Stable Revenue Growth Returns PlayAGS to Profit in 2023
LISTEN TO THIS ARTICLE:PlayAGS, a supplier of electronic gaming products, saw a return to net profit in the 2023 financial year after year-on-year growth from all three of its main businesses.
Revenue for the group in 2023 came to $356.5 million, an increase of 15.2% from the $309.4 million of the year before. It saw growth from its Electronic Gaming Machines (EGM), Table Products, and Interactive divisions, and while group spending was up year-on-year as the company expanded, the revenue growth was enough to ensure a profit.
PlayAGS also enjoyed a strong finish to 2023 with record revenue and adjusted EBITDA in three divisions. The fourth quarter was also the eleventh consecutive quarter of double-digit total revenue.
The strength in our fourth quarter results was broad-based, with all three operating segments setting new quarterly records. The quality and consistency of our recent financial performance is a true reflection of our incredibly talented and focused team, increasingly deep and diverse product offering across all three segments, and the improving efficiency and effectiveness of our execution.
Electronic Gaming Machines Lead the Way
Gaming operations brought in the most revenue, $240.2 million, up 7.3% from the previous year. Revenue from equipment sales was up 35.0% to $116.34 million.
When looking at individual divisions, EGM brought in the most revenue. It was up 15% year-on-year to $327.1 million thanks to an increase in equipment sales.
Revenue from Table Products was up 18.7% year-on-year to $17.7 million and there was a 15.6% increase in Interactive revenue, helped by the release of more content and the signing of new B2C partnerships.
PlayAGS had operating costs of $200.1 million in 2023, up 10.2%. Costs were up in almost every area, with depreciation and amortization the main expense at $76.9 million. It was followed by selling, general and administrative costs of $73.2 million.
The company also had large interest costs, which totaled $57.4 million for the year. However, thanks to the increased revenue the company had a pre-tax profit of $1.7 million, significantly better than the $10.3 million loss in 2022.
Income tax for the company came to $1.3 million but PlayAGS benefited from $7 million foreign currency translation adjustment. This left the company with a net profit of $7.4 million, compared to 2022’s $6.3 million loss.
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