Accel Entertainment (ACEL) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenues reached $302.2 million, up 5.1% year-over-year, with adjusted EBITDA of $45.9 million, reflecting growth in locations and gaming terminals.

• Net income for Q3 2024 was $4.9 million, down 53% year-over-year, primarily due to higher operating expenses and fair value adjustments on contingent earnout shares.

• Operated 25,729 gaming terminals across 4,014 locations as of September 30, 2024, up 4.1% and 2.8% year-over-year, respectively.

• Announced and progressed acquisitions in Louisiana and Fairmount Holdings (FanDuel Sportsbook & Horse Racing), both expected to close in Q4 2024.

• Share repurchase program continued, with $6.2 million spent in Q3 2024 and 585,119 shares repurchased.

Financial highlights

• Q3 2024 net revenues: $302.2 million (+5.1% year-over-year); adjusted EBITDA: $45.9 million (+3.9% year-over-year); net income: $4.9 million (down 53.2%).

• YTD 2024 net revenues: $913.5 million (+4.6% year-over-year); YTD net income: $26.9 million.

• CapEx for Q3 2024 was $17 million (down 9% year-over-year); 2024 CapEx projected at $60–$65 million.

• Net debt at quarter-end: $289 million; cash and cash equivalents: $265.1 million; $273 million available under credit agreement.

• Gross margin for Q3 2024 was approximately 30.2%; adjusted EBITDA margin: 15.2%.

Outlook and guidance

• Pending acquisitions in Louisiana and Illinois expected to close in Q4 2024, expanding distributed gaming footprint.

• CapEx for 2024 projected at $60–$65 million, with a long-term target of $40 million.

• TITO rollout in Illinois anticipated in H1 2025, expected to enhance player experience and drive growth.

• Management expects cash, cash flows from operations, and borrowing availability to be sufficient for capital requirements over the next 12 months.

• Firm backlog of contracted locations waiting to go live supports future growth.