PR Newswire | Nov 9, 2021 06:41AM EST

11/09 05:40 CST

International Game Technology PLC Reports Third Quarter 2021 Results- Third quarter consolidated revenue up 21% to $984 million, propelled by double-digit growth across all business segments- Operating income more than doubled to $212 million fueled by significant operating leverage across businesses; achieved $200 million+ OPtiMa structural cost savings target for 2021 ahead of schedule- Adjusted EBITDA of $407 million, among the highest levels in Company history- Net debt leverage improves to 3.8x from 6.4x at December 31, 2020; net debt reduced by $1.2 billion year-to-date- Raising 2021 operating income outlook on strong business trends- Reinstatement of $0.20 per common share quarterly cash dividend LONDON, Nov. 9, 2021

LONDON, Nov. 9, 2021 /PRNewswire/ -- International Game Technology PLC ("IGT") (NYSE:IGT) today reported financial results for the third quarter ended September 30, 2021. Today, at 8:00 a.m. EST, management will host a conference call and webcast to present the results; access details are provided below.

"Broad-based momentum across our Lottery, Gaming, and Digital & Betting activities drove significant improvement in key financial and performance metrics in the third quarter," said Marco Sala, CEO of IGT. "Revenue grew over 20% and operating income more than doubled, highlighting the strength of our portfolio. Based on our excellent year-to-date results and our solid financial condition, the Board reinstated a quarterly cash dividend, signaling their confidence in the Company's prospects."

"We are supporting strong top-line growth with strategic investments in the business while still making good progress on optimizing our cost structure," said Max Chiara, CFO of IGT. "Achieving our goal of reducing net debt leverage below 4.0x was a big accomplishment in the quarter. We look forward to sharing our strategy, long-term growth initiatives, and capital allocation plans during our upcoming investor day on November 16, 2021."

Overview of Consolidated Third Quarter 2021 Results



Quarter Ended ConstantY/Y CurrencyAll amounts from continuing operations September 30,ChangeChange (%) (%) 2021 2020

($ in millions, unless otherwise noted)

GAAP Financials:

Revenue

Global Lottery 652 570 14% 15%

Global Gaming 289 216 34% 34%

Digital & Betting 43 31 37% 35%

Total revenue 984 816 21% 20%



Operating income (loss)

Global Lottery 234 196 19% 20%

Global Gaming 31 (56) NA NA

Digital & Betting 12 6 100% 90%

Corporate support expense (26) (17) (54)% (54)%

Other^(1) (40) (42) 5% 5%

Total operating income (loss) 212 87 144% 145%

Operating Income margin 22% 11%



Net cash provided by operating activities113 191 (41)%



Cash and cash equivalents 435 936 (53)%



Non-GAAP Financial Measures:

Adjusted EBITDA

Global Lottery 347 309 12% 13%

Global Gaming 64 (18) NA NA

Digital & Betting 15 9 66% 59%

Corporate support expense (19) (13) (46)% (46)%

Total Adjusted EBITDA 407 287 42% 42%

Adjusted EBITDA margin 41% 35%



Free cash flow 66 126 (48)%



Net debt^(2) 6,1097,250 (16)%



^(1) Primarily includes purchase price amortization

^(2) Historical net debt recast to only reflect continuing operations

Note: Reconciliations of non-GAAP financial measures to the most directlycomparable GAAP financial measures are provided at the end of this news release

Key Highlights:

