Financial Information for Guarantor Subsidiaries and Non-Guarantor Subsidiaries (Tables)

9 Months Ended

Sep. 30, 2014

Financial Information for Guarantor Subsidiaries and Non-Guarantor Subsidiaries [Abstract]

Supplemental Condensed Consolidating Balance Sheet

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET

As of September 30, 2014  

	Parent  Company		SGI		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated
Assets
Cash and cash equivalents	$	36.4	$	0.3	$	11.3	$	84.5	$	—		$	132.5
Restricted cash	—		—		12.0		0.1		—			12.1
Accounts receivable, net	—		62.3		117.1		117.9		—			297.3
Notes receivable, net	—		—		71.5		56.6		—			128.1
Inventories	—		40.7		60.1		70.1		—			170.9
Other current assets	14.6		14.4		51.6		28.5		—			109.1
Property and equipment, net	0.5		125.7		410.2		203.2		—			739.6
Investment in subsidiaries	1,849.5		952.6		—		—		(2,802.1		)	—
Goodwill	—		253.6		480.5		434.6		—			1,168.7
Intangible assets, net	161.1		42.4		284.8		12.0		—			500.3
Intercompany balances	—		1,413.0		343.4		—		(1,756.4		)	—
Software, net	12.7		33.2		211.2		49.7		—			306.8
Other assets	3.1		116.4		26.3		327.7		—			473.5
Total assets	$	2,077.9	$	3,054.6	$	2,080.0	$	1,384.9	$	(4,558.5	)	$	4,038.9
Liabilities and stockholders’ equity
Debt payments due within one year	$	—	$	23.0	$	—	$	7.9	$	—		$	30.9
Other current liabilities	39.7		77.5		117.0		127.0		—			361.2
Long-term debt, excluding current installments	250.0		2,897.6		—		30.8		—			3,178.4
Other long-term liabilities	179.8		45.9		69.7		67.3		—			362.7
Intercompany balances	1,502.7		—		—		253.7		(1,756.4		)	—
Stockholders’ equity	105.7		10.6		1,893.3		898.2		(2,802.1		)	105.7
Total liabilities and stockholders’ equity	$	2,077.9	$	3,054.6	$	2,080.0	$	1,384.9	$	(4,558.5	)	$	4,038.9

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET

As of December 31, 2013

	Parent  Company		SGI			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated
Assets
Cash and cash equivalents	$	56.0	$	—		$	24.4	$	73.3	$	—		$	153.7
Restricted cash	—		—			10.9		—		—			10.9
Accounts receivable, net	—		66.9			135.4		143.7		—			346.0
Notes receivable, net	—		—			90.9		67.8		—			158.7
Inventories	—		28.2			59.6		50.0		—			137.8
Other current assets	13.9		10.5			95.0		30.9		—			150.3
Property and equipment, net	1.1		137.3			441.8		192.9		—			773.1
Investment in subsidiaries	1,962.5		796.5			—		—		(2,759.0		)	—
Goodwill	—		251.7			465.4		466.0		—			1,183.1
Intangible assets, net	1.9		42.0			340.6		26.6		—			411.1
Intercompany balances	—		1,430.1			296.3		—		(1,726.4		)	—
Software, net	9.4		31.7			251.4		51.0		—			343.5
Other assets	6.0		147.7			42.2		372.3		—			568.2
Total assets	$	2,050.8	$	2,942.6		$	2,253.9	$	1,474.5	$	(4,485.4	)	$	4,236.4
Liabilities and stockholders’ equity
Debt payments due within one year	$	—	$	23.0		$	—	$	7.4	$	—		$	30.4
Other current liabilities	30.4		63.2			176.2		151.4		—			421.2
Long-term debt, excluding current installments	250.0		2,912.2			—		—		—			3,162.2
Other long-term liabilities	20.8		37.8			121.2		67.8		—			247.6
Intercompany balances	1,374.6		—			—		351.8		(1,726.4		)	—
Stockholders’ equity	375.0		(93.6		)	1,956.5		896.1		(2,759.0		)	375.0
Total liabilities and stockholders’ equity	$	2,050.8	$	2,942.6		$	2,253.9	$	1,474.5	$	(4,485.4	)	$	4,236.4

