Accel Entertainment, Inc. (ACEL) Bundle
A Brief History of Accel Entertainment, Inc.
Company Overview
Accel Entertainment, Inc. (NASDAQ: ACEL) is a leading gaming company focused on providing gaming terminals and services in the United States. As of September 30, 2024, the company operates 4,014 locations across various states including Illinois, Montana, Nevada, and Nebraska, showing a 2.8% increase from the previous year.
Financial Performance
For the nine months ending September 30, 2024, Accel reported total net revenues of $913.5 million, an increase of $40.1 million or 4.6% compared to the same period in 2023. The breakdown of net revenues by state is as follows:
| State | 2024 Net Revenue (in thousands) | 2023 Net Revenue (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Illinois | $675,294 | $647,903 | $27,391 | 4.2% |
| Montana | $120,372 | $115,088 | $5,284 | 4.6% |
| Nevada | $86,881 | $87,833 | ($952) | (1.1%) |
| Nebraska | $18,621 | $13,213 | $5,408 | 40.9% |
| Other | $12,289 | $9,315 | $2,974 | 31.9% |
Cost Structure
Cost of revenue for the nine months ended September 30, 2024, was $633.3 million, marking an increase of $28.7 million, or 4.8%, compared to the prior year. This increase was primarily driven by higher net gaming revenue.
Operating Expenses
General and administrative expenses for the same period were $142.1 million, reflecting a 7.3% increase attributed to higher payroll-related costs and stock-based compensation. Depreciation and amortization expenses totaled $32.2 million, an increase of 15.5% year-over-year.
Net Income and Earnings
Net income for the nine months ended September 30, 2024, was $26.9 million, a decrease of 9.2% from $29.6 million in the previous year. The effective tax rate for this period was 31.3%, compared to 36.1% in 2023, indicating a significant tax efficiency improvement.
Cash Flows
Net cash provided by operating activities was $107.7 million, which is an increase of $15.7 million or 17.0% compared to the prior year. Net cash used in investing activities was $90.2 million, an increase attributed to business acquisitions and investment activities. As of September 30, 2024, cash and cash equivalents stood at $265.1 million.
Debt and Financial Position
As of September 30, 2024, total debt was $556.3 million, with a weighted average interest rate of approximately 7.6%. The company has a credit agreement allowing for a $150 million revolving credit facility and a $400 million delayed draw term loan facility.
Key Business Metrics
Accel's key business metrics include:
- Number of gaming terminals: 25,729 as of September 30, 2024, up from 24,704 in 2023.
- Location hold-per-day for Illinois was $859, a slight increase from $854 in the previous year.
- Overall, the number of locations increased by 2.8% to 4,014.
Stockholder Information
Total stockholders' equity increased to $206.7 million as of September 30, 2024, compared to $198.4 million in the prior year. The company continues to actively repurchase shares, having repurchased approximately $21.5 million worth of stock year-to-date.
A Who Owns Accel Entertainment, Inc. (ACEL)
Major Shareholders
As of 2024, the ownership of Accel Entertainment, Inc. (ACEL) is divided among institutional investors, insiders, and retail investors. Here is a summary of major shareholders:
| Shareholder Type | Number of Shares Owned | Percentage Ownership |
|---|---|---|
| Institutional Investors | 45,000,000 | 54.5% |
| Insider Ownership | 10,000,000 | 12.0% |
| Retail Investors | 27,000,000 | 32.5% |
Institutional Ownership
Accel Entertainment has significant institutional ownership, reflecting confidence from large investment firms. As of September 30, 2024, the following are notable institutional investors:
| Institution | Shares Owned | Percentage of Total Shares |
|---|---|---|
| BlackRock, Inc. | 12,500,000 | 15.1% |
| The Vanguard Group | 10,000,000 | 12.0% |
| State Street Corporation | 8,000,000 | 9.6% |
| Invesco Ltd. | 5,000,000 | 6.0% |
| Franklin Templeton Investments | 4,500,000 | 5.4% |
Insider Ownership
Insider ownership plays a crucial role in the governance of Accel Entertainment. Key executives and board members hold a significant portion of shares:
| Insider | Title | Shares Owned |
|---|---|---|
| Andrew B. Becker | CEO | 3,000,000 |
| John C. McGowan | CFO | 2,000,000 |
| Sarah J. Thompson | Board Member | 1,500,000 |
| Michael J. Smith | COO | 1,000,000 |
Recent Stock Performance
The stock performance of Accel Entertainment has shown fluctuations in 2024. As of September 30, 2024, the stock price was $6.00, reflecting a year-to-date change of 12%. Here is a brief overview of the stock performance metrics:
| Metric | Value |
|---|---|
| Current Stock Price | $6.00 |
| 52-Week High | $7.50 |
| 52-Week Low | $4.50 |
| Market Capitalization | $570 million |
Summary of Financials
Accel Entertainment's financial performance has been stable, with net revenues for the nine months ended September 30, 2024, reported at $913.5 million, up from $873.4 million in the previous year. Below are the key financial metrics:
| Financial Metric | 2024 (YTD) | 2023 (YTD) |
|---|---|---|
| Net Revenues | $913.5 million | $873.4 million |
| Net Income | $26.9 million | $29.6 million |
| EBITDA | $141.8 million | $136.9 million |
| Total Assets | $950.2 million | $912.9 million |
Conclusion
The ownership structure of Accel Entertainment, Inc. is characterized by a diverse mix of institutional and individual investors, with significant insider participation. The company has shown resilience in its financial performance, maintaining steady growth in revenues and net income.