* Sustained player demand in Global Lottery propels strong results; profit and related margins remain among the strongest in segment history * Global Gaming achieves highest quarterly revenue and profit levels in seven quarters as progressive recovery continues * Digital & Betting rapidly gaining scale with significantly higher revenue and profit driven by new and existing markets * Strong year-to-date operating cash flow of $613 million and free cash flow of $445 million * Successfully amended and extended term loan facility, adding an ESG margin adjustment demonstrating IGT's commitment to sustainability * Awarded 10-year lottery contract with Connecticut Lottery Corporation following a competitive procurement * Recently signed seven-year contract with La Franaise des Jeux, operator of the French National Lottery, to upgrade its lottery central system to IGT's advanced Aurora(tm) platform featuring enhanced, omnichannel capabilities * Strengthened Digital & Betting leadership with appointment of Joe Asher as President of Sports Betting and Gil Rotem as President of iGaming * Announced several turnkey sports betting solutions, including full retail and mobile services for Angel Of The Winds Casino Resort, Oneida Casino, and Snoqualmie Casino * Extended cashless momentum with agreements to deploy Resort Wallet(tm) and IGTPay(tm) at Agua Caliente Casino and Indigo Sky properties * Won several industry awards, including: * "Technology Provider of the Year" and "Lottery Product of the Year" at 2021 International Gaming Awards * "Product Innovation of the Year" for Resort Wallet and IGTPay cashless technologies at 2021 Global Gaming Awards Las Vegas * "Best Consumer-Service Technology" for CrystalFlex sports betting terminal at 2021 GGB Gaming & Technology Awards

Financial highlights:

Consolidated revenue of $984 million, up 21% compared to the prior year

* Global Lottery revenue rises 14% to $652 million, as sustained momentum drives 9% global same-store sales growth * Global Gaming revenue of $289 million, up from $216 million in the prior year and $274 million sequentially as market recovery progresses * Digital & Betting revenue increases 37% to $43 million, with double-digit growth across activities

Operating income of $212 million, up 144% from the prior year

* High profit flow-through of Global Lottery same-store sales growth * Mix of high-margin Italy lottery sales * Strong operating leverage across businesses * Disciplined cost management and benefits from OPtiMa structural cost-savings program

Net interest expense of $79 million compared to $101 million in the prior year, driven by lower average debt balances and interest rates

Provision for income taxes of $37 million compared to a benefit from income taxes of $41 million in the prior year, on significant increase in operating profitability

Net income of $101 million versus net loss of $129 million in the prior-year period, driven by higher revenue and operating profit, and a reduction in foreign exchange losses

Adjusted EBITDA of $407 million compared to $287 million in the prior-year period; Adjusted EBITDA margin of 41%, among the highest level in Company history

Net debt of $6.1 billion, down $1.2 billion from $7.3 billion at December 31, 2020; Net debt leverage of 3.8x, down from 6.4x at December 31, 2020, driven by strong cash flow generation and proceeds from sale of Italy gaming businesses, including (euro)100 million installment received during Q3'21

Cash and Liquidity Update

* Total liquidity of $2.2 billion as of September 30, 2021; $435 million in unrestricted cash and $1.8 billion in additional borrowing capacity * Executed amendment and extension of Term Loan Facility * Enhancing credit profile, increasing liquidity, and extending debt maturities * Includes ESG margin adjustment, highlighting commitment to sustainability; achieved higher ESG rating in Q3'21, lowering borrowing costs

Other DevelopmentsThe Company's Board of Directors declared a quarterly cash dividend of $0.20 per common share

* Ex-dividend date of November 22, 2021 * Record date of November 23, 2021 * Payment date of December 7, 2021

Investor Day DetailsIGT will host a virtual Investor Day on Tuesday, November 16, 2021, at 8:30 a.m. EST

* Senior management will present an in-depth review of the Company's business strategy, long-term growth prospects, and capital allocation plans * A live webcast is available under "Events Calendar" on IGT's Investor Relations website at www.IGT.com * Registration for the event is required and can be completed in advance * A replay will also be available on the website following the call

Raising Full-year 2021 Outlook (Continuing operations)

* Revenue of ~$4.1 billion * Updating operating income outlook to ~$900 million from ~$800 million * Depreciation and amortization of ~$700 - $725 million * Cash from operations of ~$850 - $900 million * Capital expenditures below $300 million * Does not factor in any additional impact from COVID-19 restrictions

Earnings Conference Call and WebcastNovember 9, 2021, at 8:00 a.m. EST

To register to participate in the conference call, or to listen to the live audio webcast, please visit the "Events Calendar" on IGT's Investor Relations website at www.IGT.com. A replay will be available on the website following the live event.

