COVER PAGE
COVER PAGE - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 04, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-38889 | |
Entity Registrant Name | SciPlay Corporation | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 83-2692460 | |
Entity Address, Address Line One | 6601 Bermuda Road | |
Entity Address, City or Town | Las Vegas | |
Entity Address, State or Province | NV | |
Entity Address, Postal Zip Code | 89119 | |
City Area Code | 702 | |
Local Phone Number | 897-7150 | |
Title of 12(b) Security | Class A Common Stock, $.001 par value | |
Trading Symbol | SCPL | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Amendment Flag | false | |
Entity Central Index Key | 0001760717 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Common Class A | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 24,444,101 | |
Common Class B | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 103,547,021 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | ||
Income Statement [Abstract] | |||||
Revenue | $ 154 | $ 165.6 | $ 305.1 | $ 283.9 | |
Operating expenses: | |||||
Cost of revenue | [1] | 48 | 52.6 | 95.1 | 90.5 |
Sales and marketing | [1] | 34.1 | 35.1 | 68.8 | 63.3 |
General and administrative | [1] | 18 | 15.2 | 33.7 | 25.4 |
Research and development | [1] | 9.5 | 8.2 | 19 | 15.5 |
Depreciation and amortization | 3.5 | 2.2 | 6.9 | 4.2 | |
Restructuring and other | 1.1 | 1 | 1.4 | 1.5 | |
Operating income | 39.8 | 51.3 | 80.2 | 83.5 | |
Other (expense) income, net | (0.1) | 0.6 | (0.5) | 1.1 | |
Net income before income taxes | 39.7 | 51.9 | 79.7 | 84.6 | |
Income tax expense | 1.8 | 3.1 | 3.9 | 4.7 | |
Net income | 37.9 | 48.8 | 75.8 | 79.9 | |
Less: Net income attributable to the noncontrolling interest | 32 | 42.2 | 64.6 | 68.9 | |
Net income attributable to SciPlay | $ 5.9 | $ 6.6 | $ 11.2 | $ 11 | |
Basic and diluted net income attributable to SciPlay per share: | |||||
Basic (in dollars per share) | $ 0.24 | $ 0.29 | $ 0.47 | $ 0.48 | |
Diluted (in dollars per share) | $ 0.24 | $ 0.27 | $ 0.45 | $ 0.45 | |
Weighted average number of shares of Class A common stock used in per share calculation: | |||||
Basic shares (in shares) | 24.4 | 22.8 | 23.8 | 22.7 | |
Diluted shares (in shares) | 24.7 | 24.2 | 24.9 | 24.2 | |
[1] | (1) Excludes depreciation and amortization. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 37.9 | $ 48.8 | $ 75.8 | $ 79.9 |
Other comprehensive income: | ||||
Foreign currency translation gain (loss), net of tax | 2 | 0.9 | (0.6) | 0.1 |
Total comprehensive income | 39.9 | 49.7 | 75.2 | 80 |
Less: comprehensive income attributable to the noncontrolling interest | 33.7 | 42.9 | 64.1 | 69 |
Comprehensive income attributable to SciPlay | $ 6.2 | $ 6.8 | $ 11.1 | $ 11 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 300.8 | $ 268.9 |
Accounts receivable, net | 51.1 | 36.6 |
Prepaid expenses and other current assets | 13.7 | 5.9 |
Total current assets | 365.6 | 311.4 |
Property and equipment, net | 4 | 4.4 |
Operating lease right-of-use assets | 7.6 | 8.5 |
Goodwill | 129.3 | 129.8 |
Intangible assets and software, net | 44.8 | 30.3 |
Deferred income taxes | 78.8 | 82.5 |
Other assets | 1.8 | 1.9 |
Total assets | 631.9 | 568.8 |
Current liabilities: | ||
Accounts payable | 18.9 | 23.2 |
Accrued liabilities | 30.3 | 22.9 |
Due to affiliate | 4.3 | 5.5 |
Total current liabilities | 53.5 | 51.6 |
Operating lease liabilities | 6.4 | 7.5 |
Liabilities under TRA | 68.5 | 68.5 |
Other long-term liabilities | 14.6 | 5.7 |
Total liabilities | 143 | 133.3 |
Commitments and contingencies (see Note 8) | ||
Stockholders’ equity: | ||
Additional paid-in capital | 44.9 | 46.1 |
Retained earnings | 44.1 | 32.9 |
Accumulated other comprehensive income | 0.8 | 0.9 |
Total SciPlay stockholders’ equity | 89.9 | 80 |
Noncontrolling interest | 399 | 355.5 |
Total stockholders’ equity | 488.9 | 435.5 |
Total liabilities and stockholders’ equity | 631.9 | 568.8 |
Common Class A | ||
Stockholders’ equity: | ||
Common stock | 0 | 0 |
Common Class B | ||
Stockholders’ equity: | ||
Common stock | 0.1 | $ 0.1 |
Total stockholders’ equity | $ 0.1 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2021 | Dec. 31, 2020 |
Common Class A | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 625,000,000 | 625,000,000 |
Common stock, shares issued (in shares) | 24,400,000 | 22,800,000 |
Common stock, shares outstanding (in shares) | 24,400,000 | 22,800,000 |
Common Class B | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 130,000,000 | 130,000,000 |
Common stock, shares issued (in shares) | 103,500,000 | 103,500,000 |
Common stock, shares outstanding (in shares) | 103,500,000 | 103,500,000 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) shares in Millions, $ in Millions | Total | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss) | Noncontrolling interest | Common Class ACommon Stock | Common Class B | Common Class BCommon Stock |
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2019 | 22.7 | 103.5 | ||||||
Stockholders' equity, beginning balance at Dec. 31, 2019 | $ 277.5 | $ 41.7 | $ 12 | $ 0.3 | $ 223.4 | $ 0 | $ 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 31.1 | 4.4 | 26.7 | |||||
Stock-based compensation | 0.1 | 0.2 | (0.1) | |||||
Currency translation | (0.8) | (0.2) | (0.6) | |||||
Stockholders' equity, ending balance (in shares) at Mar. 31, 2020 | 22.7 | 103.5 | ||||||
Stockholders' equity, ending balance at Mar. 31, 2020 | 307.9 | 41.9 | 16.4 | 0.1 | 249.4 | $ 0 | $ 0.1 | |
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2019 | 22.7 | 103.5 | ||||||
Stockholders' equity, beginning balance at Dec. 31, 2019 | 277.5 | 41.7 | 12 | 0.3 | 223.4 | $ 0 | $ 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 79.9 | |||||||
Distributions to Parent and affiliates, net | (11.6) | |||||||
Currency translation | 0.1 | |||||||
Stockholders' equity, ending balance (in shares) at Jun. 30, 2020 | 22.8 | 103.5 | ||||||
Stockholders' equity, ending balance at Jun. 30, 2020 | 351.1 | 42.9 | 23 | 0.3 | 284.8 | $ 0 | $ 0.1 | |
Stockholders' equity, beginning balance (in shares) at Mar. 31, 2020 | 22.7 | 103.5 | ||||||
Stockholders' equity, beginning balance at Mar. 31, 2020 | 307.9 | 41.9 | 16.4 | 0.1 | 249.4 | $ 0 | $ 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 48.8 | 6.6 | 42.2 | |||||
Stock-based compensation | $ 5.1 | 1 | 4.1 | |||||
Vesting of RSUs, net of tax withholdings (in shares) | 0.1 | |||||||
Distributions to Parent and affiliates, net | $ (11.6) | (11.6) | ||||||
Currency translation | 0.9 | 0.2 | 0.7 | |||||
Stockholders' equity, ending balance (in shares) at Jun. 30, 2020 | 22.8 | 103.5 | ||||||
Stockholders' equity, ending balance at Jun. 30, 2020 | 351.1 | 42.9 | 23 | 0.3 | 284.8 | $ 0 | $ 0.1 | |
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2020 | 22.8 | 103.5 | ||||||
Stockholders' equity, beginning balance at Dec. 31, 2020 | 435.5 | 46.1 | 32.9 | 0.9 | 355.5 | $ 0 | $ 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 37.9 | 5.3 | 32.6 | |||||
Stock-based compensation | $ 1.8 | 0.4 | 1.4 | |||||
Vesting of RSUs, net of tax withholdings (in shares) | 1.6 | |||||||
Vesting of RSUs, net of tax withholdings | $ (12.3) | (2.3) | (10) | |||||
Distributions to Parent and affiliates, net | (0.3) | (0.3) | ||||||
Currency translation | (2.6) | (0.4) | (2.2) | |||||
Stockholders' equity, ending balance (in shares) at Mar. 31, 2021 | 24.4 | 103.5 | ||||||
