Accel Entertainment, Inc. Q3 FY2024 earnings call

• Strong Q3 performance with revenue of $302M and adjusted EBITDA of $46M. - Pending acquisition of Fairmont Park expected to close this quarter. - Illinois market had 5% GGR growth YOY, outperforming Illinois casinos down 1% YOY. - Strategic closures of 22 underperforming locations in Illinois; reviewing portfolio for further pruning. - Nebraska saw revenue growth driven by hold per day from strategic product shift. - TITO expected to roll out in first half of 2025, making cash processing more efficient and enhancing player experience. - M&A pipeline active, including Fairmont acquisition and update on Louisiana expected by year-end.

Revenue for the third quarter was $302 million with adjusted EBITDA of $46 million. Illinois posted market-wide GGR growth of 5% year-over-year, outperforming Illinois casinos which were down 1% year-over-year. Nebraska had revenue per location increase of 16.8% year-over-year. Illinois' largest market saw GGR growth, while Nebraska benefited from strategic product shifts. Total revenue was $302M, adjusted EBITDA $46M. Illinois GGR up 5% YOY, Nebraska revenue per location up 16.8% YOY.

• Expectation to close Fairmont acquisition in early December. - Phase 1 of Fairmont project to open in second quarter of 2025 with ~250 slot machines, etc. - 2024 CapEx projected between $60M and $65M, a decrease over 20% from last year, with long-term goal of CapEx towards $40M. - 70% of $200M share repurchase program completed, having repurchased 13.5 million shares at a cost of $140M.

• Tax increases in Illinois modestly dragging on results. - Potential challenges with integrating acquired assets. - Regulatory changes in local gaming markets impacting operations.

Q: You pointed out Illinois casinos being down 1% year-over-year versus your growth. And other than kind of the -- probably a lot could be attributed to just the different business model. Why do you kind of point -- or what do you kind of point to in terms of the outperformance there? Are there any other factors maybe besides that? And then separately within Illinois, TITO, how do you kind of expect ticket in, ticket out to impact the business?

A: Our product is above competitors with latest equipment and local convenience. TITO will provide lift in convenience and player experience, expected to boost industry growth when rolled out in second quarter 2025.