Supplemental Condensed Consolidating Statement of Income

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME

Three Months Ended September 30, 2014

	Parent  Company			SGI			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries		Consolidated
Revenue	$	—		$	106.9		$	159.1		$	149.6		$	—	$	415.6
Cost of instant games, cost of services and cost of product sales (1)	—			29.7			82.2			87.3			—		199.2
Selling, general and administrative	19.5			16.8			40.4			18.9			—		95.6
Research and development	—			1.2			20.9			4.2			—		26.3
Employee termination and restructuring	(0.1		)	—			1.4			0.6			—		1.9
Depreciation and amortization	1.2			11.8			67.7			19.7			—		100.4
Operating (loss) income	(20.6		)	47.4			(53.5		)	18.9			—		(7.8		)
Interest expense	(0.2		)	(16.2		)	(29.1		)	(0.2		)	—		(45.7		)
Other (expense) income, net	(7.0		)	(55.4		)	41.4			10.1			—		(10.9		)
Net (loss) income before equity in income of subsidiaries and income taxes	(27.8		)	(24.2		)	(41.2		)	28.8			—		(64.4		)
Equity in (loss) income of subsidiaries	(38.8		)	16.3			—			—			22.5		—
Income tax expense	(3.2		)	(0.2		)	—			(2.0		)	—		(5.4		)
Net (loss) income from continuing operations	$	(69.8	)	$	(8.1	)	$	(41.2	)	$	26.8		$	22.5	$	(69.8	)
Net (loss) income	(69.8		)	(8.1		)	(41.2		)	26.8			22.5		(69.8		)
Other comprehensive (loss) income	(55.1		)	(5.4		)	—			(55.7		)	61.1		(55.1		)
Comprehensive (loss) income	$	(124.9	)	$	(13.5	)	$	(41.2	)	$	(28.9	)	$	83.6	$	(124.9	)

(1) Exclusive of depreciation and amortization.

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME

Three Months Ended September 30, 2013

	Parent  Company			SGI			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
Revenue	$	—		$	100.6		$	20.3		$	113.9		$	(0.4	)	$	234.4
Cost of instant games, cost of services and cost of product sales (1)	—			30.2			38.1			59.8			(1.6		)	126.5
Selling, general and administrative	16.9			13.3			2.5			13.1			(0.2		)	45.6
Research and development	—			0.9			0.2			0.3			—			1.4
Employee termination and restructuring	—			—			—			—			—			—
Depreciation and amortization	0.2			9.8			5.6			19.6			—			35.2
Operating (loss) income	(17.1		)	46.4			(26.1		)	21.1			1.4			25.7
Interest expense	(5.3		)	(19.7		)	—			(0.2		)	—			(25.2		)
Other income (expense), net	1.3			(44.9		)	45.1			3.3			(1.4		)	3.4
Net (loss) income before equity in income of subsidiaries and income taxes	(21.1		)	(18.2		)	19.0			24.2			—			3.9
Equity in income (loss) of subsidiaries	23.6			18.8			—			—			(42.4		)	—
Income tax expense	(2.9		)	(0.1		)	—			(1.3		)	—			(4.3		)
Net (loss) income from continuing operations	$	(0.4	)	$	0.5		$	19.0		$	22.9		$	(42.4	)	$	(0.4	)
Net loss from discontinued operations	(0.1		)	—			—			(0.1		)	0.1			(0.1		)
Net (loss) income	(0.5		)	0.5			19.0			22.8			(42.3		)	(0.5		)
Other comprehensive (loss) income	39.2			(2.1		)	—			41.0			(38.9		)	39.2
Comprehensive (loss) income	$	38.7		$	(1.6	)	$	19.0		$	63.8		$	(81.2	)	$	38.7

(1) Exclusive of depreciation and amortization.