Stockholders' equity, ending balance at Mar. 31, 2021 | 460 | 44.2 | 38.2 | 0.5 | 377 | $ 0 | $ 0.1 | |
Stockholders' equity, beginning balance (in shares) at Dec. 31, 2020 | 22.8 | 103.5 | ||||||
Stockholders' equity, beginning balance at Dec. 31, 2020 | 435.5 | 46.1 | 32.9 | 0.9 | 355.5 | $ 0 | $ 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 75.8 | |||||||
Distributions to Parent and affiliates, net | (14.1) | |||||||
Currency translation | (0.6) | |||||||
Stockholders' equity, ending balance (in shares) at Jun. 30, 2021 | 24.4 | 103.5 | ||||||
Stockholders' equity, ending balance at Jun. 30, 2021 | 488.9 | 44.9 | 44.1 | 0.8 | 399 | $ 0 | 0.1 | |
Stockholders' equity, beginning balance (in shares) at Mar. 31, 2021 | 24.4 | 103.5 | ||||||
Stockholders' equity, beginning balance at Mar. 31, 2021 | 460 | 44.2 | 38.2 | 0.5 | 377 | $ 0 | 0.1 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 37.9 | 5.9 | 32 | |||||
Stock-based compensation | 2.8 | 0.7 | 2.1 | |||||
Distributions to Parent and affiliates, net | (13.8) | (13.8) | ||||||
Currency translation | 2 | 0.3 | 1.7 | |||||
Stockholders' equity, ending balance (in shares) at Jun. 30, 2021 | 24.4 | 103.5 | ||||||
Stockholders' equity, ending balance at Jun. 30, 2021 | $ 488.9 | $ 44.9 | $ 44.1 | $ 0.8 | $ 399 | $ 0 | $ 0.1 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Statement of Cash Flows [Abstract] | ||
Net cash provided by operating activities | $ 68.3 | $ 75.5 |
Cash flows from investing activities: | ||
Capital expenditures | (7.1) | (3.2) |
Acquisition of business, net of cash acquired | 0 | (12.6) |
Net cash used in investing activities | (7.1) | (15.8) |
Cash flows from financing activities: | ||
Payments under tax receivable agreement | 0 | (2.5) |
Payments on license obligations | (1.8) | 0 |
Payments of contingent consideration | (1) | 0 |
Distributions to Scientific Games and affiliates, net | (14.1) | (11.6) |
Taxes paid related to net share settlement of equity awards | (12.3) | 0 |
Net cash used in financing activities | (29.2) | (14.1) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (0.1) | (0.1) |
Increase in cash, cash equivalents and restricted cash | 31.9 | 45.5 |
Cash, cash equivalents and restricted cash, beginning of period | 268.9 | 110.6 |
Cash, cash equivalents and restricted cash, end of period | (300.8) | (156.1) |
Supplemental cash flow information: | ||
Cash paid for income taxes | 4.1 | 1.5 |
Cash paid for contingent consideration included in operating activities | 0 | 4 |
Supplemental non-cash transactions: | ||
Non-cash additions to intangible assets related to license agreements | $ 14 | $ 0 |
Description of the Business and
Description of the Business and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of the Business and Summary of Significant Accounting Policies | Description of the Business and Summary of Significant Accounting Policies Background and Nature of Operations SciPlay Corporation was formed as a Nevada corporation on November 30, 2018 as a subsidiary of Scientific Games Corporation (“Scientific Games”, “SGC”, and “Parent”) for the purpose of completing a public offering and related transactions (collectively referred to herein as the “IPO”) in order to carry on the business of SciPlay Parent LLC and its subsidiaries (collectively referred to as “SciPlay”, the “Company”, “we”, “us”, and “our”). The IPO was completed on May 7, 2019. As the managing member of SciPlay Parent LLC, SciPlay operates and controls all of the business affairs of SciPlay Parent LLC and its subsidiaries. On July 15, 2021, Scientific Games submitted a proposal to our board of directors to acquire all the outstanding equity interest in SciPlay not already owned by Scientific Games (approximately 19%). The offer to all SciPlay shareholders (other than Scientific Games and it’s subsidiaries) is the receipt of 0.250 shares of Scientific Games common stock for each share of SciPlay Class A common stock. The transaction is subject to the negotiation and execution of a mutually acceptable merger agreement with a special committee of our board of directors, and we cannot guarantee that the proposal will result in a merger or any other transactions. We develop, market and operate a portfolio of social games played on various mobile and web platforms, including Jackpot Party Casino®, Quick Hit Slots®, Gold Fish Casino®, Hot Shot Casino®, Bingo Showdown®, MONOPOLY Slots® , and 88 Fortunes Slots®, among others. Our games are available in various formats. We have one operating segment with one business activity, developing and monetizing social games. Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). All intercompany balances and transactions have been eliminated in consolidation. In the opinion of management, we have made all adjustments necessary to present fairly our consolidated statements of income, consolidated statements of comprehensive income, condensed consolidated balance sheets, consolidated statements of changes in stockholders’ equity and condensed consolidated statements of cash flows for the periods presented. Such adjustments are of a normal, recurring nature. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and related Notes included in our 2020 Form 10-K. Interim results of operations are not necessarily indicative of results of operations to be expected for a full year. Variable Interest Entities (“VIE”) and Consolidation Subsequent to the IPO, our sole material asset is our member’s interest in SciPlay Parent LLC. In accordance with the Operating Agreement of SciPlay Parent LLC (the “Operating Agreement”), we have all management powers over the business and affairs of SciPlay Parent LLC and to conduct, direct and exercise full control over the activities of SciPlay Parent LLC. Class A common stock issued in the IPO do not hold majority voting rights but hold 100% of the economic interest in the Company, which results in SciPlay Parent LLC being considered a VIE. Due to our power to control the activities most directly affecting the results of SciPlay Parent LLC, we are considered the primary beneficiary of the VIE. Accordingly, beginning with the IPO, we consolidate the financial results of SciPlay Parent LLC and its subsidiaries. Significant Accounting Policies There have been no changes to our significant accounting policies described within the Notes of our 2020 Form 10-K, except as noted below. Minimum guarantees under licensing agreements We enter into long-term license agreements with third parties in which we are obligated to pay a minimum guaranteed amount of royalties, typically periodically over the life of the contract. These license agreements provide us with access to a portfolio of major brands to be used across our games. We account for the minimum guaranteed obligations within Current liabilities and Other long-term liabilities at the onset of the license arrangement and record a corresponding licensed asset within intangible assets, net. The licensed intangible assets related to the minimum guaranteed obligations are amortized over the term of the license agreement with the amortization expense recorded in Depreciation and amortization. The long-term liability related to the minimum guaranteed obligations is reduced as royalty payments are made as required under the license agreement. We assess the recoverability of license agreements whenever events arise or circumstances