Everi Holdings Inc. (EVRI) Misses Q1 EPS by 6c, Revenues Miss

Everi Holdings Inc. (NYSE: EVRI) reported Q1 EPS of ($0.16), $0.06 worse than the analyst estimate of ($0.10). Revenue for the quarter came in at $113 million versus the consensus estimate of $116.11 million.

First Quarter 2020 Highlights

• Results impacted by the March casino closures due to the COVID-19 pandemic
• Company took swift action to increase liquidity and reduce cash outflows
• Revenue was $113.3 million compared to $123.8 million a year ago
• Net loss was $13.5 million, or a loss of $(0.16) per diluted share, inclusive of a $7.4 million pre-tax loss on extinguishment of debt, compared to net income of $5.9 million, or $0.08 per diluted share, in the prior year
• Adjusted EBITDA, a non-GAAP financial measure, was $52.3 million compared to $61.3 million a year ago
• Free Cash Flow, a non-GAAP financial measure, was $18.4 million compared to $21.2 million in the prior year

Michael Rumbolz, Chief Executive Officer of Everi, said, “The significant improvement in our operating metrics in the first two months of 2020, including revenue, earnings and cash flow, demonstrates the strength in our business prior to the outbreak of the COVID-19 pandemic. Our performance during that time, which included a 21% year-over-year increase in the daily win per unit of our installed base and a 17% year-over-year increase in the total number of cash access transactions in our FinTech business for January and February, offers clear evidence of our operating momentum and contributed to the margin improvement we experienced. Since the onset of the pandemic and the resulting closure of our customers’ casinos in mid-March, our attention has been on addressing the impact on our employees and their families, our customers and our Company. We acted aggressively to preserve cash and improve our liquidity position to allow the Company to achieve our long-term goals as our customers’ operations begin to reopen. These actions included dramatically reducing our near-term cash burn rate, accessing the capital markets in April for an incremental $125 million term loan and amending certain financial covenants of our existing credit agreement.

“As a result of these early actions, we believe Everi has the foundation and financial flexibility to both withstand this current disruption and further our product innovation as the industry and broader economy recover from the pandemic impact. As casinos have now begun to reopen across the country, we are working to support our customers and have started a phased approach to bring our employees back to work. We believe we have unique high-value FinTech and Games solutions that will help our customers address the new operating environment as they begin to reopen. We continued to provide in-demand services to customers during their property closures — primarily related to our player loyalty and cash access solutions — which are experiencing increased interest. These solutions, together with our player-popular gaming content, help address casino operators’ near-term needs as they reopen and will help us regain the revenue, earnings and cash flow momentum we consistently demonstrated prior to the COVID-19 outbreak.”

2020 Outlook

As previously disclosed, due to the COVID-19 pandemic and the ongoing uncertainty regarding its magnitude and duration, Everi has withdrawn the 2020 financial outlook it provided on March 2, 2020.

“As casinos across the country begin to reopen and return to normalized operations over time, we believe our product development innovation initiatives together with our consistency in operational execution will drive the long-term enhancement of shareholder value,” said Rumbolz.

For earnings history and earnings-related data on Everi Holdings Inc. (EVRI) click here.

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