{"id":246759,"date":"2022-12-06T18:33:28","date_gmt":"2022-12-07T00:33:28","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=246759"},"modified":"2022-12-06T18:54:34","modified_gmt":"2022-12-07T00:54:34","slug":"light-wonder-gets-junk-credit-grade-from-fitch-ratings","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/","title":{"rendered":"Light & Wonder Lands Junk Grade From Fitch"},"content":{"rendered":"

Light & Wonder (NASDAQ: LNW) garnered a non-investment credit grade of \u201cBB\u201d in a report published by Fitch Ratings yesterday.<\/p>\n

\"Light
Light & Wonder signage at a roulette table. Fitch placed a junk rating on the company. (Image: Twitter)<\/figcaption><\/figure>\n

A \u201cstable\u201d outlook accompanies that rating. The Las Vegas-based gaming device manufacturer has long been raising cash in an effort to firm its balance sheet and potentially bolster its credit profile. Last year, the company announced sales of its OpenBet sports wagering and SG Lottery units, which enabled the firm to slash its debt to $4 billion from $8.8 billion<\/a>.<\/p>\n

Fitch believes LNW’s credit profile remains consistent with ‘BB’, due to robust free cash flow generation, strong liquidity, and still conservative leverage. Fitch forecasts LNW’s gross leverage will decline below 4.0x by 2023 through earnings before interest, taxes, depreciation, and amortization (EBITDA) growth (3.8x), though Fitch previously expected LNW to reach mid-3x by YE 2022,\u201d<\/strong> according to the research firm.<\/p><\/blockquote>\n

On Fitch\u2019s ratings scale, a \u201cBB\u201d grade implies increased potential of issuer default in the event of a sudden shift in business or broader economic conditions. But issuers with that grade usually have the flexibility to adequately service debt obligations.<\/p>\n

Light & Wonder Leverage Reduction Efforts<\/h2>\n

Light & Wonder\u2019s debt-paring efforts are paying off in the form of a lower leverage ratio<\/a>, which could eventually lead to a stronger credit rating.<\/p>\n

\n

As a result of the debt reduction, Light & Wonder reduced its net debt leverage ratio to 3.9x from 6.2x. By trimming its net debt leverage to 3.9x, Light & Wonder is within striking distance of its desired range of 2.5x to 3.5x.<\/p>\n<\/div>\n

Efforts to further reduce debt, which are highly pertinent against the backdrop of rising interest rates<\/a>, are further supported by Light & Wonder\u2019s enviable share in the premium slot machine market.<\/p>\n

\u201cThe company garners low-20% market share for both slot sales and installed base of premium slots in North America, which has come down considerably over the last decade as peers aggressively entered the market,\u201d added Fitch. \u201cWith this share, the company comfortably remains a top three supplier, and the company consistently rolls out attractive new content and cabinets that has helped maintain a leading competitive position.\u201d<\/p>\n

Light & Wonder Digital Exposure Could Pay Off<\/h2>\n

Light & Wonder is also making moves in the digital gaming arena, which could pay off for the balance sheet and investors over the long haul.<\/p>\n

Some investors are pushing the company to revisit a takeover offer for SciPlay (NASDAQ: SCPL). Light & Wonder owns 81% of SciPlay. Formerly the social gaming division of Scientific Games<\/a>, SciPlay was spun off from that company in 2019. SciPlay\u2019s well-known offerings are Jackpot Party, Quick Hit Slots, Gold Fish Casino Slots, Hot Shot Casino, 88 Fortunes, Bingo Showdown, <\/em>and Monopoly Slots.<\/em> The games are free to play, but feature in-app purchases.<\/p>\n

\u201cFitch expects the company to pursue more casual mobile gaming development as an avenue for revenue growth, which could lead to increased R&D and tuck-in acquisitions for talent or proven game titles,\u201d <\/strong>noted the ratings agency.<\/p>\n","protected":false},"excerpt":{"rendered":"

Light & Wonder (NASDAQ: LNW) garnered a non-investment credit grade of \u201cBB\u201d in a report published by Fitch Ratings yesterday. A \u201cstable\u201d outlook accompanies that rating. The Las Vegas-based gaming device manufacturer has long been raising cash in an effort to firm its balance sheet and potentially bolster its credit profile. Last year, the company […]<\/p>\n","protected":false},"author":46,"featured_media":246760,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,19,69293],"tags":[81903,81931,81890],"acf":[],"yoast_head":"\nLight & Wonder Gets Junk Credit Grade From Fitch Ratings<\/title>\n<meta name=\"description\" content=\"Light & Wonder rated junk, but debt reduction highlighted by Fitch Ratings.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Light & Wonder Gets Junk Credit Grade From Fitch Ratings\" \/>\n<meta property=\"og:description\" content=\"Light & Wonder rated junk, but debt reduction highlighted by Fitch Ratings.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2022-12-07T00:33:28+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-12-07T00:54:34+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1920\" \/>\n\t<meta property=\"og:image:height\" content=\"1080\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/\",\"url\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/\",\"name\":\"Light & Wonder Gets Junk Credit Grade From Fitch Ratings\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"datePublished\":\"2022-12-07T00:33:28+00:00\",\"dateModified\":\"2022-12-07T00:54:34+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Light & Wonder rated junk, but debt reduction highlighted by Fitch Ratings.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/light-wonder-gets-junk-credit-grade-from-fitch-ratings\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2022\/12\/lnw.jpg\",\"width\":1920,\"height\":1080,\"caption\":\"Light & Wonder signage at a roulette table. 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