change that indicate the carrying value of the licensed asset may not be recoverable. Recoverability of the licensed asset and the amount of impairment, if any, are determined using our policy for intangible assets with finite useful lives. The following reflects amortization expense related to these licenses and recorded in depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 1.1 $ 0.2 $ 2.3 $ 0.4 The following are our total minimum guaranteed obligations for the periods presented: As of June 30, December 31, 2021 2020 Current liabilities $ 5.0 $ 2.6 Other long-term liabilities 10.0 0.3 Total minimum guarantee obligation $ 15.0 $ 2.9 Weighted average remaining term (in years) 3.7 2.4 Revolving Credit Facility On May 27, 2021, SciPlay Holding Company, LLC (“SciPlay Holding”), a wholly-owned indirect subsidiary of SciPlay Corporation (the “Company”), entered into Amendment No. 1 to that certain $150.0 million revolving credit agreement, dated as of May 7, 2019 (the “Revolver”), by and among SciPlay Holding, SciPlay Parent Company, LLC, the several banks and other financial institutions or entities from time to time party thereto and Bank of America, N.A., as administrative agent, collateral agent and issuing lender (such amendment, “Amendment No. 1”). Amendment No. 1 amended, among other things, certain negative covenants in the Revolver to permit SciPlay Holding to merge or consolidate with and into its direct subsidiary, Phantom EFX, LLC, which was renamed SciPlay Games, LLC (“SciPlay Games”) immediately following such merger. Substantially simultaneously with the merger, SciPlay Games expressly assumed all obligations of SciPlay Holding as the successor borrower under the Revolver. The Revolver was undrawn as of June 30, 2021. We were in compliance with the financial covenants under the Revolver as of June 30, 2021. New Accounting Guidance - Not Yet Adopted The FASB issued ASU No. 2020-04 and subsequently ASU No. 2021-01, Reference Rate Reform (Topic 848) in March 2020 and January 2021, respectively. The new guidance provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, including derivative instruments impacted by changes in the interest rates used for discounting cash flows for computing variable margin settlements, subject to meeting certain criteria, that reference LIBOR or other reference rates expected to be discontinued, in 2022 or potentially 2023 (pending possible extension). The ASUs establish certain contract modification principles that entities can apply in other areas that may be affected by reference rate reform and certain elective hedge accounting expedients and exceptions. The ASUs may be applied prospectively. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements. We do not expect that any other recently issued accounting guidance will have a significant effect on our consolidated financial statements. Revenue Recognition We generate revenue from the sale of coins, chips and cards, which players can use to play casino-style slot games, table games and bingo games (i.e., spin in the case of slot games, bet in the case of table games and use of bingo cards in the case of bingo games). We distribute our games through various global social web and mobile platforms such as Facebook, Apple, Google, Amazon, and Microsoft. The games are primarily WMS , Bally , Barcrest ® , and SHFL ® branded games. In addition, we also offer third-party branded games and original content. Disaggregation of Revenue We believe disaggregation of our revenue on the basis of platform and geographical locations of our players is appropriate because the nature and the number of players generating revenue could vary on such basis, which represent different economic risk profiles. The following table presents our revenue disaggregated by type of platform: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Mobile $ 135.9 $ 144.3 $ 268.7 $ 245.5 Web and other 18.1 21.3 36.4 38.4 Total revenue $ 154.0 $ 165.6 $ 305.1 $ 283.9 The following table presents our revenue disaggregated based on the geographical location of our players: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 North America (1) $ 140.8 $ 152.6 $ 279.3 $ 260.6 International 13.2 13.0 25.8 23.3 Total revenue $ 154.0 $ 165.6 $ 305.1 $ 283.9 (1) North America revenue includes revenue derived from the U.S., Canada and Mexico. Contract Assets, Contract Liabilities and Other Disclosures We receive customer payments based on the payment terms established in our contracts. Payment for the purchase of coins, chips and cards is made at purchase, and such payments are non-refundable in accordance with our standard terms of service. Such payments are initially recorded as a contract liability, and revenue is subsequently recognized as we satisfy our performance obligations. The following table summarizes our opening and closing balances in contract assets, contract liabilities and accounts receivable: Accounts Receivable Contract Assets (1) Contract Liabilities (2) Beginning of period balance $ 36.6 $ 0.2 $ 0.6 Balance as of June 30, 2021 51.1 0.1 0.5 (1) Contract assets are included within Prepaid expenses and other current assets in our consolidated balance sheets. (2) Contract liabilities are included within Accrued liabilities in our consolidated balance sheets. During the six months ended June 30, 2021 and 2020, we recogni zed $0.6 million and $0.5 million, respectively, of revenue that was included in the opening contract liability balance. Substantially all of our unsatisfied performance obligations relate to contracts with an original expected length of one year or less. Concentration of Credit Risk Our revenue and accounts receivable are generated via certain platform providers, which subject us to a concentration of credit risk. The following tables summarize the percentage of revenues and accounts receivable generated via our platform providers in excess of 10% of our total revenues and total accounts receivable: Revenue Concentration Three Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Apple 46.7% 45.5% 46.7% 45.7% Google 37.2% 38.4% 37.2% 37.5% Facebook 12.5% 12.8% 12.3% 13.5% Accounts Receivable Concentration as of June 30, December 31, 2021 2020 Apple 64.1% 49.2% Google 24.6% 35.4% Facebook 8.6% 11.5% |
Intangible Assets and Software,
Intangible Assets and Software, net and Goodwill | 6 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Software, net and Goodwill | Intangible Assets and Software, net and Goodwill The following table presents certain information regarding our intangible assets and software: Gross Accumulated Net Balance as of June 30, 2021 Intellectual property $ 41.9 $ (37.8) $ 4.1 Customer relationships 30.5 (20.9) 9.6 Software 26.5 (15.4) 11.1 Licenses 23.7 (5.8) 17.9 Brand names 6.0 (3.9) 2.1 Total intangible assets and software $ 128.6 $ (83.8) $ 44.8 Balance as of December 31, 2020 Intellectual property $ 42.2 $ (37.2) $ 5.0 Customer relationships 30.5 (19.8) 10.7 Software 21.9 (13.8) 8.1 Licenses 7.7 (3.5) 4.2 Brand names 6.1 (3.8) 2.3 Total intangible assets and software $ 108.4 $ (78.1) $ 30.3 The following reflects amortization expense related to intangible assets and software included within depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 3.0 $ 1.8 $ 6.0 0 $ 3.5 The table below reconciles the changes in the carrying value of goodwill for the period from December 31, 2020 to June 30, 2021. Total Balance