Everi Holdings proves that money management can weather storms

Calculator on top on US Dollar bills. Concept of Money Management

The global gaming industry has suffered greatly because of COVID-19, with billion-dollar companies now scrambling to make ends meet. While most will blame their shortfalls on the global pandemic, an argument for lack of prudent planning can be seen clearly. Everi Holdings, a global supplier of gaming and loyalty solutions, has been able to manage its finances well enough that it is already showing almost a complete recovery from the COVID-19 disaster. It has also been able to pay off its debts, while other gaming companies are reaching out to investors to try to secure hundreds of millions of dollars just to stay alive.

Calculator on top on US Dollar bills. Concept of Money ManagementEveri just released its latest financial statement for the third quarter, showing considerable strength in its numbers as revenue is up 190% quarter over quarter. While it still reported a net loss, at $900,000, for the period ending September 30, this was much better than the net loss of $68.5 million it saw in the second quarter of the year. Revenue from games and FinTech operations were $38.7 million, but improved to $112.1 million in Q3. This is only off by 16.7% from what was reported for the same period last year, and comes as the world is continuing to struggle with the COVID-19 pandemic.

Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) also improved from the second quarter to the third. It was up 94.5%, reaching $59.8 million, and included a debt repayment of $35 million Everi had drawn on a revolving credit facility. 

Everi CEO Michael Rumbolz said in the statement, “The significant quarterly sequential improvement in revenue, net income, Adjusted EBITDA and Free Cash Flow in the third quarter demonstrates a quicker than previously expected recovery in our results. Our operations strengthened throughout the third quarter, with better performance at the end of the quarter compared to earlier in the quarter. While the future impact of the pandemic remains uncertain, our improved results highlight the resilience and strength of our recurring-revenue streams.

“The installed base of our gaming operations premium units increased year over year by 40% in the quarter, largely reflecting a return to the strong, pre-pandemic performance levels of our active units. In addition, the number and value of cash access funding transactions improved during the third quarter, and casino operators demonstrated their further preference for our loyalty products, with a significant year-over-year increase in the sales of our self-service kiosks. This strong operating performance, combined with the benefits of our initiatives to streamline operations and improve our overall cost structure, resulted in Free Cash Flow that was more than double last year’s level.”

He added, “Barring additional COVID-19 setbacks and reflecting our recent momentum, we currently expect to achieve 2020 fourth quarter net income and Adjusted EBITDA comparable to the 2020 third quarter results, despite typical fourth-quarter seasonal influences. Our focus on innovation across our portfolio of products and solutions, from exciting game development to innovative cashless funding solutions, remains a high priority. Importantly, in support of our Digital Neighborhood strategy focused on offering a comprehensive integrated set of financial and player loyalty solutions, we continued development of our CashClub Wallet® cashless and contactless mobile app ahead of its rollout with the first two casino customers later this month. Our CashClub Wallet® solution is a true digital wallet that can serve as the hub to fund a player’s activities across the casino’s entire ecosystem, from a casino’s on-premise activities to its online offerings.”