Note: Certain totals in the tables included in this press release may not add due to rounding

Comparability of ResultsAll figures presented in this news release are prepared under U.S. GAAP, unless noted otherwise. Adjusted figures exclude the impact of items such as purchase accounting, impairment charges, restructuring expense, foreign exchange, and certain one-time, primarily transaction-related items. Reconciliations to the most directly comparable U.S. GAAP measures are included in the tables in this news release. Constant currency changes for 2021 are calculated using the same foreign exchange rates as the corresponding 2020 period. Management uses non-GAAP financial measures to understand and compare operating results across accounting periods, for internal budgeting and forecasting purposes, and to evaluate the Company's financial performance. Management believes these non-GAAP financial measures reflect the Company's ongoing business in a manner that allows for meaningful period-to-period comparisons and analysis of business trends. These constant currency changes and non-GAAP financial measures should however be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with U.S. GAAP. Amounts reported in millions are computed based on amounts in thousands. As a result, the sum of the components may not equal the total amount reported in millions due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages and earnings per share amounts presented are calculated from the underlying unrounded amounts.

About IGTIGT (NYSE:IGT) is a global leader in gaming. We deliver entertaining and responsible gaming experiences for players across all channels and regulated segments, from Gaming Machines and Lotteries to Sports Betting and Digital. Leveraging a wealth of compelling content, substantial investment in innovation, player insights, operational expertise, and leading-edge technology, our solutions deliver unrivalled gaming experiences that engage players and drive growth. We have a well-established local presence and relationships with governments and regulators in more than 100 countries around the world, and create value by adhering to the highest standards of service, integrity, and responsibility. IGT has approximately 11,000 employees. For more information, please visit www.IGT.com.

Cautionary Statement Regarding Forward-Looking StatementsThis news release may contain forward-looking statements (including within the meaning of the Private Securities Litigation Reform Act of 1995) concerning International Game Technology PLC and its consolidated subsidiaries (the "Company") and other matters. These statements may discuss goals, intentions, and expectations as to future plans, trends, events, dividends, results of operations, or financial condition, or otherwise, based on current beliefs of the management of the Company as well as assumptions made by, and information currently available to, such management. Forward-looking statements may be accompanied by words such as "aim," "anticipate," "believe," "plan," "could," "would," "should," "shall", "continue," "estimate," "expect," "forecast," "future," "guidance," "intend," "may," "will," "possible," "potential," "predict," "project" or the negative or other variations of them. These forward-looking statements speak only as of the date on which such statements are made and are subject to various risks and uncertainties, many of which are outside the Company's control. Should one or more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those predicted in the forward-looking statements and from past results, performance, or achievements. Therefore, you should not place undue reliance on such statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include (but are not limited to) the factors and risks described in the Company's annual report on Form 20-F for the financial year ended December 31, 2020 and other documents filed from time to time with the SEC, which are available on the SEC's website at www.sec.gov and on the investor relations section of the Company's website at www.IGT.com. Except as required under applicable law, the Company does not assume any obligation to update these forward-looking statements. You should carefully consider these factors and other risks and uncertainties that affect the Company's business. Nothing in this news release is intended, or is to be construed, as a profit forecast or to be interpreted to mean that the financial performance of International Game Technology PLC for the current or any future financial years will necessarily match or exceed the historical published financial performance of International Game Technology PLC, as applicable. All forward-looking statements contained in this news release are qualified in their entirety by this cautionary statement. All subsequent written or oral forward-looking statements attributable to International Game Technology PLC, or persons acting on its behalf, are expressly qualified in their entirety by this cautionary statement.

Non-GAAP Financial MeasuresManagement supplements the reporting of financial information, determined under GAAP, with certain non-GAAP financial information. Management believes the non-GAAP information presented provides investors with additional useful information, but it is not intended to nor should it be considered in isolation or as a substitute for the related GAAP measures. Moreover, other companies may define non-GAAP measures differently, which limits the usefulness of these measures for comparisons with such other companies. The Company encourages investors to review its financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Adjusted EBITDA represents net income (loss) from continuing operations (a GAAP measure) before income taxes, interest expense, foreign exchange gain (loss), other non-operating expenses, depreciation, impairment losses, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income), and certain other non-recurring items. Other non-recurring items are infrequent in nature and are not reflective of ongoing operational activities. For the business segments, Adjusted EBITDA represents segment operating income (loss) before depreciation, amortization (service revenue, purchase accounting and non-purchase accounting), restructuring expenses, stock-based compensation, litigation expense (income) and certain other non-recurring items. Adjusted EBITDA - discontinued operations represents income (loss) from discontinued operations (a GAAP measure) before income taxes, interest expense, depreciation and amortization, and gain on sale of discontinued operations. Adjusted EBITDA - combined represents Total Adjusted EBITDA plus Adjusted EBITDA - discontinued operations. Management believes that the non-GAAP measures just mentioned are useful in providing period-to-period comparisons of the results of the Company's ongoing operational performance.

