IGT cuts global workforce by 7%
Staff cull expected to realise cost savings of US$30m in the current fiscal year
IGT has enacted cost-cutting measures including reducing its global workforce by 7% following a sharp decline in gross gaming revenues from its North America business.
IGT started notifying employees yesterday and expects the workforce reduction to be completed by the end of the second fiscal quarter.
The reduction in staff is expected to realise cost savings of US$30m in the current fiscal year and an estimated $50m on an annual run-rate basis.
“As we reach the halfway point in our fiscal year, you can see this is a challenging time for the industry and IGT. We knew that our success in 2013 would be difficult to replicate,” said IGT CEO Patti Hart.
“However, we did not expect such a sharp decline in North American gross gaming revenues, or further degradation in the international currency, compliance, and importation environment,” she added.
IGT is lowering its fiscal year 2014 guidance for adjusted earnings per share from continuing operations from $1.28 to $1.38 to $1.00 to $1.10.
The company is also providing guidance for adjusted earnings per share from continuing operations of $0.17 to $0.19 for the second fiscal quarter of 2014.
The gaming supplier also said it was continuing to improve its gaming operations performance after extending its licensing agreement with Sony for its Wheel of Fortune brand, and would leverage its social gaming experience to improve land-based game performance.
It also highlighted its video poker deal with Action Gaming, plus the launch of its Powerbucks interstate progressive jackpot in Nevada, New Jersey South Dakota and Canada later this year.
In January eGaming Review reported that IGT had posted Q1 2014 revenues of US$541m, a 2% increase on the same period last year thanks in part to a 57% increase in revenues from DoubleDown social casino.