Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 01, 2019 | |
Document Information [Line Items] | ||
Entity Registrant Name | PLAYAGS, INC. | |
Entity Central Index Key | 0001593548 | |
Trading Symbol | ags | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding (in shares) | 35,405,957 | |
Entity Shell Company | false | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Title of 12(b) Security | Common stock, $0.01 par value |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
Current assets | |||
Cash and cash equivalents | $ 11,733 | $ 70,726 | |
Restricted cash | 20 | 78 | |
Accounts receivable, net of allowance of $901 and $885, respectively | 58,149 | 44,704 | |
Inventories | 30,264 | 27,438 | |
Prepaid expenses | 4,782 | 3,566 | |
Deposits and other | 7,326 | 4,231 | |
Total current assets | 112,274 | 150,743 | |
Property and equipment, net | 104,880 | 91,547 | |
Goodwill | 286,203 | 277,263 | |
Intangible assets, net carrying value | 237,794 | 196,898 | |
Deferred tax asset | 2,415 | 2,544 | |
Operating lease assets | 11,940 | [1] | |
Other assets | 4,438 | 12,347 | |
Total assets | 759,944 | 731,342 | |
Current liabilities | |||
Accounts payable | 18,510 | 14,821 | |
Accrued liabilities | 33,812 | 26,659 | |
Current maturities of long-term debt | 6,026 | 5,959 | |
Total current liabilities | 58,348 | 47,439 | |
Long-term debt | 519,521 | 521,924 | |
Deferred tax liability - noncurrent | 2,195 | 1,443 | |
Operating lease liabilities, long-term | 11,823 | ||
Other long-term liabilities | 40,970 | 24,732 | |
Total liabilities | 632,857 | 595,538 | |
Commitments and contingencies (Note 13) | |||
Stockholders’ equity | |||
Preferred stock at $0.01 par value; 50,000,000 shares authorized, no shares issued and outstanding | |||
Common stock at $0.01 par value; 450,000,000 shares authorized at September 30, 2019 and at December 31, 2018; and 35,405,594 and 35,353,296 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively. | 354 | 353 | |
Additional paid-in capital | 367,620 | 361,628 | |
Accumulated deficit | (236,710) | (222,403) | |
Accumulated other comprehensive loss | (4,177) | (3,774) | |
Total stockholders’ equity | 127,087 | 135,804 | |
Total liabilities and stockholders’ equity | $ 759,944 | $ 731,342 | |
[1] | Operating lease assets are recorded net of accumulated amortization of $0.7 million as of September 30, 2019. |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts receivable, allowance | $ 901 | $ 885 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | ||
Common stock, shares authorized (in shares) | ||
Common stock, shares issued (in shares) | ||
Common stock, shares outstanding (in shares) |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Revenues | |||||
Total revenues | $ 79,377 | $ 75,526 | $ 226,928 | $ 213,204 | |
Operating expenses | |||||
Selling, general and administrative | 16,861 | 15,284 | 46,343 | 47,411 | |
Research and development | 8,671 | 7,894 | 25,175 | 23,374 | |
Write-downs and other charges | 807 | 667 | 6,859 | 3,282 | |
Depreciation and amortization | 23,810 | 18,968 | 69,002 | 57,784 | |
Total operating expenses | 73,798 | 65,416 | 211,006 | 189,832 | |
Income from operations | 5,579 | 10,110 | 15,922 | 23,372 | |
Other expense (income) | |||||
Interest expense | 9,320 | 8,956 | 27,754 | 28,253 | |
Interest income | (42) | (89) | (112) | (162) | |
Loss on extinguishment and modification of debt | 4,608 | ||||
Other (income) expense | (106) | 434 | 5,108 | 10,121 | |
(Loss) Income before income taxes | (3,593) | 809 | (16,828) | (19,448) | |
Income tax (expense) benefit | (1,926) | 3,538 | 3,884 | 8,947 | |
Net (loss) income | (5,519) | 4,347 | (12,944) | (10,501) | |
Less: Net income attributable to non-controlling interests | (17) | (231) | |||
Net (loss) income attributable to PlayAGS, Inc. | (5,536) | 4,347 | (13,175) | (10,501) | |
Foreign currency translation adjustment | (1,273) | 1,636 | (403) | 1,690 | |
Total comprehensive (loss) income | $ (6,809) | $ 5,983 | $ (13,578) | $ (8,811) | |
Basic and diluted loss per common share: | |||||
Basic (in dollars per share) | $ (0.16) | $ 0.12 | $ (0.37) | $ (0.31) | |
Diluted (in dollars per share) | $ (0.16) | $ 0.12 | $ (0.37) | $ (0.31) | |
Weighted average common shares outstanding: | |||||
Basic (in shares) | 35,447 | 35,305 | 35,416 | 34,097 | |
Diluted (in shares) | 35,447 | 36,313 | 35,416 | 34,097 | |
Gaming Operations [Member] | |||||
Revenues | |||||
Total revenues | $ 52,522 | $ 50,701 | $ 158,976 | $ 152,887 | |
Operating expenses | |||||
Cost of goods and services sold | [1] | 10,170 | 10,494 | 30,721 | 29,062 |
Equipment Sales [Member] | |||||
Revenues | |||||
Total revenues | 26,855 | 24,825 | 67,952 | 60,317 | |
Operating expenses | |||||
Cost of goods and services sold | [1] | $ 13,479 | $ 12,109 | $ 32,906 | $ 28,919 |
[1] | exclusive of depreciation and amortization |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Including Portion Attributable to Noncontrolling Interest [Member] | Noncontrolling Interest [Member] | Total |
Balance at Dec. 31, 2017 | $ 149 | $ 177,276 | $ (201,557) | $ (3,803) | ||
Issuance of common stock | 118 | 171,410 | ||||
Stock option exercises | 730 | |||||
Repurchase of common stock | ||||||
Stock split (1.5543-for-one) | 83 | (83) | ||||
Reclass of management shares | 2 | 1,319 | ||||
Vesting of restricted stock | 1 | |||||
Balance at Sep. 30, 2018 | 353 | 359,819 | (212,058) | (2,113) | $ 146,001 | |
Stock-based compensation expense | 9,167 | |||||
Net loss attributable to PlayAGS, Inc. | (10,501) | (10,501) | ||||
Foreign currency translation adjustment | 1,690 | 1,690 | ||||
Net income | ||||||
Business acquisitions | ||||||
Cash distributions to non-controlling interest owners | ||||||
Balance at Jun. 30, 2018 | 353 | 358,829 | (216,405) | (3,749) | ||
Issuance of common stock | ||||||
Stock option exercises | 451 | |||||
Repurchase of common stock | ||||||
Stock split (1.5543-for-one) | ||||||
Reclass of management shares | ||||||
Vesting of restricted stock | 1 | |||||
Balance at Sep. 30, 2018 | 353 | 359,819 | (212,058) | (2,113) | 146,001 | |
Stock-based compensation expense | 538 | |||||
Net loss attributable to PlayAGS, Inc. | 4,347 | 4,347 | ||||
Foreign currency translation adjustment | 1,636 | 1,636 | ||||
Net income | ||||||
Business acquisitions | ||||||
Cash distributions to non-controlling interest owners | ||||||
Balance at Dec. 31, 2018 | 353 | 361,628 | (222,403) | (3,774) | ||
Issuance of common stock | ||||||
Stock option exercises | 1 | 684 | ||||
Repurchase of common stock | (1) | (1,132) | ||||
Stock split (1.5543-for-one) | ||||||
Reclass of management shares | ||||||
Vesting of restricted stock | 1 | (1) | ||||
Balance at Sep. 30, 2019 | 354 | 367,620 | (236,710) | (4,177) | 127,087 | |
Stock-based compensation expense | 5,309 | |||||
Net loss attributable to PlayAGS, Inc. | (13,175) | (13,175) | ||||
Foreign currency translation adjustment | (403) | (403) | ||||
Net income | 231 | 231 | ||||
Business acquisitions | 71 | |||||
Cash distributions to non-controlling interest owners | (302) | |||||
Balance at Jun. 30, 2019 | 354 | 365,562 | (230,042) | (2,904) | 128 | |
Issuance of common stock | ||||||
Stock option exercises | 1 | 100 | ||||
Repurchase of common stock | (1) | (1,132) | ||||
Stock split (1.5543-for-one) | ||||||
Reclass of management shares | ||||||
Vesting of restricted stock | (1) | |||||
Balance at Sep. 30, 2019 | $ 354 | 367,620 | (236,710) | (4,177) | 127,087 | |
Stock-based compensation expense | $ 1,959 | |||||
Net loss attributable to PlayAGS, Inc. | $ (5,536) | (5,536) | ||||
Foreign currency translation adjustment | $ (1,273) | (1,273) | ||||
Net income | 17 | $ 17 | ||||
Business acquisitions | ||||||
Cash distributions to non-controlling interest owners | $ (145) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) (Parentheticals) | 9 Months Ended |
Sep. 30, 2018 | |
Common Stock [Member] | |
Stock split ratio | 1.5543 |
Additional Paid-in Capital [Member] | |
Stock split ratio | 1.5543 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | ||
Cash flows from operating activities | |||
Net loss | $ (12,944) | $ (10,501) | |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 69,002 | 57,784 | |
Accretion of contract rights under development agreements and placement fees | [1] | 4,550 | 3,412 |
Amortization of deferred loan costs and discount | 1,426 | 1,388 | |
Payment-in-kind interest payments | (37,624) | ||
Write-off of deferred loan cost and discount | 3,410 | ||
Stock-based compensation expense | 5,309 | 9,167 | |
Provision (benefit) for bad debts | 183 | (198) | |
Loss on disposition of assets | 1,015 | 1,383 | |
Impairment of assets | 5,343 | 1,199 | |
Fair value adjustment of contingent consideration | 501 | 700 | |
(Benefit) provision for deferred income tax | 873 | (205) | |
Changes in assets and liabilities that relate to operations: | |||
Accounts receivable | (12,136) | (12,277) | |
Inventories | 961 | (3,173) | |
Prepaid expenses | (1,098) | (1,958) | |
Deposits and other | (3,081) | (626) | |
Other assets, non-current | 9,024 | 13,574 | |
Accounts payable and accrued liabilities | (6,447) | (12,135) | |
Net cash provided by operating activities | 62,481 | 13,320 | |
Cash flows from investing activities | |||
Business acquisitions, net of cash acquired | (54,935) | (4,452) | |
Purchase of intangible assets | (4,926) | (931) | |
Software development and other expenditures | (9,957) | (8,794) | |
Proceeds from disposition of assets | 161 | 21 | |
Purchases of property and equipment | (38,760) | (34,457) | |
Net cash used in investing activities | (108,417) | (48,613) | |
Cash flows from financing activities | |||
Repayment of PIK notes | (115,000) | ||
Repayment of first lien credit facilities | (4,040) | (3,864) | |
Payment of financed placement fee obligations | (6,058) | (2,688) | |
Payments of previous acquisition obligation | (1,227) | ||
Payments on equipment long-term note payable and finance leases | (1,043) | (2,108) | |
Proceeds from issuance of common stock | 176,341 | ||
Initial public offering cost | (4,160) | ||
Repurchase of common stock | (1,133) | ||
Proceeds from stock option exercise | 685 | 731 | |
Distributions to non-controlling interest owners | (302) | ||
Net cash (used in) provided by financing activities | (13,118) | 49,252 | |
Effect of exchange rates on cash and cash equivalents | 3 | 4 | |
(Decrease) increase in cash and cash equivalents | (59,051) | 13,963 | |
Cash, cash equivalents and restricted cash, beginning of period | 70,804 | 19,342 | |
Cash, cash equivalents and restricted cash, end of period | 11,753 | 33,305 | |
Supplemental cash flow information: | |||
Intangible assets obtained under placement fee arrangements | 39,198 | 931 | |
Leased assets obtained in exchange for new finance lease liabilities | 882 | 307 | |
Leased assets obtained in exchange for new operating lease liabilities | $ 13,048 | ||
[1] | Non-cash item related to the accretion of contract rights under development agreements and placement fees. |
Note 1 - Description of the Bus
Note 1 - Description of the Business and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Business Description and Accounting Policies [Text Block] | NOTE 1. Description of Business PlayAGS, Inc. (the "Company," "PlayAGS," "we," "us," or "our") is a leading designer and supplier of gaming products and services for the gaming industry. We operate in legalized gaming markets across the globe and provide state-of-the-art, value-add products in three Dex S two The Company filed a Registration Statement on Form 10 December 19, 2013, 1934, December 19, 2013. January 30, 2018, 10,250,000 $16.00 On February 27, 2018, 1,537,500 Electronic Gaming Machines Our EGM segment offers a selection of video slot titles developed for the global marketplace, and EGM cabinets which include the Alora Orion Portrait, Orion Slant, Orion Upright, ICON, Halo, Big Red/Colossal Diamonds Table Products Our Table Products include both internally developed and acquired proprietary table products, side-bets, progressives, and table technology related to blackjack, poker, baccarat, craps and roulette. We have acquired a number of popular proprietary brands, including In Bet Gaming (“In Bet”), Buster Blackjack, Double Draw Poker Criss Cross Poker Dex S Interactive Our business-to-consumer ( “B2C” Lucky Play Casino Golden Wins, Royal Reels So Hot “B2B” Lucky Play Casino 2, B2B Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain disclosures required by generally accepted accounting principles (“GAAP”) are omitted or condensed in these condensed consolidated financial statements. In the opinion of management, all adjustments (consisting of only normal recurring adjustments) that are necessary for a fair statement of the Company's financial position, results of operations and cash flows for the interim periods have been made. The interim results reflected in these condensed consolidated financial statements are not 10 December 31, 2018 Principles of Consolidation The accompanying condensed consolidated financial statements include the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company to make decisions based upon estimates, assumptions, and