InvestorPresenta,on
GlobalGamingExpoSeptember26-29,2016
Disclaimer
2
Forward-LookingStatements;Non-GAAPFinancialMeasures
Throughoutthispresenta=onwemakeforward-lookingstatementswithinthemeaningoftheU.S.PrivateSecuri=esLi=ga=onReformActof1995.Theforward-lookingstatementsaregenerallyaccompaniedbywordssuchas‘‘plan,’’‘‘es=mate,’’‘‘expect,’’‘‘intend,’’‘‘believe,’’‘‘should,’’‘‘would,’’‘‘could,”“poten=al,”‘‘an=cipate,’’“project”orotherwordsthatconveyuncertaintyoffutureeventsoroutcomes.EveriHoldingsInc.’s(“Everi”or“our”)actualresultscoulddiffermateriallyfromthosestatedorimpliedbytheseforward-lookingstatementsduetorisksanduncertain=esassociatedwithEveri’sbusiness.FactorswhichcouldcauseEveri’sactualresultstodifferfromthoseprojectedorcontemplatedinanysuchforward-lookingstatementsinclude,butarenotlimitedto,thefollowingfactors:(1)ourabilitytomaintainabroadcustomerreach,crosssellingopportuni=esandacombinedsalesforceabletoaddresscustomers’needs;(2)ourgamedevelopmentstudios’abilitytoincreasetheproductlibraryanddevelopnewenhancementstoincludeinnewlydevelopedcontent;(3)ourabilitytoobtainapprovalofnewproductsinnewandexis=nggamingjurisdic=ons;(4)thefailureofanaly=csforgamingopera=onstoadequatelypredictormeasuregamingopera=ons;(5)ourabilitytoiden=fythecoststructureandcapitalspendrequiredtooperateatcurrentbusinesslevels;(6)ourabilitytosecurebrandlicensearrangementsandtocompletedevelopmentofgamesusingthesebrandsbyG2E2016;(7)ourabilitytointroducenewproductsandservices;(8)expecta=onsregardingcustomers’preferencesanddemandsforfuturegamingofferings;(9)expecta=onsregarding=mingforrecogni=onofrevenuefromnewmarkets;(10)the=mingofrecogni=onofcertainsalestoAlbertaGamingandLo^eryCommission;and(11)expecta=onsregardingproductapprovalsforourgamesandourabilitytointroducegamesintofieldtrials.Theforegoingreviewofimportantfactorsthatcouldcauseactualeventstodifferfromexpecta=onsshouldnotbeconstruedasexhaus=veandshouldbereadinconjunc=onwithstatementsthatareincludedhereinandelsewhere,includingtheriskfactorsincludedinEveri’smostrecentAnnualReportonForm10-KfiledwiththeU.S.Securi=esandExchangeCommission.Exceptasrequiredbyapplicablelaw,Everiundertakesnoobliga=ontopubliclyupdateanyforward-lookingstatement,ortomakeanyotherforward-lookingstatements,whetherwri^enororal,thatmaybemadefrom=meto=me,whetherasaresultofnewinforma=on,futuredevelopmentsorotherwise.Readersarecau=onednottoplaceunduerelianceonforward-lookingstatements,whicharebasedonlyoninforma=oncurrentlyavailabletoEveriandspeakonlyasofthedateofthiscommunica=on.
Addi,onalNotes
Thispresenta=oncontainsindustrymarketdata,industryforecastsandothersta=s=calinforma=on.Suchinforma=onhasbeenobtainedfrompubliclyavailableinforma=onandindustrypublica=ons.Everihasnotindependentlyverifiedsuchinforma=onandmakesnorepresenta=onsastotheaccuracyofsuchinforma=on.