Net debt is a non-GAAP financial measure that represents debt (a GAAP measure, calculated as long-term obligations plus short-term borrowings) minus capitalized debt issuance costs and cash and cash and equivalents. Cash and cash equivalents are subtracted from the GAAP measure because they could be used to reduce the Company's debt obligations. Management believes that net debt is a useful measure to monitor leverage and evaluate the balance sheet.

Net debt leverage is a non-GAAP financial measure that represents the ratio of Net debt as of a particular balance sheet date to Adjusted EBITDA for the last twelve months ("LTM") prior to such date. Prior to the disposal of the Italian B2C gaming businesses in the second quarter of 2021, management calculated the Net debt leverage ratio as the ratio of Net debt as of a particular balance sheet date to the LTM of Adjusted EBITDA - combined prior to such date. Management believes that Net debt leverage is a useful measure to assess our financial strength and ability to incur incremental indebtedness when making key investment decisions.

Free cash flow is a non-GAAP financial measure that represents cash flow from operations (a GAAP measure) less capital expenditures. Management believes free cash flow is a useful measure of liquidity and an additional basis for assessing IGT's ability to fund its activities, including debt service and distribution of earnings to shareholders.

Constant currency is a non-GAAP financial measure that expresses the current financial data using the prior-year/period exchange rate (i.e., the exchange rates used in preparing the financial statements for the prior year). Management believes that constant currency is a useful measure to compare period-to-period results without regard to the impact of fluctuating foreign currency exchange rates.

A reconciliation of the non-GAAP measures to the corresponding amounts prepared in accordance with GAAP appears in the tables in this release. The tables provide additional information as to the items and amounts that have been excluded from the adjusted measures.

Contact:Phil O'Shaughnessy, Global Communications, toll free in U.S./Canada +1 (844) IGT-7452; outside U.S./Canada +1 (401) 392-7452Francesco Luti, +39 06 5189 9184; for Italian media inquiriesJames Hurley, Investor Relations, +1 (401) 392-7190

Select Performance and KPI data: ($ in millions, unless otherwise noted)









Sequential Y/Y Change Constant Change as GLOBAL LOTTERY Q3'21 Q3'20 Currency Q2'21 (%) Change (%)^(1) Reported (%)

Revenue

Service

Operating and facilities management contracts 590 525 12% 12% 675 (13)%

Upfront license fee amortization (51) (52) 1% -% (53) 2%

Operating and facilities management contracts, net 539 474 14% 14% 623 (13)%

Other 78 76 4% 5% 79 (1)%

Total service revenue 617 549 12% 13% 702 (12)%



Product sales 35 20 71% 70% 23 51%

Total revenue 652 570 14% 15% 725 (10)%



Operating income 234 196 19% 20% 300 (22)%

Adjusted EBITDA^(1) 347 309 12% 13% 414 (16)%



Global same-store sales growth (%)

Instant ticket & draw games 7.1% 10.6% 34.9%

Multi-jurisdiction jackpots 42.2% (14.3)% 28.8%

Total 9.3% 8.7% 34.5%



North America & Rest of world same-store sales growth (%)

Instant ticket & draw games 4.6% 15.0% 20.5%

Multi-jurisdiction jackpots 42.2% (14.3)% 28.8%

Total 7.5% 12.1% 21.1%



Italy same-store sales growth (%)

Instant ticket & draw games 16.3% (3.5)% 115.2%



^(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein







Constant Sequential Y/Y Change Q3'21 Q3'20 Currency Q2'21 Change as GLOBAL GAMING (%) Change (%)^(1) Reported (%)