factors considered relevant to the circumstances. Such decisions include the selection of applicable accounting principles and the use of judgment in their application, the results of which impact reported amounts and disclosures. Changes in future economic conditions or other business circumstances may Revenue Recognition Leasing of equipment in both our EGM and Table Products segments is accounted for under lease accounting guidance in ASC 842, 842 606 606 The following table disaggregates our revenues by type within each of our segments (amounts in thousands): Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 EGM Gaming operations $ 48,854 $ 47,109 $ 148,515 $ 142,301 Equipment sales 26,445 24,675 67,417 60,060 Total $ 75,299 $ 71,784 $ 215,932 $ 202,361 Table Products Gaming operations $ 2,451 $ 1,902 $ 6,902 $ 5,257 Equipment sales 410 150 535 257 Total $ 2,861 $ 2,052 $ 7,437 $ 5,514 Interactive (gaming operations) Social $ 712 $ 1,446 $ 2,606 $ 5,033 RMG 505 244 953 296 Total $ 1,217 $ 1,690 $ 3,559 $ 5,329 Gaming Operations Gaming operations revenue is earned by providing customers with gaming machines, gaming machine content licenses, table products, back-office equipment and linked progressive systems, which are collectively referred to as gaming equipment, under participation arrangements. The participation arrangements convey the right to use the equipment (i.e., gaming machines and related integral software) for a stated period of time, which typically ranges from one three no Under participation arrangements, the Company retains ownership of the gaming equipment installed at the customer facilities and receives either revenue based on a percentage of the win per day generated by the gaming equipment or a fixed daily fee. Thus, in our consolidated financial statements the Company records revenue monthly related to these arrangements and the gaming equipment is recorded in property and equipment, net on our balance sheet and depreciated over the expected life of the gaming equipment. The majority of the Company’s leases require the Company to provide maintenance throughout the entire term of the lease. In some cases, a performance guarantee exists that, if not Gaming operations revenue is also earned from the licensing of table product content and is earned and recognized primarily on a fixed monthly rate. Our B2C B2C B2B Equipment Sales Revenues from contracts with customers are recognized and recorded when the following criteria are met: • We have a contract that has been approved by both the customer and the Company. Our contracts specify the products being sold and payment terms and are recognized when it is probable that we will collect substantially all of the contracted amount; and • Control has been transfered and services have been rendered in accordance with the contract terms. Equipment sales are generated from the sale of gaming machines, table products and licensing rights to the integral game content software that is installed in the related equipment, parts, and other ancillary equipment. Also included within the deliverables are delivery, installation and training, all of which occur within a few days of arriving at the customer location. Equipment sales do not 30 90 12 24 The Company enters into revenue arrangements that may may may Revenue is allocated to the separate performance obligations based on relative standalone selling prices determined at contract inception. Standalone selling prices are primarily determined by prices that we charge for the products when they are sold separately. When a product is not Revenue allocated to any undelivered performance obligations is recorded as a contract liability. The balance of our contract liabilities was not September 30, 2019 December 31, 2018 Cash and Cash Equivalents Cash and cash equivalents consist primarily of deposits held at major banks and other marketable securities with original maturities of 90 Restricted Cash Restricted cash amounts represent funds held in escrow as collateral for the Company’s surety bonds for various gaming authorities. Allowance for Doubtful Accounts Accounts receivable are stated at face value less an allowance for doubtful accounts. The Company maintains an allowance for doubtful accounts related to accounts receivable and notes receivable, which are non-interest bearing, deemed to have a high risk of collectability. The Company reviews the accounts receivable and notes receivable on a monthly basis to determine if any receivables will potentially be uncollectible. The Company analyzes historical collection trends and changes in the customers’ payment patterns, customer concentration, and credit worthiness when evaluating the adequacy of the allowance for doubtful accounts. A large percentage of receivables are with Native American tribes and the Company has concentrations of credit risk with several tribes. The Company includes any receivable balances that are determined to be uncollectible in the overall allowance for doubtful accounts. Changes in the assumptions or estimates reflecting the collectability of certain accounts could materially affect the allowance for both accounts and notes receivable. Inventories Inventories consist primarily of parts and supplies that are used to repair and maintain machinery and equipment as well as EGMs in production and finished goods held for sale. Inventories are stated at net realizable value. Cost of inventories is determined using the first first September 30, 2019 December 31, 2018 $25.8 $22.3 September 30, 2019 December 31, 2018 $4.5 $5.1 no September 30, 2019 December 31, 2018 Property and Equipment The cost of gaming equipment, consisting of fixed-base player terminals, file servers and other support equipment as well as other property and equipment, is depreciated over their estimated useful lives, using the straight-line method for financial reporting. The Company capitalizes costs incurred for the refurbishment of used gaming equipment that is typically incurred to refurbish a machine in order to return it to its customer location. The refurbishments extend the life of the gaming equipment beyond the original useful life. Repairs and maintenance costs are expensed as incurred. The Company routinely evaluates the estimated lives used to depreciate assets. The estimated useful lives are as follows: Gaming equipment (in years) 2 to 6 Other property and equipment (in years) 3 to 6 The Company reviews its property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not not When the estimated undiscounted cash flows are not The Company measures recoverability of assets to be held and used by comparing the carrying amount of an asset to future cash flows expected to be generated by the asset. The Company’s policy is to impair, when necessary, excess or obsolete gaming machines on hand that it does not Intangible Assets The Company reviews its identifiable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not not When the estimated undiscounted cash flows are not Certain trade names have an indefinite useful life and the Company tests these trade names for possible impairment at least annually, on October 1, may not not Costs of Capitalized Computer Software Internally developed gaming software represents the Company’s internal costs to develop gaming titles to utilize on the Company’s gaming machines. Internally developed gaming software is stated at cost and amortized over the estimated useful lives of the software, using the straight-line method. Software development costs are capitalized once technological feasibility has been established and are amortized when the software is placed into service. The computer software we develop reaches technological feasibility when a working model of the computer software is available. Any subsequent software maintenance costs, such as bug fixes and subsequent testing, are expensed as incurred. Discontinued software development costs are expensed when the determination to discontinue is made. Software development costs are amortized over the expected life of the title or group of titles, if applicable, to amortization expense. On a quarterly basis, or more frequently if circumstances warrant, the Company compares the net book value of its internally developed computer software to the net realizable value on a title or group of title basis. The net realizable value is determined based upon certain assumptions, including the expected future revenues and net cash flows of the gaming titles or group of gaming titles utilizing that software, if applicable. Goodwill The excess of the purchase price of an acquired business over the estimated fair value of the assets acquired and the liabilities assumed is recorded as goodwill. The Company tests for possible impairment of goodwill at least annually, on October 1, not 0”, not may not not may second 2019, 4. Acquisition Accounting The Company applies the provisions of ASC 805, Business Combinations” 805 may one may Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements 820 820 • Level 1 • Level 2 • Level 3 The carrying values of the Company’s cash and cash equivalents, restricted cash, receivables and accounts payable approximate fair value because of the short term maturities of these instruments. The fair value of our long-term debt is based on the quoted market prices for similar issues (Level 2 September 30, 2019 December 31, 2018 $532.3 $528.1 Accounting for Income Taxes We conduct business globally and are subject to income taxes in U.S. federal, state, local, and foreign jurisdictions. Determination of the appropriate amount and classification of income taxes depends on several factors, including estimates of the timing and probability of realization of deferred income taxes, reserves for uncertain income tax positions and income tax payment timing. We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. Taxes on income of our foreign subsidiaries are provided at the tax rates applicable to the tax jurisdictions in which they are located. Future tax benefits are recognized to the extent that realization of those benefits is considered more likely than not not The recoverability of certain deferred tax assets is based in part on estimates of future income and the timing of temporary differences, and the failure to fully realize such deferred tax assets could result in a higher tax provision in future periods. We apply the accounting guidance to our uncertain tax positions and under the guidance, we may not 50% We are required to make significant judgments when evaluating our uncertain tax positions and the related tax benefits. We believe our assumptions are reasonable; however, there is no not may Contingencies The Company assesses its exposures to loss contingencies including claims and legal proceedings and accrues a liability if a potential loss is considered probable and the amount can be estimated. Significant judgment is required in both the determination of probability and the determination as to whether an exposure is reasonably estimable. Because of uncertainties related to these matters, if the actual loss from a contingency differs from management’s estimate, there could be a material impact on the results of operations or financial position. Operating expenses, including legal fees, associated with contingencies are expensed when incurred. Foreign Currency Translation The financial statements of the Company’s foreign subsidiaries are translated into U.S. dollars at the period end rate of exchange for asset and liability accounts and the weighted average rate of exchange for income statement accounts. The effects of these translations are recorded as a component of other accumulated comprehensive loss in stockholders’ equity. Recently Issued Accounting Pronouncements In February 2016, 2016 02, Leases (Topic 842 2016 02 2016 02 December 15, 2018, July 2018, 2018 11, 842 2018 11 January 1, 2019. 840 840 840. no January 1, 2019. not January 1, 2019. 15. not no In June 2016, No. 2016 13, November 2018 No. 2018 19, not 326 20, 842. May 2019, No. 2019 05 326. December 15, 2019, first December 15, 2018. not In August 2018, No. 2018 15, December 15, 2019, not We do not |
Note 2 - Acquisitions