Non-GAAPFinancialMeasures
Thispresenta=onincludesfinancialmeasuresthatwerenotpreparedinaccordancewithUnitedStatesgenerallyacceptedaccoun=ngprinciples(“GAAP”).AdjustedEBITDAisanon-GAAPmeasurementpresentedhereinasasupplementaldisclosure.EveridefinesAdjustedEBITDAasearningsbeforenetinterestexpense,incometaxes,deprecia=on,amor=za=on,lossonex=nguishmentofdebt,non-cashstockcompensa=on,assetimpairment,acquisi=onandothercostsrelatedtomergersandpurchaseaccoun=ngadjustments,accruedexecu=veseverance,accre=onofcontractrightslessabenefitfromone-=melegalse^lementproceeds.EveripresentsAdjustedEBITDAasitusesthismeasuretomanageitsbusinessandconsidersthismeasuretobesupplementaltoitsopera=ngperformance.Everialsomakescertaincompensa=ondecisionsbased,inpart,onitsopera=ngperformance,asmeasuredbyAdjustedEBITDA;anditscreditfacility,seniorsecurednotesandseniorunsecurednotesrequireEveritocomplywithaconsolidatedsecuredleveragera=othatincludesperformancemetricssubstan=allysimilartoAdjustedEBITDA..
Areconcilia=onofEveri’smostdirectlycomparableGAAPmeasuretoAdjustedEBITDAisincludedinEveri’searningreleaseslocatedonEveri’swebsiteatir.everi.com.Addi=onally,areconcilia=onofeachsegment’sopera=ngincome(loss)toAdjustedEBITDAisalsoincluded.Onasegmentlevel,opera=ngincome(loss)perGAAP,ratherthannetearnings(loss)perGAAP,isreconciledtoAdjustedEBITDAasEveridoesnotreportnetearnings(loss)bysegment.Managementbelievesthatthispresenta=onismeaningfultoinvestorsinevalua=ngtheperformanceofEveri’ssegments.
BusinessOverview
TheIndustry’sOnlyGames&PaymentsProvider
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BroadCustomerReach/CrossSellingOpportuni,es/CombinedSalesforcetoAddressallCustomers
HighlyDifferen,ated,ComplementaryProductsfortheCasinoFloor
SignificantRecurringRevenue(Approximately90%ofTotalRevenue)
HistoricalStrengthinClassIIGaming/ProviderofGaming-FocusedPaymentsSolu,ons
GamesSegmentOverviewGamingOpera,ons
• 19%of2Q16TTMconsolidatedrevenue
• 13,179gamingunitsinstalled(7,762ClassIIand5,417ClassIII)throughoutNorthAmericaatJune30,2016
• Revenuederivedfromrevenue-sharingarrangementsorleasefeesontheinstalledbase
• Suppliesthecentraldeterminantsystemforapproximately18,400videolo^eryterminals("VLTs")inNewYork
MachineSalesandOther
• 6%of2Q16TTMconsolidatedrevenue
• Broadpornolioofgamingmachineproductssoldtocasinocustomers
• Gamethemeshistoricallyfocusedonin-house,proprietarycontent
• Introduced7newslotthemesbaseduponlicensed,brandedcontentatG2Ein2016toaddnewproductsegment
• Sold2,483slotmachinesintwelvemonthsendedJune30,2016
$134.0$165.7
$204.2 $207.0 $214.4 $207.0
$0.0
$50.0
$100.0
$150.0
$200.0
$250.0
2011 2012 2013 2014 2015 2Q16TTM
Revenue
5 Note: $ in millions; fiscal year ended December 31
$62.4$79.9
$106.6 $110.9$122.8 $117.2
46.6% 48.2% 52.2% 53.6% 57.3% 56.6%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
$0.0
$25.0
$50.0
$75.0
$100.0
$125.0
$150.0
2011 2012 2013 2014 2015 2Q16TTM
AdjustedEBITDA
AdjustedEBITDA %Margin
Prominent Class II Manufacturer With Strong Recurring Revenue Base and Growing Class III Presence
PaymentsSegmentOverview
ATM(38%ofTTM2Q16consolidatedrevenue)
• EnablescashwithdrawalsusingATM,debit,orcreditcards
• Processed74.6milliontransac=onstotaling$14.9billionindollarvolume(1)inthetwelvemonthsendedJune30,2016