as of December 31, 2020 $ 129.8 Foreign currency adjustments (0.5) Balance as of June 30, 2021 $ 129.3 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases | LeasesOur operating leases primarily consist of real estate leases such as offices. Our leases have remaining terms of approximately 4 years. We do not have any finance leases. Our total variable and short term lease payments and operating lease expenses were immaterial for all periods presented. Supplemental balance sheet and cash flow information related to operating leases is as follows: June 30, December 31, 2021 2020 Operating lease right-of-use assets $ 7.6 $ 8.5 Accrued liabilities 2.1 2.0 Operating lease liabilities 6.4 7.5 Total operating lease liabilities $ 8.5 $ 9.5 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases for the six months ended June 30, 2021 and 2020, respectively $ 1.2 $ 1.2 Weighted average remaining lease term, years 3.8 4.3 Weighted average discount rate 5.0 % 5.0 % Lease liability maturities: Operating Leases Remainder of 2021 $ 1.3 2022 2.5 2023 2.5 2024 2.4 2025 0.7 Thereafter — Less: Imputed Interest (0.9) Total $ 8.5 As of June 30, 2021, we did not have material additional operating leases that have not yet commenced. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We hold an economic interest of 19.1% in SciPlay Parent LLC subsequent to the IPO. The 80.9% economic interest that we do not own represents a noncontrolling interest for financial reporting purposes. SciPlay Parent LLC is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As such, SciPlay Parent LLC is not subject to income tax in most jurisdictions, and SciPlay Parent LLC’s members, of which we are one, are liable for income taxes based on their allocable share of SciPlay Parent LLC’s taxable income. The effective income tax rates for the three and six months ended June 30, 2021 were 4.5% and 4.9%, respectively, and 6.0% and 5.6% for the three and six months ended June 30, 2020. The effective income tax rates were determined using an estimated annual effective tax rate after considering any discrete items for such periods. Our effective tax rate differs from the statutory rate of 21% primarily because we generally do not record income taxes for the noncontrolling interest portion of U.S. pre-tax income. TRA During the six months ended June 30, 2020, payments totaling $2.5 million were made to Scientific Games pursuant to the TRA. As of June 30, 2021 and December 31, 2020, the total TRA liability was $72.5 million, of which $4.0 million was included in Accrued liabilities. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The following is the summary o f expenses paid to Scientific Games and settled in cash: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Financial Statement Line Item Royalties to Scientific Games for third-party IP $ 0.7 $ 2.0 $ 1.4 $ 3.7 Cost of revenue Parent services 1.6 1.0 3.2 2.4 General and administrative TRA payments (see Note 4) (1) — 2.5 — 2.5 Accrued liabilities Distributions to Scientific Games and affiliates, net (1) 13.8 11.6 14.1 11.6 Noncontrolling interest (1) Under the terms of the Operating Agreement, SciPlay Corporation relies on distributions from SciPlay Parent LLC to pay its obligations under the TRA and any other tax obligations. All distributions must be on a pari-passu basis, thus initiating a pro-rata distribution to Parent and affiliates. The following is the summary of balances due to affiliates: June 30, 2021 December 31, 2020 Royalties to Scientific Games for third-party IP $ 1.4 $ 2.5 Parent services 0.7 0.8 Reimbursable expenses to Scientific Games and its subsidiaries 2.2 2.2 $ 4.3 $ 5.5 Parent Equity Awards See Note 6 for disclosures related to Parent’s equity awards. |
Stockholders_ Equity and Noncon
Stockholders’ Equity and Noncontrolling Interest | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Stockholders’ Equity and Noncontrolling Interest | Stockholders’ Equity and Noncontrolling Interest Noncontrolling Interest We are a holding company, and our sole material assets are SciPlay Parent LLC Interests (“LLC Interests”) that we purchased from SciPlay Parent LLC and SG Social Holding Company I, LLC, representing an aggregate 19.1% economic interest in SciPlay Parent LLC. The remaining 80.9% economic interest in SciPlay Parent LLC is owned indirectly by SGC, through the ownership of LLC Interests by the indirect wholly-owned subsidiaries of SGC, the SG Members. Stock-Based Compensation The following table summarizes stock-based compensation expense that is included in general and administrative expenses: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 SciPlay awards $ 3.4 $ 5.0 $ 5.1 $ 4.9 Parent awards 0.1 0.1 0.2 0.3 Total $ 3.5 $ 5.1 $ 5.3 $ 5.2 As of June 30, 2021, we had $15.8 million in unrecognized stock-based compensation expense that is expected to be recognized over a weighted-average expected vesting period of 1.4 years, of which $9.4 million relates to performance-based restricted stock units. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The table below sets forth a calculation of basic earnings per share ("EPS") based on net income attributable to SciPlay divided by the basic weighted average number of Class A common stock outstanding during the period. Diluted EPS of Class A common stock is computed by dividing net income attributable to SciPlay by the weighted average number of shares of Class A common stock outstanding adjusted to give effect to all potentially dilutive securities, using the treasury stock method. No material number of restricted stock units was excluded from the calculation of diluted weighted-average common shares outstanding for the three and six month periods ended June 30, 2021 and 2020. We excluded Class B common stock from the computation of basic and diluted EPS, as holders of Class B common stock do not have economic interest in us, and, therefore, a separate presentation of EPS of Class B common stock under the two-class method has not been presented. Three Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Numerator: Net income $ 37.9 $ 48.8 $ 75.8 $ 79.9 Less: net income attributable to the noncontrolling interest 32.0 42.2 64.6 68.9 Net income attributable to SciPlay $ 5.9 $ 6.6 $ 11.2 $ 11.0 Denominator: Weighted average shares of Class A common stock for basic EPS 24.4 22.8 23.8 22.7 Effect of dilutive securities: Stock-based compensation grants 0.3 1.4 1.1 1.5 Weighted average shares of Class A common stock for diluted EPS 24.7 24.2 24.9 24.2 Basic and diluted net income attributable to SciPlay per share: Basic $ 0.24 $ 0.29 $ 0.47 $ 0.48 Diluted $ 0.24 $ 0.27 $ 0.45 $ 0.45 |
Litigation