Note 2 - Acquisitions | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | NOTE 2. In Bet Gaming During the quarter ended September 30, 2019, $4.0 $1.2 $2.8 9.3 Integrity On February 8, 2019, 2,500 33 The total purchase price consideration for Integrity was as follows: February 8, 2019 (in 000s) Total purchase price for Integrity common stock (35,223,928 shares at CAD $0.46 per share) $ 12,335 Payments in respect of Integrity stock options, restricted share units 441 Repayments of Integrity debt and other obligations 39,806 Total purchase price consideration $ 52,582 The acquisition was accounted for as an acquisition of a business and the assets acquired and liabilities assumed were measured based on our preliminary estimates of their fair values at the acquisition date. The estimated fair values of assets acquired and liabilities assumed and resulting goodwill ( not not no one The acquisition of Integrity was accounted for using the acquisition method of accounting, which requires, among other things, the assets acquired and liabilities assumed be recognized at their respective fair values as of the acquisition date. The property, plant and equipment which fair value was determined based on the cost and market approach (level 2 10 3 The information below reflects preliminary allocation of the purchase price based on assumptions and estimates related to fair value that are subject to change as additional information may one February 8, 2019 (in 000s) Assets Current assets Cash and cash equivalents $ 1,646 Accounts receivable 1,584 Inventories 159 Deposits and other 26 Prepaid expenses 141 Total Current Assets 3,556 Property and Equipment 12,708 Intangible Assets 30,600 Goodwill 11,380 Total Assets $ 58,244 Liabilities and Equity Current liabilities Accounts payable $ 1,366 Accrued liabilities 2,087 Current portion of long-term debt 151 Total current liabilities 3,604 Other long-term liabilities 1,787 Long-term debt 200 Total liabilities 1,987 Minority Interest 71 Net assets acquired $ 52,582 We recognized the $0.6 $1.4 3 The following unaudited pro forma statements of operations give effect to the Integrity acquisition as if it had been completed on January 1, 2018 2019. not January 1, 2018 2019. not not not 1 2 Three months ended September 30, 2019 Three months ended September 30, 2018 Nine months ended September 30, 2019 Nine months ended September 30, 2018 Total revenues $ 79,377 $ 79,782 $ 228,667 $ 227,496 Net (loss) income attributable to PlayAGS, Inc. $ (5,536 ) $ 4,060 $ (13,236 ) $ (12,185 ) AGS iGaming During the quarter ended June 30, 2018, We attributed the goodwill recognized to our ability to utilize AGS iGaming’s existing RMG platform to distribute our existing EGM game content into many markets, diversification of our Interactive segment’s product portfolio that now includes a real-money gaming solution and other strategic benefits. The total consideration for this acquisition was $5.0 $4.5 $0.5 18 not $3.7 $2.1 6.7 4 The intangible assets consisted primarily of customer relationships and a technology platform. The customer relationships were valued using the cost approaches (level 3 3 It is not |
Note 3 - Property and Equipment
Note 3 - Property and Equipment | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | NOTE 3. Property and equipment consist of the following (in thousands): September 30, 2019 December 31, 2018 Gaming equipment $ 170,822 $ 141,530 Other property and equipment 25,327 23,304 Less: Accumulated depreciation (91,269 ) (73,287 ) Property and equipment, net $ 104,880 $ 91,547 Gaming equipment and other property and equipment are depreciated over the respective useful lives of the assets ranging from two six $11.6 $8.0 three September 30, 2019 2018 $33.7 $23.7 nine September 30, 2019 2018 |
Note 4 - Goodwill and Intangibl
Note 4 - Goodwill and Intangibles | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Goodwill and Intangible Assets Disclosure [Text Block] | NOTE 4. Changes in the carrying amount of goodwill are as follows (in thousands): Gross Carrying Amount EGM Table Products Interactive (1) Total Balance at December 31, 2018, net $ 267,079 $ 6,641 $ 3,543 $ 277,263 Foreign currency adjustments (77 ) - (10 ) (87 ) Acquisitions 11,380 1,180 - 12,560 Impairment - - (3,533 ) (3,533 ) Balance at September 30, 2019 $ 278,382 $ 7,821 $ - $ 286,203 ( 1 September 30, 2019 $8.4 During the second 2019 2018. As a result of this triggering event, we performed a quantitative impairment analysis of the associated goodwill and determined that the entire balance of $3.5 3.0% 25% Intangible assets consist of the following (in thousands): September 30, 2019 December 31, 2018 Useful Life Gross Accumulated Net Carrying Gross Accumulated Net Carrying (years) Value Amortization Value Value Amortization Value Indefinite lived trade names Indefinite $ 12,126 $ - $ 12,126 $ 12,126 $ - $ 12,126 Trade and brand names 7 14,870 (12,901 ) 1,969 14,730 (10,681 ) 4,049 Customer relationships 7 219,003 (112,958 ) 106,045 188,772 (93,358 ) 95,413 Contract rights under development and placement fees 1 - 7 58,818 (18,917 ) 39,901 19,620 (14,367 ) 5,253 Gaming software and technology platforms 1 - 7 159,127 (93,661 ) 65,466 151,055 (82,371 ) 68,682 Intellectual property 10 - 12 19,345 (7,057 ) 12,288 17,205 (5,830 ) 11,375 $ 483,288 $ (245,494 ) $ 237,794 $ 403,508 $ (206,607 ) $ 196,898 Intangible assets are amortized over their respective estimated useful lives ranging from one twelve $12.1 $11.0 three September 30, 2019 2018 $35.3 $34.1 nine September 30, 2019 2018 Management reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not may not 25% 3% $0.6 $0.7 $0.4 3 25%. 5% The Company enters into development agreements and placement fee agreements with certain customers to secure floor space under lease agreements for its gaming machines. Amounts paid in connection with the development agreements are repaid to the Company in accordance with the terms of the agreement, whereas placements fees are not not $1.7 $1.2 three September 30, 2019 2018 $4.6 $3.4 nine September 30, 2019 2018 In March 2019, $33.1 $2.1 $40.1 83 |
Note 5 - Accrued Liabilities
Note 5 - Accrued Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Accounts Payable and Accrued Liabilities Disclosure [Text Block] | NOTE 5. Accrued liabilities consist of the following (in thousands): September 30, 2019 December 31, 2018 Salary and payroll tax accrual $ 8,302 $ 13,393 Taxes payable 4,384 3,437 Current portion of operating lease liability 2,117 - License fee obligation 1,000 1,000 Placement fees payable 8,738 2,490 Accrued other 9,271 6,339 Total accrued liabilities $ 33,812 $ 26,659 |
Note 6 - Long-term Debt
Note 6 - Long-term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Long-term Debt [Text Block] | NOTE 6. Long-term debt consists of the following (in thousands): September 30, 2019 December 31, 2018 First Lien Credit Facilities: Term loans, interest at LIBOR or base rate plus 3.50% (5.61% at September 30, 2019), net of unamortized discount and deferred loan costs of $9.5 million and $10.9 million at September 30, 2019 and December 31, 2018, respectively. $ 523,846 $ 526,461 Equipment long-term note payable and finance leases 1,701 1,422 Total debt 525,547 527,883 Less: Current portion (6,026 ) (5,959 ) Long-term debt $ 519,521 $ 521,924 First Lien Credit Facilities On June 6, 2017 ( first $450.0 $30.0 On December 6, 2017, $65.0 “December December An additional $1.0 December $0.9 third On February 8, 2018, $513 550 425 100 On February 8, 2018, third $1.2 $0.4 On October 5, 2018, No. 2 No. 2” No. 2 June 6, 2017, December 6, 2017 February 8, 2018 ( 0.75% 0.25% B1 $30 On October 5, 2018, third $1.5 On August 30, 2019, No. 3 As of September 30, 2019 Equipment Long Term Note Payable and Finance Leases The Company has entered into a financing agreement to purchase certain gaming devices, systems and related equipment and has entered into leases for vehicles and equipment that are accounted for as finance leases. |
Note 7 - Stockholders' Equity
Note 7 - Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 7. Common Stock Prior to the completion of the IPO, the Company’s common stock consisted of two 1.5543 1 1.5543 On January 26, 2018, 10,250,000 $16.00 February 27, 2018 1,537,500 $171.5 Upon the consummation of the IPO, 170,712 April 28, 2014 ( not $1.3 three nine September 30, 2019 11. As further clarification of the foregoing, prior to the IPO, shares were held by management that were subject to repurchase rights as outlined in Section 6 |
Note 8 - Write-downs and Other
Note 8 - Write-downs and Other Charges | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Asset Impairment Charges [Text Block] | NOTE 8. The Condensed Consolidated Statements of Operations and Comprehensive Loss include various non-routine transactions, such as loss on disposal or impairment of long-lived assets and fair value adjustments to contingent consideration that have been classified as write-downs and other charges. During the three September 30, 2019 $0.8 $0.6 $0.1 3 $0.1 3 During the nine September 30, 2019 $6.9 $3.5 $1.3 4. $1.0 $0.5 3 $0.5 3 During the three September 30, 2018 $0.7 $0.4 $0.2 3 $0.1 3 During the nine September 30, 2018 $3.3 $1.4 $1.2 3 $0.7 3 |
Note 9 - Basic and Diluted Inco
Note 9 - Basic and Diluted Income (Loss) Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | NOTE 9. The Company computes net (loss) income per share in accordance with accounting guidance that requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the Condensed Consolidated Statement of Operations and Comprehensive (Loss) Income. Basic EPS is computed by dividing net (loss) income for the period by the weighted average number of shares outstanding during the period. Basic EPS includes common stock weighted for average number of shares issued during the period. Diluted EPS is computed by dividing net (loss) income for the period by the weighted average number of common shares outstanding during the period, increased by potentially dilutive common shares that were outstanding during the period. Diluted EPS excludes all potential dilutive shares if their effect is anti-dilutive. Potentially dilutive common shares include stock options and restricted stock (see Note 11 There were no three nine September 30, 2019 Excluded from the calculation of diluted EPS for the three September 30, 2019 651,611 505,309 nine September 30, 2019 594,265 733,605 For three September 30, 3018, Three months ended September 30, 2018 Numerator: Net income $ 4,347 Net income attributable to participating securities (16 ) Net income attributable to common stock $ 4,331 Denominator: Weighted average of common shares outstanding $ 35,305 Potential dilutive effect of stock options 1,008 Weighted average of common shares outstanding $ 36,313 Excluded from the calculation of diluted EPS for the nine September 30, 2018 70,744 840,815 |
Note 10 - Benefit Plans
Note 10 - Benefit Plans | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Compensation and Employee Benefit Plans [Text Block] | NOTE 10. The Company has established a 401 “401 401 may 401 three September 30, 2019 2018 $0.3 401 nine September 30, 2019 2018 $1.0 $0.9 The increase in the expense associated with the 401 On April 28, 2014, 2014 ten may 2,253,735 1.5543 1 January 30, 2018 September 30, 2019 423,268 On January 16, 2018, 2018 may 1,607,389 September 30, 2019 765,515 |
Note 11 - Stock-based Compensat
Note 11 - Stock-based Compensation | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Share-based Payment Arrangement [Text Block] | NOTE 11. All share information is presented after giving effect to the 1.5543 1 January 30, 2018 Stock Options The Company has granted stock awards to eligible participants under its incentive plans. The stock awards include options to purchase the Company’s common stock. These stock options include a combination of service and market conditions, as further described below. Prior to the Company’s IPO, these stock options included a performance vesting condition, a Qualified Public Offering (see Note 7 not no 2018. For the three September 30, 2019 $0.2 $1.8 nine September 30, 2019 $0.7 $4.6 $1.1 $12.4 September 30, 2019 2.0 3.0 The Company calculates the grant date fair value of stock options that vest over a service period using the Black Scholes model. For stock options that contain a market condition related to the return on investment that the Company’s stockholders achieve, the options are valued using a lattice-based option valuation model. The assumptions used in these calculations are the expected dividend yield, expected volatility, risk-free interest rate and expected term (in years). Expected volatilities are based on implied volatilities from comparable companies. The expected time to liquidity is based on management’s estimate. The risk-free rate is based on the U.S. Treasury yield curve for a term equivalent to the estimated time to liquidity. There were no three nine September 30, 2019 Nine months ended September 30, Nine months ended September 30, 2019 2018 Option valuation assumptions: Expected dividend yield N/A — % Expected volatility N/A 50 % Risk-free interest rate N/A 2.71 % Expected term (in years) N/A 6.3 Stock option awards represent options to purchase common stock and are granted pursuant to the Company’s incentive plans, and include options that the Company primarily classifies as Tranche A or time based, Tranche B and Tranche C. Tranche A or time based options are eligible to vest in equal installments of 20% 25% first five four not All other option awards are eligible to vest upon the satisfaction of certain performance conditions (collectively, “Performance Options”). On January 16, 2018, 20%, 2.5 2014 first 60 $19.11 60 not 181st 25%, 3.0 first 60 $22.93 60 not 181st first $2.9 As of September 30, 2019 617,510 October 2018. A summary of the changes in stock options outstanding during the nine September 30, 2019 Number of Options Weighted Average Exercise Price Weighted Average Remaining Contract Term (years) Aggregate Intrinsic Value (in thousands) Options outstanding as of December 31, 2018 1,515,461 $ 9.11 Granted - - Exercised (70,288 ) 9.74 Canceled or forfeited (19,080 ) 10.56 Options outstanding as of September 30, 2019 1,426,093 9.06 5.7 $ 2,562 Exercisable as of September 30, 2019 1,218,162 $ 8.41 5.4 $ 2,541 Restricted Stock Restricted stock awards are typically eligible to vest in equal installments of 25% first four 12 Certain restricted stock awards are eligible to vest upon the satisfaction of certain conditions (collectively, “Performance Awards”). Vesting occurs on the first 60 $29.60. A summary of the changes in restricted stock outstanding during the nine September 30, 2019 Shares Outstanding Grant Date Fair Value (per share) Outstanding as of December 31, 2018 287,479 $ 29.26 Granted 454,529 $ 23.73 Vested (85,395 ) $ 26.00 Canceled or forfeited (40,611 ) $ 26.08 Restricted stock outstanding as of September 30, 2019 616,002 $ 25.84 |
