Investor OverviewJune 2020
1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This presentation contains statements that constitute forward-looking statements which involve risks and uncertainties, including such risks and uncertainties relatedto the effects of COVID-19 on the Company’s business and results of operations and other factors set forth in the Annual Report on Form 10-K of PlayAGS, Inc.(“AGS” or the “Company”) filed with the U.S. Securities and Exchange Commission (the “SEC”) by the Company. These statements include descriptions regardingthe intent, belief or current expectations of AGS or its officers with respect to the consolidated results of operations and financial condition, future events and plansof AGS. These statements can be recognized by the use of words such as "expects," "plans," "will," "estimates," "projects," or words of similar meaning. Such forward-looking statements are not guarantees of future performance and actual results may differ from those in the forward-looking statements as a result of variousfactors and assumptions. These statements are subject to risks, uncertainties, changes in circumstances, assumptions and other important factors, many of whichare outside management’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. You arecautioned not to place undue reliance on these forward looking statements, which are based on the current view of the management of AGS on future events.We undertake no obligation to publicly update or revise any forward-looking statement contained in this presentation, whether as a result of new information,future events or otherwise, except as required by law. In light of the risks, uncertainties and assumptions, the forward-looking events discussed in this presentationmight not occur, and our actual results could differ materially from those anticipated in these forward-looking statements.
This presentation also contains references to Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), Adjusted EBITDA, Free Cash Flow, total netdebt leverage ratio and adjusted total net debt leverage ratio which are non-GAAP financial measures. Management believes that there are non-GAAPmeasures and their related measures are commonly reported by companies and widely used by investors as indicators of a company’s operating performance.Non-GAAP financial measures should be considered only as a supplement to, and not as a superior measure to, financial measures prepared in accordance withGAAP. Please refer to the reconciliations of certain non-GAAP financial measures included in this presentation to the most directly comparable financial measureprepared in accordance with GAAP.
Unless otherwise noted, information included herein is presented as of the dates indicated. This presentation is not complete and the information contained hereinmay change at any time without notice. Except as required by applicable law, we do not have any responsibility to update the presentation to account for suchchanges.
Certain information in this presentation is based upon management forecasts and reflects prevailing conditions and management’s views as of this date, all ofwhich are subject to change. In preparing this presentation, we have relied upon and assumed, without independent verification, the accuracy andcompleteness of all information available from public sources or which was provided to us by third parties. The information contained herein is subject to change,completion or amendment and we are not under any obligation to keep you advised of such changes. We make no representation or warranty, express orimplied, with respect to the accuracy, reasonableness or completeness of any of the information contained herein, including, but not limited to, informationobtained from third parties.
The information contained herein is not intended to provide, and should not be relied upon for, accounting, legal or tax advice or investment recommendations.
2
▪ Market-leading and high-performing products
• Casino-owned EGMs generated win per day of ~1.2x(1)
▪ Recurring revenue represents 70% of total revenue(2)
• More than 26,000 EGMs on lease
▪ Growth in free cash flow provides opportunities for high-ROI investments, growth and deleveraging
▪ AGS generates one of the top EGM Adjusted EBITDA margins in the industry, which fund high-ROI growth opportunities
▪ EGM sales provide a tremendous opportunity to expand and diversify product and customer mix
INVESTMENT HIGHLIGHTS
Attractive
Business Model
w/ High-
Performing
Products
▪ Industry-leading game performance drives continued market share growth
▪ Recent ship share gains far in excess of current market share: ~5% U.S. ship share(3)
vs 3.0% market share of a total market of nearly 1 million EGMs.
▪ Substantial whitespace opportunity due to an expansive total addressable market: Grew new licenses and TAM by 82% and 38%, respectfully, since 2014
▪ Emerging product line in large table games market
▪ Real money gaming offers future upside by leveraging land-based content in emerging markets in Europe and U.S.
