Company: ACEL
Filing Date: 2025-03-03
Form Type: 10-K
Source: 0001698991-25-000011
Chunk: 182

Company: Accel Entertainment, Inc.
Filing Date: 2025-03-03
Form: 10-K
Item: Item 7
Chunk 182
---
Amortization of intangible assets and route and customer acquisition costs

Amortization of intangible assets and route and customer acquisition costs for the year ended December 31, 2024 was $22.6 million, an increase of $1.4 million, or 6.4%, compared to the prior year due to an increase in location contracts acquired.

Other expenses, net

Other expenses, net for the year ended December 31, 2024 were $19.3 million, an increase of $12.9 million, or 199.7%, compared to the prior year. The increase was primarily attributable to higher fair value adjustments associated with the revaluation of contingent consideration liabilities and higher non-recurring expenses related to acquisitions, as well as the impact of a $1.7 million gain recognized in the prior-year period on the convertible note settlement as discussed in Note 4 to the consolidated financial statements.

Interest expense, net

Interest expense, net for the year ended December 31, 2024 was $35.9 million, an increase of $2.7 million, or 8.3%, compared to the prior year, primarily due to an increase in average outstanding debt and higher interest rates, partially offset by the benefit realized on our interest rate caplets. For the year ended December 31, 2024, the weighted-average interest rate was approximately 7.4% compared to the weighted-average interest rate of approximately 7.3% for the prior year.

37

Loss on change in fair value of contingent earnout shares

Loss on change in fair value of contingent earnout shares for the year ended December 31, 2024 was $1.3 million, a decrease of $7.3 million compared to the prior year. The change was primarily due to the fluctuations in the market value of our Class A-1 common stock, which is the primary input to the valuation of the contingent earnout shares. 

Income tax expense

Income tax expense for the year ended December 31, 2024 was $18.4 million, a decrease of $1.7 million, or 8.4%, compared to the prior year. The effective tax rate for the year ended December 31, 2024 was 34.3% compared to 30.6% in the prior year period. Our effective income tax rate can vary from period to period depending on, among other factors, the amount of permanent tax adjustments and discrete items. The change in the