Note 12 - Income Taxes
Note 12 - Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | NOTE 12. The Company's effective income tax rate for the three September 30, 2019 53.6%. 21% three September 30, 2019 three September 30, 2018 437.3%. 21% three September 30, 2018 The Company's effective income tax rate for the nine September 30, 2019 23.1%. 21% nine September 30, 2019 nine September 30, 2018 46.0%. 21% nine September 30, 2018 The Company entered into an indemnification agreement with the prior owners of Cadillac Jack (acquired in May 2015 September 30, 2019 $3.9 During the three nine September 30, 2019 $0.1 $5.4 three nine September 30, 2018 $0.5 $9.4 |
Note 13 - Commitments and Conti
Note 13 - Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 13. The Company is subject to federal, state and Native American laws and regulations that affect both its general commercial relationships with its customers, as well as the products and services provided to them. Periodically, the Company reviews the status of each significant matter and assesses the potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be estimated, the Company accrues a liability for the estimated loss. If a potential loss from any claim or legal proceeding is considered reasonably possible, the Company discloses an estimate of the possible loss or range of possible loss, or a statement that such an estimate cannot be made. During the three September 30, 2019, $1.6 may |
Note 14 - Operating Segments
Note 14 - Operating Segments | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | NOTE 14. We report our business segment results by segment in accordance with the “management approach.” The management approach designates the internal reporting used by our chief operating decision maker (“CODM”), who is our Chief Executive Officer (the “CEO”), for making decisions and assessing performance of our reportable segments. See Note 1 three Segment revenues include leasing, licensing, or selling of products within each reportable segment. Segment adjusted EBITDA includes the revenues and operating expenses from each segment adjusted for depreciation, amortization, write-downs and other charges, accretion of placement fees, non-cash stock based compensation expense, as well as other costs such as certain acquisitions and integration related costs including restructuring and severance charges; legal and litigation expenses including settlement payments; new jurisdictions and regulatory licensing costs; non-cash charges on capitalized installation and delivery; contract cancellation fees; and other adjustments primarily composed of professional fees incurred by the Company for projects, corporate and public filing compliance and other costs deemed to be non-recurring in nature. Revenues in each segment are attributable to third Segment adjusted EBITDA excludes other income and expense, income taxes and certain expenses that are managed outside of the operating segments. The following provides financial information concerning our reportable segments for the three nine September 30, 2019 2018 Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 Revenues by segment EGM $ 75,299 $ 71,784 $ 215,932 $ 202,361 Table Products 2,861 2,052 7,437 5,514 Interactive 1,217 1,690 3,559 5,329 Total Revenues $ 79,377 $ 75,526 $ 226,928 $ 213,204 Adjusted EBITDA by segment EGM 35,825 34,026 108,088 105,197 Table Products 1,409 428 2,694 684 Interactive (447 ) (877 ) (1,985 ) (1,223 ) Subtotal 36,787 33,577 108,797 104,658 Write-downs and other: Loss on disposal of long lived assets 570 363 1,015 1,383 Impairment of long lived assets 136 204 5,343 1,199 Fair value adjustments to contingent consideration and other items 101 100 501 700 Depreciation and amortization 23,810 18,968 69,002 57,784 Accretion of placement fees (1) 1,747 1,206 4,550 3,412 Non-cash stock-based compensation expense 1,959 538 5,309 9,167 Acquisitions and integration related costs including restructuring and severance 481 746 2,944 3,156 Initial public offering costs and secondary offering (11 ) 859 414 2,168 Legal and litigation expenses including settlement payments 1,745 (45 ) 1,748 789 Non-cash charge on capitalized installation and delivery 679 494 1,991 1,478 Other adjustments (9 ) 34 58 50 Interest expense 9,320 8,956 27,754 28,253 Interest (income) (42 ) (89 ) (112 ) (162 ) Loss on extinguishment and modification of debt - - - 4,608 Other (income) expense (106 ) 434 5,108 10,121 (Loss) Income before income taxes $ (3,593 ) $ 809 $ (16,828 ) $ (19,448 ) ( 1 The Company’s CODM does not not not two not not |
Note 15 - Leases
Note 15 - Leases | 9 Months Ended |
Sep. 30, 2019 | |
Notes to Financial Statements | |
Lessee, Operating and Finance Leases [Text Block] | NOTE 15. Operating Leases We lease office space, warehouses and office equipment which we classify as operating leases. Operating leases with an initial term of 12 not not not not not December 31, 2018 January 1, 2019 Finance Leases We lease vehicles which we account for as finance leases using the effective interest method. Our finance lease agreements do not For the nine September 30, 2019 2018 not one The following table discloses the operating and finance assets and liability balances recorded under ASC 842 September 30, 2019 840 December 31, 2018 As of September 30, 2019 As of December 31, 2018 (ASC 842) (ASC 840) Leases (in thousands) Classification Assets Operating leases Operating lease assets (a) $ 11,940 N/A Finance leases Property and equipment, net (b) 1,754 1,344 Total leased assets, net $ 13,694 $ 1,344 Liabilities Current: Operating leases Accrued liabilities $ (2,117 ) N/A Finance leases Current maturities of long-term debt (639 ) 408 Non-current: Operating leases Operating lease liabilities, long-term (11,823 ) N/A Finance leases Long-term debt (1,062 ) 851 Total lease liability $ (15,641 ) $ 1,259 (a) $1.1 September 30, 2019 (b) $0.6 $0.4 September 30, 2019 December 31, 2018 The table below discloses the costs for operating and finance leases for the three nine September 30, 2019 2018: Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 (ASC 842) (ASC 840) (ASC 842) (ASC 840) Operating lease costs (in thousands) Classification Operating lease cost - office building Selling, general and administrative $ 394 N/A $ 1,183 N/A Operating lease cost - R&D Research and development 49 N/A 182 N/A Operating lease cost - warehouses Cost of gaming operations (a) 124 N/A 347 N/A Finance lease cost Depreciation of leased assets Depreciation and amortization 248 116 505 312 Interest on lease liabilities Interest expense 10 5 29 15 Total Lease Cost $ 825 $ 121 $ 2,246 $ 327 The table below sets forth the maturity of the operating and financing leases liabilities for five 842: Operating Leases (a) Financing Leases Total Maturity of lease liabilities (in thousands) 2019 (excluding nine months ended September 30, 2019) $ 717 $ 164 $ 881 2020 2,897 648 3,545 2021 2,476 555 3,031 2022 1,951 311 2,262 2023 1,825 74 1,899 Thereafter 7,411 13 7,424 Total lease payments $ 17,277 $ 1,765 $ 19,042 Less: interest 3,337 64 3,401 Present value of lease liabilities $ 13,940 $ 1,701 $ 15,641 (a) $14.3 not September 30, 2019 Future minimum lease payments under ASC 840 December 31, 2018 Total (in thousands) For the year ended December 31, 2019 $ 2,817 2020 2,716 2021 2,212 2022 1,470 2023 1,121 Thereafter 5,260 Total $ 15,596 The following table sets forth the weighted average of the lease terms and discount rates for operating and finance leases as of September 30, 2019 2018 As of As of September 30, December 31, 2019 2018 (ASC 842) (ASC 840) Lease term and discount rate Operating Weighted average remaining lease term (years) 8.8 N/A Weighted average discount rate 5.9 % N/A Finance Leases Weighted average remaining lease term (years) 2.0 2.7 Weighted average discount rate 2.7 % 2.6 % Other Information The table below discloses cash paid for the amounts included in the measurement of lease liabilities for the nine September 30, 2019 2018 Nine months ended September 30, 2019 2018 (ASC 842) (ASC 840) Cash paid for amounts included in the measurement of lease liabilities (in thousands) Operating cash flows from operating leases $ 1,906 N/A Operating cash flows from finance leases $ 29 $ 14 Financing cash flows from finance leases $ 446 $ 290 |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain disclosures required by generally accepted accounting principles (“GAAP”) are omitted or condensed in these condensed consolidated financial statements. In the opinion of management, all adjustments (consisting of only normal recurring adjustments) that are necessary for a fair statement of the Company's financial position, results of operations and cash flows for the interim periods have been made. The interim results reflected in these condensed consolidated financial statements are not 10 December 31, 2018 |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The accompanying condensed consolidated financial statements include the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company to make decisions based upon estimates, assumptions, and factors considered relevant to the circumstances. Such decisions include the selection of applicable accounting principles and the use of judgment in their application, the results of which impact reported amounts and disclosures. Changes in future economic conditions or other business circumstances may |
Revenue [Policy Text Block] | Revenue Recognition Leasing of equipment in both our EGM and Table Products segments is accounted for under lease accounting guidance in ASC 842, 842 606 606 The following table disaggregates our revenues by type within each of our segments (amounts in thousands): Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 EGM Gaming operations $ 48,854 $ 47,109 $ 148,515 $ 142,301 Equipment sales 26,445 24,675 67,417 60,060 Total $ 75,299 $ 71,784 $ 215,932 $ 202,361 Table Products Gaming operations $ 2,451 $ 1,902 $ 6,902 $ 5,257 Equipment sales 410 150 535 257 Total $ 2,861 $ 2,052 $ 7,437 $ 5,514 Interactive (gaming operations) Social $ 712 $ 1,446 $ 2,606 $ 5,033 RMG 505 244 953 296 Total $ 1,217 $ 1,690 $ 3,559 $ 5,329 Gaming Operations Gaming operations revenue is earned by providing customers with gaming machines, gaming machine content licenses, table products, back-office equipment and linked progressive systems, which are collectively referred to as gaming equipment, under participation arrangements. The participation arrangements convey the right to use the equipment (i.e., gaming machines and related integral software) for a stated period of time, which typically ranges from one three no Under participation arrangements, the Company retains ownership of the gaming equipment installed at the customer facilities and receives either revenue based on a percentage of the win per day generated by the gaming equipment or a fixed daily fee. Thus, in our consolidated financial statements the Company records revenue monthly related to these arrangements and the gaming equipment is recorded in property and equipment, net on our balance sheet and depreciated over the expected life of the gaming equipment. The majority of the Company’s leases require the Company to provide maintenance throughout the entire term of the lease. In some cases, a performance guarantee exists that, if not Gaming operations revenue is also earned from the licensing of table product content and is earned and recognized primarily on a fixed monthly rate. Our B2C B2C B2B Equipment Sales Revenues from contracts with customers are recognized and recorded when the following criteria are met: • We have a contract that has been approved by both the customer and the Company. Our contracts specify the products being sold and payment terms and are recognized when it is probable that we will collect substantially all of the contracted amount; and • Control has been transfered and services have been rendered in accordance with the contract terms. Equipment sales are generated from the sale of gaming machines, table products and licensing rights to the integral game content software that is installed in the related equipment, parts, and other ancillary equipment. Also included within the deliverables are delivery, installation and training, all of which occur within a few days of arriving at the customer location. Equipment sales do not 30 90 12 24 The Company enters into revenue arrangements that may may may Revenue is allocated to the separate performance obligations based on relative standalone selling prices determined at contract inception. Standalone selling prices are primarily determined by prices that we charge for the products when they are sold separately. When a product is not Revenue allocated to any undelivered performance obligations is recorded as a contract liability. The balance of our contract liabilities was not September 30, 2019 December 31, 2018 |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash and cash equivalents consist primarily of deposits held at major banks and other marketable securities with original maturities of 90 |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash amounts represent funds held in escrow as collateral for the Company’s surety bonds for various gaming authorities. