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Intralot SA (FRA:9IL) Q1 2025 Earnings Call Highlights: Strong Revenue Growth Amidst US Market ...
Revenue Growth: Increased by 10.9% year-over-year.
Operating Cash Flow: Approximately EUR49 million, EUR22 million higher than the previous year.
Cash Balance: EUR76 million, EUR11.5 million higher than 2024 year-end.
Adjusted Net Debt: EUR316.5 million, improved by EUR40 million from 2024 year-end.
Adjusted Net Leverage Ratio: Improved to 2.4 times from 2.7 times at year-end 2024.
Free Cash Flow Generation: EUR38.4 million.
Earnings Before Tax: EUR3.6 million, compared to EUR5.4 million in Q1 2024.
Principal Debt Repayments: EUR12.9 million.
Net Interest Payments: EUR10 million.
Regional Performance: North America stable in revenue, EUR2.3 million lower in EBITDA.
Warning! GuruFocus has detected 5 Warning Signs with FRA:9IL.
Release Date: May 30, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Intralot SA (FRA:9IL) experienced growth in revenues and stable EBITDA performance in the first quarter of 2025 compared to the previous year.
The company generated strong operating and free cash flow, with operating cash flow approximately EUR49 million, EUR22 million higher than the previous year.
Cash balance at the end of the quarter increased by EUR11.5 million compared to the end of 2024, reaching EUR76 million.
Adjusted net debt improved by around EUR40 million compared to the end of 2024, reflecting a stronger credit profile.
Revenue growth was supported by strong performances in Turkey, Argentina, and Croatia, despite challenges in the US market.
The absence of significant jackpots in the US market impacted revenue and EBITDA, with North America experiencing a EUR2.3 million decrease in EBITDA.
The growth in revenue came from jurisdictions with lower margins, such as Argentina and Turkey, affecting overall profitability.
Inflationary pressures in North America led to increased costs, contributing to lower EBITDA despite stable revenue.
The company faced a negative variance in earnings before tax due to hyperinflation indexation and higher depreciation.
The lack of multistate jackpots in the US market is a concern, as it directly affects revenue and EBITDA generation.
Q: Could you provide some color on potential uses of capital? Is the company considering any asset transactions or acquisitions? A: Nikolaos I. Nikolakopoulos, Group CEO: Currently, we are focused on executing our operational plan and deploying CapEx in projects like New Hampshire and New Zealand. Our primary focus is on generating cash and deleveraging, with no current plans for acquisitions.
Q: Regarding your refinancing strategy, is the company considering a broader refinance of the whole structure or extending maturities for a better profile? A: Andreas Chrysos, CFO: We are exploring various options to unify the capital structure and will announce plans once finalized to refinance the existing debt.
Q: Has anything changed in your outlook for the year given the stable first quarter performance and recent macro events? A: Andreas Chrysos, CFO: No changes have been made. We remain focused on executing our plan and are positive about this year's performance.
Q: In North America, revenue was stable, but EBITDA was down. Could you elaborate on the cost pressures? A: Nikolaos I. Nikolakopoulos, Group CEO: The absence of significant jackpots affected revenue, which was compensated by selling equipment and solutions. The costs associated with these sales impacted EBITDA. We believe this is a seasonal issue and expect normalization with future jackpots.
Q: For the rest of the world, revenue and EBITDA increased equally. Could you explain the cost dynamics? A: Andreas Chrysos, CFO: The growth came from jurisdictions with lower margins, such as Argentina and Turkey. It's not about increased costs but rather the mix of jurisdictions contributing to revenue growth.
Q: Can you discuss the macro environment in Argentina and its impact on growth? A: Nikolaos I. Nikolakopoulos, Group CEO: In Argentina, we provide technology and share revenue with states. The improved macro environment has led to increased player spending, benefiting our operations without additional marketing efforts from our side.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
