6
Slide 7: Propelling Gaming Growth with Robust Machine Sales
Propelling Gaming Growth with Robust Machine Sales IN $MILLIONS Revenue AEBITDA Key 3Q24 Gaming Highlights • Gaming Revenue increased 15% YoY, primarily driven by Global $1,552 $771 Gaming Machine Sales growth of 38%, coupled with growth in $1,354 the N.A. installed base $267 $673 $235 o Gaming Oper
Slide 8: Sustained Strong Key Gaming Performance Metrics
Sustained Strong Key Gaming Performance Metrics Key 3Q24 Gaming KPI Highlights 3Q24 3Q23 Var% 9M24 9M23 Var% • Gaming Operations growth was primarily driven by an increase of Gaming Operations KPI: 7% YoY in N.A. installed base, with N.A. premium installed base U.S. and Canadian: growth of 17 consec
Slide 9: Elevating our Hardware and Content Roadmap
Elevating our Hardware and Content Roadmap COSMICTM MURALTM KASCADATM DUAL SCREEN HORIZONTM LANDMARKTM 7000 FAMILY Key Titles Key Titles Key Titles Key Titles Key Titles MONOPOLY is a trademark of Hasbro. Used with Permission. © 2024 Hasbro. All rights reserved. SQUID GAME TM/© Netflix. Used with pe
Slide 10: Significant Progress in Adjacencies and International
Significant Progress in Adjacencies and International VLT(1) Class II • Leading presence in • High performance Illinois, with cabinets and games meaningful expansion placed in both leased progress in Canada and for sale markets, with existing content and Oregon, recently synergies coming online in M
Slide 11: Continuing to Outpace the Social Casino Industry
Continuing to Outpace the Social Casino Industry IN $MILLIONS Revenue AEBITDA Key 3Q24 SciPlay Highlights • Revenue of $206 million, up 5% YoY, and fourth consecutive quarter $617 of revenue over $200 million. Outpacing social casino market, through $198 enhanced monetization and record performance
Slide 12: Enhancing Performance Through the SciPlay Engine
Enhancing Performance Through the SciPlay Engine Key 3Q24 SciPlay Highlights • Outpaced the social casino market for 11 consecutive quarters o Driving sustained monetization through strategic Live Ops and comprehensive product roadmaps o Leveraging data analytics to optimize player engagement DTC at
Slide 13: Fueling iGaming Growth Through Engaging Content
Fueling iGaming Growth Through Engaging Content IN $MILLIONS Key 3Q24 iGaming Highlights Revenue AEBITDA • Maintained record revenue of $74 million, up 6% YoY primarily driven by continued momentum in the U.S. $222 o U.S. OGS(1) GGR(2) grew 34% YoY, supported by $204 THUNDERING BLAZETM and RICH LITT
Slide 14: Harnessing the Scale of Our Established iGaming Platform
Harnessing the Scale of Our Established iGaming Platform OPERATORS CONTENT Key 3Q24 iGaming Highlights • Continued strong game launches, supported by proven land-based franchises OUR STUDIOS • Launched second game in the series with FanDuel, World of Wonka Pure Imagination via Playzido • Launched Su
Slide 15: Financials
Financials IGHT & WONDER 15
Slide 16: Sustained Double-Digit Top- and Bottom-Line Growth
Sustained Double-Digit Top- and Bottom-Line Growth IN $MILLIONS Key 3Q24 Highlights Consolidated Consolidated • Achieved 12% YoY Consolidated Revenue growth, driven by Revenue AEBITDA(1) strong performance across all businesses o Gaming growth led primarily by Global Gaming Machine Sales, which rema
Slide 17: Optimized Capital Allocation To Fuel Growth
Optimized Capital Allocation To Fuel Growth IN $MILLIONS Net Debt Key Highlights Interest Expense Leverage Ratio(1) • Ended the quarter with a principal face value of debt outstanding of $3.9 billion and reduced net debt leverage ratio(1) to 2.9x, remaining within targeted range(1)(2) of 2.5x to 3.5
Slide 18: Generated Scalable Free Cash Flow Potential
Generated Scalable Free Cash Flow(1) Potential IN $MILLIONS 3Q24 3Q23 9M24 9M23 Key Highlights Net cash provided by operating activities $ 119 $ 204 $ 430 $ 423 • Free Cash Flow(1) was $83 million compared to Less: Capital Expenditures $123 million in the prior year period primarily due to (71) (70)
Slide 19: Differentiated Value Proposition To Fuel Sustainable Growth
Differentiated Value Proposition To Fuel Sustainable Growth Streamlined business and healthy balance sheet Focus on operational excellence driving enhanced shareholder value Leading global games and platform provider with all the major pieces in place Unmatched global market positions and cross-plat
Slide 20: Appendix
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Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures The Company’s management (“Management”) uses the following non-GAAP financial measures in conjunction with Consolidated AEBITDA (representing AEBITDA from continuing operations) GAAP financial measures: Consolidated AEBITDA (representing continuing operations), Consolidat
Slide 22: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) addition to the preceding adjustments, we exclude Earnings from equity investments and add (without duplication) Adjusted NPATA Per Share - Diluted discontinued operations pro rata share of EBITDA from equity investments, which represents their share of earnin
Slide 23: L&W Reconciliation of Consolidated AEBITDA, AEBITDA from Discontinued Operations and Combined AEBITDA
L&W Reconciliation of Consolidated AEBITDA, AEBITDA from Discontinued Operations and Combined AEBITDA Three Months Ended Nine Months Ended Twelve Months Ended September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023 September 30, 2024 June 30, 2024 September 30, 2021 Reconciliatio
Slide 24: L&W Reconciliation of Adjusted NPATA and Adjusted NPATA Per Share
L&W Reconciliation of Adjusted NPATA and Adjusted NPATA Per Share Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Reconciliation of Net Income Attributable to L&W to Adjusted NPATA Net income attributable to L&W $ 64 $ 75 $ 228 $ 96 Net income attributable to non
Slide 25: L&W Reconciliation of Principal Face Value of Debt Outstanding to Net Debt Leverage Ratio
L&W Reconciliation of Principal Face Value of Debt Outstanding to Net Debt Leverage Ratio As of September 30, 2024 June 30, 2024 September 30, 2021 (1) Consolidated AEBITDA/Combined AEBITDA $ 1,232 $ 1,199 $ 1,229 Total debt $ 3,873 $ 3,871 $ 8,846 Add: Unamortized debt discount/premium and deferred
Slide 26: L&W Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
L&W Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Net cash provided by operating activities $ 119 $ 204 $ 430 $ 423 Less: Capital expenditures (71) (70) (224) (182) Add: Payments on c
Slide 27: L&W Reconciliation of Consolidated AEBITDA Margin
L&W Reconciliation of Consolidated AEBITDA Margin Y Three Months Ended September 30, Nine Months Ended September 30, e 2024 2023 # 2024 2023 (1) $ 319 $ 286 $ 929 $ 815 Consolidated AEBITDA Revenue 817 731 2,391 2,131 Net income margin 8% 11 % % 10 % 5% (2) Consolidated AEBITDA margin 39 % 39 % % 39
Slide 28: L&W Reconciliation of Earnings from Equity Investments to EBITDA from Equity Investments
L&W Reconciliation of Earnings from Equity Investments to EBITDA from Equity Investments Twelve Months Ended September 30, 2021 Continuing Discontinued Operations Operations Earnings from equity investments $ 4 $ 31 Add: Income tax expense - 8 Add: Depreciation, amortization and impairments 1 30 Add