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Allowance for Doubtful Accounts Accounts receivable are stated at face value less an allowance for doubtful accounts. The Company maintains an allowance for doubtful accounts related to accounts receivable and notes receivable, which are non-interest bearing, deemed to have a high risk of collectability. The Company reviews the accounts receivable and notes receivable on a monthly basis to determine if any receivables will potentially be uncollectible. The Company analyzes historical collection trends and changes in the customers’ payment patterns, customer concentration, and credit worthiness when evaluating the adequacy of the allowance for doubtful accounts. A large percentage of receivables are with Native American tribes and the Company has concentrations of credit risk with several tribes. The Company includes any receivable balances that are determined to be uncollectible in the overall allowance for doubtful accounts. Changes in the assumptions or estimates reflecting the collectability of certain accounts could materially affect the allowance for both accounts and notes receivable. |
Inventory, Policy [Policy Text Block] | Inventories Inventories consist primarily of parts and supplies that are used to repair and maintain machinery and equipment as well as EGMs in production and finished goods held for sale. Inventories are stated at net realizable value. Cost of inventories is determined using the first first September 30, 2019 December 31, 2018 $25.8 $22.3 September 30, 2019 December 31, 2018 $4.5 $5.1 no September 30, 2019 December 31, 2018 |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment The cost of gaming equipment, consisting of fixed-base player terminals, file servers and other support equipment as well as other property and equipment, is depreciated over their estimated useful lives, using the straight-line method for financial reporting. The Company capitalizes costs incurred for the refurbishment of used gaming equipment that is typically incurred to refurbish a machine in order to return it to its customer location. The refurbishments extend the life of the gaming equipment beyond the original useful life. Repairs and maintenance costs are expensed as incurred. The Company routinely evaluates the estimated lives used to depreciate assets. The estimated useful lives are as follows: Gaming equipment (in years) 2 to 6 Other property and equipment (in years) 3 to 6 The Company reviews its property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not not When the estimated undiscounted cash flows are not The Company measures recoverability of assets to be held and used by comparing the carrying amount of an asset to future cash flows expected to be generated by the asset. The Company’s policy is to impair, when necessary, excess or obsolete gaming machines on hand that it does not |
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | Intangible Assets The Company reviews its identifiable intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not not When the estimated undiscounted cash flows are not Certain trade names have an indefinite useful life and the Company tests these trade names for possible impairment at least annually, on October 1, may not not |
Software to be Sold, Leased, or Otherwise Marketed, Policy [Policy Text Block] | Costs of Capitalized Computer Software Internally developed gaming software represents the Company’s internal costs to develop gaming titles to utilize on the Company’s gaming machines. Internally developed gaming software is stated at cost and amortized over the estimated useful lives of the software, using the straight-line method. Software development costs are capitalized once technological feasibility has been established and are amortized when the software is placed into service. The computer software we develop reaches technological feasibility when a working model of the computer software is available. Any subsequent software maintenance costs, such as bug fixes and subsequent testing, are expensed as incurred. Discontinued software development costs are expensed when the determination to discontinue is made. Software development costs are amortized over the expected life of the title or group of titles, if applicable, to amortization expense. On a quarterly basis, or more frequently if circumstances warrant, the Company compares the net book value of its internally developed computer software to the net realizable value on a title or group of title basis. The net realizable value is determined based upon certain assumptions, including the expected future revenues and net cash flows of the gaming titles or group of gaming titles utilizing that software, if applicable. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill The excess of the purchase price of an acquired business over the estimated fair value of the assets acquired and the liabilities assumed is recorded as goodwill. The Company tests for possible impairment of goodwill at least annually, on October 1, not 0”, not may not not may second 2019, 4. |
Business Combinations Policy [Policy Text Block] | Acquisition Accounting The Company applies the provisions of ASC 805, Business Combinations” 805 may one may |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements 820 820 • Level 1 • Level 2 • Level 3 The carrying values of the Company’s cash and cash equivalents, restricted cash, receivables and accounts payable approximate fair value because of the short term maturities of these instruments. The fair value of our long-term debt is based on the quoted market prices for similar issues (Level 2 September 30, 2019 December 31, 2018 $532.3 $528.1 |
Income Tax, Policy [Policy Text Block] | Accounting for Income Taxes We conduct business globally and are subject to income taxes in U.S. federal, state, local, and foreign jurisdictions. Determination of the appropriate amount and classification of income taxes depends on several factors, including estimates of the timing and probability of realization of deferred income taxes, reserves for uncertain income tax positions and income tax payment timing. We account for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. Taxes on income of our foreign subsidiaries are provided at the tax rates applicable to the tax jurisdictions in which they are located. Future tax benefits are recognized to the extent that realization of those benefits is considered more likely than not not The recoverability of certain deferred tax assets is based in part on estimates of future income and the timing of temporary differences, and the failure to fully realize such deferred tax assets could result in a higher tax provision in future periods. We apply the accounting guidance to our uncertain tax positions and under the guidance, we may not 50% We are required to make significant judgments when evaluating our uncertain tax positions and the related tax benefits. We believe our assumptions are reasonable; however, there is no not may |
Commitments and Contingencies, Policy [Policy Text Block] | Contingencies The Company assesses its exposures to loss contingencies including claims and legal proceedings and accrues a liability if a potential loss is considered probable and the amount can be estimated. Significant judgment is required in both the determination of probability and the determination as to whether an exposure is reasonably estimable. Because of uncertainties related to these matters, if the actual loss from a contingency differs from management’s estimate, there could be a material impact on the results of operations or financial position. Operating expenses, including legal fees, associated with contingencies are expensed when incurred. |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency Translation The financial statements of the Company’s foreign subsidiaries are translated into U.S. dollars at the period end rate of exchange for asset and liability accounts and the weighted average rate of exchange for income statement accounts. The effects of these translations are recorded as a component of other accumulated comprehensive loss in stockholders’ equity. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Pronouncements In February 2016, 2016 02, Leases (Topic 842 2016 02 2016 02 December 15, 2018, July 2018, 2018 11, 842 2018 11 January 1, 2019. 840 840 840. no January 1, 2019. not January 1, 2019. 15. not no In June 2016, No. 2016 13, November 2018 No. 2018 19, not 326 20, 842. May 2019, No. 2019 05 326. December 15, 2019, first December 15, 2018. not In August 2018, No. 2018 15, December 15, 2019, not We do not |
Note 1 - Description of the B_2
Note 1 - Description of the Business and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Disaggregation of Revenue [Table Text Block] | Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 EGM Gaming operations $ 48,854 $ 47,109 $ 148,515 $ 142,301 Equipment sales 26,445 24,675 67,417 60,060 Total $ 75,299 $ 71,784 $ 215,932 $ 202,361 Table Products Gaming operations $ 2,451 $ 1,902 $ 6,902 $ 5,257 Equipment sales 410 150 535 257 Total $ 2,861 $ 2,052 $ 7,437 $ 5,514 Interactive (gaming operations) Social $ 712 $ 1,446 $ 2,606 $ 5,033 RMG 505 244 953 296 Total $ 1,217 $ 1,690 $ 3,559 $ 5,329 |
Property, Plant and Equipment, Useful Life [Table Text Block] | Gaming equipment (in years) 2 to 6 Other property and equipment (in years) 3 to 6 |
Note 2 - Acquisitions (Tables)
Note 2 - Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | February 8, 2019 (in 000s) Total purchase price for Integrity common stock (35,223,928 shares at CAD $0.46 per share) $ 12,335 Payments in respect of Integrity stock options, restricted share units 441 Repayments of Integrity debt and other obligations 39,806 Total purchase price consideration $ 52,582 February 8, 2019 (in 000s) Assets Current assets Cash and cash equivalents $ 1,646 Accounts receivable 1,584 Inventories 159 Deposits and other 26 Prepaid expenses 141 Total Current Assets 3,556 Property and Equipment 12,708 Intangible Assets 30,600 Goodwill 11,380 Total Assets $ 58,244 Liabilities and Equity Current liabilities Accounts payable $ 1,366 Accrued liabilities 2,087 Current portion of long-term debt 151 Total current liabilities 3,604 Other long-term liabilities 1,787 Long-term debt 200 Total liabilities 1,987 Minority Interest 71 Net assets acquired $ 52,582 |
Business Acquisition, Pro Forma Information [Table Text Block] | Three months ended September 30, 2019 Three months ended September 30, 2018 Nine months ended September 30, 2019 Nine months ended September 30, 2018 Total revenues $ 79,377 $ 79,782 $ 228,667 $ 227,496 Net (loss) income attributable to PlayAGS, Inc. $ (5,536 ) $ 4,060 $ (13,236 ) $ (12,185 ) |
Note 3 - Property and Equipme_2
Note 3 - Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | September 30, 2019 December 31, 2018 Gaming equipment $ 170,822 $ 141,530 Other property and equipment 25,327 23,304 Less: Accumulated depreciation (91,269 ) (73,287 ) Property and equipment, net $ 104,880 $ 91,547 |
Note 4 - Goodwill and Intangi_2
Note 4 - Goodwill and Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Goodwill [Table Text Block] | Gross Carrying Amount EGM Table Products Interactive (1) Total Balance at December 31, 2018, net $ 267,079 $ 6,641 $ 3,543 $ 277,263 Foreign currency adjustments (77 ) - (10 ) (87 ) Acquisitions 11,380 1,180 - 12,560 Impairment - - (3,533 ) (3,533 ) Balance at September 30, 2019 $ 278,382 $ 7,821 $ - $ 286,203 |
Schedule of Intangible Assets and Goodwill [Table Text Block] | September 30, 2019 December 31, 2018 Useful Life Gross Accumulated Net Carrying Gross Accumulated Net Carrying (years) Value Amortization Value Value Amortization Value Indefinite lived trade names Indefinite $ 12,126 $ - $ 12,126 $ 12,126 $ - $ 12,126 Trade and brand names 7 14,870 (12,901 ) 1,969 14,730 (10,681 ) 4,049 Customer relationships 7 219,003 (112,958 ) 106,045 188,772 (93,358 ) 95,413 Contract rights under development and placement fees 1 - 7 58,818 (18,917 ) 39,901 19,620 (14,367 ) 5,253 Gaming software and technology platforms 1 - 7 159,127 (93,661 ) 65,466 151,055 (82,371 ) 68,682 Intellectual property 10 - 12 19,345 (7,057 ) 12,288 17,205 (5,830 ) 11,375 $ 483,288 $ (245,494 ) $ 237,794 $ 403,508 $ (206,607 ) $ 196,898 |