CashAdvance(28%ofTTM2Q16consolidatedrevenue)
• EnablescashadvancesthroughcreditcardcashaccessandPOSdebitcardtransac=ons
• Processed8.8milliontransac=onstotaling$5.1billionindollarvolumeinthetwelvemonthsendedJune30,2016
CheckServices(3%ofTTM2Q16consolidatedrevenue)
• Checkverifica=onandwarrantyservicesallowcasinostomanageandreducerisksonpatroncheckscashed
• Processed3.5milliontransac=onstotaling$1.1billionindollarvolumeinthetwelvemonthsendedJune30,2016
Other(6%ofTTM2Q16consolidatedrevenue)
• Includesintegratedkioskandjackpotkiosksalesandservices,CentralCreditrepor=ngservices,compliancesopwaresolu=ons,andcasinomarke=ngservices
• Otherrevenueincreased~2.1%Y/YinthetwelvemonthsendedJune30,2016
$544.1 $584.5 $582.4 $585.6 $612.6 $626.0
-10.2%
7.4%
-0.3% 0.5%4.6% 5.4%
-15.0%
-5.0%
5.0%
15.0%
$0.0
$200.0
$400.0
$600.0
$800.0
2011 2012 2013 2014 2015 2Q16TTM
Revenue
Revenue %Growth
6 1) Includes ATM processing acEvity for third-party ATM partner porJolios, which were
acquired by Everi in 3Q15 & 4Q15
$61.7
$79.3$71.2 $76.0 $77.6 $77.2
11.3%
13.6%
12.2%13.0% 12.7% 12.3%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
$0.0
$20.0
$40.0
$60.0
$80.0
$100.0
2011 2012 2013 2014 2015 2Q16TTM
AdjustedEBITDA
AdjustedEBITDA %Margin
Market Leading Provider of Cash Access and Compliance Products and Services
Note: $ in millions; fiscal year ending December 31
2Q16Results&RecentDevelopments• Consolidatedrevenuesof$214.0million
• Gamesrevenueof$54.3million,down1.1%Y/Y• Paymentsrevenueof$159.7million,up5.4%Y/Y
• AdjustedEBITDAof$51.2million• GamesAdjustedEBITDAof$30.0million,down10.4%Y/Y• PaymentsAdjustedEBITDAof$21.2million,up12.2%Y/Y
• KeyDevelopments• NewCoreHDXgamingcabinetaccountedfor57%of2Q16unitsales• Firstcompanyinthecasinoindustrytobefullyend-to-endEMVcompliantwithallits
financialtransac=ondevices,planormsandsystems• Debu=ngsevenbrandedgamesatG2EthroughpartnershipswithPenn&Teller,
DreamWorks,HalvrickStudiosandWarnerBros.• NewTournEventenhancementstodebutatG2E,includingthefirstskill-basedgame
baseduponpopularFruitNinjabrandwhichwillbeavailableineverymarket• Enteredintoanagreementtolicensetechnologyandintegrategamingcontentto
expandsocialandrealmoneygamingcapabili=es
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Execu,ngonStrategicPriori,es:G2E
FocusonFiveStrategicPriori,es1. Increasetheproductlibrary
2. Increasedistribu=oncapabili=esandenternewjurisdic=ons
3. Driveopera=ngefficienciesandcostcontainment
4. Developnewlicensedandbrandedgamesforpremiumpar=cipa=onsegment
5. Drivesalesandplacementsthroughintegra=onofgamesandpaymentsproducts
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G2E2016Highlights
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EveriGamesDevelopmentIni,a,ves• Industryvetsleadinggamedevelopment
• Powerfulmixofhomegrownandnewtalentdesigningwithkeeneyeonslotplayer;provenleadershipaligningtechnologyandinnova=on
• IncreasedR&Dbudgetfundingtechnologyinnova,on• DrivingR&Dspendhigherasapercentageoftotalgamingbusinessrevenue
• Robusthardwareroadmap• Basegameplanorm,topboxintroduc=onsgivedeveloperslargercanvasforuniquegame
content
• Largethemebandwidth• Providediverseoutputofnewgamecontentcapableofopera=ngoncustomers’exis=ng
EverihardwareaswellasCompany’snewhardware• Expandingstudiodevelopmentteamstosharpenfocusonqualitywithoutsacrificing
