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UPDATE 1-GTECH confirms guidance after Q2 core profit down slightly
July 31, 2014 / 7:35 PM / in 3 years

UPDATE 1-GTECH confirms guidance after Q2 core profit down slightly

(Recasts with guidance, adds details from conference call)

MILAN, July 31 (Reuters) - Italian gaming group GTECH on Thursday confirmed its full-year guidance and said core earnings edged slightly lower in the second quarter due to a strong comparison period last year that was boosted by a significant order from Canada.

The group said in March it was targeting higher revenues of 3.15-3.25 billion euros for the whole year, up from 3.06 billion euros in 2013. Core earnings are expected in the range of 1.06-1.1 billion euros in 2014, up from 1.04 billion last year.

We are “confident of reaching the year-end guidance in the light of the results of the second quarter, comparable to the historic highs of 2013,” Chief Executive Marco Sala said during the company’s post-results conference call.

The Rome-based group, which recently sealed a deal worth $4.7 billion to buy Las Vegas-based IGT, said earnings before interest, tax, depreciation and amortisation (EBITDA) fell 2.4 percent to 266.6 million euros ($357 million) in the second quarter. Sales fell 1.4 percent to 751.1 million euros.

Sala pointed to improving results in Italy where higher income from Lotto almost fully offset lower instant-ticket sales. Total Italian revenues rose slightly to 425 million euros.

GTECH managers explained during the conference call that the company had decided not to participate in the final phase of a privatisation tender to operate Turkey’s national lottery for 10 years because it no longer appeared economically viable.

The lottery licence was won by Net Sans-Hitay, a unit of Turkish tourism company Net Holding

GTECH shares closed down 1.6 percent at 18 euros on Thursday, in line with Milan’s blue-chip index.

$1 = 0.7469 Euros Reporting by Agnieszka Flak and Claudia Cristoferi; Editing by Robin Pomeroy

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