Scientific Games Corporation: Company Profile and SWOT Analysis by ICDResearch

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									Scientific Games Corporation

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Scientific Games Corporation                                               Financial Snapshot

                                                                           Operating Performance
Fast Facts
                                         750 Lexington Avenue, New York,   The company reported revenue of US$882.50 million
Headquarters Address
                                         10022,United States of America    during the fiscal year 2010 (2010). The company's
                                                                           revenue declined at a compounded rate of -0.41%
Telephone                                + 1 212 7542233
                                                                           during 2006–2010, with an annual decline of -4.88%
                                                                           over 2009. In 2010, the company recorded an
Fax                                      + 1 212 7542372                   operating margin of 6.32%, as against 0.52% in 2009.

Website                                  www.scientificgames.com
                                                                           Revenue and Margins
Ticker Symbol, Stock Exchange            SGMS, NASDAQ

Number of Employees                      3,200

Fiscal Year End                          December

Revenue (in US$ million)                 882.50




SWOT Analysis

Strengths                                Weaknesses                        Return on Equity

Secure market presence                   Decline in top-line performance   The company recorded a return on equity (ROE) of -
                                                                           32.96% for 2010, as compared to its peers,
                                         Dependence on North American      International Game Technology (Ticker: IGT), Intralot
Strategic inorganic growth                                                 S.A. (Ticker: INLOT) and GameTech International,
                                         market
                                                                           Inc. (Ticker: GMTC), which recorded ROEs of
Strong intellectual property portfolio                                     15.07%, 12.89% and -213.76% respectively. The
                                                                           company reported a net profit margin of 6.32% in
                                                                           2010.
Opportunities                            Threats

Growth in gaming market                  Competitive Pressure              Return on Equity


Strategic initiatives                    Currency fluctuations

                                         Piracy and unauthorized copying




                                                                           Liquidity Position

                                                                           The company reported a current ratio of 2.11 in 2010,
                                                                           as compared to its peers, International Game
                                                                           Technology,      Intralot   S.A.    and    GameTech
                                                                           International, Inc., which recorded current ratios of
                                                                           2.06, 1.92 and 0.47 respectively. As of December
                                                                           2010, the company recorded cash and short-term
                                                                           investments of worth US$124.28 million, against
                                                                           US$8.43 million current debt. The company reported
                                                                           a debt to equity ratio of 3.09 in 2010 as compared to
                                                                           its peers, International Game Technology, Intralot
                                                                           S.A. and GameTech International, Inc., which
                                                                           recorded debt to equity ratios of 1.36, 1.84 and 2.89
                                                                           respectively.




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Scientific Games Corporation - SWOT Profile                                                                       Page 1
Scientific Games Corporation

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TABLE OF CONTENTS

1     Business Analysis ................................................................................................................................... 5
    1.1       Company Overview ................................................................................................................................................5
    1.2       Business Description ..............................................................................................................................................5
    1.3       Major Products and Services .................................................................................................................................7
2     Analysis of Key Performance Indicators ............................................................................................... 8
    2.1       Five Year Snapshot: Overview of Financial and Operational Performance Indicators ..........................................8
    2.2       Key Financial Performance Indicators .................................................................................................................11
      2.2.1       Revenue and Operating Profit .........................................................................................................................11
      2.2.2       Asset, Liabilities and Capex .............................................................................................................................12
      2.2.3       Net Debt vs. Gearing Ratio ..............................................................................................................................13
      2.2.4       Operational Efficiency ......................................................................................................................................14
      2.2.5       Solvency ..........................................................................................................................................................15
      2.2.6       Valuation ..........................................................................................................................................................16
    2.3       Competitive Benchmarking ..................................................................................................................................17
      2.3.1       Efficiency ..........................................................................................................................................................17
      2.3.2       Capital Expenditure ..........................................................................................................................................18
      2.3.3       Turnover – Inventory and Asset .......................................................................................................................19
      2.3.4       Liquidity ............................................................................................................................................................20
3     Mergers & Acquisitions and Partnerships ........................................................................................... 21
    3.1       M&A and Partnerships Strategy ...........................................................................................................................21
4     SWOT Analysis ...................................................................................................................................... 22
    4.1       SWOT Analysis - Overview ..................................................................................................................................22
    4.2       Strengths ..............................................................................................................................................................22
    4.3       Weaknesses ..................................................................................
								
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