Litigation | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation | Litigation From time to time, we are subject to various claims, complaints and legal actions in the normal course of business. There have been no material changes to these matters since our 2020 Form 10-K was filed with the SEC, except as described below. In addition, we may receive notifications alleging infringement of patent or other intellectual property rights. Washington State Matter On April 17, 2018, a plaintiff, Sheryl Fife, filed a putative class action complaint, Fife v. Scientific Games Corporation , against SGC in the United States District Court for the Western District of Washington. The plaintiff seeks to represent a putative class of all persons in the State of Washington who purchased and allegedly lost virtual coins playing SGC’s online social casino games, including but not limited to Jackpot Party Casino and Gold Fish Casino . The complaint asserts claims for alleged violations of Washington’s Recovery of Money Lost at Gambling Act, Washington’s consumer protection statute, and for unjust enrichment, and seeks unspecified money damages (including treble damages as appropriate), the award of reasonable attorneys’ fees and costs, pre- and post-judgment interest, and injunctive and/or declaratory relief. On July 2, 2018, SGC filed a motion to dismiss the plaintiff’s complaint with prejudice, which the trial court denied on December 18, 2018. SGC filed its answer to the putative class action complaint on January 18, 2019. On August 24, 2020, the trial court granted plaintiff’s motion for leave to amend her complaint and to substitute a new plaintiff, Donna Reed, for the initial plaintiff, and re-captioned the matter Reed v. Scientific Games Corporation . On August 25, 2020, the plaintiff filed a first amended complaint against SGC, asserting the same claims, and seeking the same relief, as the complaint filed by Sheryl Fife. On September 8, 2020, SGC filed a motion to compel arbitration of plaintiff’s claims and to dismiss the action, or, in the alternative, to transfer the action to the United States District Court for the District of Nevada, and that motion is fully-briefed and pending before the trial court. On April 9, 2021, the plaintiff filed a motion to certify the putative class and for a preliminary injunction. Although the case was brought against Scientific Games, pursuant to the Intercompany Services Agreement, we would expect to cover or contribute to any damage awards due to the matter arising as a result of our business. We are currently unable to determine the likelihood of an outcome or estimate a range of reasonably possible loss. SciPlay IPO Matter (New York) On or about October 14, 2019, the Police Retirement System of St. Louis filed a putative class action complaint in New York state court against SciPlay, certain of its executives and directors, and SciPlay’s underwriters with respect to its initial public offering (the “PRS Action”). The complaint was amended on November 18, 2019. The plaintiff seeks to represent a class of all persons or entities who acquired Class A common stock of SciPlay pursuant and/or traceable to the Registration Statement filed and issued in connection with SciPlay’s initial public offering, which commenced on or about May 3, 2019. The complaint asserts claims for alleged violations of Sections 11 and 15 of the Securities Act, 15 U.S.C. § 77, and seeks certification of the putative class; compensatory damages of at least $146.0 million, and the award of the plaintiff’s and the class’s reasonable costs and expenses incurred in the action. On or about December 9, 2019, Hongwei Li filed a putative class action complaint in New York state court asserting substantively similar causes of action under the Securities Act of 1933 and substantially similar factual allegations as those alleged in the PRS Action (the “Li Action”). On December 18, 2019, the New York state court entered a stipulated order consolidating the PRS Action and the Li Action into a single lawsuit. On December 23, 2019, the defendants moved to dismiss the consolidated action. On August 28, 2020, the court issued an oral ruling granting in part and denying in part the defendants’ motion to dismiss. On December 14, 2020, plaintiffs in the consolidated action filed a motion to certify the putative class. That motion is not yet fully-briefed. SciPlay IPO Matter (Nevada) On or about November 4, 2019, plaintiff John Good filed a putative class action complaint in Nevada state court against SciPlay, certain of its executives and directors, SGC, and SciPlay’s underwriters with respect to SciPlay’s initial public offering. The plaintiff seeks to represent a class of all persons who purchased Class A common stock of SciPlay in or traceable to SciPlay’s initial public offering that it completed on or about May 7, 2019. The complaint asserts claims for alleged violations of Sections 11 and 15 of the Securities Act, 15 U.S.C. § 77, and seeks certification of the putative class; compensatory damages, and the award of the plaintiff’s and the class’s reasonable costs and expenses incurred in the action. On February 27, 2020, the trial court entered a stipulated order that, among other things, stayed the lawsuit pending entry of an order resolving the motion to dismiss that was pending in the SciPlay IPO matter in New York state court. On September 29, 2020, the trial court entered a stipulated order that extended the stay pending a ruling on class certification in the SciPlay IPO matter in New York state court. Based on our assessment under ASC 410 and ASC 450 and consideration of the two SciPlay IPO matters above, we determined that both loss and insurance proceeds loss recovery, which we believe is recoverable under our insurance policy, are deemed probable and reasonably estimable. As a result, we recorded approximately $8.3 million in Accrued liabilities and $8.0 million in Prepaid expenses and other current assets as of June 30, 2021, with no material impact on our statement of income for the three and six month period ended June 30, 2021. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Acquisition of Koukoi Games Oy (“Koukoi”) On July 2, 2021, we acquired privately held Koukoi, a Finland-based developer and operator of casual mobile games for $5.3 million cash consideration, net of cash acquired. The acquisition allows us to expand our casual games portfolio. We are in the process of completing the preliminary purchase price accounting and expect that a substantial portion of the purchase price will be allocated to acquired intellectual property. |
Description of the Business a_2
Description of the Business and Summary of Significant Accounting Policies (Policies) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Basis of Presentation | Basis of Presentation The accompanying financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). All intercompany balances and transactions have been eliminated in consolidation. | |
Principles of Consolidation | In the opinion of management, we have made all adjustments necessary to present fairly our consolidated statements of income, consolidated statements of comprehensive income, condensed consolidated balance sheets, consolidated statements of changes in stockholders’ equity and condensed consolidated statements of cash flows for the periods presented. Such adjustments are of a normal, recurring nature. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and related Notes included in our 2020 Form 10-K. Interim results of operations are not necessarily indicative of results of operations to be expected for a full year. | |
Variable Interest Entities (“VIE”) and Consolidation | Variable Interest Entities (“VIE”) and Consolidation Subsequent to the IPO, our sole material asset is our member’s interest in SciPlay Parent LLC. In accordance with the Operating Agreement of SciPlay Parent LLC (the “Operating Agreement”), we have all management powers over the business and affairs of SciPlay Parent LLC and to conduct, direct and exercise full control over the activities of SciPlay Parent LLC. Class A common stock issued in the IPO do not hold majority voting rights but hold 100% of the economic interest in the Company, which results in SciPlay Parent LLC being considered a VIE. Due to our power to control the activities most directly affecting the results of SciPlay Parent LLC, we are considered the primary beneficiary of the VIE. Accordingly, beginning with the IPO, we consolidate the financial results of SciPlay Parent LLC and its subsidiaries. | |
