The CEO of global gaming and loyalty provider Everi Holdings Inc, Michael Rumbolz, says prior investments in technology innovations and game development have helped the company recover faster than originally expected from the COVID-19 pandemic.
Everi reported a net loss of US$68.5 million in the three months to 30 June 2020, with revenues having fallen 70.2% to US$38.7 million compared with US$129.7 million a year earlier.
But the company also achieved positive EBITDA of US$3.3 million in the quarter, significantly higher than Everi had anticipated during the early days of the pandemic.
“We achieved better-than-expected results in the second quarter, including a return to positive Adjusted EBITDA more quickly than we anticipated at the beginning of the quarter,” Rumbolz said.
“This was the result of several factors, including the swift actions we took in March when the pandemic struck to reduce our operating costs and preserve liquidity during the time casinos were shut down; as well as our focus on enhancing operational efficiencies and pursuing higher-value opportunities.
“In addition, as our customers began to reopen faster than previously expected, we benefited from our prior investments in technology innovations and game development through the strong performance of our FinTech solutions and installed base of recurring-revenue games.
“As we move through the third quarter, our products and services continue to reflect a return to the performance momentum we were achieving before COVID-19. The units in our gaming operations installed base that are active are performing at levels comparable to our experience pre-pandemic. In addition, the cash access portion of our FinTech business is processing same-store transactional volumes at levels that are, on average, only moderately below the prior year. Reflecting these trends, as well as the benefit from the 636-unit growth in installed premium games since the beginning of 2020, we expect quarterly sequential growth in the second half of 2020, including a return to Free Cash Flow generation in the third quarter, which is earlier than we had previously anticipated.
“We believe we have unique high-value FinTech and Games solutions that will help our customers address the new operating environment in their reopened properties, which when combined with our more streamlined operating approach, will help us regain the revenue, earnings and cash flow momentum we consistently demonstrated prior to the pandemic.”
As previously reported by Inside Asian Gaming, Rumbolz announced in March that he was cutting his pay to zero and that of Everi’s executive team by 70% in order to reduce expenses during the COVID-19 pandemic.
It was stated at the time that the reduction of executive salaries would enable Everi to keep payroll expenses to less than US$2 million per month.