▪ Meaningful international expansion opportunities in Philippines and South America
Multiple Levers
for Growth
(1) Eilers-Fantini Game Performance Report – April 2020
(2) For LTM 3/31/20
(3) Eilers – Fantini Quarterly Slot Surveys
3
MANAGING COVID-19 IMPACT
▪ Health and safety of our employees and the communities we operate in remains our top priority
▪ Providing employees workplace flexibility and various health resources
▪ Protect our culture amid crisis
▪ Cost savings initiatives and capital expenditure reductions
▪ Labor cost savings through company-wide salary reductions, furloughs, and 10% reduction in
work force
▪ Protecting our renowned employee-centric corporate culture was considered in all
decisions and communications
▪ Suspension of all non-essential spending
▪ Suspension of all non-essential capital expenditures
▪ The company estimates that it has reduced its monthly cash outflows nearly 80% to
approximately $4 million with an additional monthly debt service cost of $3.8 million
▪ 3/19/20 borrowed under the revolving credit facility in the full amount of $30 million
▪ 5/1/20 closed on $95 million incremental term loan and amended the credit agreement to
provide for net first lien leverage ratio covenant relief
▪ Current cash balance of $129 million(1)
Our People
Cash
Preservation
& Controlling
Costs
Balance Sheet
Flexibility
(1) Pro Forma cash balance of $127 million as of 3/31/20
4
12/31/2019 3/31/2020 Adj Pro Forma Rate Maturity
Capitalization
Cash $13 $44 $83 $127
$30 million existing revolver – 30 – 30 L+3.50% 06/06/22
First lien term loan 532 531 – 531 L+3.50% 02/15/24
Incremental term loan – – 95 95 L+13.00% 02/15/24
Other 2 2 – 2
Total first lien debt $534 $562 – $657
Total debt $534 $562 – $657
Total net debt $521 $519 – $530
LTM Adjusted EBITDA $146 $134 – $134
Net leverage 3.6x 3.9x – 4.0x
CAPITAL STRUCTURE OVERVIEW
Capitalization
▪ On March 19, 2020, drew under the revolving credit facility the full amount of $30 million
▪ On May 1st, closed an incremental term loan of $95 million and amended our credit agreement to provide financial covenant relief
▪ Incremental term loan matures in February 2024 with an interest of 1,300 basis points, with a 100 basis point LIBOR floor
5
CORE VALUES
6
ACCOLADES
We are proud of our people, products, and culture and appreciate the fact that we are recognized for the impact we make in all three facets.
2017 - 20192017 - 2019Orion and Bonus Spin STAX Progressive
5%+US AGS employees are veterans
Vegas Inc.Financial Executive of the Year
Manufacturing & Technology
Kimo AkionaChief Financial Officer STAX Progressive
DavidLopezChief Executive Officer
PEOPLE PRODUCTS CULTURE
Starwall
7
PERFORMANCE DRIVEN BY CULTURE OF INNOVATION
David Lopez
Kimo Akiona
Sigmund Lee
Matt Reback
Julia Boguslawski
John Hemberger
TitleYears
Experience
Years at
AGSAGS Drives Innovation Through Its Unique Culture
700+ EMPLOYEESAROUND THE GLOBE
R&D employees represent ~33% of total AGS employees
Kris Morishige
8
AGS COMPANY OVERVIEW
Table Products: $11mm+29% Y-o-Y
$286mm Revenue-3% Y-o-Y
47% Adj. EBITDA margin
$134mm Adj. EBITDA-3% Y-o-Y
LTM 3/31/20Revenue
70% RECURRING REVENUE
EGM: $270mm-3% Y-o-Y
Interactive: $5mm-14% Y-o-Y
CanadaMexico Philippines Brazil
RampingEstablished Early Entry
LTM 3/31/2020
(1)
Prospective
Note: All figures as of LTM 3/31/20. Y-o-Y growth is from LTM 3/31/19 to LTM 3/31/20
(1) Denotes AGS acquired by funds managed by Apollo, not Apollo Global Management itself
FINANCIAL SNAPSHOT SEGMENT BREAKDOWNSIGNIFICANT EGM
WHITESPACE OPPORTUNIY
CORPORATE EVOLUTION
No Gaming
9
$36.7 $23.4
$0.5
$0.9
0.0
25.0
50.0
Q1 2019 Q1 2020
EGM Table Products
$69.7
$50.4
$2.2
$2.5
$1.2
$1.5
50.0
Q1 2019 Q1 2020
EGM Table Products Interactive
Q1 2020 FINANCIAL PERFORMANCE
Note: Adjusted EBITDA allows us to add back certain non-cash charges that are deducted in calculating net income and to deduct certain gains that are included in
calculating net income. However, these expenses and gains vary greatly, and are difficult to predict. They can represent the effect of long-term strategies as opposed to
short-term results. In addition, in the case of charges or expenses, these items can represent the reduction of cash that could be used for other corporate purposes.
