Light & Wonder (LNW) 1 Mar 232022 Q4 Earnings call transcript

Welcome to the Light & Wonder 2022 Fourth Quarter and Full Year Earnings Conference Call. [Operator Instructions].

Now let me turn the call over to Steve Wan, Director of Investor Relations for Light & Wonder. Mr. Steve, you may begin.

good and operator you, afternoon, everyone. Thank

call, full year today's a session. we performance, will and quarter Q&A fourth our XXXX by discuss followed During results operating and

James. CEO, and With Matt today are CFO, me Connie Wilson

certain Our call today those to uncertainties contain statements discussed results during could actual materially risks may cause and that differ and they will involve from the call.

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replay As Investors be call being a of website. materials of is reminder, accompanying this our archived recorded. this and section A webcast the conference will in

that, With to over I'm pleased to call turn Matt. the

joining call. everyone today's Thanks, Steve, thanks for to and

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Connie. over to let's turn Now things

afternoon, Matt. Thank And good everyone. you,

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years, us. For is first balance advantage our the time a for in many sheet strategic

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year-to-date approximately approximately the to impacted related cash total, flow flow. million our in to by million tax including the payments. quarter was with in divestitures, Turning In review tax associated by strategic payments cash was $XXX affected our Cash divestiture. flow in costs primarily and $XXX

integrate a businesses. continued remains we top XXXX, further to priority ahead operational efficiency Looking our as

optimize spend across We content are world-class maximize by enables to offshore to platforms. continually further and opportunities This of dollar centers assessing us more leveraging our R&D. efficiently development R&D every deploying and scale

by cash to the remaining as as comps to remained In incremental drive XXXX, $XX efficiencies million well be divestitures. as will impacted tax expected, of payments flow

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capital to position. us achieve order leadership will in leveraging and key this. we core for R&D enhance are invest continue smartly to Importantly, ways our expenditures long-term capabilities and growth our bolster to

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sustainable a to continue preserve optimize the creation. in near-term to maintain will value order our growth financial profile for balances and cash flexible optionality in to We

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the turn Thank it you. your for questions. over With that, operator we'll to

first We Barry, Jonas your from line from now open. Truist. question comes Barry our have is

here? competitors maybe of to the diving around conservatism some to of target, showing are wanted X over changed $X.X would I from terms this some the in macro. next AEBITDA get so composition and note that into year Has billion. much. anything guiding your the you start cadence years there the just the Thank the the building I blocks,

So your here. curious to get thoughts

the Wilson. off start to Hi, Connie. Thanks joining call. hand Barry. I'll it Matt for and then

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markets We're we not healthy. moment end in delusional. So operate look the the really that at

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get at you how to thoughts strategy, positioning if and impacting all? you. curious your that Thank your see Just

question. Fair Yes.

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Connie. Thanks Matt. much, so Thanks

from We line have from comes Katz next your our open. now is David question David, Jefferies.

the reduction And there's the And you priorities are quarter X to everyone. maybe those or I order a about higher choices today In how versus about a discussion ago? internally. up Connie, started some of just has go capital to investing lot allocation. good do. drift quarters debt Hi, after I in the particular, thinking wonder morning or wanted to if back of particular, good evening, to

just Great. transformative just with Fundamentally, understand I'd you. I think today And to year to if for because back, where step say, so us. Good last was be are we we thanks, it's important David.

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at range our had within quarter, we for to net X.X X.Xx leverage fact, recorded X.Xx. In the of

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for to a Because Thank iGaming go to talk And mainly back hit and do but any to see we've XXXX? to mine, order you. targets I occur go you to little I your in just guess, bit wanted states deeper. some about started legalization legalizing, need

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of However, they're the scheme things. immaterial in big

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is This We land-based own. We a business. us natural content to business about into build iGaming. for content. Yes. put for It's that the

maximize to these our ourselves as come online. position to share markets is job our So

to for. coming So big happen, that's happen in way. exactly it's the investing it's going what is hard in when gaming the believe going a inevitable, but we to we're years, digitalization Again, to predict of

