Half Year 2019
Revenues
In the first half of 2019, the NOVOMATIC Group generated EUR 1,264.7 million in revenues, compared to EUR 1,287.3 million in the same period of 2018.
The largest decrease in revenues in absolute figures was recorded in the area of revenues from the operation of gaming machines, which declined by EUR 25.8 million (-4.1 percent). The expected weaker performance of the TR 5.0 devices in Germany and the increase of the stake-dependent gaming fees in Italy contributed significantly to this development. Conversely, the core markets of the United Kingdom, Spain, Austria and the Netherlands reported rising slot machine revenues due to site roll-outs and performance improvements at existing locations, which partially offset the declines in Germany and Italy.
EBITDA
Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to EUR 297.1 million in the first half of the year, which is EUR 15.9 million below the result achieved in the first half of 2018. The EBITDA margin in the first half of 2019 was 23.5 percent, which is 0.8 percentage points below the previous year’s level. The operating result (EBIT) declined by EUR 110.7 million to EUR 47.5 million, as depreciation, amortization, and impairments increased by EUR 94.8 million. The increase in depreciation and amortization is mainly attributable to the first-time recognition of the depreciation on right-of-use assets as per IFRS 16 (EUR 63.3 million) as well as increased scheduled depreciation and impairment losses on gaming devices in Germany.
Equity ratio
Equity increased by EUR 9.3 million to EUR 1,367.9 million. The increase resulted primarily from the positive net income in the first half of the financial year less dividend distributions.
Cash Flow
Cash flow from operating activities in the first half of 2019 of EUR 242.6 million was higher than in the same period of the previous year by EUR 74.8 million. In particular, this was due to changes in the presentation from the first-time application of IFRS 16 and a decrease in the cash outflow for corporate tax payments of EUR 60.7 million.
The cash flow from investment activities changed from EUR -464.8 million in 2018 to EUR -56.3 million during the reporting period. In particular, the item “Acquisition of consolidated companies, net of cash” should be noted. Cash outflows, which in the previous year had been caused in particular by the acquisition of Ainsworth Game Technology Ltd., declined by EUR 310.8 million. In addition, investments in intangible assets and property, plant and equipment decreased by EUR 58.1 million in the reporting period. The lower cash outflow is attributable to the current consolidation efforts. A further positive effect is attributable to the sale of the subsidiaries in Croatia. In total, disposals resulted in cash inflows of EUR 40.4 million, compared with EUR 15.1 million in the same period of the previous year.
Cash flow from financing activities changed from EUR -144.0 million in the prior year period to EUR -158.6 million in the first half of 2019. The difference results mainly from two opposing effects. On the one hand, the negative deviation against the previous year is due to the redemption of a bond in the amount of EUR 246.0 million. On the other hand, a cash inflow from net increase in bank loans of EUR 210.2 million was generated in the first half of 2019, mainly through the utilization of the revolving credit line in the amount of EUR 230 million. In the previous year, loan repayments had resulted in a cash outflow of EUR 88.5 million. In addition, the first-time application of IFRS 16 resulted in the disclosure of payments under finance leases, which increased the cash outflow from financing activities by a further EUR 69.2 million.
