Scientific Games’ Q4 2020 figures are noticeably lower across the board compared to the previous year, but the result is still an improvement over its Q3 performance.
Scientific Games Suffers Overall Performance Drop Compared to 2019
US-based gambling products and services provider Scientific Games has ended the final quarter of 2020 with a slight revenue dip compared to 2019. However, the company’s Q4 performance is a notable improvement compared to the previous quarter of the year. One of the primary reasons for the dip in the ongoing pandemic and accompanying economic recession.
Scientific Games’ consolidated revenue for Q4 2020 dipped to $762 million – an 11.7% drop compared to the corresponding period of 2019. At the same time, the company’s Q4 performance is actually 8.4% higher compared to the $698 million generated during Q3 of the same year.
Overall, Scientific Games ended Q4 with a net loss of $84 million – a notably worse performance than the $37 million loss in the same quarter of 2019. The loss was primarily driven by the COVID-19 pandemic and the safety measures and temporary closures imposed on land-based casinos throughout the world.
As a result of these land-based venues’ temporary absence, Scientific Games suffered a $75 million drop in net cash flow to $471 million. The negative impact was partially offset by the company’s improved working capital and lower interest rates.
The Q4 Results Are a Step Up Compared to Previous Quarter
Despite the challenging economic environment, Scientific Games’ performance improved compared to the previous quarter. According to the company, this is largely due to gaming improvements. This includes the launch of several new gaming titles as well as stable initial play levels throughout the fourth quarter of the year.
However, the pandemic has left a noticeable dent in Scientific Games’ combined annual performance. The gambling services provider generated a total of $2.7 billion in revenue for 2020 – a step down compared to the $3.4 billion in 2019.
The drop was partially halted by the impressive performance of several of the company’s business units. The SciPlay, Digital, and Lottery sectors all saw growth across the board in Q4, but SciPlay achieved by far the highest results. In Q4, SciPlay’s revenue increased by 30% and its consolidated adjusted EBITDA by 41%.
Scientific Games has also greatly expanded its total liquidity to $1,269 million in 2020 – a $363 million increase compared to 2019.
Scientific Games CEO and President Barry Cottle said that while 2020 definitely offered plenty of challenges for the company, he couldn’t be more proud of the team for successfully navigating them. He also attributed the positive cash flow to the company’s strong execution coupled with its business diversity.