The following discussion is intended to enhance the reader's understanding of our operations and current business environment from management's perspective and should be read in conjunction with the description of our business included under Part I, Item 1 "Condensed Consolidated Financial Statements" and Part II, Item 1A "Risk Factors" in this Quarterly Report on Form 10-Q and under Part I, Item 1 "Business," Item 1A "Risk Factors" and Part II, Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in our 2020 10-K. This "Management's Discussion and Analysis of Financial Condition and Results of Operations" ("MD&A") contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and should be read in conjunction with the disclosures and information contained and referenced under "Forward-Looking Statements" and "Risk Factors" included in this Quarterly Report on Form 10-Q and "Risk Factors" included in our 2020 10-K. As used in this MD&A, the terms "we," "us," "our" and the "Company" mean SGC together with its consolidated subsidiaries.
BUSINESS OVERVIEW We are a leading developer of technology-based products and services and associated content for the worldwide gaming, lottery, social and digital gaming industries. Our portfolio of revenue-generating activities primarily includes supplying gaming machines and game content, casino-management systems and table game products and services to licensed gaming entities; providing instant and draw-based lottery products, lottery systems and lottery content and services to lottery operators; providing social casino and other mobile games to retail customers; and providing a comprehensive suite of digital RMG and sports wagering solutions, distribution platforms, content, products and services. We also gain access to technologies and pursue global expansion through strategic acquisitions and equity investments. We report our results of operations in four business segments-Gaming, Lottery, SciPlay and Digital-representing our different products and services. Recent Events Strategic Review Update OnJune 29, 2021 , we announced that the Company with the support of its Board of Directors completed the strategic review, which (1) reaffirmed the strategy to become a content-led growth company with a particular focus on digital markets; and (2) intends to divest our Lottery and Sports Betting (component of our Digital business segment) operations ("referred herein as businesses") creating the path to significantly de-lever and position the Company for enhanced growth. We are currently evaluating strategic alternatives to execute the divestitures for each business, respectively, including IPO or a combination with SPAC, or a sale or a strategic combination with another business. Additionally, as described in Note 1, onJuly 15, 2021 , we submitted a proposal to SciPlay's board of directors to acquire the remaining 19% equity interest in SciPlay that we do not currently own in an all-stock transaction, following which SciPlay would become a wholly-owned subsidiary ofScientific Games . This proposed transaction is part of our strategic review described above and a step forward on the recently announced strategy to become a content-led growth company with a particular focus on digital markets that we believe will unlock the value of our products and technologies. There can be no assurances that our evaluation of strategic alternatives for our Lottery and Sports Betting businesses or for the acquisition of the remaining equity interest in SciPlay will result in any transactions or other actions and execution of these transactions is subject to market, operational and other uncertainties. Impacts of COVID-19 As more fully described in the "Description of the Business and Summary of Significant Accounting Policies - Impact of COVID-19" in Note 1 of our 2020 10-K, COVID-19 disruptions continue to impact our results of operations and particularly our Gaming business segment operations. Although most gaming establishments have reopened globally and some have begun operating at full capacity, many gaming operations have yet to return to pre-COVID levels. The current state reflects continued fluctuations in infection rates and regulations for various regions along with ongoing domestic and international travel restrictions or warnings, social distancing measures, reduced operating capacity and an overall economic and general uncertainty regarding the magnitude and length of time that these disruptions will continue. These circumstances may change in the future and such changes could be material. We continue to assess the situation jurisdiction by jurisdiction, actively managing our cash flows and continuing to evaluate additional measures that may reduce operating costs and conserve cash to preserve liquidity as we execute on our strategic initiatives. Impact on Business Operations and Financial Results 28 -------------------------------------------------------------------------------- Throughout 2020 and the first half of 2021, the Gaming business segment was especially impacted by the COVID-19 disruptions due to the widespread closures of gaming operation establishments and restricted reopening of a substantial number of gaming operation establishments coupled with global economic uncertainty. Many of these closures and restrictions have been lifted with some gaming operation establishments removing all restrictions, thereby allowing full capacity operations along with other businesses which have begun to see more activity given the expansion of capacity limits, increased travel, and distribution of vaccines during the second quarter of 2021. Additionally, we noted that theU.S. andU.K. markets have rebounded which has had a notable impact on our Gaming operations primarily due to the lifting of restrictions and further elevated by consumer pent up demand from prior periods resulting in higher gross gaming revenues. Additionally, Gaming operations revenue for the three and six months endedJune 30, 2021 benefited from the FOBT recovery as described in the Consolidated Results section below. However, the future impact of the COVID-19 pandemic remains uncertain. We continue to monitor the global supply chain constraints along with the labor shortages on a macro level caused by COVID-19, which have negatively impacted the hospitality and leisure industries, including gaming. For more information on the effects that COVID-19 has had on each of our business segments, refer to "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Impact on Business Operations and Financial Results" and Note 1 of our 2020 10-K. Impact on Liquidity Our only financial maintenance covenant (excluding SciPlay's Revolver) is contained in SGI's credit agreement. For information regarding the impact on liquidity and other requirements, please refer to the "Description of the Business and Summary of Significant Accounting Policies" in Note 1 and "Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operations" under the "Business Overview" along with the "Liquidity,Capital Resources and Working Capital " sections of our 2020 10-K. InJuly 2021 , we made a voluntary payment of$150 million on SGI's revolving credit facility. Subsequent toJune 30, 2021 , we amended our Credit Agreement to provide for additional flexibility on executing the recently announced strategic transactions, more fully described in Note 11. Segments We report our operations in four business segments - Gaming, Lottery, SciPlay and Digital - representing our different products and services. See "- Business Segments Results" below and Note 3 for additional business segment information. Foreign Exchange Our results are impacted by changes in foreign currency exchange rates used in the translation of foreign functional currencies into USD and the remeasurement of foreign currency transactions or balances. The impact of foreign currency exchange rate fluctuations represents the difference between current rates and prior-period rates applied to current activity. Our exposure to foreign currency volatility on revenue is as follows:
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