Note: Please refer to appendix for Net Income to Adjusted EBITDA reconciliation
REVENUE ADJUSTED EBITDA
$279.4 $270.3
$8.1
$10.5
$5.9
$5.1
250.0
300.0
LTM 3/31/19 LTM 3/31/20
EGM Table Products Interactive
($ in mm) ($ in mm)
Recurring
Revenue
$200.4
Recurring
Revenue
$42.7
$73.0
$54.3
$286.0$293.5
$139.8
$131.4
$1.2
$4.1
120.0
LTM 3/31/19 LTM 3/31/20
EGM Table Products
Interactive: ($3.1) Interactive: ($1.2)
Interactive: ($0.4)
$138.0
$24.5
$36.3
$134.3
Interactive: ($0.9) Interactive: $0.2
10
EGM SEGMENT
11
Class II
12,291
International
8,286
Class III
5,000
VLT
512
EGM SEGMENTSTRONG RECURRING REVENUE BASE WITH COMPETITIVE MARGINS
26,089
Leased
EGMs
47%
32%
19%
Mexico &
Philippines
▪ Second largest Class II Installed Base
▪ High recurring revenue
▪ Strong relationships
▪ High margin business
2%
EGM INSTALLED BASE
Note: Installed base as of 3/31/2020
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EGM SEGMENT
EGM REVENUE & EGM ADJUSTED EBITDA
$200
$271 $290$270
$108 $137 $145 $131
2017 2018 2019 LTM 3/31/2020
EGM Revenue EGM Adjusted EBITDA
($ in mm)
16,078 16,296 18,368 17,803
7,727 8,3518,497 8,286
2017 2018 2019 3/31/2020
Domestic International
~100% recurring business; ~80% gross profit margin(1)
LEASED EGMs
Note: All financial figures include contributions of Rocket Gaming Systems acquisition in December 2017 and Integrity Gaming Corp. acquisition in February 2019.(1) Gross Profit Margin for leased units = EGM gaming operations revenue less EGM cost of gaming operations, divided by EGM gaming operations revenue for LTM 3/31/2020(2) Gross Profit Margin for sold units defined as EGM equipment sales revenue less costs of equipment sales, divided by EGM equipment sales revenue for LTM 3/31/2020
~50% gross profit margin(2)
2,565
4,387 4,879
4,329
2017 2018 2019 LTM 3/31/2020
SOLD EGMs
26,865 26,08924,64723,805
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EGM SEGMENT - NEW PRODUCTS FUELING GROWTHEXCITING NEW PRODUCTS IN THE PIPELINE
Pricing Model Premium Lease Only Premium Lease Only Sale & Lease
Year Introduced Q1 2020 Q1 2020 Q2 2020
Installed Base (1) 48 12 N/A
Approx. Fixed
Fees~$50 ~$300 N/A
Selling Price N/A N/A N/A
Steady
release
of game
titles
and
cabinets
Eight-foot premium cabinet gives AGS a competitive curved
portrait option
Large-format LED display for premium
portrait elevates game merchandising
beyond traditional signs, end caps, etc.
High-rise format for premium lease only
merchandised to attract players
Robust product pipeline fuels future growth
Orion Rise Orion 49CStarwall Pipeline
Note: Based on our list price of EGMs
(1) Leased units as of 3/31/20
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1.3X
1.2X1.0X
1.1X
1.0X 1.0X0.9X
0.8X0.8X
Pe
rfo
rma
nc
e o
ve
r zo
ne
av
era
ge
TOP 25 CORE GAME
@ 1.6 HA
RECENT EGM PERFORMANCE
GAME PERFORMANCE OVERVIEW
▪ 6 R&D studios across the globe to generate industry recognized content
▪ Proven ability to create high-performing content offerings with staying power
(1) Eilers-Fantini Game Performance Report – April 2020
Top Indexing Suppliers – Owned (Domestic Performance)(1)
TOP INDEXING SUPPLIER OVERALL(1)
TOP 25 GROSSING OWNED
GAME
15
FOOTPRINTAGS HAS SIGNIFICANTLY EXPANDED ITS FOOTPRINT, BUT STILL HAS MANY EARLY ENTRY MARKETS TO PENETRATE
75%
5%
9%
11%
CA75,368
NV160,625
UT
AZ17,562
TX3,765
OR19,220
WA31,759
ID3,764
MT17,559
WY1,676
CO15,350
NM20,097
OK75,140
KS8,574
NE662
SD14,798
ND3,989
MN21,505
WI18,113
MI31,126IA
18,818
IL42,940
MO16,246
AR3,504
LA39,998
FL24,090
GAAL6,441
MS28,216
SC
NC4,455TN
KY2,891
IN19,181
OH18,766
WV12,816 MD
11,474
PA24,236
NY35,229
ME1,682
VTNH MA
6,730
CT7,499
RI5,099
DE6,486
MB10,099
RampingEstablished Early Entry Prospective No Casino Gaming
AK90
% of total units
BC15,490
NB2,711
NL1,896
SK7,581
AB20,927
ON25,017
QC16,763
NS2,919
PE505
Note: Eilers: Slot & Table Count – 4Q19
NJ17,742
VA2,149
16
11%
MARKET SHAREAGS IS GROWING MARKET SHARE IN CURRENTLY LICENSED STATES
Note: Market share is calculated based on the # of units on participation plus the cumulative amount of units sold to date and estimated to remain on casino floors(1) Per Eilers & Krejcik - Slot & Table Count - 4Q19(2) Other Early Entry jurisdictions include AR, AZ, CT, DE, ID, IA, IL, KS, MD, MA, MN, ND, NE, NJ, NC, OR, SD, WA, WI, WY and the Canadian provinces of British Columbia, Manitoba, New Brunswick, Nova