Note 5 - Accrued Liabilities (T
Note 5 - Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Accounts Payable and Accrued Liabilities [Table Text Block] | September 30, 2019 December 31, 2018 Salary and payroll tax accrual $ 8,302 $ 13,393 Taxes payable 4,384 3,437 Current portion of operating lease liability 2,117 - License fee obligation 1,000 1,000 Placement fees payable 8,738 2,490 Accrued other 9,271 6,339 Total accrued liabilities $ 33,812 $ 26,659 |
Note 6 - Long-term Debt (Tables
Note 6 - Long-term Debt (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Long-term Debt Instruments [Table Text Block] | September 30, 2019 December 31, 2018 First Lien Credit Facilities: Term loans, interest at LIBOR or base rate plus 3.50% (5.61% at September 30, 2019), net of unamortized discount and deferred loan costs of $9.5 million and $10.9 million at September 30, 2019 and December 31, 2018, respectively. $ 523,846 $ 526,461 Equipment long-term note payable and finance leases 1,701 1,422 Total debt 525,547 527,883 Less: Current portion (6,026 ) (5,959 ) Long-term debt $ 519,521 $ 521,924 |
Note 9 - Basic and Diluted In_2
Note 9 - Basic and Diluted Income (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three months ended September 30, 2018 Numerator: Net income $ 4,347 Net income attributable to participating securities (16 ) Net income attributable to common stock $ 4,331 Denominator: Weighted average of common shares outstanding $ 35,305 Potential dilutive effect of stock options 1,008 Weighted average of common shares outstanding $ 36,313 |
Note 11 - Stock-based Compens_2
Note 11 - Stock-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | Nine months ended September 30, Nine months ended September 30, 2019 2018 Option valuation assumptions: Expected dividend yield N/A — % Expected volatility N/A 50 % Risk-free interest rate N/A 2.71 % Expected term (in years) N/A 6.3 |
Share-based Payment Arrangement, Option, Activity [Table Text Block] | Number of Options Weighted Average Exercise Price Weighted Average Remaining Contract Term (years) Aggregate Intrinsic Value (in thousands) Options outstanding as of December 31, 2018 1,515,461 $ 9.11 Granted - - Exercised (70,288 ) 9.74 Canceled or forfeited (19,080 ) 10.56 Options outstanding as of September 30, 2019 1,426,093 9.06 5.7 $ 2,562 Exercisable as of September 30, 2019 1,218,162 $ 8.41 5.4 $ 2,541 |
Nonvested Restricted Stock Shares Activity [Table Text Block] | Shares Outstanding Grant Date Fair Value (per share) Outstanding as of December 31, 2018 287,479 $ 29.26 Granted 454,529 $ 23.73 Vested (85,395 ) $ 26.00 Canceled or forfeited (40,611 ) $ 26.08 Restricted stock outstanding as of September 30, 2019 616,002 $ 25.84 |
Note 14 - Operating Segments (T
Note 14 - Operating Segments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 Revenues by segment EGM $ 75,299 $ 71,784 $ 215,932 $ 202,361 Table Products 2,861 2,052 7,437 5,514 Interactive 1,217 1,690 3,559 5,329 Total Revenues $ 79,377 $ 75,526 $ 226,928 $ 213,204 Adjusted EBITDA by segment EGM 35,825 34,026 108,088 105,197 Table Products 1,409 428 2,694 684 Interactive (447 ) (877 ) (1,985 ) (1,223 ) Subtotal 36,787 33,577 108,797 104,658 Write-downs and other: Loss on disposal of long lived assets 570 363 1,015 1,383 Impairment of long lived assets 136 204 5,343 1,199 Fair value adjustments to contingent consideration and other items 101 100 501 700 Depreciation and amortization 23,810 18,968 69,002 57,784 Accretion of placement fees (1) 1,747 1,206 4,550 3,412 Non-cash stock-based compensation expense 1,959 538 5,309 9,167 Acquisitions and integration related costs including restructuring and severance 481 746 2,944 3,156 Initial public offering costs and secondary offering (11 ) 859 414 2,168 Legal and litigation expenses including settlement payments 1,745 (45 ) 1,748 789 Non-cash charge on capitalized installation and delivery 679 494 1,991 1,478 Other adjustments (9 ) 34 58 50 Interest expense 9,320 8,956 27,754 28,253 Interest (income) (42 ) (89 ) (112 ) (162 ) Loss on extinguishment and modification of debt - - - 4,608 Other (income) expense (106 ) 434 5,108 10,121 (Loss) Income before income taxes $ (3,593 ) $ 809 $ (16,828 ) $ (19,448 ) |
Note 15 - Leases (Tables)
Note 15 - Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Notes Tables | |
Assets and Liabilities, Lessee [Table Text Block] | As of September 30, 2019 As of December 31, 2018 (ASC 842) (ASC 840) Leases (in thousands) Classification Assets Operating leases Operating lease assets (a) $ 11,940 N/A Finance leases Property and equipment, net (b) 1,754 1,344 Total leased assets, net $ 13,694 $ 1,344 Liabilities Current: Operating leases Accrued liabilities $ (2,117 ) N/A Finance leases Current maturities of long-term debt (639 ) 408 Non-current: Operating leases Operating lease liabilities, long-term (11,823 ) N/A Finance leases Long-term debt (1,062 ) 851 Total lease liability $ (15,641 ) $ 1,259 |
Lease, Cost [Table Text Block] | Three months ended September 30, Nine months ended September 30, 2019 2018 2019 2018 (ASC 842) (ASC 840) (ASC 842) (ASC 840) Operating lease costs (in thousands) Classification Operating lease cost - office building Selling, general and administrative $ 394 N/A $ 1,183 N/A Operating lease cost - R&D Research and development 49 N/A 182 N/A Operating lease cost - warehouses Cost of gaming operations (a) 124 N/A 347 N/A Finance lease cost Depreciation of leased assets Depreciation and amortization 248 116 505 312 Interest on lease liabilities Interest expense 10 5 29 15 Total Lease Cost $ 825 $ 121 $ 2,246 $ 327 As of As of September 30, December 31, 2019 2018 (ASC 842) (ASC 840) Lease term and discount rate Operating Weighted average remaining lease term (years) 8.8 N/A Weighted average discount rate 5.9 % N/A Finance Leases Weighted average remaining lease term (years) 2.0 2.7 Weighted average discount rate 2.7 % 2.6 % Nine months ended September 30, 2019 2018 (ASC 842) (ASC 840) Cash paid for amounts included in the measurement of lease liabilities (in thousands) Operating cash flows from operating leases $ 1,906 N/A Operating cash flows from finance leases $ 29 $ 14 Financing cash flows from finance leases $ 446 $ 290 |
Lessee, Lease Liability, Maturity [Table Text Block] | Operating Leases (a) Financing Leases Total Maturity of lease liabilities (in thousands) 2019 (excluding nine months ended September 30, 2019) $ 717 $ 164 $ 881 2020 2,897 648 3,545 2021 2,476 555 3,031 2022 1,951 311 2,262 2023 1,825 74 1,899 Thereafter 7,411 13 7,424 Total lease payments $ 17,277 $ 1,765 $ 19,042 Less: interest 3,337 64 3,401 Present value of lease liabilities $ 13,940 $ 1,701 $ 15,641 |
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] | Total (in thousands) For the year ended December 31, 2019 $ 2,817 2020 2,716 2021 2,212 2022 1,470 2023 1,121 Thereafter 5,260 Total $ 15,596 |
Note 1 - Description of the B_3
Note 1 - Description of the Business and Summary of Significant Accounting Policies (Details Textual) $ / shares in Units, $ in Thousands | Feb. 27, 2018shares | Jan. 30, 2018$ / sharesshares | Jan. 26, 2018$ / sharesshares | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
Number of Reportable Segments | 3 | ||||
Stock Issued During Period, Shares, New Issues | shares | 1,537,500 | ||||
Contract with Customer, Liability, Total | $ 0 | $ 0 | |||
Inventory, Raw Materials, Gross, Total | 25,800 | 22,300 | |||
Inventory, Finished Goods, Gross, Total | 4,500 | 5,100 | |||
Inventory, Work in Process, Gross | 0 | 0 | |||
Long-term Debt, Fair Value | $ 532,300 | $ 528,100 | |||
Gaming Operations [Member] | Minimum [Member] | |||||
Lessor, Operating Lease, Term of Contract | 1 year | ||||
Gaming Operations [Member] | Maximum [Member] | |||||
Lessor, Operating Lease, Term of Contract | 3 years | ||||
IPO [Member] | |||||
Stock Issued During Period, Shares, New Issues | shares | 10,250,000 | 10,250,000 | |||
Shares Issued, Price Per Share | $ / shares | $ 16 | $ 16 |
Note 1 - Description of the B_4
Note 1 - Description of the Business and Summary of Significant Accounting Policies - Disaggregation of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Total revenues | $ 79,377 | $ 75,526 | $ 226,928 | $ 213,204 |
Gaming Operations [Member] | ||||
Total revenues | 52,522 | 50,701 | 158,976 | 152,887 |
Equipment Sales [Member] | ||||
Total revenues | 26,855 | 24,825 | 67,952 | 60,317 |
EGM [Member] | ||||
Total revenues | 75,299 | 71,784 | 215,932 | 202,361 |
EGM [Member] | Gaming Operations [Member] | ||||
Total revenues | 48,854 | 47,109 | 148,515 | 142,301 |
EGM [Member] | Equipment Sales [Member] | ||||
Total revenues | 26,445 | 24,675 | 67,417 | 60,060 |
Table Products [Member] | ||||
Total revenues | 2,861 | 2,052 | 7,437 | 5,514 |
Table Products [Member] | Gaming Operations [Member] | ||||
Total revenues | 2,451 | 1,902 | 6,902 | 5,257 |
Table Products [Member] | Equipment Sales [Member] | ||||
Total revenues | 410 | 150 | 535 | 257 |
Interactive (Gaming Operations) [Member] | ||||
Total revenues | 1,217 | 1,690 | 3,559 | 5,329 |
Interactive (Gaming Operations) [Member] | Gaming Operations [Member] | ||||
Total revenues | 712 | 1,446 | 2,606 | 5,033 |
Interactive (Gaming Operations) [Member] | Equipment Sales [Member] | ||||
Total revenues | $ 505 | $ 244 | $ 953 | $ 296 |
Note 1 - Description of the B_5
Note 1 - Description of the Business and Summary of Significant Accounting Policies - Property and Equipment Useful Life (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Minimum [Member] | |
Useful life (Year) | 2 years |
Minimum [Member] | Property, Plant and Equipment, Other Types [Member] | |
Useful life (Year) | 3 years |
Maximum [Member] | |
Useful life (Year) | 6 years |
Maximum [Member] | Property, Plant and Equipment, Other Types [Member] | |
Useful life (Year) | 6 years |
Note 2 - Acquisitions (Details
Note 2 - Acquisitions (Details Textual) $ in Thousands | Feb. 08, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Goodwill, Ending Balance | $ 286,203 | $ 277,263 | ||
In Bet [Member] | ||||
Business Combination, Consideration Transferred, Total | 4,000 | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 1,200 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total | $ 2,800 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 9 years 109 days | |||
Integrity Gaming Corp [Member] | ||||
Business Combination, Consideration Transferred, Total | $ 52,582 | |||
Number of Gaming Machines | 2,500 | |||
Number of Casinos | 33 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities, Current | $ 600 | |||
Business Combination Recognized Identifiable Assets Acquired And Liabilities Assumed, Uncertain Tax Position | 1,400 | |||
Payments to Acquire Businesses, Gross | 12,335 | |||
Business Combination, Consideration Transferred, Liabilities Incurred | 39,806 | |||
Goodwill, Ending Balance | $ 11,380 | |||
Integrity Gaming Corp [Member] | Customer Relationships [Member] | ||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 10 years | |||
Gameiom Technologies Limited [Member] | ||||
Business Combination, Consideration Transferred, Total | $ 5,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill, Total | $ 2,100 | |||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 years 255 days | |||
Payments to Acquire Businesses, Gross | $ 4,500 | |||
Business Combination, Consideration Transferred, Liabilities Incurred | $ 500 | |||
Deferred Consideration To Acquire Business, Payment Terms | 1 year 180 days | |||
Goodwill, Ending Balance | $ 3,700 |
Note 2 - Acquisitions - Integri
Note 2 - Acquisitions - Integrity Acquisition (Details) $ in Thousands | Feb. 08, 2019USD ($)shares | Sep. 30, 2019USD ($) | Feb. 08, 2019$ / shares | Feb. 08, 2019USD ($) | Dec. 31, 2018USD ($) |
Goodwill, Ending Balance | $ 286,203 | $ 277,263 | |||
Integrity Gaming Corp [Member] | |||||
Integrity common stock, shares (in shares) | shares | 35,223,928 | ||||
Integrity common stock, per share (in CAD per share) | $ / shares | $ 0.46 | ||||
Total purchase price for Integrity common stock (35,223,928 shares at CAD $0.46 per share) | $ 12,335 | ||||
Payments in respect of Integrity stock options, restricted share units | 441 | ||||
Repayments of Integrity debt and other obligations | 39,806 | ||||
Total purchase price consideration | $ 52,582 | ||||
Cash and cash equivalents | $ 1,646 | ||||
Accounts receivable | 1,584 | ||||
Inventories | 159 | ||||
Deposits and other | 26 | ||||
Prepaid expenses | 141 | ||||
Total Current Assets | 3,556 | ||||
Property and Equipment | 12,708 | ||||
Intangible Assets | 30,600 | ||||
Goodwill, Ending Balance | 11,380 | ||||
Total Assets | 58,244 | ||||
Accounts payable | 1,366 | ||||
Accrued liabilities | 2,087 | ||||
Current portion of long-term debt | 151 | ||||
Total current liabilities | 3,604 | ||||
Other long-term liabilities | 1,787 | ||||
Long-term debt | 200 | ||||
Total liabilities | 1,987 | ||||
Minority Interest | 71 | ||||
Net assets acquired | $ 52,582 |
Note 2 - Acquisitions - Integ_2
Note 2 - Acquisitions - Integrity Acquisition (Details) (Parentheticals) - Integrity Gaming Corp [Member] | Feb. 08, 2019$ / sharesshares |