quan=ty
• Introduc,onofgamesbasedonbrandedlicenses• Strategicallytarge=ngthird-partycontentthatlendsitselftologicalplayerappealand
innova=vegameplaymechanics 11
CoreHDX• Premium-feelingcabinetforstandardcabinetprice
• Keyfeaturesinclude:• PremiumLCDbu^ondeck• PowerfulMforce®planorm• Immersivegamecontrolledligh=ng
• Firstcabinettoofferaward-winningEveriBetsolu,on• Proprietaryminimumbetconfigura=oncontrolledbyoperatorwithoutchangingvola=lity
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BrandedLicenses• Sevennewbrandedlicensesdebu,ngatG2E
• Penn&Teller®• Casablanca®• FruitNinja™
• DreamWorksClassic®• RichieRich®• HotStuff®• Underdog®• Casper®
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PremiumLeasedCabinet:EmpireMPX• ExclusivelyfortheCompany’sgamesbasedonlicensedbrands
• LauncheswithPenn&Teller®andCasablanca®
• Company’sfirst-everWAPgamesforClassIImarkets
• DailyfeeexclusiveforClassIIImarkets
• Keyfeatures• Completelynewdesign• Allowsfornes=ngofcabinetsinbank
sezngs• Overheadspotlightfeature• Gamecontrolledligh=ng• Backligh=ng• DualUSBcharger
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NewHardwareandBankedGames• Hardware
• Innova=onsenhanceCompany’sexis=ngpornolioofgamecabinets• Tower370™,GameCrown®,Founda=on™Sign
• BankedProduct• JackpotJump™• SuperJackpotSeries™• ClassIIWideAreaProgressives• LinkedLocalAreaProgressives
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EveriPaymentsDevelopmentIni,a,ves• Dedica,ontonetworksecurity
• StrategicinfrastructureandsecurityinvestmentsmakeEveriabest-in-classproviderofsecurepaymentssolu=ons
• Innova,vesolu,ons• ProprietaryEveriIDtechnologyaidsinpatroniden=fica=onandduediligencewhile
JackpotXpressallowsforefficientmobile-basejackpotprocessingandpayment
• Industryleadingenhancements• UniversalXchangewithUniversalIntegratedManagementprovidesanenhancedkiosk
sopwareplanorm• Everiisonlycasinoindustrycompanytobefullyend-to-endEMVcompliant
• Makingpaymentshappen• Focusondrivingcashtofloorthrougheffec=veself-servicesolu=ons
• Evolvingdigitalcapacity• CashClubWalletdecentralizespaymentsthroughoutthegamingenterpriseandoffers
anenhanced,streamlinedplayerexperience16
PaymentsProductsHighlights• JackpotXChange®(JXC-L)
• Fullservicejackpotpayoutdevice• Singleterminal• Newbacklitkeyboardwithtouchpad
• UniversalXChange™(UXC)• Fullyre-engineeredkiosksopwareplanorm
withupdated,simplifiedandcommonarchitectureforlineofEverikiosks
• Modularapproachallowsforeasyandquickinstalla=onofinnova=vepaymentsproducts
• Supportscommonkioskfunc=onality,suchasATM,billbreakand=cketredemp=on
• Versa,leExchange™(VXC)• Non-cashdispensingkioskintendedasQCA
replacement• Featuresincludebillacceptor,PINpad,card
reader,TITOprinter,carddispenser
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PaymentsProductsHighlights• JackpotXpress™
• Mobileapplica=onthatallowsa^endanttoservicetheplayeratthepointofplay
• Integra=onwithslotaccoun=ngsystemandEveri’sAMLsopware
• RendersandcompletesIRSforms
• CashClub®Wallet• Facilitatesfundsflow,reducescashhandling
costsandkeepscashtransac=onsin-house• Supportsalterna=veandmobilepayments• IntegratedwithEvericashaccessservices
• EveriID™• Informa=ongatewayforPatrondata,
includingOFACSDNList,DMFandTIN• IntegratedwithEveriCompliance