Scotia, Prince Edward Island, and Saskatchewan. (3) AGS is not currently licensed in U.S. states of AK, CO, KY, ME, MO, RI, VA, WV and the Canadian province of Newfoundland & Labrador. (4) Ship share is average TTM 3/31/20 ship share Per Eilers& Krejcik
9%
7%
3%
Ship
Share(4)
7%
10%
11%
Market Stage JurisdictionEstimated Total Units in State(1)
AGS Estimated Current Market Share
Established
Alabama 6,441 49.0%
Texas 3,765 36.8%
Oklahoma 75,140 13.3%
Florida 24,090 11.4%
RampingMontana 17,559 2.9%
California 75,368 2.6%
Early Entry
Indiana 19,181 1.9%
Ontario - CAN 25,017 1.7%
New Mexico 20,097 1.6%
Mississippi 28,216 1.5%
New York 35,229 1.5%
Michigan 31,126 1.4%
Louisiana 39,998 1.2%
Nevada 160,625 0.9%
Alberta - CAN 20,927 0.8%
Pennsylvania 24,236 0.6%
Ohio 18,766 0.5%
Other(2) 317,338 1.7%
Prospective Other(3) 58,219 0.1%
Total 1,001,338 3.0%
17
EMERGING SUPPLIERSSMALLER SUPPLIERS GAINING SHARE
20%
17% 16%
25%27%
28%
31%
34%
10%
20%
30%
40%
12/11 12/12 12/13 12/14 12/15 12/16 12/17 12/18 12/19 12/20
Industry consolidation
triggered shift towards Non-
Big-3 suppliers
30%
23%19%
7% 6% 6%2% 2% 2% 0% 0%
3%
Other
Big-3 Non-Big-3
(1) EILERS: Gaming Supplier KPIs - 4Q20. 3/31/20 is based on Eilers estimates.
(2) 1Q20 EILERS-FANTINI Quarterly Slot Survey; expected forward replacement ship share includes route ops
3/31/20
33%
Non-Big-3 Ship Share Increasing as Customers Prefer More Diversification Given Industry Consolidation(1)
North American Expected FORWARD 12-Month Replacement Ship Share(2)
34%
18
EGM - INTERNATIONAL GROWTH
GROW INTERNATIONAL FOOTPRINT (MOSTLY RECURRING REVENUE)
International
Mexico
Philippines
▪ Initial ALORA units currently installed and live
▪ Monitoring initial performance
▪ ~70,000 unit market size
▪ Currently represent ~10% of the Mexico EGM market
▪ ~88,000 unit market size
▪ Low cost optimization of legacy domestic units
Imm
ed
iate
Up
sid
e
▪ Argentina, Peru and Asia represent future opportunities for growth
Brazil
Furt
he
r U
psi
de
▪ Pending legislation could allow up to 500,000+ video bingo machines
▪ Targeting 8,000-10,000 recurring revenue video bingo machines
19
TABLE PRODUCTS SEGMENT
20
▪ Capitalize on trend of
introducing multiple
side-bets on
blackjack tables to
increase the game’s
overall hold
▪ Segment will serve as
important growth
engine by introducing
further cross-selling
opportunities with
EGM offerings
▪ Recently acquired In
Bet Gaming assets
strengthen library
▪ Progressive bonusing
on table products is
growing trend with
substantial growth
opportunity
▪ Improves marketing
and drives slot-style
excitement
▪ Revolutionary Bonus
Spin Xtreme links all
table games within a
casino, including
community games
▪ Dex S single deck
poker shuffler
launched in late 2018;
more than 160
installed and growing
with North American
market opportunity of
+7,000 poker tables
▪ Addresses pent-up
demand for
alternative option in
the shuffler market
▪ Showcased Pax S
single-deck specialty
shuffler at G2E for 2020
launch
▪ Adds excitement,
motion, and attraction
to the table pit and
enhances player
experience
▪ New seasonal displays,
customizable content,
and animated
characters incent
operators to upgrade
outdated technology
TABLE PRODUCTS AT A GLANCE
Premium Games &
Side BetsProgressive Technology Card Shufflers Table Signage
21
$4.1
$7.7
$10.2 $10.5
($0.5)
$0.9
$3.7 $4.1
2017 2018 2019 LTM 3/31/2020
Revenue AEBITDA
TABLE PRODUCTS SEGMENT
Table Products Revenue & AEBITDA Table Products Installed Base and ALP
($ in mm)
2,400
2017 2018 2019 3/31/2020
~55% Side Bets
~35% Progressives
~5% Premium
~5% Other
$167 $218 $230
3,162
ALP:
3,897
$197
3,766
22
INTERACTIVE SEGMENT
23
Pennsylvania
Prospective
Markets
United
Kingdom
New Jersey
INTERACTIVE SEGMENT – RMG OPPORTUNITY
▪ Recently received approval to place slot content with 17 of 20, or 85%of iGaming operators
▪ Currently live with Caesars Entertainment, Golden Nugget, Resorts Digital Gaming, Mohegan Sun, Kindred Group, and Rush Street