Integrity common stock, shares (in shares) | shares | 35,223,928 |
Integrity common stock, per share (in CAD per share) | $ / shares | $ 0.46 |
Note 2 - Acquisitions - Pro For
Note 2 - Acquisitions - Pro Forma Information Related to Integrity Acquisition (Details) - Integrity Gaming Corp [Member] - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Total revenues | $ 79,377 | $ 79,782 | $ 228,667 | $ 227,496 |
Net (loss) income attributable to PlayAGS, Inc. | $ (5,536) | $ 4,060 | $ (13,236) | $ (12,185) |
Note 3 - Property and Equipme_3
Note 3 - Property and Equipment (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Depreciation, Total | $ 11.6 | $ 8 | $ 33.7 | $ 23.7 |
Minimum [Member] | ||||
Property, Plant and Equipment, Useful Life | 2 years | |||
Maximum [Member] | ||||
Property, Plant and Equipment, Useful Life | 6 years |
Note 3 - Property and Equipme_4
Note 3 - Property and Equipment - Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Less: Accumulated depreciation | $ (91,269) | $ (73,287) |
Property and equipment, net | 104,880 | 91,547 |
Gaming Equipment [Member] | ||
Property and equipment, gross | 170,822 | 141,530 |
Property, Plant and Equipment, Other Types [Member] | ||
Property and equipment, gross | $ 25,327 | $ 23,304 |
Note 4 - Goodwill and Intangi_3
Note 4 - Goodwill and Intangibles (Details Textual) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Mar. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |||
Goodwill, Impairment Loss | $ 3,533 | ||||||||
Amortization of Intangible Assets, Total | $ 12,100 | $ 11,000 | 35,300 | $ 34,100 | |||||
Indefinite-lived Intangible Assets (Excluding Goodwill), Ending Balance | 12,126 | 12,126 | $ 12,126 | ||||||
Accretion of Contract Rights Under Development Agreements and Customer Agreements | 1,747 | $ 1,206 | 4,550 | [1] | $ 3,412 | [1] | |||
Placement Fees, Capitalized | $ 33,100 | ||||||||
Placement Fees, Unamortized Cost | 2,100 | ||||||||
Present Value and Cash Payments, Placement Fees Payables | $ 40,100 | ||||||||
Placement Fees, Payment Term | 6 years 330 days | ||||||||
RMG Customer Relationships, Gaming Licenses, and Game Content [Member] | |||||||||
Indefinite-lived Intangible Assets (Excluding Goodwill), Ending Balance | 600 | 600 | |||||||
RMG Technology Platform [Member] | |||||||||
Indefinite-lived Intangible Assets (Excluding Goodwill), Ending Balance | $ 400 | 400 | |||||||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | $ 700 | ||||||||
Minimum [Member] | |||||||||
Finite-Lived Intangible Asset, Useful Life | 1 year | ||||||||
Maximum [Member] | |||||||||
Finite-Lived Intangible Asset, Useful Life | 12 years | ||||||||
Measurement Input, Long-term Revenue Growth Rate [Member] | |||||||||
Impairment Assumptions, Measurement Input | 0.03 | 0.03 | |||||||
Measurement Input, Discount Rate [Member] | |||||||||
Impairment Assumptions, Measurement Input | 0.25 | 0.25 | |||||||
Royalty Rate [Member] | |||||||||
Impairment Assumptions, Measurement Input | 0.05 | 0.05 | |||||||
Interactive (Gaming Operations) [Member] | |||||||||
Goodwill, Impaired, Accumulated Impairment Loss | $ 8,400 | $ 8,400 | |||||||
Goodwill, Impairment Loss | $ 3,500 | $ 3,533 | |||||||
[1] | Non-cash item related to the accretion of contract rights under development agreements and placement fees. |
Note 4 - Goodwill and Intangi_4
Note 4 - Goodwill and Intangibles - Changes in Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2019 | ||
Beginning Balance | $ 277,263 | ||
Foreign currency adjustments | (87) | ||
Acquisitions | 12,560 | ||
Impairment | (3,533) | ||
Ending Balance | 286,203 | ||
EGM [Member] | |||
Beginning Balance | 267,079 | ||
Foreign currency adjustments | (77) | ||
Acquisitions | 11,380 | ||
Impairment | |||
Ending Balance | 278,382 | ||
Table Products [Member] | |||
Beginning Balance | 6,641 | ||
Foreign currency adjustments | |||
Acquisitions | 1,180 | ||
Impairment | |||
Ending Balance | 7,821 | ||
Interactive (Gaming Operations) [Member] | |||
Beginning Balance | [1] | 3,543 | |
Foreign currency adjustments | [1] | (10) | |
Acquisitions | [1] | ||
Impairment | $ (3,500) | (3,533) | |
Ending Balance | [1] | ||
[1] | Accumulated goodwill impairment charges for the Interactive segment as of September 30, 2019 were $8.4 million. |
Note 4 - Goodwill and Intangi_5
Note 4 - Goodwill and Intangibles - Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Indefinite lived trade names | $ 12,126 | $ 12,126 |
Finite lived, accumulated amortization | (245,494) | (206,607) |
Intangible assets, gross value | 483,288 | 403,508 |
Intangible assets, net carrying value | $ 237,794 | 196,898 |
Minimum [Member] | ||
Intangible assets, useful life (Year) | 1 year | |
Maximum [Member] | ||
Intangible assets, useful life (Year) | 12 years | |
Trade Names [Member] | ||
Intangible assets, useful life (Year) | 7 years | |
Finite lived, gross value | $ 14,870 | 14,730 |
Finite lived, accumulated amortization | (12,901) | (10,681) |
Finite lived, net carrying value | $ 1,969 | 4,049 |
Customer Relationships [Member] | ||
Intangible assets, useful life (Year) | 7 years | |
Finite lived, gross value | $ 219,003 | 188,772 |
Finite lived, accumulated amortization | (112,958) | (93,358) |
Finite lived, net carrying value | 106,045 | 95,413 |
Contractual Rights [Member] | ||
Finite lived, gross value | 58,818 | 19,620 |
Finite lived, accumulated amortization | (18,917) | (14,367) |
Finite lived, net carrying value | $ 39,901 | 5,253 |
Contractual Rights [Member] | Minimum [Member] | ||
Intangible assets, useful life (Year) | 1 year | |
Contractual Rights [Member] | Maximum [Member] | ||
Intangible assets, useful life (Year) | 7 years | |
Computer Software, Intangible Asset [Member] | ||
Finite lived, gross value | $ 159,127 | 151,055 |
Finite lived, accumulated amortization | (93,661) | (82,371) |
Finite lived, net carrying value | $ 65,466 | 68,682 |
Computer Software, Intangible Asset [Member] | Minimum [Member] | ||
Intangible assets, useful life (Year) | 1 year | |
Computer Software, Intangible Asset [Member] | Maximum [Member] | ||
Intangible assets, useful life (Year) | 7 years | |
Intellectual Property [Member] | ||
Finite lived, gross value | $ 19,345 | 17,205 |
Finite lived, accumulated amortization | (7,057) | (5,830) |
Finite lived, net carrying value | $ 12,288 | $ 11,375 |
Intellectual Property [Member] | Minimum [Member] | ||
Intangible assets, useful life (Year) | 10 years | |
Intellectual Property [Member] | Maximum [Member] | ||
Intangible assets, useful life (Year) | 12 years |
Note 5 - Accrued Liabilities -
Note 5 - Accrued Liabilities - Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Salary and payroll tax accrual | $ 8,302 | $ 13,393 |
Taxes payable | 4,384 | 3,437 |
Current portion of operating lease liability | 2,117 | |
License fee obligation | 1,000 | 1,000 |
Placement fees payable | 8,738 | 2,490 |
Accrued other | 9,271 | 6,339 |
Total accrued liabilities | $ 33,812 | $ 26,659 |
Note 6 - Long-term Debt (Detail
Note 6 - Long-term Debt (Details Textual) - USD ($) $ in Thousands | Oct. 05, 2018 | Feb. 08, 2018 | Feb. 07, 2018 | Dec. 06, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Jun. 06, 2017 |
Gain (Loss) on Extinguishment of Debt, Total | $ (4,608) | |||||||||
Long-term Debt, Total | $ 525,547 | 525,547 | $ 527,883 | |||||||
Write off of Deferred Debt Issuance Cost | $ 3,410 | |||||||||
AP Gaming I, LLC [Member] | The First Lien Credit Agreement [Member] | Revolving Credit Facility [Member] | ||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 30,000 | |||||||||
AP Gaming I, LLC [Member] | The First Lien Credit Agreement [Member] | Term Loan [Member] | ||||||||||
Debt Instrument, Face Amount | $ 30,000 | $ 65,000 | $ 450,000 | |||||||
Debt Issuance Costs, Gross | 1,000 | |||||||||
Gain (Loss) on Extinguishment of Debt, Total | $ (1,500) | $ (900) | ||||||||
Long-term Debt, Total | $ 513,000 | |||||||||
Gains (Losses) on Restructuring of Debt | (1,200) | |||||||||
Write off of Deferred Debt Issuance Cost | $ 400 | |||||||||
Debt Instrument, Conditional Increase in Basis Spread on Variable Rate | 0.75% | |||||||||
Debt Instrument, Additional Increase in Basis Spread on Variable Rate | 0.25% | |||||||||
AP Gaming I, LLC [Member] | The First Lien Credit Agreement [Member] | Term Loan [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||||||
Debt Instrument, Basis Spread on Variable Rate | 4.25% | 5.50% | ||||||||
Debt Instrument, Basis Floor on Variable Rate | 1.00% |
Note 6 - Long-term Debt - Sched
Note 6 - Long-term Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Total debt | $ 525,547 | $ 527,883 |
Less: Current portion | (6,026) | (5,959) |
Long-term debt | 519,521 | 521,924 |
First Lien Credit Facilities [Member] | Term Loan [Member] | ||
Total debt | 523,846 | 526,461 |
Equipment Long-term Note Payable and Finance Leases [Member] | Notes Payable, Other Payables [Member] | ||
Total debt | $ 1,701 | $ 1,422 |
Note 6 - Long-term Debt - Sch_2
Note 6 - Long-term Debt - Schedule of Long-term Debt (Details) (Parentheticals) - Term Loan [Member] - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
First Lien Credit Facilities [Member] | ||
Unamortized discount and costs | $ 9.5 | $ 10.9 |
First Lien Credit Facilities [Member] | ||
Effective interest rate | 5.61% | |
First Lien Credit Facilities [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||
Interest rate | 3.50% | 3.50% |
First Lien Credit Facilities [Member] | Base Rate [Member] | ||
Interest rate | 3.50% | 3.50% |
Note 7 - Stockholders' Equity (
Note 7 - Stockholders' Equity (Details Textual) $ / shares in Units, $ in Millions | Feb. 27, 2018shares | Jan. 30, 2018$ / sharesshares | Jan. 26, 2018USD ($)$ / sharesshares | Sep. 30, 2019shares | Dec. 31, 2018shares |
Stockholders' Equity Note, Stock Split, Conversion Ratio | 1.5543 | ||||
Stock Issued During Period, Shares, New Issues | 1,537,500 | ||||
Proceeds from Issuance Initial Public Offering | $ | $ 171.5 | ||||
Common Stock, Shares, Issued, Total | |||||
Reclassification From Liabilities to Additional Paid in Capital | $ | $ 1.3 | ||||
Management [Member] | |||||
Common Stock, Shares, Issued, Total | 170,712 | ||||
IPO [Member] | |||||
Stock Issued During Period, Shares, New Issues | 10,250,000 | 10,250,000 | |||
Shares Issued, Price Per Share | $ / shares | $ 16 | $ 16 |
Note 8 - Write-downs and Othe_2
Note 8 - Write-downs and Other Charges (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Other Cost and Expense, Operating, Total | $ 807 | $ 667 | $ 6,859 | $ 3,282 | |
Gain (Loss) on Disposition of Assets, Total | (570) | (363) | (1,015) | (1,383) | |
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Asset | 100 | 100 | 700 | ||
Goodwill, Impairment Loss | 3,533 | ||||
Interactive (Gaming Operations) [Member] | |||||
Other Cost and Expense, Operating, Total | 6,900 | ||||
Impairment of Intangible Assets, Finite-lived | 1,300 | ||||
Goodwill, Impairment Loss | $ 3,500 | 3,533 | |||
EGM [Member] | |||||
Gain (Loss) on Disposition of Assets, Total | (1,000) | ||||
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Asset | 500 | ||||
Goodwill, Impairment Loss | |||||
Game Titles [Member] | |||||
Impairment of Intangible Assets, Finite-lived | $ 100 | ||||
Game Titles [Member] | EGM [Member] | |||||
Impairment of Intangible Assets, Finite-lived | $ (500) | ||||
Development Agreements [Member] | |||||
Impairment of Intangible Assets, Finite-lived | $ 200 | $ 1,200 |
Note 9 - Basic and Diluted In_3
Note 9 - Basic and Diluted Income (Loss) Per Share (Details Textual) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Weighted Average Number Diluted Shares Outstanding Adjustment, Total | 0 | 0 | ||
Restricted Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 651,611 | 3,018 | 594,265 | 70,744 |
Share-based Payment Arrangement, Option [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 505,309 | 733,605 | 840,815 |
Note 9 - Basic and Diluted In_4
Note 9 - Basic and Diluted Income (Loss) Per Share - Schedule of Earnings Per Share (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Net income | $ (5,536) | $ 4,347 | $ (13,175) | $ (10,501) |
Net income attributable to participating securities | (16) | |||
Net income attributable to common stock | $ 4,331 | |||
Basic (in shares) | 35,447 | 35,305 | 35,416 | 34,097 |
Potential dilutive effect of stock options (in shares) | 1,008 | |||
Weighted average of common shares outstanding (in shares) | 35,447 | 36,313 | 35,416 | 34,097 |
Note 10 - Benefit Plans (Detail
Note 10 - Benefit Plans (Details Textual) $ in Millions | Jan. 30, 2018 | Apr. 28, 2014shares | Sep. 30, 2019USD ($)shares | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)shares | Sep. 30, 2018USD ($) | Jan. 16, 2018shares |
Defined Contribution Plan, Cost | $ | $ 0.3 | $ 0.3 | $ 1 | $ 0.9 | |||
Stockholders' Equity Note, Stock Split, Conversion Ratio | 1.5543 | ||||||
The 2014 Long-Term Incentive Plan [Member] | |||||||
Share Based Compensation Arrangement By Share Based Payment Award, Term | 10 years | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 2,253,735 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 423,268 | 423,268 | |||||
