Accel Entertainment (ACEL) Q4 2020 earnings summary

Executive summary

• FY2020 revenue fell 26% YoY to $316M and Adjusted EBITDA fell 57% to $34M, reflecting COVID-related shutdowns; terminal count grew 17% to 12,247.

• Operations reopened across Illinois by Jan. 23, 2021, and returned to normal gaming hours by Feb. 5 with limited indoor dining; February was the highest-revenue month on record.

Financial highlights

• Q4 2020 revenue was $74M, down 39% YoY, and Adjusted EBITDA was $5M, down 77%; locations grew 5% to 2,435 and VGTs grew 17% to 12,247.

• FY2020 gross profit was $105M with a 33% margin; net video gaming revenue was $301M versus $411M in 2019.

• FY2020 reported net loss was $13M and Adjusted Net Income was $6M, versus a $16M reported loss and $23M Adjusted Net Income in restated 2019.

• Gaming revenue at locations open in both February 2020 and February 2021 increased 20% YoY.

Outlook and guidance

• 2021 guidance: revenue $580M–$600M, Adjusted EBITDA $95M–$100M, 2,550–2,575 locations and 13,250–13,400 VGTs.

• 2021 cash CapEx guidance is $20M–$25M; guidance includes the January shutdown and increased COVID-19 expenses, and assumes no M&A.

• Guidance reflects expected growth in locations and terminals, including Illinois sixth-machine installations.