Revenue

Service

Terminal 116 81 44% 43% 108 8%

Systems, software, and other 56 51 8% 8% 48 16%

Total service revenue 172 133 30% 30% 156 10%



Product sales

Terminal 81 49 64% 63% 86 (6)%

Other 36 34 7% 6% 31 14%

Total product sales revenue 117 83 41% 40% 118 (1)%

Total revenue 289 216 34% 34% 274 6%



Operating income (loss) 31 (56) NA NA 1 NM

Adjusted EBITDA^(1) 64 (18) NA NA 35 80%



Installed base units

Casino 48,434 48,280 -% 47,964

Casino - L/T lease^(2) 1,144 1,102 4% 1,136

Total installed base units 49,578 49,382 -% 49,100



Installed base units (by geography)

US & Canada 34,347 34,584 (1)% 33,820

Rest of world 15,231 14,798 3% 15,280

Total installed base units 49,578 49,382 -% 49,100



Yields (by geography)^(3), in absolute $

US & Canada $40.79 $26.79 52% $38.41

Rest of world $5.64 $4.31 31% $4.03

Total yields $29.67 $19.88 49% $27.49



Global machine units sold

New/expansion 1,009 818 23% 1,167

Replacement 4,692 2,853 64% 5,168

Total machine units sold 5,701 3,671 55% 6,335



US & Canada machine units sold

New/expansion 524 667 (21)% 643

Replacement 3,451 2,007 72% 3,485

Total machine units sold 3,975 2,674 49% 4,128



^(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein

^(2) Excluded from yield calculations due to treatment as sales-type leases

^(3) Excludes Casino L/T lease units due to treatment as sales-type leases; comparability on a Y/Y basis hindered due to fewer active units







Sequential Y/Y Change Constant Q3'21 Q3'20 Q2'21 Change as GLOBAL GAMING (Continued) (%) Currency Reported Change (%)^(1) (%)

Rest of world machine units sold

New/expansion 485 151 221% 524

Replacement 1,241 846 47% 1,683

Total machine units sold 1,726 997 73% 2,207



Average Selling Price (ASP), in absolute $

US & Canada $13,900$13,8001% $13,900

Rest of world $14,400$12,10019% $12,700

Total ASP $14,100$13,3006% $13,400



Gaming Systems Revenue 38 31 22% 39









Sequential Y/Y Change Constant Q3'21 Q3'20 Q2'21 Change as DIGITAL & BETTING (%) Currency Reported Change (%)^(1) (%)

Revenue

Service 43 31 39% 36% 43 -%

Product sales - - (66)% (66)% (0) NA

Total revenue 43 31 37% 35% 42 2%



Operating income 12 6 100% 90% 9 35%

Adjusted EBITDA^(1) 15 9 66% 59% 13 18%





CONSOLIDATED

Revenue (by geography)

US & Canada 556 443 26% 25% 561 (1)%

Italy 294 248 18% 19% 353 (17)%

Rest of world 134 125 7% 6% 127 5%

Total revenue 984 816 21% 20% 1,041 (5)%





^(1) Non-GAAP measures; see disclaimer and reconciliations to the most directly comparable GAAP measure included herein



International Game Technology PLC

Consolidated Statements of Operations

($ in millions and shares in thousands, except per share amounts)

Unaudited



For the three months endedFor the nine months ended

September 30, September 30,

2021 2020 2021 2020

Service revenue 832 713 2,634 1,891

Product sales 152 104 406 340

Total revenue 984 816 3,039 2,230



Cost of services 422 418 1,302 1,194

Cost of product sales 93 83 253 243

Selling, general and administrative 195 179 588 511

Research and development 63 48 179 140

Goodwill impairment - - - 296

Restructuring (1) - (1) 47

Other operating expense - 1 1 3

Total operating expenses 772 730 2,323 2,434



Operating income (loss) 212 87 716 (204)