Minimum guarantees under licensing agreements | Minimum guarantees under licensing agreementsWe enter into long-term license agreements with third parties in which we are obligated to pay a minimum guaranteed amount of royalties, typically periodically over the life of the contract. These license agreements provide us with access to a portfolio of major brands to be used across our games. We account for the minimum guaranteed obligations within Current liabilities and Other long-term liabilities at the onset of the license arrangement and record a corresponding licensed asset within intangible assets, net. The licensed intangible assets related to the minimum guaranteed obligations are amortized over the term of the license agreement with the amortization expense recorded in Depreciation and amortization. The long-term liability related to the minimum guaranteed obligations is reduced as royalty payments are made as required under the license agreement. We assess the recoverability of license agreements whenever events arise or circumstances change that indicate the carrying value of the licensed asset may not be recoverable. Recoverability of the licensed asset and the amount of impairment, if any, are determined using our policy for intangible assets with finite useful lives. | |
New Accounting Guidance - Not Yet Adopted | New Accounting Guidance - Not Yet Adopted The FASB issued ASU No. 2020-04 and subsequently ASU No. 2021-01, Reference Rate Reform (Topic 848) in March 2020 and January 2021, respectively. The new guidance provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, including derivative instruments impacted by changes in the interest rates used for discounting cash flows for computing variable margin settlements, subject to meeting certain criteria, that reference LIBOR or other reference rates expected to be discontinued, in 2022 or potentially 2023 (pending possible extension). The ASUs establish certain contract modification principles that entities can apply in other areas that may be affected by reference rate reform and certain elective hedge accounting expedients and exceptions. The ASUs may be applied prospectively. We do not expect the adoption of this standard to have a material impact on our consolidated financial statements. We do not expect that any other recently issued accounting guidance will have a significant effect on our consolidated financial statements. | |
Revenue Recognition and Contract Assets, Contract Liabilities and Other Disclosures | Revenue Recognition We generate revenue from the sale of coins, chips and cards, which players can use to play casino-style slot games, table games and bingo games (i.e., spin in the case of slot games, bet in the case of table games and use of bingo cards in the case of bingo games). We distribute our games through various global social web and mobile platforms such as Facebook, Apple, Google, Amazon, and Microsoft. The games are primarily WMS , Bally , Barcrest ® , and SHFL ® branded games. In addition, we also offer third-party branded games and original content. Disaggregation of Revenue We believe disaggregation of our revenue on the basis of platform and geographical locations of our players is appropriate because the nature and the number of players generating revenue could vary on such basis, which represent different economic risk profiles. | |
Concentration of Credit Risk | Concentration of Credit Risk Our revenue and accounts receivable are generated via certain platform providers, which subject us to a concentration of credit risk. |
Description of the Business a_3
Description of the Business and Summary of Significant Accounting Policies (Tables) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Schedule of Amortization Expense | The following reflects amortization expense related to these licenses and recorded in depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 1.1 $ 0.2 $ 2.3 $ 0.4 The following reflects amortization expense related to intangible assets and software included within depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 3.0 $ 1.8 $ 6.0 0 $ 3.5 | |
Schedule of Guarantor Obligations | The following are our total minimum guaranteed obligations for the periods presented: As of June 30, December 31, 2021 2020 Current liabilities $ 5.0 $ 2.6 Other long-term liabilities 10.0 0.3 Total minimum guarantee obligation $ 15.0 $ 2.9 Weighted average remaining term (in years) 3.7 2.4 | |
Disaggregation of Revenue | The following table presents our revenue disaggregated by type of platform: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Mobile $ 135.9 $ 144.3 $ 268.7 $ 245.5 Web and other 18.1 21.3 36.4 38.4 Total revenue $ 154.0 $ 165.6 $ 305.1 $ 283.9 The following table presents our revenue disaggregated based on the geographical location of our players: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 North America (1) $ 140.8 $ 152.6 $ 279.3 $ 260.6 International 13.2 13.0 25.8 23.3 Total revenue $ 154.0 $ 165.6 $ 305.1 $ 283.9 (1) North America revenue includes revenue derived from the U.S., Canada and Mexico. | |
Summary of Balances in Receivables and Contract Asset and Liability Accounts | The following table summarizes our opening and closing balances in contract assets, contract liabilities and accounts receivable: Accounts Receivable Contract Assets (1) Contract Liabilities (2) Beginning of period balance $ 36.6 $ 0.2 $ 0.6 Balance as of June 30, 2021 51.1 0.1 0.5 (1) Contract assets are included within Prepaid expenses and other current assets in our consolidated balance sheets. (2) Contract liabilities are included within Accrued liabilities in our consolidated balance sheets. | |
Schedules of Concentration of Risk | The following tables summarize the percentage of revenues and accounts receivable generated via our platform providers in excess of 10% of our total revenues and total accounts receivable: Revenue Concentration Three Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Apple 46.7% 45.5% 46.7% 45.7% Google 37.2% 38.4% 37.2% 37.5% Facebook 12.5% 12.8% 12.3% 13.5% Accounts Receivable Concentration as of June 30, December 31, 2021 2020 Apple 64.1% 49.2% Google 24.6% 35.4% Facebook 8.6% 11.5% |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, net (Tables) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Schedule of Information Regarding Intangible Assets | The following table presents certain information regarding our intangible assets and software: Gross Accumulated Net Balance as of June 30, 2021 Intellectual property $ 41.9 $ (37.8) $ 4.1 Customer relationships 30.5 (20.9) 9.6 Software 26.5 (15.4) 11.1 Licenses 23.7 (5.8) 17.9 Brand names 6.0 (3.9) 2.1 Total intangible assets and software $ 128.6 $ (83.8) $ 44.8 Balance as of December 31, 2020 Intellectual property $ 42.2 $ (37.2) $ 5.0 Customer relationships 30.5 (19.8) 10.7 Software 21.9 (13.8) 8.1 Licenses 7.7 (3.5) 4.2 Brand names 6.1 (3.8) 2.3 Total intangible assets and software $ 108.4 $ (78.1) $ 30.3 | |
