PlayAGS, Inc., the public company formed by the IPO earlier this year of slot and table-game supplier AGS, announced the commencement of a secondary public offering of 4,250,000 shares of the company’s common stock by Apollo Gaming Holdings, L.P., the former AGS parent company that is now its largest shareholder.
The pricing was subsequently announced at $21.50 per share.
The underwriters will have a 30-day option to purchase up to an additional 425,000 shares of common stock from Apollo. The company itself is not selling any shares and will not receive any proceeds from the offering.
Credit Suisse, Deutsche Bank Securities, Jefferies and Macquarie Capital are acting as joint book-running managers and as representatives of the underwriters for the proposed offering. BofA Merrill Lynch, Citigroup, Nomura, Stifel and SunTrust Robinson Humphrey are acting as joint book-running managers for the proposed offering. Roth Capital Partners, Union Gaming, The Williams Capital Group, L.P. and Apollo Global Securities are acting as co-managers for the proposed offering.
The offering will be made only by means of a prospectus. A copy of the preliminary prospectus relating to this offering, when available, may be obtained from any of the following sources:
Credit Suisse Securities (USA) LLC, Attention: Prospectus Department, One Madison Avenue, New York, NY 10010, or by telephone at (800) 221-1037 or by email at newyork.prospectus@credit-suisse.com;
Deutsche Bank Securities Inc., Attention: Prospectus Group, 60 Wall Street, New York, NY 10005, or by telephone at (800) 503-4611, or by email at prospectus.CPDG@db.com; Jefferies LLC, Attention: Prospectus Department, 520 Madison Avenue, 2nd Floor, New York, NY 10022, or by telephone at (877) 821-7388 or by email at Prospectus_Department@Jefferies.com; or Macquarie Capital (USA) Inc., Attention: Syndicate Department, 125 West 55th Street, L-22, New York, NY 10019, or by telephone at (212) 231-0440 or by email at MacquarieEquitySyndicateUSA@macquarie.com
PlayAGS narrowed its quarterly loss for the first quarter to reflect a year-on-year improvement. The company reported a net loss of $9.5 million, or 30 cents per share, for the three months ended March 31. A year ago, the then-private company had a net loss of $12.4 million, or 53 cents per share.
Revenue rose 35.8 percent to a record $64.9 million from $47.8 million. Growth in sales of electronic game machines, particularly the Orion Portrait cabinet, spurred the overall revenue increase, the company said. Electronic game machine equipment sales more than doubled to $15.2 million, also a record, with 838 units sold, PlayAGS said.
The company said its installed games base increased by more than 2,500 units year-over-year, driven by the purchase of 1,500 machines from Rocket Gaming in December.
Adjusted earnings before interest, taxes, depreciation and amortization, rose 39 percent to $34.5 million, boosted by the revenue increase, the company said. The company revised its EBITDA projections to between $126 million and $131 million. The company said its capital expenditures forecast remained at $55 to $60 million.
“The first quarter of 2018 was absolutely tremendous for AGS — we achieved records in every key category, including revenue, adjusted EBITDA, average selling price, and recurring revenue,” President and CEO David Lopez said in a statement accompanying the earnings. “With industry-leading game performance and the recent introduction of the new Orion Slant, AGS shows no signs of slowing down, and we are confident that 2018 will be our best year yet.”