▪ Current iGaming market gross revenue of nearly $300M
▪ U.K. iGaming is one of the largest markets with nearly $2.5B in annual iGaming gross revenue
▪ Currently live on operators such as: GVC, Ladbrokes Coral, William Hill, 888, BetVictor and Rank
Imm
ed
iate
Up
sid
e
▪ Pennsylvania, regulated European markets, Canada and Latin America, all represent future opportunities for growth
Fu
rth
er
Up
sid
e
▪ Recently launched into the Pennsylvania market
▪ Currently live with Rush Street and Parx Casino
24
INTERACTIVE SEGMENTINDUSTRY-LEADING CONTENT DRIVES CUSTOMER ENGAGEMENT
▪ Recently launched our RMG platform into Pennsylvania and live with two operators
▪ Our RMG platform now live in New Jersey with six operators
▪ Continued placement of AGS content in the European RMG space with introduction two new titles in Q1, Bonanza Blast and Wolf Queen
▪ Continued costs savings from the restructuring of our social business
($ in mm)
Real Money Gaming (AxSys) Interactive Revenue & AEBITDA
$8.0
$6.6
$4.9 $5.1
($0.4)
($2.1) ($2.4)($1.2)
2017 2018 2019 LTM 3/31/2020
Revenue AEBITDA
25
FINANCIALS
26
AGS’ STRONG FINANCIAL TRACK RECORD OF SUCCESS
$107
$85
$136$146
51% 50% 48% 48% 45%
2016 2017 2018 2019 LTM 3/31/20
Adj. EBITDA margin
$167
$212
$285 $286
2016 2017 2018 2019 LTM 3/31/20
$305
▪ 70% of the $286(1) million total revenue is recurring
• ~80% gross profit margin for leased units(2) and ~50% gross profit margin for sold units(3)
▪ 47% LTM 3/31/20 Total Adjusted EBITDA Margin
($ in mm)
Revenues by Segment 2016 2017 2018 2019 LTM 3/31/20
EGM $156.4 $199.9 $271.0 $289.6 $270.3
Table Products 2.7 4.1 7.7 10.2 10.5
Interactive 7.7 8.0 6.6 4.9 5.1
Adjusted EBITDA by Segment 2016 2017 2018 2019 LTM 3/31/20
EGM $91.7 $107.8 $137.4 $144.7 $131.4
Table Products (1.7) (0.5) 0.9 3.7 4.1
Interactive (4.7) (0.4) (2.1) (2.4) (1.2)
($ in mm)
(1) Total Revenue for LTM 3/31/20
(2) Gross Profit Margin for leased units = EGM gaming operations revenue less EGM cost of gaming operations, divided by EGM gaming operations revenue for LTM 3/31/20
(3) Gross Profit Margin for sold units = EGM equipment sales revenue less EGM cost of equipment sales, divided by EGM equipment sales revenue for LTM 3/31/20
(4) As reported figures
Strong Revenue Growth with Robust Margins
Total Revenue(4) Total Adjusted EBITDA(4)
$134
27
FAVORABLE CASH FLOW DYNAMICS INVESTMENTS
▪ Total Adj. EBITDA – one of the
industries leading Adj. EBITDA
margin of 47% (1)
▪ Cash taxes – significant NOLs of
over $100 million and high D&A
results in minimal cash taxes
▪ Maintenance capex – low
refurbishment obligations on
existing installed base
PRODUCE HIGH DISCRETIONARY CASH FLOW AND PERMIT ATTRACTIVE ROI
Favorable Cash Flow Drivers
▪ Growth capex – builds recurring
revenue base by placing
higher yielding leased cabinets
with highly compelling ROIs
▪ Intangibles – primarily
capitalized R&D that facilitates
cutting edge hardware and
content development
Strong cashflow
for high-ROI
investments, growth
and deleveraging
(1) Adjusted EBITDA margin for LTM 3/31/2020
28
SUMMARIZING THE AGS OPPORTUNITY
Attractive high-margin, recurring revenue model1
Pure-play casino gaming supplier with outsized growth potential2
Capitalizing on strong Class II position while continuing to penetrate Class III markets3
Strong free cash flow generation allows for reinvestment in business at attractive ROIs4
Industry-leading R&D platform in both hardware and content5
Diversified product suite6
Proven ability to successfully integrate acquisitions and scale the platform7
Growth from international expansion in Philippines, Brazil and other markets8
29
APPENDIX
30
More than 9,200 units installed
36 titles available
Rakin’ Bacon – 1.6x vs HA(1)
(1) Eilers-Fantini Game Performance Report April 2019
31
48 units installed
Launched in Q1 2020
Premium offering to drive leases
32
Launched in Q1 2020
12 units installed
Premium offering to drive leases
33
49” curved LCD 4K portrait monitor
420 game-controlled LED lights
Ergonomic button deck
Scheduled launch – Q2 2020
For sale, lease, or participation
34
More than 2,600 units installed
74 titles available
(1) Eilers-Fantini Game Performance Database October 2019 TTM
35