Interest expense, net 79 101 264 297

Foreign exchange (gain) loss, net (6) 149 (62) 153

Other expense, net 1 6 96 34

Total non-operating expenses 74 256 298 485

Income (loss) from continuing operations before 138 (170) 418 (689) provision for (benefit from) income taxes

Provision for (benefit from) income taxes 37 (41) 217 (45)

Income (loss) from continuing operations 101 (129) 200 (644)

Income from discontinued operations, net of tax - 26 24 25

Gain on sale of discontinued operations, net of tax - - 391 -

Income from discontinued operations - 26 415 25

Net income (loss) 101 (102) 615 (619)

Less: Net income attributable to non-controlling interests36 25 155 40 from continuing operations

Less: Net income (loss) attributable to non-controlling - 1 (2) (3) interests from discontinued operations

Net income (loss) attributable to IGT PLC 65 (128) 462 (656)



Net income (loss) from continuing operations 0.32 (0.75) 0.22 (3.34) attributable to IGT PLC per common share - basic

Net income (loss) from continuing operations 0.31 (0.75) 0.22 (3.34) attributable to IGT PLC per common share - diluted

Net income (loss) attributable to IGT PLC per 0.32 (0.62) 2.25 (3.20) common share - basic

Net income (loss) attributable to IGT PLC per 0.31 (0.62) 2.24 (3.20) common share - diluted

Weighted-average shares - basic 205,188 204,857 205,048 204,680

Weighted-average shares - diluted 206,899 204,857 206,728 204,680

International Game Technology PLC

Consolidated Balance Sheets

($ in millions)

Unaudited



September 30,December 31,

2021 2020

Assets

Current assets:

Cash and cash equivalents 435 907

Restricted cash and cash equivalents 152 199

Trade and other receivables, net 1,017 846

Inventories 181 169

Other current assets 607 480

Assets held for sale 4 839

Total current assets 2,396 3,440

Systems, equipment and other assets related to contracts, net956 1,068

Property, plant and equipment, net 118 132

Operating lease right-of-use assets 283 288

Goodwill 4,670 4,713

Intangible assets, net 1,453 1,577

Other non-current assets 1,500 1,774

Total non-current assets 8,981 9,552

Total assets 11,376 12,992



Liabilities and shareholders' equity

Current liabilities:

Accounts payable 1,003 1,126

Current portion of long-term debt - 393

Other current liabilities 825 847

Liabilities held for sale - 250

Total current liabilities 1,828 2,615

Long-term debt, less current portion 6,544 7,857

Deferred income taxes 392 333

Operating lease liabilities 269 266

Other non-current liabilities 322 360

Total non-current liabilities 7,528 8,816

Total liabilities 9,355 11,431

Commitments and contingencies

IGT PLC's shareholders' equity 1,317 777

Non-controlling interests 704 784

Shareholders' equity 2,021 1,561

Total liabilities and shareholders' equity 11,376 12,992

International Game Technology PLC

Consolidated Statements of Cash Flows

($ in millions)

Unaudited

For the three months endedFor the nine months ended

September 30, September 30,

2021 2020 2021 2020

Cash flows from operating activities

Net income (loss) 101 (102) 615 (619)

Less: Income from discontinued operations - 26 415 25

Adjustments to reconcile net income (loss) from continuing operations to net cash provided by operating activities from continuing operations:

Depreciation 81 91 246 265

Amortization of upfront license fees 54 54 164 156

Amortization 51 53 150 160

Stock-based compensation 11 1 22 (11)

Debt issuance cost amortization 4 5 15 16

Loss on extinguishment of debt 1 - 92 28

Goodwill impairment - - - 296

Foreign exchange (gain) loss, net (6) 149 (62) 153

Deferred income taxes (27) (70) 56 (107)

Other non-cash items, net (6) 1 (1) -

Changes in operating assets and liabilities, excluding the effects of acquisitions and dispositions:

Trade and other receivables (50) 81 (184) 169

Inventories (17) (3) (12) (9)

Accounts payable (101) (25) (77) (45)

Other assets and liabilities 18 (18) 4 (85)

Net cash provided by operating activities from continuing operations 113 191 613 344

Net cash provided by (used in) operating activities from discontinued - 95 (31) 267 operations

