Light & Wonder Receives Optimistic Rating from Fitch Amidst Growth
Date: 2023-11-23 Author: Dima Zakharov Categories: EVENTS
Fitch's Positive Outlook
Fitch, a renowned capital market analyst, has recently updated Light & Wonder's rating, marking it as a company with an increased default risk but still financially stable. Despite some default risk, Light & Wonder has been assigned a BB rating, indicating confidence in its ability to fulfill financial commitments.
Optimistic EBITDA Leverage Targets
Fitch is optimistic about Light & Wonder's ability to reduce its EBITDA leverage to 3.7x by the end of 2023 and further to 3.3x in 2024. The agency anticipates that the actual figures may surpass these targets, driven by the company's strong gaming equipment and systems cash flow. Notably, Light & Wonder aims for leverage between 2.5x and 3.5x.
SciPlay Acquisition Boosts Business
Fitch acknowledges the positive impact of Light & Wonder's acquisition of SciPlay. The agency emphasizes that the company expects Free Cash Flow (FCF) generation and liquidity to align with its BB rating. Furthermore, Light & Wonder has approximately $200 million available under its 2022 share repurchase program, providing flexibility for future endeavors.
APAC Expansion and Financial Success
Fitch highlights Light & Wonder's expansion in the APAC region, particularly in Australia, a key market for the gambling supplier. The company has strengthened its presence in Australia by securing a secondary listing on the Australian Securities Exchange. Opportunities in markets like Singapore and the Philippines contribute to Light & Wonder's growth prospects.
Strong Q3 Financial Report
In its recent financial report for the third quarter, Light & Wonder celebrated outstanding results, marking ten consecutive quarters of revenue growth. The acquisition of SciPlay in October further fueled this success, showcasing the company's commitment to building on SciPlay's momentum.