Schedule of Amortization Expense | The following reflects amortization expense related to these licenses and recorded in depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 1.1 $ 0.2 $ 2.3 $ 0.4 The following reflects amortization expense related to intangible assets and software included within depreciation and amortization: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Amortization expense $ 3.0 $ 1.8 $ 6.0 0 $ 3.5 | |
Schedule of Goodwill | The table below reconciles the changes in the carrying value of goodwill for the period from December 31, 2020 to June 30, 2021. Total Balance as of December 31, 2020 $ 129.8 Foreign currency adjustments (0.5) Balance as of June 30, 2021 $ 129.3 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Schedule of Supplemental Operating Lease Information | Supplemental balance sheet and cash flow information related to operating leases is as follows: June 30, December 31, 2021 2020 Operating lease right-of-use assets $ 7.6 $ 8.5 Accrued liabilities 2.1 2.0 Operating lease liabilities 6.4 7.5 Total operating lease liabilities $ 8.5 $ 9.5 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases for the six months ended June 30, 2021 and 2020, respectively $ 1.2 $ 1.2 Weighted average remaining lease term, years 3.8 4.3 Weighted average discount rate 5.0 % 5.0 % |
Maturities of Lease Liabilities | Lease liability maturities: Operating Leases Remainder of 2021 $ 1.3 2022 2.5 2023 2.5 2024 2.4 2025 0.7 Thereafter — Less: Imputed Interest (0.9) Total $ 8.5 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following is the summary o f expenses paid to Scientific Games and settled in cash: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 Financial Statement Line Item Royalties to Scientific Games for third-party IP $ 0.7 $ 2.0 $ 1.4 $ 3.7 Cost of revenue Parent services 1.6 1.0 3.2 2.4 General and administrative TRA payments (see Note 4) (1) — 2.5 — 2.5 Accrued liabilities Distributions to Scientific Games and affiliates, net (1) 13.8 11.6 14.1 11.6 Noncontrolling interest (1) Under the terms of the Operating Agreement, SciPlay Corporation relies on distributions from SciPlay Parent LLC to pay its obligations under the TRA and any other tax obligations. All distributions must be on a pari-passu basis, thus initiating a pro-rata distribution to Parent and affiliates. The following is the summary of balances due to affiliates: June 30, 2021 December 31, 2020 Royalties to Scientific Games for third-party IP $ 1.4 $ 2.5 Parent services 0.7 0.8 Reimbursable expenses to Scientific Games and its subsidiaries 2.2 2.2 $ 4.3 $ 5.5 |
Stockholders_ Equity and Nonc_2
Stockholders’ Equity and Noncontrolling Interest (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Summary of Stock-based Compensation Expense | The following table summarizes stock-based compensation expense that is included in general and administrative expenses: Three Months Ended Six Months Ended June 30, June 30, 2021 2020 2021 2020 SciPlay awards $ 3.4 $ 5.0 $ 5.1 $ 4.9 Parent awards 0.1 0.1 0.2 0.3 Total $ 3.5 $ 5.1 $ 5.3 $ 5.2 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | Three Months Ended Six Months Ended June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Numerator: Net income $ 37.9 $ 48.8 $ 75.8 $ 79.9 Less: net income attributable to the noncontrolling interest 32.0 42.2 64.6 68.9 Net income attributable to SciPlay $ 5.9 $ 6.6 $ 11.2 $ 11.0 Denominator: Weighted average shares of Class A common stock for basic EPS 24.4 22.8 23.8 22.7 Effect of dilutive securities: Stock-based compensation grants 0.3 1.4 1.1 1.5 Weighted average shares of Class A common stock for diluted EPS 24.7 24.2 24.9 24.2 Basic and diluted net income attributable to SciPlay per share: Basic $ 0.24 $ 0.29 $ 0.47 $ 0.48 Diluted $ 0.24 $ 0.27 $ 0.45 $ 0.45 |
Description of the Business a_4
Description of the Business and Summary of Significant Accounting Policies - Narrative (Details) $ in Millions | May 07, 2019USD ($) | Sep. 30, 2021 | Jun. 30, 2021USD ($)segment | Jun. 30, 2020USD ($) |
Subsidiary, Sale of Stock [Line Items] | ||||
Number of operating segments | segment | 1 | |||
Economic interests called by common stock units | 19.10% | |||
Revenue recognized | $ 0.6 | $ 0.5 | ||
Revolving Credit Facility | Line of Credit | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Maximum borrowing capacity | $ 150 | |||
Subsequent Event | Forecast | Scientific Games | SciPlay Corporation | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Voting interests acquired | 19.00% | |||
Shares issued for each outstanding share | 0.250 | |||
IPO | Common Class A | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Economic interests called by common stock units | 100.00% |
Description of the Business a_5
Description of the Business and Summary of Significant Accounting Policies - Schedule of Amortization Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ||||
Amortization expense | $ 3 | $ 1.8 | $ 6 | $ 3.5 |
Licenses | ||||
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Line Items] | ||||
Amortization expense | $ 1.1 | $ 0.2 | $ 2.3 | $ 0.4 |
Description of the Business a_6
Description of the Business and Summary of Significant Accounting Policies - Schedule of Guarantor Obligations (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2020 | |
Business Combination and Asset Acquisition [Abstract] | ||
Current liabilities | $ 5 | $ 2.6 |
Other long-term liabilities | 10 | 0.3 |
Total minimum guarantee obligation | $ 15 | $ 2.9 |
Weighted average remaining term (in years) | 3 years 8 months 12 days | 2 years 4 months 24 days |
Description of the Business a_7
Description of the Business and Summary of Significant Accounting Policies - Disaggregation of Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 154 | $ 165.6 | $ 305.1 | $ 283.9 |
Mobile | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 135.9 | 144.3 | 268.7 | 245.5 |
Web and other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 18.1 | 21.3 | 36.4 | 38.4 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 140.8 | 152.6 | 279.3 | 260.6 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 13.2 | $ 13 | $ 25.8 | $ 23.3 |
Description of the Business a_8
Description of the Business and Summary of Significant Accounting Policies - Balances in Receivables and Contract Asset and Liability Accounts (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Dec. 31, 2020 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accounts Receivable | $ 51.1 | $ 36.6 |
Contract Assets | 0.1 | 0.2 |
Contract Liabilities | $ 0.5 | $ 0.6 |
Description of the Business a_9
Description of the Business and Summary of Significant Accounting Policies - Schedule of Concentration Risk (Details) - Customer Concentration Risk | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Apple | Revenue Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 46.70% | 45.50% | 46.70% | 45.70% |
Apple | Accounts Receivable Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 64.10% | 49.20% | ||
Google | Revenue Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 37.20% | 38.40% | 37.20% | 37.50% |
Google | Accounts Receivable Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 24.60% | 35.40% | ||
Facebook | Revenue Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 12.50% | 12.80% | 12.30% | 13.50% |
Facebook | Accounts Receivable Concentration | ||||
Concentration Risk [Line Items] | ||||