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME

Nine Months Ended September 30, 2014

	Parent  Company			SGI			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries		Consolidated
Revenue	$	—		$	317.1		$	475.4		$	428.1		$	—	$	1,220.6
Cost of instant games, cost of services and cost of product sales (1)	—			93.5			243.8			237.1			—		574.4
Selling, general and administrative	51.6			50.9			122.5			57.6			—		282.6
Research and development	—			2.3			62.5			12.2			—		77.0
Employee termination and restructuring	1.9			0.2			5.5			4.8			—		12.4
Depreciation and amortization	6.7			32.1			187.5			64.2			—		290.5
Operating (loss) income	(60.2		)	138.1			(146.4		)	52.2			—		(16.3		)
Interest expense	(2.5		)	(62.7		)	(77.0		)	(0.7		)	—		(142.9		)
Other (expense) income, net	(39.6		)	(150.7		)	132.8			47.5			—		(10.0		)
Net (loss) income before equity in income of subsidiaries and income taxes	(102.3		)	(75.3		)	(90.6		)	99.0			—		(169.2		)
Equity in (loss) income of subsidiaries	(71.7		)	51.4			—			—			20.3		—
Income tax expense	(13.2		)	(0.3		)	—			(4.5		)	—		(18.0		)
Net (loss) income from continuing operations	$	(187.2	)	$	(24.2	)	$	(90.6	)	$	94.5		$	20.3	$	(187.2	)
Net (loss) income	(187.2		)	(24.2		)	(90.6		)	94.5			20.3		(187.2		)
Other comprehensive (loss) income	(51.4		)	(2.4		)	(0.3		)	(45.6		)	48.3		(51.4		)
Comprehensive (loss) income	$	(238.6	)	$	(26.6	)	$	(90.9	)	$	48.9		$	68.6	$	(238.6	)

(1) Exclusive of depreciation and amortization.

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME

Nine Months Ended September 30, 2013

	Parent  Company			SGI			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
Revenue	$	—		$	308.4		$	42.2		$	340.5		$	(2.1	)	$	689.0
Cost of instant games, cost of services and cost of product sales (1)	—			97.1			107.2			185.8			(5.5		)	384.6
Selling, general and administrative	52.2			38.1			7.6			42.0			(0.8		)	139.1
Research and development	—			3.1			0.5			1.1			—			4.7
Employee termination and restructuring	—			—			—			0.3			—			0.3
Depreciation and amortization	0.5			28.4			16.7			65.5			—			111.1
Operating (loss) income	(52.7		)	141.7			(89.8		)	45.8			4.2			49.2
Interest expense	(15.9		)	(58.8		)	—			(0.6		)	—			(75.3		)
Other income (expense), net	4.5			(131.7		)	134.6			9.0			(4.2		)	12.2
Net (loss) income before equity in income of subsidiaries and income taxes	(64.1		)	(48.8		)	44.8			54.2			—			(13.9		)
Equity in income (loss) of subsidiaries	45.5			44.6			—			—			(90.1		)	—
Income tax expense	(6.5		)	(0.3		)	—			(4.4		)	—			(11.2		)
Net (loss) income from continuing operations	$	(25.1	)	$	(4.5	)	$	44.8		$	49.8		$	(90.1	)	$	(25.1	)
Net loss from discontinued operations	(1.6		)	—			—			(1.6		)	1.6			(1.6		)
Net (loss) income	(26.7		)	(4.5		)	44.8			48.2			(88.5		)	(26.7		)
Other comprehensive (loss) income	1.9			(1.9		)	—			3.6			(1.7		)	1.9
Comprehensive (loss) income	$	(24.8	)	$	(6.4	)	$	44.8		$	51.8		$	(90.2	)	$	(24.8	)

(1) Exclusive of depreciation and amortization.

