Another verse, just like the first.
For the second straight quarter, Everi Holdings rode growth of its financial services and gaming products to Wall Street-forecast-topping earnings and revenue. Earnings tripled from a year earlier; revenue set a quarterly record.
Also as in the second quarter, Everi didn’t mention the possible sale of the company that made headlines in the spring. Bloomberg News in May reported that Everi was working with a financial adviser to solicit potential buyout offers, including several from private equity firms.
In a statement Tuesday, Everi, a Las Vegas-based cash access products company, said net income was $9.3 million, or 12 cents per share, for the three months ended Sept. 30, up from net income of $2.1 million or 3 cents per share, a year earlier.
Analysts surveyed by Zacks Investment Research had, on average, expected net income of 7 cents per share.
Adjusted earnings before interest, taxes, depreciation and amortization, a cash flow measure that excludes one-time costs, rose 11% to $64.7 million from $58.3 million.
Revenue rose 11.9% to $134.6 million from $120.3 million and topped the $129.3 million forecast of Zacks-polled analysts.
In a statement accompanying the results, Everi CEO Michael Rumbolz said revenue and EBITDA have risen for 13 consecutive quarters.
He said the company’s games unit continued to thrive. Games segment revenues rose 5% to $69.3 million from $65.8 million and Everi’s installed base increased by 156 units year to year to a record quarter-ending level of 14,272 units on Sept. 30.
“The same innovation demonstrated in our newest premium units is also being applied to the development of our standard games, as we focus on building a deeper library of games to support our growing portfolio of cabinets,” Rumbolz said in the statement. “We believe this focus will enable Everi to deliver full-year unit sales growth and expand our ship share.”
Financial technology revenue rose 19.8% to $65.3 million from $54.5 million a year earlier, helped by $4.6 million in revenue from the player loyalty and marketing business acquired in March.
Also, cash access services revenue, which include ATM, cash advance and check services, rose 9.6% to $43.2 million from $39.4 million.
Macquarie analyst Chad Beynon has been bullish about Everi. In a September note to investors highlighted by the seekingalpha.com website, he rated the stock “outperform,” and said the small-cap gaming and financial technology “hybrid” offers consistent growth and a high degree of earnings beats.
He added that Everi’s portfolio of products and new intellectual property should keep its growth above industry peers for the near term.
Meanwhile, Everi named Atul Bali, who held executive positions at lottery business GTech and Aristocrat Technologies, to its board. Everi Board Chairman E. Miles Kilburn said Bali’s experience in online gaming and global sports betting will serve Everi particularly well.
Everi shares rose 20 cents, or 1.96%, to close at $10.39 on the New York Stock Exchange. The share price has more than doubled in 2019.
Follow Matthew Crowley on Twitter @copyjockey
