Everi Holdings reported a 14.2% increase in revenue year-on-year for the first three months of 2023. This highlights the impact of existing acquisitions and growth initiatives.
Everi has made a number 2022 deals that have helped to drive growth during Q1, such as the historical horse racing gaming company Intuicode Gaming Corporation, which was acquired in May of last year and is now part of Everi’s gaming segment.
Everi’s financial technology solutions arm (fintech), which includes the acquisition of Ecash Holdings, in February 2022, has also seen an increase in hardware sales.
Everi also purchased certain assets from mobile-first engagement platform Venutize, in October 2022. This diversified Everi outside the gaming sector. And it acquired the majority of assets at gaming devices and systems provider Video King, this month. Randy Taylor, the chief executive of the group, said that this will allow for further growth.
Taylor stated that “Overall, the first quarter results continue to show our consistent growth profile as we execute on our organic expansion initiatives and benefit from many acquisitions completed in the past 12 months.”
“As a consequence, and despite uncertainty in the macroeconomic climate and higher interest rate, we remain favourably positioned for solid top-line revenue growth. We expect to generate at least $92.0m net income and at minimum $150.0m free cash flow by the end of this year.”
Everi Q1 revenue driven by Fintech
Revenue for the three months to 31 March amounted to $200.5m (PS159.0m/EUR183.2m), up from $175.6m in the same period last year.
The Games segment revenue increased 9.3% year-on-year to $107.4m. This was due to a 14.6% increase in revenue from gaming equipment sales, which reached $32.1m. Gaming operations revenues, including digital gaming operations, also rose 7.1% to $75.3m.
The fintech segment’s revenue also increased by 20,4%, to $93.1m. Everi attributed this to a 12.6% increase in revenue from financial access services to $56.2m. Software and other revenue grew 35.2% to $42.2m, and hardware sales revenue grew 30.5% to $12.75m.
In terms of spending, the total costs for the quarter were up by 20.7% at $148.4m. Revenue costs increased in both the gaming and the fintech segments. Everi reported an increase in research and development and operating costs, as well as a rise of depreciation.
After adding $18.0m of interest expenses, the pre-tax profit was $34.1m. This is down 17.2% from the previous year. Everi paid $6.0m of tax, and accounted for an $186,000 loss due to foreign currency conversion.
The net profit for the first quarter was $27.9m. This is a drop of 13.1% from last year. The adjusted EBTIDA, however, was higher by 3.2% year-on-year. It stood at $92.5m.
Taylor stated that “our financial results continue benefiting from our capital allocation priority, including our focus of high-value internal products development and our ability of executing on strategic tuck in acquisitions for businesses we expect to scale up and optimise, like our recent acquisitions of Video King’s assets.”
We expect to continue returning capital through our increased share purchase program. Meanwhile, we will focus on integrating our recent acquisitions, which provide incremental growth in 2023 and beyond.