Concentration risk | 8.60% | 11.50% |
Intangible Assets and Softwar_2
Intangible Assets and Software, net and Goodwill - Schedule of Information Regarding Intangible Assets (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | $ 128.6 | $ 108.4 |
Amortizable intangible assets, accumulated amortization | (83.8) | (78.1) |
Amortizable intangible assets, net balance | 44.8 | 30.3 |
Intellectual property | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | 41.9 | 42.2 |
Amortizable intangible assets, accumulated amortization | (37.8) | (37.2) |
Amortizable intangible assets, net balance | 4.1 | 5 |
Customer relationships | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | 30.5 | 30.5 |
Amortizable intangible assets, accumulated amortization | (20.9) | (19.8) |
Amortizable intangible assets, net balance | 9.6 | 10.7 |
Software | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | 26.5 | 21.9 |
Amortizable intangible assets, accumulated amortization | (15.4) | (13.8) |
Amortizable intangible assets, net balance | 11.1 | 8.1 |
Licenses | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | 23.7 | 7.7 |
Amortizable intangible assets, accumulated amortization | (5.8) | (3.5) |
Amortizable intangible assets, net balance | 17.9 | 4.2 |
Brand names | ||
Finite-Lived Intangible Assets, Net [Abstract] | ||
Amortizable intangible assets, gross carrying amount | 6 | 6.1 |
Amortizable intangible assets, accumulated amortization | (3.9) | (3.8) |
Amortizable intangible assets, net balance | $ 2.1 | $ 2.3 |
Intangible Assets and Softwar_3
Intangible Assets and Software, net and Goodwill - Intangible Amortization Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 3 | $ 1.8 | $ 6 | $ 3.5 |
Intangible Assets and Softwar_4
Intangible Assets and Software, net and Goodwill - Schedule of Goodwill (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2021USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Foreign currency adjustments | $ (0.5) |
Balance as of June 30, 2021 | $ 129.3 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Jun. 30, 2021 |
Minimum | |
Range [Line Items] | |
Remaining lease terms | 4 years |
Leases - Supplemental Operating
Leases - Supplemental Operating Lease Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease right-of-use assets | $ 7.6 | $ 8.5 | |
Accrued liabilities | 2.1 | 2 | |
Operating lease liabilities | 6.4 | 7.5 | |
Total operating lease liabilities | 8.5 | $ 9.5 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows for operating leases for the six months ended June 30, 2021 and 2020, respectively | $ 1.2 | $ 1.2 | |
Weighted average remaining lease term, years | 3 years 9 months 18 days | 4 years 3 months 18 days | |
Weighted average discount rate | 5.00% | 5.00% |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) $ in Millions | Jun. 30, 2021USD ($) |
Leases [Abstract] | |
Remainder of 2021 | $ 1.3 |
2022 | 2.5 |
2023 | 2.5 |
2024 | 2.4 |
2025 | 0.7 |
Thereafter | 0 |
Less: Imputed Interest | (0.9) |
Total | $ 8.5 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | May 07, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Income Tax Disclosure [Line Items] | |||||
Economic interests called by common stock units | 19.10% | ||||
Effective tax rates | 4.50% | 6.00% | 4.90% | 5.60% | |
Total tax receivable agreement liability | $ 72.5 | $ 72.5 | |||
Tax receivable agreement liability, current | $ 4 | $ 4 | |||
Scientific Games Corporation | |||||
Income Tax Disclosure [Line Items] | |||||
Economic interests called by common stock units | 80.90% |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||||||
Parent services | $ 1.6 | $ 1 | $ 3.2 | $ 2.4 | ||
Distributions to Scientific Games and affiliates, net | 13.8 | $ 0.3 | 11.6 | 14.1 | 11.6 | |
Total due to (from) related parties | 4.3 | 4.3 | $ 5.5 | |||
Royalties to Scientific Games for third-party IP | ||||||
Related Party Transaction [Line Items] | ||||||
Total due to (from) related parties | (1.4) | (1.4) | (2.5) | |||
Parent services | ||||||
Related Party Transaction [Line Items] | ||||||
Total due to (from) related parties | (0.7) | (0.7) | (0.8) | |||
Reimbursable expenses to Scientific Games and its subsidiaries | ||||||
Related Party Transaction [Line Items] | ||||||
Total due to (from) related parties | (2.2) | (2.2) | $ (2.2) | |||
Intellectual property, Third-party | ||||||
Related Party Transaction [Line Items] | ||||||
Royalties to Scientific Games for third-party IP | $ 0.7 | $ 2 | $ 1.4 | $ 3.7 |
Stockholders_ Equity and Nonc_3
Stockholders’ Equity and Noncontrolling Interest (Details) - USD ($) $ in Millions | May 07, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 |
Class of Stock [Line Items] | |||||
Economic interests called by common stock units | 19.10% | ||||
Total compensation expense | $ 3.5 | $ 5.1 | $ 5.3 | $ 5.2 | |
Unrecognized stock-based compensation expense | $ 15.8 | 15.8 | |||
Period expected to be recognized | 1 year 4 months 24 days | ||||
Scientific Games Corporation | |||||
Class of Stock [Line Items] | |||||
Economic interests called by common stock units | 80.90% | ||||
LTIP | |||||
Class of Stock [Line Items] | |||||
Total compensation expense | $ 3.4 | 5 | 5.1 | 4.9 | |
Equity Incentive Award Plan, Parent | |||||
Class of Stock [Line Items] | |||||
Total compensation expense | 0.1 | $ 0.1 | 0.2 | $ 0.3 | |
Performance-Based Restricted Stock Units (PRSUs) | |||||
Class of Stock [Line Items] | |||||
Unrecognized stock-based compensation expense | $ 9.4 | $ 9.4 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||||
Net income | $ 37.9 | $ 37.9 | $ 48.8 | $ 31.1 | $ 75.8 | $ 79.9 |
Less: Net income attributable to the noncontrolling interest | 32 | 42.2 | 64.6 | 68.9 | ||
Net income attributable to SciPlay | $ 5.9 | $ 6.6 | $ 11.2 | $ 11 | ||
Denominator: | ||||||
Weighted average shares of Class A common stock for basic EPS (in shares) | 24,400 | 22,800 | 23,800 | 22,700 | ||
Effect of dilutive securities: | ||||||
Stock-based compensation grants (in shares) | 300 | 1,400 | 1,100 | 1,500 | ||
Weighted average shares of Class A common stock for diluted EPS (in shares) | 24,700 | 24,200 | 24,900 | 24,200 | ||
Net income attributable to SciPlay per share of Class A common stock - basic (in dollars per share) | $ 0.24 | $ 0.29 | $ 0.47 | $ 0.48 | ||
Net income attributable to SciPlay per share of Class A common stock - diluted (in dollars per share) | $ 0.24 | $ 0.27 | $ 0.45 | $ 0.45 | ||
Noncontrolling interest | ||||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||||
Net income | $ 32 | $ 32.6 | $ 42.2 | $ 26.7 |
Litigation (Details)
Litigation (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2021USD ($) | |
Subsequent Event [Line Items] | |
Loss contingency accrual | $ 8.3 |
Estimated insurance recoveries | 8 |
SciPlay IPO Matter [Member] | |
Subsequent Event [Line Items] | |
Damages sought | $ 146 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | Jul. 02, 2021 | Jun. 30, 2021 | Jun. 30, 2020 |
Subsequent Event [Line Items] | |||
Acquisition of business, net of cash acquired | $ 0 | $ 12.6 | |
Subsequent Event | Koukoi | |||
Subsequent Event [Line Items] | |||
Acquisition of business, net of cash acquired | $ 5.3 |
Uncategorized Items - scpl-2021
Label | Element | Value |
Payments under Tax Receivable Agreement | scpl_PaymentsUnderTaxReceivableAgreement | $ 2,500,000 |
Payments under Tax Receivable Agreement | scpl_PaymentsUnderTaxReceivableAgreement | $ 0 |