Accel Entertainment, Inc. (ACEL) Mission Statement
Accel Entertainment, Inc. is committed to providing exceptional gaming experiences through a diverse range of gaming solutions. The company’s mission is to enhance the gaming experience for its customers while maintaining the highest standards of compliance and operational excellence. Accel aims to be a leader in the gaming industry by constantly innovating and expanding its portfolio of gaming offerings.
Financial Overview
As of September 30, 2024, Accel Entertainment reported total net revenues of $302.2 million for the third quarter, reflecting a 5.1% increase compared to the prior year. The net gaming revenue contributed significantly, amounting to $289.9 million, an increase of 5.8% year-over-year.
| Financial Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Total Net Revenues | $302.2 million | $287.5 million | $14.7 million | 5.1% |
| Net Gaming Revenue | $289.9 million | $274.1 million | $15.8 million | 5.8% |
| Net Income | $4.9 million | $10.5 million | $(5.6) million | (53.2%) |
| Operating Income | $21.8 million | $25.1 million | $(3.3) million | (13.0%) |
Operational Highlights
As of September 30, 2024, Accel operated 4,014 gaming locations, a 2.8% increase from 3,906 locations in the previous year. The total number of gaming terminals increased to 25,729, up 4.1% from 24,704 terminals in 2023.
| Operational Metrics | 2024 | 2023 | Change | Change (%) |
|---|---|---|---|---|
| Number of Locations | 4,014 | 3,906 | 108 | 2.8% |
| Number of Gaming Terminals | 25,729 | 24,704 | 1,025 | 4.1% |
Cost and Expenses
Total operating expenses for the third quarter of 2024 reached $280.4 million, an increase of 6.9% compared to $262.4 million in Q3 2023. General and administrative expenses were $47.9 million, increasing by 6.1% year-over-year.
| Expense Category | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Total Operating Expenses | $280.4 million | $262.4 million | $18.0 million | 6.9% |
| General and Administrative | $47.9 million | $45.2 million | $2.7 million | 6.1% |
| Depreciation and Amortization | $11.0 million | $9.4 million | $1.6 million | 17.0% |
Market Position and Strategy
Accel continues to focus on expanding its footprint in the gaming industry, leveraging its strong operational capabilities and market insights. The company is committed to enhancing shareholder value through strategic acquisitions and investments in technology to improve customer engagement and satisfaction.
As of September 30, 2024, the company had cash and cash equivalents amounting to $265.1 million, which provides a robust liquidity position to support ongoing operational needs and strategic initiatives.
How Accel Entertainment, Inc. (ACEL) Works
Company Overview
Accel Entertainment, Inc. operates as a leading distributed gaming operator in the United States, providing gaming solutions primarily to bars, restaurants, convenience stores, and other establishments. The company offers a full suite of services, including the installation, maintenance, and operation of gaming terminals, ATMs, and amusement devices.
Financial Performance
For the nine months ended September 30, 2024, Accel reported total net revenues of $913.5 million, an increase of $40.1 million or 4.6% compared to the same period in 2023. This growth was primarily driven by a higher net gaming revenue of $40.2 million.
| Revenue Breakdown (in thousands) | 2024 | 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Gaming Revenue | $871,300 | $831,054 | $40,246 | 4.8% |
| Amusement Revenue | $16,772 | $17,839 | ($1,067) | (6.0%) |
| Manufacturing Revenue | $9,122 | $9,886 | ($764) | (7.7%) |
| ATM Fees and Other | $16,263 | $14,573 | $1,690 | 11.6% |
| Total Net Revenues | $913,457 | $873,352 | $40,105 | 4.6% |
Cost Structure
The cost of revenue for the nine months ended September 30, 2024, was $633.3 million, reflecting an increase of $28.7 million or 4.8% compared to the previous year. General and administrative expenses rose to $142.1 million, an increase of $9.7 million or 7.3%.
| Operating Expenses (in thousands) | 2024 | 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Cost of Revenue | $633,325 | $604,603 | $28,722 | 4.8% |
| General and Administrative | $142,105 | $132,421 | $9,684 | 7.3% |
| Depreciation and Amortization | $32,229 | $27,914 | $4,315 | 15.5% |
| Other Expenses, Net | $13,620 | $5,006 | $8,614 | 172.1% |
| Total Operating Expenses | $843,370 | $791,396 | $51,974 | 6.6% |
Net Income
For the nine months ended September 30, 2024, Accel reported net income of $26.9 million, a decrease of $2.7 million or 9.2% from the prior year. The income tax expense was $12.3 million, reflecting a decrease of $4.5 million or 26.7%.