Me too. Thank you.

comes Craig-Hallum. your Sigdahl now Ryan, open. next question is from line Ryan Our from

talk cash free of of half sounds a think first flow the think I One, year. really deck, this through sort had this into free to going to about to you of kind of that cash of carry then of into outflows Good you it's chart think this year? achievable in year it kind it's lot Connie. Matt, get slide the year. how onetime Hey, cash the flow, back half so But helpful little afternoon. conversion targets, second I to this do and But your a of down the Is XX% the XXXX. half bit break like

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be outperforming over Josh, point to SciPlay I'd want significantly they're but follow-up, And for industry. tomorrow, but ask of the I your and switch just my I'll guys' view, curious to for

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more from that So business. to growth come

franchises if you into building do on in out those content great you what look strategic the flow cross technology to the businesses. putting didn't content, parts the evergreen its land-based in of through like wanted of leveraging that We again assets, that of that games success had to about universe. lot a franchises. the cabinets, the of and at business. specifically they that's decision taking casino, I company your and think ultimately those sweating at land iGaming, review, lottery an look of if we And we the then that of that at is the going fit this with But was those rest portfolio was divested made base, land-based look center the coming driving it's that it the the platform, the SciPlay, which sports, majority like organization deploying question be

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you. So thank

Congrats Connie. good Thanks, and Matt, luck guys.

Stantial Jeff, now Jeff your Our Stifel. is line open. from next question comes from

think Connie, taking Thanks questions. where relief timing get seeing for should more where AEBITDA broader still chain inflation looks recently, to today, stand Matt, some afternoon, our update cost their Good to where you flow the just are hoping off, through and to margins? I from and we supply Starting world Thanks. a an Great. for on was points how are Connie. of a standpoint, the this pressure about you

be you. Yes, with to absolutely. And great

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Q - Jeff Stantial

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from your is line Chad, from Beynon Chad last open. comes Our question Macquarie.

also goal. and start your In wanted sales Thanks game and execution. XXX pretty evening, and to Nice ANZ. along you in you nice America of about already Matt, talked in just talked that laid taking North the about market basis points earlier far Investor goals comments, market that share for Connie. there, in Matt, up one probably executing question. share with some at Australia you wins out the Good my Day,

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to back and at Dragon the again, half presale So are the Frankenstein come more of the in in moment, year.

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XXXX. one The see market a into expected we to was first recovery

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think that So then combination and we're entering these the time. adjacencies it's core replacement I the market over of

So the direction feeling convicted about there. of travel

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we're run in that been development best-in-class acquisition Yes. exceptional, knows our the Advantage. to India, Wolfe, teams. the amount knows brought made how Thanks, with to working time who the operator's pain kind [ph] in a spending of Chad. portfolio. House of. like We technology Jon is pretty He's an systems his [Adjacent] leader proud points, a We good over team. of of area That's

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see it QX, So QX. was good close momentum into we to and a great heading

things, new leader felt that's underinvested, a take really really it's good we've and retooling, feeling a needed bit system got Jon, reinvigorated and we some direction. a about what to that he's business forward, like with the yes, So was us needed

Appreciate Thanks. it.

Matt? Wilson, the Matt further Light hand on will of & no have CEO back We line. to now I questions Wonder.

Yes. transformative to our double-digit driving business, we've Thank setting We've and laid out for targets your and in up May. success support. delivered and last long-range growth time plan while all ambitious you on an operational the achieve us

Our energized enthusiastic our about teams the and around opportunities. world are

in testament these people in come. trying that group more I'll close we momentum a to build and the the year the achieving by real just We're who great never about a saying future, to see Wonder. continuing strong excited been Light at dedicated great are to to business have behind culture great numbers of things, here we're our &

great our of behalf everyone to and us thank in of on a deliver on strong opportunities you the rest for ahead and position industry-leading and put Our On capitalize talent, a have time, convergence. day. your games product in here, enormous technology your roadmap, lead industry