Net cash provided by operating activities 113 285 582 610



Cash flows from investing activities

Capital expenditures (47) (65) (168) (204)

Proceeds from sale of assets 3 1 15 6

Other - 2 1 12

Net cash used in investing activities from continuing operations (44) (62) (152) (186)

Net cash provided by (used in) investing activities from discontinued 118 (1) 852 (21) operations

Net cash provided by (used in) investing activities 74 (63) 700 (207)



Cash flows from financing activities

Net (repayments of) proceeds from Revolving Credit Facilities (498) (579) 17 146

Principal payments on long-term debt (424) - (2,846) (959)

Net (payments of) receipts from financial liabilities (55) 59 (52) 96

Payments of debt issuance costs (7) (2) (14) (21)

Payments in connection with the extinguishment of debt - - (85) (25)

Net proceeds from (repayments of) short-term borrowings 16 (83) 19 (8)

Proceeds from long-term debt 589 - 1,339 750

Dividends paid - - - (41)

Dividends paid - non-controlling interests - (45) (89) (136)

Return of capital - non-controlling interests (31) - (92) -

Capital increase - non-controlling interests 1 1 12 3

Other (3) (3) (12) (9)

Net cash used in financing activities (412) (650) (1,804) (204)



Net (decrease) increase in cash and cash equivalents and restricted cash and (225) (428) (522) 200 cash equivalents

Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash (6) 38 (19) 46 equivalents

Cash and cash equivalents and restricted cash and cash equivalents at the 819 1,530 1,129 894 beginning of the period

Cash and cash equivalents and restricted cash and cash equivalents at the end 588 1,140 588 1,140 of the period

Less: Cash and cash equivalents and restricted cash and cash equivalents of - 19 - 19 discontinued operations

Cash and cash equivalents and restricted cash and cash equivalents at the end of the period of 588 1,121 588 1,121 continuing operations



Supplemental Cash Flow Information

Interest paid 104 141 323 372

Income taxes paid 64 20 104 38

International Game Technology PLC

Net Debt

($ in millions)

Unaudited



September 30,December 31,

2021 2020

6.250% Senior Secured U.S. Dollar Notes due February 2022 - 1,004

4.750% Senior Secured Euro Notes due February 2023 - 1,038

5.350% Senior Secured U.S. Dollar Notes due October 2023 61 61

3.500% Senior Secured Euro Notes due July 2024 576 610

6.500% Senior Secured U.S. Dollar Notes due February 2025 1,093 1,092

4.125% Senior Secured U.S. Dollar Notes due April 2026 743 -

3.500% Senior Secured Euro Notes due June 2026 863 913

6.250% Senior Secured U.S. Dollar Notes due January 2027 745 744

2.375% Senior Secured Euro Notes due April 2028 575 608

5.250% Senior Secured U.S. Dollar Notes due January 2029 744 743

Senior Secured Notes 5,399 6,813



Euro Term Loan Facilities due January 2027 1,145 1,044

Long-term debt, less current portion 6,544 7,857



Euro Term Loan Facility due January 2027 - 393

Current portion of long-term debt - 393



Short-term borrowings 19 -

Total debt 6,563 8,250



Less: Cash and cash equivalents 435 907

Less: Debt issuance costs, net - Revolving Credit Facilities due July 202418 24

Net debt 6,109 7,319



Note: Net debt is a non-GAAP financial measure

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions)

Unaudited



For the three months ended September 30, 2021

Business

Global GlobalDigitalSegment CorporateTotal & IGT

LotteryGamingBettingTotal and OtherPLC

Income from continuing 101 operations

Provision for income 37 taxes

Interest expense, net 79

Foreign exchange gain, (6) net

Other non-operating 1 expense, net

Operating income 234 31 12 278 (66) 212 (loss)

Depreciation 48 29 4 81 - 81

Amortization - service54 - - 54 - 54 revenue ^(1)

Amortization - non-purchase 8 1 - 10 1 11 accounting

Amortization - - - - - 40 40 purchase accounting

Restructuring - - (1) (1) - (1)

