Jim Hurley – Senior Vice President of Investor Relations
Marco Sala – Chief Executive Officer
Alberto Fornaro – Chief Financial Officer
Barry Jonas – Bank of America
Davis Katz – Telsey Group
John DeCree – Union Gaming
Steven Kent – Goldman Sachs
Cameron Mcknight – Wells Fargo
Antonio Casari – Northlight
David Farber – Credit Suisse
Good day, and welcome to the IGT 2015 Fourth Quarter Results Conference Call. Today’s conference is being recorded.
At this time, I would like to turn the conference over to Jim Hurley, Senior Vice President of Investor Relations. Please go ahead, sir.
Good morning. Thank you for joining us on IGT’s fourth quarter and full year 2015 conference call. On today’s call Marco Sala, our Chief Executive Officer will provide an overview of the quarter and year and comment on broader strategic initiatives. Then Alberto Fornaro, our Chief Financial Officer, will provide operational and financial perspective on the period, in addition to providing our outlook for 2016. After the company’s prepared remarks, we will open up the call for your questions.
During today’s call, we’ll be making some forward-looking statements within the meaning of the Federal Securities Laws. Forward-looking statements are not guarantees, and our actual results may differ materially from those expressed or implied in the forward-looking statements. The principal risks and uncertainties that could cause our results to differ materially from our current expectations are detailed in our SEC filings.
With that, I’ll turn the call over to Marco Sala.
Thank you, Jim, and welcome, everyone. We are pleased to report a strong fourth quarter and full year results that met the top end of our expectations. Adjusted EBITDA of $449 million in the fourth quarter was up 8% in constant currency, the first quarter of year-over-year growth since the acquisition, and a clear demonstration of the success of our integration efforts.
The $1.704 billion in pro forma adjusted EBITDA for the full year was at the high end of our guidance, and we achieved over $110 million in cash synergy savings during the year, putting us ahead of schedule for our total synergy plan, which we had increased.
Strong profitability and disciplined capital management translated into free cash flow before onetime transaction costs of over $540 million in 2015. As a result, we made very good progress in reducing our debt and leverage during the year, and our financial condition is solid. Our capability to deliver this financial performance is a testimony to the dedication and focus of our teams around the world.
There were other important milestones in 2015. Having completed a transformational acquisition, we combined the world’s number one companies in lottery and gaming equipment to create the he global leader in gaming.
Coupling that with the strong position we have in social and interactive, our broad-based coverage of gaming continuum gives us a significant competitive advantage. Geographically, nearly half of our revenues come from North America.
Italy represents one-third, and the balance comes from the rest of the world. That gives us a unique perspective on emerging gaming trends and opportunities, wherever they arise.
From a customer perspective our balance between B2C and B2B capabilities enable us to better leverage our proximity with players in everything we do. And in lottery, but also gaming, we have a significant base of recurring revenues accounting for nearly 85% of the total, with the remainder coming from product sales.