Light & Wonder outlines hard targets for new 2025 vision
Light & Wonder Inc, the new corporate identity of a transformed Scientific Games Corporation (SGC), has outlined to investors its objective of achieving a $1.4 billion EBITDA target by 2025.
The 2025 earnings target declared to investors will require Light & Wonder to match a compound annual growth rate (CAGR) of 15%.
The Nasdaq technology group, which during Q1 trading offloaded its heritage lottery unit to PE fund Brookfield Partners for $5.8 billion, stated that it was in a “leading position to capitalize on cross-platform opportunities” focusing on its future growth in the global online gambling sector estimated to be worth $70 billion.
Presenting its 2025 vision, Light & Wonder further declared that it would improve its “cash flow generation to reflect a free cash flow conversion rate of 45% by 2025 trading”.
The sale of SGC’s lottery unit has freed “$10 billion of available capital to deploy through the group’s balanced and opportunistic capital allocation priorities”.Further hard targets see Light & Wonder aim to bring down its net debt leverage ratio range to between 2.5x-to-3.5x.
Group President & CEO Barry Cottle outlined confidence in the firm achieving its hard targets, as Light and Wonder held the sector’s ‘deepest operator relationships’, ‘best tech talent and resources’ and ‘greatest collection of IP and content’.
“We have transformed ourselves to take full advantage of our unmatched market position to capitalise on this opportunity. Our unique asset mix and leading market positions provide unparalleled advantages to deliver games fully cross-platform,” Cottle told investors.
“This results in an enviable and durable financial profile, which includes double-digit growth, a high mix of recurring revenues and robust margins, all translating into robust cash flow generation. With a clear roadmap to take market share and drive long-term shareholder value creation, I’m very confident that Light & Wonder will be the one to lead the future of the games industry.”