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FinancialOutlookandCreditUpdate
SecuredLeverageRa,oAnalysis
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($inthousands)Balance6/30/16 MaturityDate Rate
TermLoan 470,600$ 12/19/2020 6.25% LIBORplus5.25%witha1%floorRevolver -$ 12/19/2019 0.50% Commitmentrate-BorrowingatLIBORplus4.75%SeniorSecuredNotes 335,000$ 4/15/2021 7.25% FixedRateSeniorUnsecuredNotes 350,000$ 1/15/2022 10.00% FixedRate
1,155,600$
DebtCovenant:TheCompany'srequiredmaintenancecovenant,whichcoversSecuredDebtonly,asofDecember31stofeachperiodpresented($inthousands):
2016 2017 2018SecuredDebt(1) 800,600$ 790,600$ 780,600$CashReductiontoNetDebt(2) (50,000)$ (50,000)$ (50,000)$SecuredDebt,net $750,600 $740,600 $730,600
SecuredLeverageRatioRequirement 4.25x 4.00x 3.75x
RequiredAdjustedEBITDAperCreditAgreement(3)(6) 176,612$ 185,150$ 194,827$EstimatedCashUsageFeesexcludedfromCreditAgreementAdjEBITDA(4) 3,400$ 4,500$ 4,500$MinimumAdjustedEBITDA,asReported(5)(6) 180,012$ 189,650$ 199,327$
Assumptions:(1)AssumesnoadditionalFreeCashFlowPaydownorborrowingundertheRevolverandonlytherequired2%amortizationof$10Mperyear.(2)Forpurposeofthecovenantcomputation,theCreditAgreementprovidesforupto$50millionincashasareductiontothenetdebt.TableassumesCompanymaintainsinexcessof$50millioninfutureperiods.(3)RequiredAdjustedEBITDApertheCreditAgreementtoremainincompliancewithSecuredLeverageRatio.(4)CashUsagefeesareincludedaspartofInterestExpense,netforfinancialreportingpurposesandexcludedfromReportedAdjustedEBITDA.PertheCreditAgreementCashUsagefeesarenotincludedaspartofInterestExpenseforpurposesofSeniorLeverageRatioCovenant.Amountreportedreflectsapproximately50bpsincreaseinthecashusageratefor2017&2018ascomparedto2016.(5)MinimumAdjustedEBITDA,asReportedreflectsAdjustedEBITDAonacomparablebasistotheCompany'scurrentquarterlyreportingpracticesinquarterlyearningsreleases.(6)ToremainincompliancewiththeCompany'srequiredmaintenancecovenant,forevery$1millionincreaseinSecuredDebt,net(e.g.borrowingsontherevolver,amtofcashreductionlessthan$50million,etc.)theRequiredAdjustedEBITDAperCreditAgreementandMinimumAdjustedEBITDA,asReportedwouldbeincreasedbythefollowing:
2016 2017 2018ChangeinRequired/MinimumAdjEBITDAper$1MchangeinSecuredDebt,net 235$ 250$ 267$
Debt
Current2016Outlook• 2016AdjustedEBITDAnotexpectedtogrowvs.2015AdjustedEBITDA
• 2H16AdjustedEBITDAexpectedtobehigherthan1H16
• FactorsinCompany’s2016outlookinclude:• GamesunitsalesexpectedtoincreaseY/Yineveryquarterbeginningin2Q16
• CoreHDXintroduc=onaccelera=ngtrialunits• Introduc=onofnewgamecontent• Entranceintonewmarkets
• TheCompanyexpectstorecognizethepreviouslyannouncedsaleof200unitstotheAlbertaGamingandLo^eryCommissioninthesecondhalfof2016
• December31,2016installedbaseexpectedtoberela=velyflatcomparedtoinstalledbaseatDecember31,2015andexpectedtoincreasefrom2Q16levels
• ReflectsnewplacementsofproprietaryClassIIandClassIIIunits• Companyexpectstoreplaceapor=onofanythirdpartyClassIIIunitremovals
withproprietaryClassIIunits• Paymentsexpectedtobenefitfromthecon=nuingimprovementincashtothefloorin
thegamingindustry• Salesofkiosksandcomplianceproductsareexpectedtocontributehigherrevenuein
thesecondhalfoftheyearcomparedtothefirsthalfoftheyear21
Q&A