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SciPlay Details Planned Social Gaming IPO

Viviane Stamm - 25-04-2019

SciPlay Details Planned Social Gaming IPOSciPlay, the social gaming arm of international tech giant Scientific Games, has laid out the details of a planned initial public offering (IPO) of its Class A common stock. In doing so, the firm has made clear its aim to raise as much as $352 million for its social operations.

A total number of 22 million shares are set to be made available through the new offering, and each of them is expected to be priced at around $14 to $16. Underwriters will also reportedly be granted a 30-day option to buy an additional 3.3 million Class A common stock shares should they wish to do so.

More Info About the IPO Revealed

SciPlay is planning to trade its shares on the NASDAQ Global Select Market under its original ticker symbol ‘SCPL’, as was revealed in the company’s announcement of the IPO earlier this April. BofA Merrill Lynch, J.P. Morgan Securities and Deutsche Bank Securities will all be acting as lead book-running managers for the IPO in question, while RBC Capital Markets, Morgan Stanley, Goldman Sachs and Macquarie Capital will act as the offering’s dedicated book running managers. Wedbush Securities and Stifel, Nicolaus & Co. will be serving as co-managers, according to Scientific Games’ statement.

In a mandatory filing with the US Securities and Exchange Commission, Vegas-based Scientific Games has also outlined preliminary results for its successful social gaming sector for the first quarter of the financial year.

According to the filing, revenue for the period in question is expected to come in at around $117 million to $119 million for the three months ended March 31, 2019, up from $97.5 million during the same period of the previous year. Scientific has credited the increase to an upswing in mobile revenues, which constituted nearly all of the aforementioned revenue increase.

Q1 2019 Revenues to Reach $117m

With that said, the firm’s internet platform revenue decreased overall due to a drop in player numbers as a result of customer preferences causing a migration to mobile gambling platforms. Net income for Scientific is predicted to improve from a $1.1 million loss to a $13 million to $15 million profit, boosted by an $18 million contingent acquisition consideration decrease.

Operating expenses for the social gaming arm’s business segment are expected to remain level at around $97 million, primarily because of lower contingent consideration remeasurement charges. EBITDA is predicted to grow from $22.7 million to around $24 million as a result of the increased revenues.

In February this year, Scientific published its full-year 2018 results for its social gaming arm, revealing a revenue increase of 14.9% to $415.9 million. Digital revenues trebled to $269.6 million, pushing the firm’s total revenues up by 9.1%, although Scientific did still post a loss of $352.4 million over the previous year due to higher operating costs in 2018.