Stock-based 3 2 - 5 6 11 compensation

Other ^(2) - - - - - -

Adjusted EBITDA 347 64 15 426 (19) 407





Cash flows from operating activities - 113 continuing operations

Capital expenditures (47)

Free Cash Flow 66





^(1) Includes amortization of upfront license fees

^(2) Primarily includes transaction-related costs

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions)

Unaudited



For the three months ended September 30, 2020

Business

Global GlobalDigital &Segment CorporateTotal IGT

LotteryGamingBetting Total and OtherPLC

Loss from continuing operations (129)

Benefit from income taxes (41)

Interest expense, net 101

Foreign exchange loss, net 149

Other non-operating expense, net 6

Operating income (loss) 196 (56) 6 146 (59) 87

Depreciation 51 36 4 91 - 91

Amortization - service revenue ^(1) 54 - - 54 - 54

Amortization - non-purchase accounting 8 2 - 10 1 11

Amortization - purchase accounting - - - - 42 42

Stock-based compensation - - - - 1 1

Other ^(2) - - - - 1 1

Adjusted EBITDA 309 (18) 9 301 (13) 287



Income from discontinued operations 26

Provision for income taxes 14

Interest expense, net -

Depreciation 11

Amortization 13

Adjusted EBITDA - discontinued operations 65



Adjusted EBITDA - combined 352



Cash flows from operating activities - continuing operations 191

Capital expenditures (65)

Free Cash Flow 126



^(1) Includes amortization of upfront license fees

^(2) Primarily includes transaction-related costs

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions)

Unaudited



For the nine months ended September 30, 2021

Business

Global GlobalDigital &Segment CorporateTotal IGT

LotteryGamingBetting Total and OtherPLC

Income from continuing operations 200

Provision for income taxes 217

Interest expense, net 264

Foreign exchange gain, net (62)

Other non-operating expense, net 96

Operating income (loss) 871 7 28 906 (190) 716

Depreciation 144 92 11 247 (1) 246

Amortization - service revenue ^(1) 164 - - 164 - 164

Amortization - non-purchase accounting 25 4 - 29 3 32

Amortization - purchase accounting - - - - 118 118

Restructuring (1) - (1) (1) - (1)

Stock-based compensation 5 4 - 10 12 22

Other ^(2) - - - - 1 1

Adjusted EBITDA 1,209 107 39 1,355 (57) 1,299



Income from discontinued operations 415

Gain on sale of discontinued operations (396)

Provision for income taxes 4

Interest expense, net -

Depreciation -

Amortization -

Adjusted EBITDA - discontinued operations 23



Adjusted EBITDA - combined 1,322



Cash flows from operating activities - continuing operations 613

Capital expenditures (168)

Free Cash Flow 445



^(1) Includes amortization of upfront license fees

^(2) Primarily includes transaction-related costs

International Game Technology PLC

Reconciliation of Non-GAAP Financial Measures

($ in millions)

Unaudited



For the nine months ended September 30, 2020

Business

Global GlobalDigital &Segment CorporateTotal IGT

LotteryGamingBetting Total and OtherPLC

Loss from continuing operations (644)

Benefit from income taxes (45)

Interest expense, net 297

Foreign exchange loss, net 153

Other non-operating expense, net 34

Operating income (loss) 447 (170) 3 280 (484) (204)

Goodwill impairment - - - - 296 296

Depreciation 147 106 11 264 1 265

Amortization - service revenue ^(1) 156 - - 156 - 156

Amortization - non-purchase accounting 22 5 - 27 2 30

Amortization - purchase accounting - - - - 131 131

Restructuring 5 34 1 41 6 47

Stock-based compensation (4) (5) - (9) (2) (11)

Other ^(2) - - - - 3 3

Adjusted EBITDA 773 (28) 14 759 (47) 713



Income from discontinued operations 25

Provision for income taxes 10

Interest expense, net -

Depreciation 36

Amortization 41

Adjusted EBITDA - discontinued operations 112



Adjusted EBITDA - combined 825



Cash flows from operating activities - continuing operations 344

Capital expenditures (204)

Free Cash Flow 139





^(1) Includes amortization of upfront license fees

^(2) Primarily includes transaction-related costs

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SOURCE International Game Technology PLC