Accel Entertainment (ACEL) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 revenues of $309.4 million, up 5.7% year-over-year, and net income of $15 million, up 46% year-over-year, driven by growth in locations and terminals.

• Adjusted EBITDA reached a record $50 million, up 6.5% year-over-year.

• Grew to 4,034 locations and 25,757 gaming terminals, increases of 4.7% and 5.7% respectively from Q2 2023.

• Announced pending acquisition of Fairmount Holdings (FanDuel Sportsbook & Horse Racing), expected to close in Q4 2024.

• Outperformed Illinois market GGR growth, with 6% revenue growth versus 5% market-wide, and expanded to nearly 50 new locations nationwide.

Financial highlights

• Q2 2024 net revenues: $309.4 million (+5.7% year-over-year); net income: $15 million (+46%); adjusted EBITDA: $50 million (+6.5%).

• CapEx for Q2 was $18 million, with 2024 guidance of $55–$65 million, down over 20% from last year.

• Revenue per location: Illinois $862/day (+0.5%), Montana $612/day (+7.6%), Nebraska $255/day (+7.6%), Nevada $843/day (-2%).

• Adjusted EBITDA margin stable at 16% for Q2 2024.

• Cash and cash equivalents as of June 30, 2024: $254.9 million.

Outlook and guidance

• CapEx expected to trend toward $40 million annual depreciation over the long term.

• Focus remains on organic growth, M&A, and capital returns; Fairmount Holdings acquisition expected to close in Q4 2024.

• TITO implementation in Illinois anticipated within 18 months, expected to drive 5–10% market lift.

• Management expects cash, cash flows from operations, and borrowing availability to be sufficient for capital requirements over the next twelve months.

• No material impacts observed from macroeconomic conditions, but the company continues to monitor inflation and interest rates.