AGS claims that its first-quarter success is a ‘testament to the resiliency and durability’ of the company, just two months after claiming to be in the best position it has ever been.
The remarks follow the release of the Las Vegas-based company’s first-quarter report, in which David Lopez, president and CEO of AGS, lauded “one of the best corporate strategic planning meetings I have ever participated in” for improving organisational cohesion around key business goals.
Revenue rose 1.9 percent to $55.4 million in the fiscal year ending March 31, 2021 (2020: $54.3 million), with increases in the EGM, table goods, and digital businesses helping to offset the effect of continued weakness in the North American slot replacement industry.
In comparison to the prior year’s period, the company earned an additional $2.1 million in sales revenue from units that were strategically pruned and then sold.
The EGM, table goods, and digital core reporting divisions all saw rises of 0.3 percent, 11 percent, and 41.3 percent, respectively, to $50.51 million (2020: $50.35 million), $2.75 million (2020: $2.48 million), and $2 million (2020: $1.4 million).
As of March 31, 2021, AGS reports that 99 percent of its domestic installed base of 15,456 units and 51 percent of its foreign installed base of 7,985 units is operational. As of December 31, 2020, those percentages were 90 percent and 36 percent, respectively.
Total adjusted EBITDA increased 7.4 percent year over year to $26.3 million, with gains in all three operating divisions, led by a $1 million, or 4.4 percent, increase in EGMs.
Recurring revenue-centric business model
AGS’ CFO, Kimo Akiona, stated: “Our first quarter results once again serve as a testament to the resiliency and durability inherent to our company’s recurring revenue-centric business model.
“I am confident our improving execution and strong liquidity position will allow us to deliver more consistent financial performance and, in turn, further enhance shareholder value.”
It is reported that the company has reduced the first quarter net loss from $14 million to $7 million this year, based on an improvement in revenues and lower amortisation and depreciation expenses from the inclusion of several intangible assets that had reached the end of their economic life and a few months prior.
“I was very pleased with our team’s execution in the 2021 first quarter and am equally as encouraged by the macro level trends and overall sentiment we are seeing across the gaming landscape today,” Lopez added.
“Following one of the best corporate strategic planning meetings I have ever participated in, we are strengthening our organisational alignment around key business objectives, which should allow us to improve our business trajectory and overall operating efficiency.”