More than 600 units installed
64 titles available
36
CONSOLIDATED OPERATIONAL SUMMARY
($ in mm, except RPD, ASP, and ALP)
Operational and other data Q1 Q2 Q3 Q4 2018 Q1 Q2 Q3 Q4 2019 Q1 LTM 3/31/20
Revenues by segmentEGM $61.3 $69.3 $71.8 $68.7 $271.0 $69.7 $71.0 $75.3 $73.7 $289.6 $50.4 $270.3Table products 1.7 1.8 2.1 2.1 7.7 2.2 2.4 2.9 2.8 10.2 2.5 10.5Interactive 1.9 1.7 1.7 1.3 6.6 1.2 1.1 1.2 1.3 4.9 1.5 5.1Total revenue $64.9 $72.8 $75.5 $72.1 $285.3 $73.0 $74.5 $79.4 $77.8 $304.7 $54.3 $286.0
Adjusted EBITDA by segmentEGM $34.3 $36.9 $34.0 $32.2 $137.4 $36.7 $35.5 $35.8 $36.6 $144.7 $23.4 $131.4
% margin 56.0% 53.2% 47.4% 46.9% 50.7% 52.7% 50.1% 47.6% 49.7% 50.0% 46.4% 48.6%Table products 0.2 0.1 0.4 0.3 0.9 0.5 0.8 1.4 1.0 3.7 0.9 4.1Interactive 0.0 (0.4) (0.9) (0.9) (2.1) (0.9) (0.6) (0.4) (0.4) (2.4) 0.2 (1.2)Total Adjusted EBITDA $34.5 $36.6 $33.6 $31.5 $136.2 $36.3 $35.7 $36.8 $37.3 $146.1 $24.5 $134.3
% margin 53.2% 50.2% 44.5% 43.8% 47.7% 49.6% 48.0% 46.3% 47.9% 47.9% 45.1% 47.0%
EGM segmentVLT 1,217 1,217 1,217 797 797 667 517 517 512 512 512 512 Class II 12,254 12,206 11,477 11,790 11,790 12,191 12,154 12,355 12,415 12,415 12,291 12,291 Class III 3,082 3,224 3,374 3,709 3,709 5,940 5,750 5,852 5,441 5,441 5,000 5,000 Domestic installed base 16,553 16,647 16,068 16,296 16,296 18,798 18,421 18,724 18,368 18,368 17,803 17,803 International installed base 7,480 7,876 8,116 8,351 8,351 8,510 8,596 8,668 8,497 8,497 8,286 8,286 Total installed base 24,033 24,523 24,184 24,647 24,647 27,308 27,017 27,392 26,865 26,865 26,089 26,089
Installed base, Oklahoma 7,066 7,077 7,048 7,643 7,643 10,193 10,083 10,503 10,171 10,171 9,745 9,745 Installed base - non-Oklahoma 9,487 9,570 9,020 8,653 8,653 8,605 8,338 8,221 8,197 8,197 8,058 8,058 Domestic installed base 16,553 16,647 16,068 16,296 16,296 18,798 18,421 18,724 18,368 18,368 17,803 17,803
Domestic RPD $26.72 $27.79 $27.14 $26.41 $27.02 $26.42 $26.16 $25.08 $24.97 $25.65 $21.08 $24.34International RPD $8.27 $8.80 $8.52 $8.07 $8.41 $8.68 $8.22 $7.99 $7.65 $8.13 $6.89 $7.65Total RPD $20.94 $21.77 $20.95 $20.20 $20.96 $20.73 $20.49 $19.68 $19.52 $20.10 $16.57 $19.08
Domestic EGM units sold 792 1,058 1,332 1,159 4,341 1,024 1,053 1,350 1,173 4,600 426 4,002International EGM units sold 46 – – – 46 – 128 41 110 279 38 317Total EGM units sold 838 1,058 1,332 1,159 4,387 1,024 1,181 1,391 1,283 4,879 464 4,319
Domestic avg sales price $17,898 $18,728 $18,051 $18,782 $18,383 $18,657 $18,178 $18,476 $17,833 $18,302 $17,564 $18,112
Table products segmentTable products installed base 2,631 2,737 3,065 3,162 3,162 3,285 3,380 3,601 3,766 3,766 3,897 3,897Avg monthly lease price $220 $213 $214 $224 $218 $217 $230 $232 $239 $230 $197 $224
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TOTAL ADJUSTED EBITDA RECONCILIATION
▪ Write-downs and other include items related to loss on disposal or impairment of long lived assets, and fair value adjustments to contingent consideration
▪ Loss on extinguishment and modification of debt primarily relates to the refinancing of long-term debt, in which deferred loan costs and discounts related to old senior secured credit facilities were written off
• Other adjustments are primarily composed of professional fees incurred for projects, corporate and public filing compliance, contract cancellation fees and other transaction costs deemed to be non-operating in nature
▪ Other non-cash charges are costs related to non-cash charges and losses on the disposition of assets, non-cash charges on capitalized installation and delivery, which primarily includes the costs to acquire contracts that are expensed over the estimated life of each contract and non-cash charges related to accretion of contract rights under development agreements
▪ New jurisdiction and regulatory license costs relate primarily to one-time non-operating costs incurred to obtain new licenses and develop products for new jurisdictions
▪ Legal & litigation expenses include payments to law firms and settlements for matters that are outside the normal course of business
