GTECH profits dip as Italian growth stutters
Revenues stay largely flat as Q2 profit falls 4%, with interactive wagers in Italy falling 11%
Gaming supplier GTECH recorded a dip in Q2 operating profit to 156m as its international and Italian businesses both recorded revenue slides.
Total group revenue for the three months ended 30 June remained largely flat at 751m, with EBITDA slipping 2% year-on-year to 267m.
Total revenue from its international business fell 5% year-on-year to 76m which the firm attributed to a change in contract terms with an unnamed customer, despite the period including the launch of the GTECH-powered OPAP sportsbook.
The firm also revealed that it withdrew from the Turkish lottery tender, awarded to a consortium led by Scientific Games last month, after it deemed the project was not economically viable to pursue.
Its Italian online business continued to decline with wagers down 11% in the period to 449m, and the business recorded a 1m loss despite what GTECH referred to as “cost streamlining”.
The Italy-facing business is expetected to be boosted in the future by through GTECH’s purchase of Probability earlier this year, which has its own Italian arm in B2B firm Playyoo.
Total H1 profit fell by around 5% to 336.9m, however CEO Marco Sala said that the firm’s reporting of comparable results to a very good second quarter last year was a “significant accomplishment”.
“Cash generation was better than anticipated and we continue feeling very positive about the underlying trend in net financial position,” Alberto Fornaro, GTECH’s CFO, said.
Little insight was given into the firm’s $6.4bn acquisition of IGT last month, with the merger not expected to complete until H1 2015.