Accel Entertainment Evaluates Entry Into Chicago VGT Market As City Estimates $1B In Incremental Gaming Revenue

Accel Entertainment, (NYSE:ACEL) ("Accel" or "the Company"), a leading locals-focused gaming operator partnering with small businesses, local communities, and state governments to provide entertaining, convenient, and safe gaming experiences nationwide, is evaluating the potential to bring its distributed gaming and local entertainment model to the city of Chicago following recent public announcements regarding the possible introduction of Video Gaming Terminals ("VGTs") in licensed locations.

The City Council Office of Financial Analysis (the "COFA") has estimated that the proposed framework for VGTs could generate approximately $64 million in incremental annual tax revenue for the City of Chicago. Based on existing legislative revenue splits, and further stated in the COFA's analysis, these estimates suggest a total annual Chicago VGT gross gaming revenue ("GGR") of $1B incremental to the existing $3B generated in the rest of the state, once fully implemented, which they note in their analysis may take up to 10 years based on previous studies. VGT operators currently receive a statutory split of GGR equal to 32.04% which would translate into approximately $320 million of expected incremental Net Terminal Income for the licensed VGT operator community operating in Chicago.

Notwithstanding the expected 10 year ramp to maturity, based on our experience in Illinois, the Company expects a Chicago VGT market could begin generating revenue for Accel as early as the third or fourth quarter of 2026, following completion of the legislative, regulatory, and implementation processes, with a gradual ramp-up toward steady-state performance over time.