▪ Acquisition & integration costs include restructuring and severance and are related to costs incurred after the purchase of businesses, such as the acquisitions of Rocket and Gameiom, to integrate operations
▪ Non-cash stock compensation includes non-cash compensation expense related to grants of options, restricted stock, and other equity awards
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($ in mm)
Adj. EBITDA reconciliation Q1 Q2 Q3 Q4 2018
Net loss attributable to PlayAGS, Inc. ($9.5) ($5.3) $4.3 ($10.3) ($20.8)
Income tax expense (benefit) (12.4) 7.0 (3.5) 0.6 (8.4)
Depreciation and amortization 19.3 19.5 19.0 19.8 77.5
Other (income) expense 9.2 0.5 0.4 0.4 10.5
Interest income (0.1) (0.0) (0.1) (0.0) (0.2)
Interest expense 10.4 8.9 9.0 9.4 37.6
Write downs and other 1.6 1.0 0.7 5.5 8.8
Loss on extinguishment and modification of debt 4.6 – – 2.0 6.6
Other adjustments 0.4 0.9 0.9 0.2 2.4
Other non-cash charges 1.6 1.6 1.7 1.7 6.6
New jurisdiction and regulatory licensing costs – – – – –
Legal & litigation expenses including settlement payments – 0.8 (0.0) 0.2 1.0
Acquisition & integration related costs 1.2 1.2 0.7 0.5 3.6
Non-cash stock compensation 8.2 0.5 0.5 1.8 10.9
Adjusted EBITDA $34.5 $36.6 $33.6 $31.5 $136.2
($ in mm)
Adj. EBITDA reconciliation Q1 Q2 Q3 Q4 2019
Net (loss) income attributable to PlayAGS, Inc. ($0.1) ($7.6) ($5.5) $1.4 ($11.8)
Income tax (benefit) expense (5.8) (0.1) 1.9 (1.6) (5.4)
Depreciation and amortization 21.5 23.7 23.8 22.5 91.5
Other expense (income) 5.3 (0.0) (0.1) (0.5) 4.6
Interest income (0.0) (0.0) 0.0 (0.1) (0.2)
Interest expense 8.9 9.6 9.3 8.5 36.2
Write downs and other 1.0 5.0 0.8 0.1 6.9
Loss on extinguishment and modification of debt – – – – –
Other adjustments 0.3 0.4 0.1 0.2 0.9
Other non-cash charges 2.0 2.2 2.4 2.5 9.2
New jurisdiction and regulatory licensing costs – – – – –
Legal & litigation expenses including settlement payments – 0.0 1.7 0.1 1.8
Acquisition & integration related costs 2.0 0.4 0.5 0.4 3.2
Non-cash stock compensation 1.2 2.2 2.0 3.7 9.0
Adjusted EBITDA $36.3 $35.7 $36.8 $37.3 $146.1
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TOTAL ADJUSTED EBITDA RECONCILIATION
▪ Write-downs and other include items related to loss on disposal or impairment of long lived assets, and fair value adjustments to contingent consideration
▪ Loss on extinguishment and modification of debt primarily relates to the refinancing of long-term debt, in which deferred loan costs and discounts related to old senior secured credit facilities were written off
• Other adjustments are primarily composed of professional fees incurred for projects, corporate and public filing compliance, contract cancellation fees and other transaction costs deemed to be non-operating in nature
▪ Other non-cash charges are costs related to non-cash charges and losses on the disposition of assets, non-cash charges on capitalized installation and delivery, which primarily includes the costs to acquire contracts that are expensed over the estimated life of each contract and non-cash charges related to accretion of contract rights under development agreements
▪ New jurisdiction and regulatory license costs relate primarily to one-time non-operating costs incurred to obtain new licenses and develop products for new jurisdictions
▪ Legal & litigation expenses include payments to law firms and settlements for matters that are outside the normal course of business
▪ Acquisition & integration costs include restructuring and severance and are related to costs incurred after the purchase of businesses, such as the acquisitions of Rocket and Gameiom, to integrate operations
▪ Non-cash stock compensation includes non-cash compensation expense related to grants of options, restricted stock, and other equity awards
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($ in mm) LTM
Adj. EBITDA reconciliation Q2 '18 Q3 '18 Q4 '18 Q1 '19 3/31/19
Net loss attributable to PlayAGS, Inc. ($5.3) $4.3 ($10.3) ($0.1) ($11.4)
Income tax expense (benefit) 7.0 (3.5) 0.6 (5.8) (1.8)
Depreciation and amortization 19.5 19.0 19.8 21.5 79.7
Other (income) expense 0.5 0.4 0.4 5.3 6.6
Interest income (0.0) (0.1) (0.0) (0.0) (0.2)
Interest expense 8.9 9.0 9.4 8.9 36.1
Write downs and other 1.0 0.7 5.5 1.0 8.1
