AGS (AGS) Misses Q1 EPS by 34c

AGS (NYSE: AGS) reported Q1 EPS of ($0.41), $0.34 worse than the analyst estimate of ($0.07). Revenue for the quarter came in at $54.3 million versus the consensus estimate of $69.15 million.

AGS President and Chief Executive Officer David Lopez said, "As a result of the global impact of COVID-19, particularly near the end of the quarter, the gaming industry was significantly impacted with essentially all North American gaming facilities closed at the end of March. Casino closures resulted in significant revenue interruptions and increased business uncertainty. Our team took early steps to formulate and implement a comprehensive plan that included costs savings through Company-wide salary reductions, layoffs, and furloughs, capital expenditure reductions, and strengthening our liquidity position. Through these initial steps, we were able to reduce our estimated monthly cash outflow nearly 80% to approximately $4 million, which does not include our monthly debt service costs of $3.8 million. We are approaching the uncertainty and challenges in the second quarter and the rest of 2020 with resolve and from a position of strength given the recent reinforcement of our balance sheet and operational initiatives. With our strong culture underpinning our recovery efforts, we are focused on not simply managing through the crisis, but building a strong future for our employees, customers, and shareholders."

Kimo Akiona, AGS' Chief Financial Officer, added, "In addition to the operational savings and cash-saving programs that we have implemented, we have taken measures to ensure that the Company is in the best possible liquidity position given the current operating environment. These measures included drawing the full $30 million under the existing revolving credit facility during the quarter and postponing substantially all capital expenditures and related projects. On May 1, 2020, we entered into an incremental agreement in which we incurred incremental term loans of $95 million and obtained covenant relief on our net first lien leverage ratio for the remaining periods in 2020."

For earnings history and earnings-related data on AGS (AGS) click here.

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