Scientific cuts 1,000 jobs through Bally synergy savings

Scientific cuts 1,000 jobs through Bally synergy savings

Tuesday, August 4, 2015 Totally Gaming
Scott Schweinfurth said that no more redundancies are likely

Scientific Games says that 1,000 jobs have been cut through synergy savings since its $5.1bn (€4.65bn) acquisition of Bally Technologies last November.

The gaming operator's chief financial officer Scott Schweinfurth revealed the number of job losses associated with one of the industry’s biggest M&A deals in a conference call after announcing that revenue increased by 65.8 per cent year-on-year to $691.5m during Q2.

Schweinfurth said no more redundancies are expected - among a workforce estimated at around 9,000 in March 2015 - and added that the company now predicts savings of $200m this year, which is up around six per cent on the previously announced $188m.

While the takeover propelled revenue growth, operations were hit hard with a $102.2m loss during the quarter - including the $2.2m spent on employee termination and restructuring - which was even more than the $72.4m hit recorded during the same period in 2014. However, chief executive and president Gavin Isaacs believes that positive figures are not far away.

“Throughout the second quarter we made further significant progress on implementing our key initiatives targeting revenue growth opportunities, advancing our comprehensive integration efforts and implementing our planned cost savings,” Isaacs said.

“Our focus on accelerating revenue growth is balanced with our commitment to deliver the realisation of anticipated cost savings that will drive expected further enhancement of operating margin and cash flow in the second half of 2015 and beyond.

“We expect the progress from rapidly implementing our integration strategies during the first half of 2015 will be favourably reflected in our performance during the second half of this year.”

Scientific’s gaming segment, which includes slot machine sales, grew revenue to $449.7m from $176.9 million last year, largely thanks to the Bally merger. The interactive segment, which includes social gaming apps, rose to $51.6m from $32.2m last year, while lottery revenue fell 8.5 per cent to $190.2 million.

Isaacs is particularly pleased with recent new product introductions, such as games based on television shows Friends and The Flintstones, and the WMS-branded s32 hybrid slant slot cabinet.

"We have heightened our focus on innovation to take advantage of the unique value proposition we can deliver to drive growth for our customers,” Isaacs said.

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