Everi announced last week that it will acquire casino gaming-related assets, including self-service kiosk and marketing platform technology, from Atrient, a portion with cash on hand and the rest over the next two years.
“The assets that we acquired from Atrient will add complementary products and services to our fintech business,” Everi CEO Mike Rumbolz said during an investor conference call. “We believe these assets will expand our market position and help us to accelerate growth in revenue and adjusted EBITDA.”
In February, at the ICE London trade show, Atrient and Everi showed their products’ interoperability in a joint display demonstrating how Atrient’s PowerKiosk works with Everi’s multifunction CXC 5.0 L kiosk.
SunTrust gaming analyst Barry Jonas told investors that Everi expanded its financial services business by acquiring more than 50 customer contracts in 100 casinos from Atrient.
“Everi did not quantify the (cash flow) profile of the company, though noted they expect the acquisition to be neutral to cash flow positive for 2019 results,” Jonas said, according to CDC Gaming Reports. “We believe the purchase multiple is likely at or below Everi’s current trading multiple on an annualized basis.”
In a statement accompanying the results, Rumbolz said the company showed consistent improvement across performance indicators.
“The investments we have made in our financial technology and games product portfolios over the last several years have led to a greater range of products and services that are delivering higher value to casino operators and better experiences for their guests. As a result, we are expanding our presence on casino floors in both business segments,” Rumbolz said.
“Our unit sales and ship share continue to improve. And we have established a product pipeline that we expect will drive ongoing improvements in our high-margin gaming operations business.”
At the same time as the Atrient announcement, Everi reported fourth-quarter earnings or 2018 that showed a net income of $4.2 million, reversing what had been a $25 million loss in the same quarter in 2017.
After issuing its earnings statement, the company announced it will spend $40 million to acquire assets including platform technology from Michigan-based Atrient, a casino loyalty and marketing solutions provider.
In the quarter, Everi’s adjusted earnings before interest, taxes, depreciation and amortization, a cash flow measure that excludes nonrecurring costs, rose 6.4 percent to $54.6 million from $51.3 million in the quarter. Fourth-quarter revenue was $119.5 million, topping the $113.4 million forecast by Zacks-polled analysts. The latest result is up 5.4 percent from $105 million a year earlier.
Everi’s fourth-quarter games segment revenue rose 18.4 percent to $67 million from $56.6 million. Gaming operations revenue rose 11.9 percent to $41.5 million from $37.1 million, reflecting year-over-year growth in installed base and estimated daily win per unit.
Financial technology segment revenue rose 8.5 percent to $52.5 million from $48.4 million. Cash access services revenue, which includes ATM, cash advance and check services, also rose 8.5 percent to $39.5 million from $36.4 million.
For the 12 months ended Dec. 31, Everi had net income of $12.4 million, or 17 cents per share, reversing a year-earlier loss of $51.9 million, or 78 cents per share. Full-year revenue rose 14.3 percent to $469.5 from $410.7 million.