The 2018 Omnibus Incentive Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 1,607,389 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 765,515 | 765,515 |
Note 11 - Stock-based Compens_3
Note 11 - Stock-based Compensation (Details Textual) $ / shares in Units, $ in Thousands | Jan. 30, 2018 | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Dec. 31, 2018shares |
Stockholders' Equity Note, Stock Split, Conversion Ratio | 1.5543 | |||||
Share-based Payment Arrangement, Expense | $ 1,959 | $ 538 | $ 5,309 | $ 9,167 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Net of Forfeitures, Total | shares | 0 | 0 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | shares | 1,426,093 | 1,426,093 | 1,515,461 | |||
Share-based Payment Arrangement, Option [Member] | ||||||
Share-based Payment Arrangement, Expense | $ 200 | $ 700 | ||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total | 1,100 | $ 1,100 | ||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 2 years | |||||
Share-based Payment Arrangement, Option [Member] | Share-based Payment Arrangement, Tranche A [Member] | Minimum [Member] | Long-term Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 20.00% | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |||||
Share-based Payment Arrangement, Option [Member] | Share-based Payment Arrangement, Tranche A [Member] | Maximum [Member] | Long-term Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 25.00% | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | |||||
Restricted Stock [Member] | ||||||
Share-based Payment Arrangement, Expense | 1,800 | $ 4,600 | ||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total | $ 12,400 | $ 12,400 | ||||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 3 years | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Threshold Share Price | $ / shares | $ 29.60 | $ 29.60 | ||||
Restricted Stock [Member] | On Each of First Four Anniversaries of Date of Grant [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage | 25.00% | |||||
Performance Shares [Member] | ||||||
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $ 2,900 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | shares | 617,510 | 617,510 | ||||
Performance Shares [Member] | Share-based Payment Arrangement, Tranche B [Member] | Long-term Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Threshold, Internal Rate of Return Percentage | 20.00% | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Threshold, Return on Investment Ratio | 2.5 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Threshold Share Price | $ / shares | $ 19.11 | $ 19.11 | ||||
Performance Shares [Member] | Share-based Payment Arrangement, Tranche C [Member] | Long-term Incentive Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Threshold, Internal Rate of Return Percentage | 25.00% | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Threshold, Return on Investment Ratio | 3 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Threshold Share Price | $ / shares | $ 22.93 | $ 22.93 |
Note 11 - Stock-based Compens_4
Note 11 - Stock-based Compensation - Valuation Assumptions (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Expected dividend yield | |
Expected volatility | 50.00% |
Risk-free interest rate | 2.71% |
Expected term (in years) (Year) | 6 years 109 days |
Note 11 - Stock-based Compens_5
Note 11 - Stock-based Compensation - Stock Option Activity (Details) | 9 Months Ended |
Sep. 30, 2019USD ($)$ / sharesshares | |
Options outstanding, number of options (in shares) | shares | 1,515,461 |
Granted, number of options (in shares) | shares | 0 |
Exercised, number of options (in shares) | shares | (70,288) |
Canceled or forfeited, number of options (in shares) | shares | (19,080) |
Options outstanding, number of options (in shares) | shares | 1,426,093 |
Exercisable, number of options (in shares) | shares | 1,218,162 |
Options outstanding, weighted average exercise price (in dollars per share) | $ / shares | $ 9.11 |
Granted, weighted average exercise price (in dollars per share) | $ / shares | |
Exercised, weighted average exercise price (in dollars per share) | $ / shares | 9.74 |
Canceled or forfeited, weighted average exercise price (in dollars per share) | $ / shares | 10.56 |
Options outstanding, weighted average exercise price (in dollars per share) | $ / shares | 9.06 |
Exercisable, weighted average exercise price (in dollars per share) | $ / shares | $ 8.41 |
Options outstanding, weighted average remaining contract term (Year) | 5 years 255 days |
Exercisable, weighted average remaining contract term (Year) | 5 years 146 days |
Options outstanding, aggregate intrinsic value | $ | $ 2,562 |
Exercisable, aggregate intrinsic value | $ | $ 2,541 |
Note 11 - Stock-based Compens_6
Note 11 - Stock-based Compensation - Restricted Stock Activity (Details) - Restricted Stock [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Outstanding, shares (in shares) | shares | 287,479 |
Outstanding, grant date fair value (in dollars per share) | $ / shares | $ 29.26 |
Granted, shares (in shares) | shares | 454,529 |
Granted, grant date fair value (in dollars per share) | $ / shares | $ 23.73 |
Vested, shares (in shares) | shares | (85,395) |
Vested, grant date fair value (in dollars per share) | $ / shares | $ 26 |
Canceled or forfeited, shares (in shares) | shares | (40,611) |
Canceled or forfeited, grant date fair value (in dollars per share) | $ / shares | $ 26.08 |
Outstanding, shares (in shares) | shares | 616,002 |
Outstanding, grant date fair value (in dollars per share) | $ / shares | $ 25.84 |
Note 12 - Income Taxes (Details
Note 12 - Income Taxes (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Effective Income Tax Rate Reconciliation, Percent, Total | 53.60% | 437.30% | 23.10% | 46.00% |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 21.00% |
Business Combination, Indemnification Assets, Amount as of Acquisition Date | $ 3.9 | $ 3.9 | ||
Business Combination, Indemnification Assets, Change in Amount | $ 0.1 | $ 0.5 | $ (5.4) | $ (9.4) |
Note 13 - Commitments and Con_2
Note 13 - Commitments and Contingencies (Details Textual) $ in Millions | 3 Months Ended |
Sep. 30, 2019USD ($) | |
Insurance Claims [Member] | |
Loss Contingency Accrual, Provision | $ 1.6 |
Note 14 - Operating Segments (D
Note 14 - Operating Segments (Details Textual) | 9 Months Ended |
Sep. 30, 2019 | |
Number of Reportable Segments | 3 |
Note 14 - Operating Segments -
Note 14 - Operating Segments - Financial Information by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |||
Total revenues | $ 79,377 | $ 75,526 | $ 226,928 | $ 213,204 | ||
Adjusted EBITDA | 36,787 | 33,577 | 108,797 | 104,658 | ||
Loss on disposition of assets | 570 | 363 | 1,015 | 1,383 | ||
Impairment of long lived assets | 136 | 204 | 5,343 | 1,199 | ||
Fair value adjustment of contingent consideration | 101 | 100 | 501 | 700 | ||
Depreciation and amortization | 23,810 | 18,968 | 69,002 | 57,784 | ||
Accretion of placement fees(1) | 1,747 | 1,206 | 4,550 | [1] | 3,412 | [1] |
Non-cash stock-based compensation expense | 1,959 | 538 | 5,309 | 9,167 | ||
Acquisitions and integration related costs including restructuring and severance | 481 | 746 | 2,944 | 3,156 | ||
Initial public offering costs and secondary offering | (11) | 859 | 414 | 2,168 | ||
Legal and litigation expenses including settlement payments | 1,745 | (45) | 1,748 | 789 | ||
Non-cash charge on capitalized installation and delivery | 679 | 494 | 1,991 | 1,478 | ||
Other adjustments | (9) | 34 | 58 | 50 | ||
Interest expense | 9,320 | 8,956 | 27,754 | 28,253 | ||
Interest income | (42) | (89) | (112) | (162) | ||
Loss on extinguishment and modification of debt | 4,608 | |||||
Other (income) expense | (106) | 434 | 5,108 | 10,121 | ||
(Loss) Income before income taxes | (3,593) | 809 | (16,828) | (19,448) | ||
Electronic Gaming Machines, EGM [Member] | ||||||
Total revenues | 75,299 | 71,784 | 215,932 | 202,361 | ||
Adjusted EBITDA | 35,825 | 34,026 | 108,088 | 105,197 | ||
Table Products [Member] | ||||||
Total revenues | 2,861 | 2,052 | 7,437 | 5,514 | ||
Adjusted EBITDA | 1,409 | 428 | 2,694 | 684 | ||
Interactive (Gaming Operations) [Member] | ||||||
Total revenues | 1,217 | 1,690 | 3,559 | 5,329 | ||
Adjusted EBITDA | $ (447) | $ (877) | $ (1,985) | $ (1,223) | ||
[1] | Non-cash item related to the accretion of contract rights under development agreements and placement fees. |
Note 15 - Leases (Details Textu
Note 15 - Leases (Details Textual) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Operating Lease, Right-of-use Asset, Accumulated Amortization | $ 1.1 | |
Finance Lease, Right-of-use Asset, Accumulated Amortization | 0.6 | $ 0.4 |
Lessee, Operating Lease, Lease Not yet Commenced, Liability, Payments, Due, Total | $ 14.3 |
Note 15 - Leases - Operating an
Note 15 - Leases - Operating and Finance Assets and Liability Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | ||
Operating leases, ASC 842 | $ 11,940 | [1] | ||
Finance leases, ASC 842 | [2] | 1,754 | ||
Finance leases, ASC 840 | [2] | 1,344 | ||
Total leased assets, net, ASC 842 | 13,694 | |||
Operating leases, current ASC 842 | (2,117) | |||
Finance leases, current ASC 842 | (639) | |||
Finance leases, current ASC 840 | 408 | |||
Operating leases, non-current ASC 842 | (11,823) | |||
Finance leases, non-current ASC 842 | (1,062) | |||
Finance leases, non-current ASC 840 | 851 | |||
Total lease liability, ASC 842 | $ (15,641) | |||
Total lease liability, ASC 840 | $ 1,259 | |||
[1] | Operating lease assets are recorded net of accumulated amortization of $0.7 million as of September 30, 2019. | |||
[2] | Finance lease assets are recorded net of accumulated amortization of $0.6 million and $0.4 million as of September 30, 2019 and December 31, 2018, respectively. |
Note 15 - Leases - Lease Cost (
Note 15 - Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Depreciation of leased assets | $ 248 | $ 505 | |||
Depreciation of leased assets, ASC 840 | $ 116 | $ 312 | |||
Interest on lease liabilities | 10 | 29 | |||
Interest on lease liabilities, ASC 840 | 5 | 15 | |||
Total Lease Cost | $ 825 | $ 2,246 | |||
Total Lease Cost, ASC 840 | $ 121 | 327 | |||
Weighted average remaining lease term (years), operating lease (Year) | 8 years 292 days | 8 years 292 days | |||
Weighted average discount rate, operating lease | 5.90% | 5.90% | |||
Weighted average remaining lease term (years), finance lease (Year) | 2 years | 2 years | |||
Weighted average remaining lease term (years), finance lease ASC 840 (Year) | 2 years 255 days | ||||
Weighted average discount rate, finance lease | 2.70% | 2.70% | |||
Weighted average discount rate, finance lease ASC 840 | 2.60% | ||||
Operating cash flows from operating leases | $ 1,906 | ||||
Operating cash flows from finance leases | 29 | ||||
Operating cash flows from finance leases, ASC 840 | 14 | ||||
Financing cash flows from finance leases | 446 | ||||
Financing cash flows from finance leases, ASC 840 | $ 290 | ||||
Selling, General and Administrative Expenses [Member] | |||||
Operating lease cost | $ 394 | 1,183 | |||
Research and Development Expense [Member] | |||||
Operating lease cost | 49 | 182 | |||
Cost of Gaming Operations [Member] | |||||
Operating lease cost | $ 124 | $ 347 |
Note 15 - Leases - Maturity of
Note 15 - Leases - Maturity of Operating and Financing Leases Liabilities (Details) $ in Thousands | Sep. 30, 2019USD ($) | |
2019 (excluding nine months ended September 30, 2019), operating leases | $ 717 | [1] |
2019 (excluding nine months ended September 30, 2019), financing leases | 164 | |
2019 (excluding nine months ended September 30, 2019), operating and financing leases | 881 | |
2020, operating leases | 2,897 | [1] |
2020, financing leases | 648 | |
2020, operating and financing leases | 3,545 | |
2021, operating leases | 2,476 | [1] |
2021, financing leases | 555 | |
2021, operating and financing leases | 3,031 | |
2022, operating leases | 1,951 | [1] |
2022, financing leases | 311 | |
2022, operating and financing leases | 2,262 | |
2023, operating leases | 1,825 | [1] |
2023, financing leases | 74 | |
2023, operating and financing leases | 1,899 | |
Thereafter, operating leases | 7,411 | [1] |
Thereafter, financing leases | 13 | |
Thereafter, operating and financing leases | 7,424 | |
Total lease payments, operating leases | 17,277 | [1] |
Total lease payments, financing leases | 1,765 | |
Total lease payments, operating and financing leases | 19,042 | |
Less: interest, operating leases | 3,337 | [1] |
Less: interest, financing leases | 64 | |
Less: interest, operating and financing leases | 3,401 | |
Present value of lease liabilities, operating leases | 13,940 | [1] |
Present value of lease liabilities, financing leases | 1,701 | |
Present value of lease liabilities, operating and financing leases | $ 15,641 | |
[1] | Operating leases payments exclude $14.8 million of legally binding minimum lease payments for leases signed but not commenced as of September 30, 2019. |
Note 15 - Leases - Future Minim
Note 15 - Leases - Future Minimum Lease Payments Under ASC 840 (Details) $ in Thousands | Dec. 31, 2018USD ($) |
2019 | $ 2,817 |
2020 | 2,716 |
2021 | 2,212 |
2022 | 1,470 |
2023 | 1,121 |
Thereafter | 5,260 |
Total | $ 15,596 |