International Game Technology PLC (NYSE:IGT) Q3 2019 Earnings Conference Call - Final Transcript
Nov 14, 2019 • 08:00 am ET
Thank you. [Operator Instructions] And our first question comes from Chad Beynon from Macquarie. Your line is open.
Hi, good morning. Thanks for taking my question. Guys wanted to start with free cash flow because I think that was a bright spot in the quarter. Alberto, you highlighted year-to-date trends and now with the reduced capex, , can you just give us an update in terms of what your leverage targets are, and just remind us any near-term major cash outflows that could come in 2020 that I guess would more be in kind of the project capex,, category? Thanks.
Yeah, Chad, first of all, good morning to you. Regarding the cash flow, let's say that we are basically marching according to our expectation, as you are aware, for this year, we had provided an outlook in the range of the adjusted free cash flow to be between $410 million and $510 million and, you know, we are on-trend and actually this quarter is confirming what already in the second quarter we showed this progress in that direction. So the only update, I can say is that we confirm what we have said in the past.
Regarding capex, , the only big news that I can say has been Brazil. The Lotex -- that is growth capex, for a new initiative, the profile from capex, is fairly moderate because with the upfront fee to be paid over eight installments, it has significantly reduced the impact and over several years and we are planning that so far in Q3 2020 potentially that could be the payment -- that could be the start of these initiatives. So the impact of the roll is going to be moderate in 2020 and other than that our -- the usual -- be the expansion that we have talked in the past. So, no big news on the capex, front.
Okay, thank you. And then switching to Italy, Alberto, you mentioned the VLT wagers were a little bit weaker in the third quarter. I think in the second quarter you really didn't see a decline just in terms of player pay.
Player pay. So could you maybe talk about if some of these players are moving over to the AWPs? And then could you also just kind of high level what the -- what the Italian impact has been year-to-date given the different changes in the gaming market? Thank you.
Good morning, Chad. I take your question. As a matter of fact, the VLT wagers went up in the first and we plan it for them to be down in the second half as they were -- they were in Q3. In reality, the players are still playing [Indecipherable] was up in September. But the wages that affected by a lower payout.As we were anticipating is revenue situation, we anticipated in the previous calls that saying that we would have faced more challenging situation second half of the year. Its not a matter particulars reach