Loss on extinguishment and modification of debt – – 2.0 – 2.0
Other adjustments 0.9 0.9 0.2 0.3 2.3
Other non-cash charges 1.6 1.7 1.7 2.0 7.0
New jurisdiction and regulatory licensing costs – – – – –
Legal & litigation expenses including settlement payments 0.8 (0.0) 0.2 – 1.0
Acquisition & integration related costs 1.2 0.7 0.5 2.0 4.4
Non-cash stock compensation 0.5 0.5 1.8 1.2 4.0
Adjusted EBITDA $36.6 $33.6 $31.5 $36.3 $138.0
($ in mm) LTM
Adj. EBITDA reconciliation Q2 '19 Q3 '19 Q4 '19 Q1 '20 3/31/20
Net (loss) income attributable to PlayAGS, Inc. ($7.6) ($5.5) $1.4 ($14.4) ($26.1)
Income tax (benefit) expense (0.1) 1.9 (1.6) (3.4) (3.2)
Depreciation and amortization 23.7 23.8 22.5 24.4 94.4
Other expense (income) (0.0) (0.1) (0.5) 4.3 3.7
Interest income (0.0) 0.0 (0.1) (0.1) (0.1)
Interest expense 9.6 9.3 8.5 8.3 35.7
Write downs and other 5.0 0.8 0.1 0.1 6.0
Loss on extinguishment and modification of debt – – – – –
Other adjustments 0.4 0.1 0.2 0.7 1.4
Other non-cash charges 2.2 2.4 2.5 2.6 9.7
New jurisdiction and regulatory licensing costs – – – – –
Legal & litigation expenses including settlement payments 0.0 1.7 0.1 – 1.8
Acquisition & integration related costs 0.4 0.5 0.4 0.5 1.7
Non-cash stock compensation 2.2 2.0 3.7 1.6 9.4
Adjusted EBITDA $35.7 $36.8 $37.3 $24.5 $134.3
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FREE CASH FLOW RECONCILIATION
($ in 000’s) Q2 '19 Q3 '19 Q4 '19 Q1 '20 LTM 3/31/20
Free Cash Flow Reconciliation
Net cash provided by operating activities 26,020$ 24,806$ 25,508$ 18,809$ 95,143$
Purchase of intangible assets (2,719) (976) (1,369) (699) (5,763)
Software development and other expenditures (3,630) (3,658) (4,393) (3,756) (15,437)
Purchases of property and equipment (8,714) (14,941) (11,660) (6,150) (41,465) Free Cash Flow 10,957$ 5,231$ 8,086$ 8,204$ 32,478$
▪ Purchase of intangible assets include cash paid for placement fee arrangements securing floor space on long-term contracts
▪ Software development and other expenditures is driven primarily by capitalized R&D costs related to new product development
▪ Purchases of property plant and equipment includes growth capex relating to new EGM lease placements, optimization of the EGM installed base, maintenance capex as well as capitalized corporate expenses.
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TERMS USED IN THIS PRESENTATION
▪ Average Monthly Lease Price (ALP): Average monthly lease price is calculated by dividing (a) total revenues recognized and directly attributable to Table Products by (b) the number of Table Products Installed Base and by (c) the number of months in such period.
▪ Average Sales Price (ASP): Average sales price is calculated by dividing (a) total revenues recognized and directly attributable to EGM unit sales in a period by (b) the number of EGM units sold over that same period.
▪ EGM Installed Base: EGM Installed Base is the number of recurring revenue EGM units installed on a specified date.
▪ Electronic Gaming Machine (EGM): EGMs include but are not limited to slot machines, Class II machines, video poker and video lottery machines.
▪ House Average (HA): House average is the average casino win from slot machines or table products.
▪ Revenue Per Day (RPD): RPD is calculated by dividing (a) total revenues over a specified period recognized and directly attributable to units on lease (whether on a participation or daily fee arrangement) by (b) the number of units installed over that period and by (c) the number of days in such period.
▪ Ship Share: Ship Share is the share of all slots sold in a specified period.
▪ Table Products Installed Base: Table Products Installed Base is the number of table products installed on a specified date.
▪ TAM: Total addressable markets are markets in which we are currently licensed, or could be licensed with minimal effort, to place EGMs in the United States and Canada.
▪ Win Per Day (WPD): WPD is the total revenue generated by an EGM per day.
Unless otherwise indicated or the context otherwise requires, the following terms in this presentation have the meanings set forth below:
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