Investors flocked to Scientific Games shares Monday after the gaming and lottery supply giant produced a stronger than expected earnings report and an announcement to refinance some of its debt load.
After closing at $26.85 last Friday, the company’s share price rose as high as $34.55 in the afternoon – a boost of nearly 29 percent.
The investor confidence comes on the heels of a strong second quarter in which the company reported a 5 percent year-over-year increase in revenue to $766 million and a net loss of $39 million – a 25 percent improvement over the prior year quarter. EBITDA checked in at $315 million – up nearly 13 percent year-over-year and topping the consensus Wall Street estimate of $292 million.
“Second quarter results represent our seventh quarter of consecutive year-over-year growth, including $169 million of cash flow from operating activities, as a result of ongoing improvements in our gaming, lottery and interactive operations,” said Kevin Sheehan, Chief Executive Officer of Scientific Games.
Sheehan also emphasized that the company revenue growth was complemented by a 270 basis point improvement in attributable EBITDA margin due to cost savings and business process improvements across the enterprise.