Supplemental Condensed Consolidating Statement of Cash Flows

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Nine Months Ended September 30, 2014

	Parent  Company			SGI			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in) provided by operating activities	$	(79.2	)	$	19.8		$	160.0		$	132.8		$	—		$	233.4
Cash flows from investing activities:																—
Additions to property and equipment	(2.3		)	(2.1		)	(22.1		)	(5.9		)	—			(32.4		)
Lottery and gaming services expenditures	(0.1		)	(9.7		)	(41.3		)	(22.0		)	—			(73.1		)
Intangible assets and software expenditures	(6.0		)	(12.1		)	(49.9		)	(2.8		)	—			(70.8		)
Additions to equity method investments	—			—			—			(43.3		)	—			(43.3		)
Distributions of capital on equity investments	—			(1.3		)	—			46.7			—			45.4
Proceeds on sale of equity interest	—			—			—			44.9			—			44.9
Other	(9.6		)	29.2			(0.6		)	16.1			(35.7		)	(0.6		)
Intercompany balances	—			18.8			(44.9		)	—			26.1			—
Net cash provided by (used in) investing activities	(18.0		)	22.8			(158.8		)	33.7			(9.6		)	(129.9		)
Cash flows from financing activities:
Net payments on long-term debt	—			(19.5		)	—			(9.9		)	—			(29.4		)
Payments of financing fees	—			(22.8		)	—			—			—			(22.8		)
Payments on license obligations	—			—			(7.0		)	—			—			(7.0		)
Common stock repurchases	(29.5		)	—			—			—			—			(29.5		)
Contingent earnout payments	—			—			(7.0		)	(3.2		)	—			(10.2		)
Net redemptions of common stock under stock-based compensation plans	(19.1		)	—			—			(35.7		)	35.7			(19.1		)
Other, principally intercompany balances	126.2			—			—			(100.1		)	(26.1		)	—
Net cash provided by (used in) financing activities	77.6			(42.3		)	(14.0		)	(148.9		)	9.6			(118.0		)
Effect of exchange rate changes on cash	—			—			(0.3		)	(6.4		)	—			(6.7		)
Increase (decrease) in cash and cash equivalents	(19.6		)	0.3			(13.1		)	11.2			—			(21.2		)
Cash and cash equivalents, beginning of period	56.0			—			24.4			73.3			—			153.7
Cash and cash equivalents, end of period	$	36.4		$	0.3		$	11.3		$	84.5		$	—		$	132.5

SCIENTIFIC GAMES CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Nine Months Ended September 30, 2013

	Parent Company			SGI			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in) provided by operating activities	$	(44.7	)	$	(16.1	)	$	43.3		$	113.1		$	—		$	95.6
Cash flows from investing activities:
Additions to property and equipment	(3.3		)	(1.8		)	(12.2		)	(5.6		)	—			(22.9		)
Lottery and gaming services expenditures	(0.2		)	(6.4		)	(0.4		)	(44.3		)	—			(51.3		)
Intangible assets and software expenditures	(2.1		)	(12.2		)	(11.7		)	(12.1		)	—			(38.1		)
Business acquisitions, net of cash acquired	—			—			—			(0.4		)	—			(0.4		)
Other assets and investments	9.9			14.0			—			36.3			(64.3		)	(4.1		)
Other, principally intercompany balances	32.3			—			(23.4		)	—			(8.9		)	—
Net cash (used in) provided by investing activities	36.6			(6.4		)	(47.7		)	(26.1		)	(73.2		)	(116.8		)
Cash flows from financing activities:
Net payments on long-term debt	—			(4.7		)	—			(4.8		)	—			(9.5		)
Net redemptions of common stock under stock-based compensation plans	(2.1		)	—			—			(64.3		)	64.3			(2.1		)
Payment of financing fees	—			(2.0		)	—			—			—			(2.0		)
Other, principally intercompany balances	—			29.0			—			(37.9		)	8.9			—
Net cash provided by (used in) financing activities	(2.1		)	22.3			—			(107.0		)	73.2			(13.6		)
Effect of exchange rate changes on cash	—			0.2			—			(0.9		)	—			(0.7		)
Decrease in cash and cash equivalents	(10.2		)	—			(4.4		)	(20.9		)	—			(35.5		)
Cash and cash equivalents, beginning of period	27.2			0.2			2.4			79.2			—			109.0
Cash and cash equivalents, end of period	$	17.0		$	0.2		$	(2.0	)	$	58.3		$	—		$	73.5