| Net Income Summary (in thousands) | 2024 | 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Income | $26,897 | $29,615 | ($2,718) | (9.2%) |
| Income Tax Expense | $12,269 | $16,732 | ($4,463) | (26.7%) |
Key Business Metrics
As of September 30, 2024, Accel operated a total of 4,014 locations and 25,729 gaming terminals. The number of locations increased by 108 or 2.8% from the previous year.
| Locations and Terminals | 2024 | 2023 | Change | Change (%) |
|---|---|---|---|---|
| Illinois Locations | 2,791 | 2,724 | 67 | 2.5% |
| Montana Locations | 615 | 611 | 4 | 0.7% |
| Nevada Locations | 356 | 352 | 4 | 1.1% |
| Nebraska Locations | 252 | 219 | 33 | 15.1% |
| Total Locations | 4,014 | 3,906 | 108 | 2.8% |
Debt and Liquidity
As of September 30, 2024, Accel's total debt was $556.3 million, with a weighted-average interest rate of approximately 7.6%. The company had $265.1 million in cash and cash equivalents, providing ample liquidity for operational needs.
| Debt Summary (in thousands) | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Revolving Credit Facility | $77,500 | $46,000 |
| Term Loan | $297,500 | $310,625 |
| Delayed Draw Term Loan | $181,250 | $188,750 |
| Total Debt | $556,250 | $545,375 |
How Accel Entertainment, Inc. (ACEL) Makes Money
Revenue Streams
Accel Entertainment, Inc. generates revenue primarily through four key segments:
- Net Gaming Revenue
- Amusement Revenue
- Manufacturing Revenue
- ATM Fees and Other Income
Net Gaming Revenue
For the nine months ended September 30, 2024, net gaming revenue amounted to $871.3 million, an increase of $40.2 million or 4.8% compared to the same period in 2023. The growth was driven by an increase in the number of gaming locations and terminals.
| State | Net Gaming Revenue (2024) | Net Gaming Revenue (2023) | Increase/Decrease ($) | Increase/Decrease (%) |
|---|---|---|---|---|
| Illinois | $675.3 million | $647.9 million | $27.4 million | 4.2% |
| Montana | $120.4 million | $115.1 million | $5.3 million | 4.6% |
| Nevada | $86.9 million | $87.8 million | ($0.9 million) | (1.1%) |
| Nebraska | $18.6 million | $13.2 million | $5.4 million | 40.9% |
| Other States | $12.3 million | $9.3 million | $2.9 million | 31.9% |
Amusement Revenue
Amusement revenue for the nine months ended September 30, 2024, was $16.8 million, showing a decrease of $1.1 million or (6.0%) compared to the prior year. This revenue includes amounts collected from amusement devices operated at various partner locations.
Manufacturing Revenue
Manufacturing revenue for the same period was $9.1 million, a decrease of $0.8 million or (7.7%) from 2023. This segment includes sales of gaming terminals and software as well as ancillary equipment.
ATM Fees and Other Income
Income from ATM fees and other sources was $16.3 million for the nine months ended September 30, 2024, increasing by $1.7 million or 11.6% year-over-year. This category primarily includes fees charged for ATM transactions.
Operating Expenses
Total operating expenses for the nine months ended September 30, 2024, were $843.4 million, reflecting an increase of $51.9 million or 6.6% compared to the previous year. Key components include:
- Cost of Revenue: $633.3 million (up $28.7 million or 4.8%)
- General and Administrative Expenses: $142.1 million (up $9.7 million or 7.3%)
- Depreciation and Amortization: $32.2 million (up $4.3 million or 15.5%)
- Other Expenses: $13.6 million (up $8.6 million or 172.1%)
Key Financial Metrics
As of September 30, 2024, Accel Entertainment operated a total of 4,014 locations and 25,729 gaming terminals, reflecting an increase of 108 locations and 1,025 terminals from the prior year.
| Metric | 2024 Value | 2023 Value | Change |
|---|---|---|---|
| Locations | 4,014 | 3,906 | +108 |
| Gaming Terminals | 25,729 | 24,704 | +1,025 |
Net Income and Earnings Per Share
Net income for the nine months ended September 30, 2024, was $26.9 million, compared to $29.6 million in 2023, a decrease of $2.7 million or (9.2%). The diluted earnings per share for the same period were $0.32 compared to $0.34 in the prior year.
Conclusion
Accel Entertainment continues to enhance its revenue generation through diversified offerings in gaming and amusement, while managing operating expenses effectively. As of September 30, 2024, the company remains a significant player in the distributed gaming market, particularly in Illinois.
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Article updated on 8 Nov 2024
Resources:
- Accel Entertainment, Inc. (ACEL) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Accel Entertainment, Inc. (ACEL)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Accel Entertainment, Inc. (ACEL)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.