NEW YORK, March 11, 2021 /PRNewswire/ --
- Peak 2020 Monthly Revenue and Adjusted EBITDA, excluding
VAT-related income, in October, continuing sequential monthly
growth trend from third quarter 2020 before COVID-19-related
closures in November and December ("COVID-19
Closures")
- Liquidity position remains strong with cash of
approximately $47.1 million and fully
undrawn revolver availability of approximately $27.4 million at year
end¹
- Integration of the Gaming Technology Group of Novomatic
UK Ltd. ("NTG") acquisition substantially completed with realized
synergies exceeding previously communicated guidance
- Fourth Quarter Revenue of $71.7
million, including $32.5
million of VAT-related revenue
- Fourth Quarter Aggregate Online Revenue²
nearly doubled year-over-year; strong forward pipeline of existing
opportunities in North America,
Europe and South America, including a new online
provisional license for Michigan
iGaming
- Fourth Quarter Adjusted EBITDA³ of
$34.9 million, including $31.7 million of VAT-related income
- Company completes financial segment reclassification –
New segments are Gaming, Virtual Sports, Interactive and
Leisure
Inspired Entertainment, Inc. ("Inspired") (NASDAQ: INSE) today
reported unaudited financial results4 for the three-month
period and fiscal year ended December 31,
2020.
The Company generated Total Revenue of $71.7 million and Adjusted EBITDA of $34.9 million in the fourth quarter 2020 on a
reported basis5. These results include a payment from a UK LBO
customer related to our contractual revenue share of their
value-added tax rebate, which positively impacted Revenue by
$32.5 million and Adjusted EBITDA by
$31.7 million (in conjunction with
third party fees).
"October was a stellar month and indicated how quickly we could
recover before our land-based businesses went back into lockdown in
November and December," said Lorne
Weil, Executive Chairman of Inspired. "Our October
monthly Revenue of $21.2
million6 and Adjusted EBITDA of $6.8 million6, or 32% of total revenue, was
nearly 20% above October 2019 and the
highest monthly levels we experienced in 2020, excluding the
VAT-related income. This follows the general pattern we saw of
sequential monthly growth throughout the third quarter 2020
following the second quarter lockdown. Importantly, year to
year growth in October occurred despite the fact that October
performance was impacted by pub curfews in early October and the
introduction of tiered closures in the second half of the
month."
Revenue and Adjusted EBITDA were negatively impacted in November
and December by the COVID-19 Closures. In November, most of our
land-based customers' venues were closed. In December the UK had a
tiered lockdown system whereby many of our land-based customers'
venues were open but restricted, limiting revenue while incurring
near-full service costs. This tiered system is not expected to
return in England.
The Company's aggregate business across its Online Virtuals and
Interactive channels showed strength in the quarter with revenues
increasing sequentially from $3.0
million in October to $3.3
million in November to $4.2
million in December. This reflects year-over-year growth of
89%, 95% and 99%, respectively, over $1.6
million, $1.7 million and
$2.1 million in the same months in
2019, demonstrating the growing presence and popularity of the
Company's online offerings.
Weil continued, "While the UK is expected to remain on lockdown
through the first quarter 2021, based on the UK Prime Minister's
public statement on February
22nd, and assuming achievement of key goalposts,
the UK will ease lockdown restrictions in stages with LBOs
reopening in April, pubs and holiday parks reopening in May and an
end of the lockdown by June
21st. By the end of the second quarter 2021,
assuming the UK ends its lockdown, we would expect our UK business
to be on a run rate similar to where we were in the third quarter
2020 when we generated $17.1
million6 in Adjusted EBITDA, excluding
VAT-related income, at current exchange rates."
"Furthermore, by the third quarter 2021, we expect to have the
added benefit of our online business having grown substantially
year over year with continuing expectations for growth from that
higher starting point due to a strong business development
pipeline, including new commercial agreements in existing
territories, jurisdictional expansion in North America, Europe and South
America and continued strong product development across both
Interactive and Online Virtual Sports. We also expect to have
our holiday park business back to pre-pandemic levels, which was
not the case in the third quarter 2020 given local restrictions.
We're confident that, as we did last time, we will recover
quickly once lockdowns are lifted to emerge from this pandemic even
stronger than before with a lower cost structure, improved
liquidity, a larger customer base and increased growth
opportunities," concluded Weil.
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Summary of
Consolidated Fourth Quarter and Fiscal Year 2020 Financial Results
(unaudited)
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|
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|
|
|
Quarter
Ended
|
|
Year
Ended
|
|
|
|
|
December
31,
|
Change
|
December
31,
|
Change
|
|
|
|
2020
|
2019
|
(%)
|
2020
|
2019
|
(%)
|
|
(In $ millions,
except per share figures)
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|
|
|
|
|
|
|
|
GAAP
Measures:
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
71.7
|
$
66.4
|
8.0%
|
$
199.8
|
$
153.4
|
30.2%
|
|
Net operating income
(loss)
|
|
$
19.3
|
$
(2.1)
|
NM2
|
$
6.4
|
$
(13.0)
|
NM2
|
|
Net income
(loss)
|
|
$
12.4
|
$
(12.8)
|
NM2
|
$
(29.2)
|
$
(37.0)
|
NM2
|
|
Net income (loss) per
share - basic
|
|
$
0.55
|
$
(0.58)
|
NM2
|
$
(1.30)
|
$
(1.69)
|
NM2
|
|
Ne income (loss) per
share - diluted
|
|
$
0.49
|
$
(0.58)
|
NM2
|
$
(1.30)
|
$
(1.69)
|
NM2
|
|
Non-GAAP
Measures:
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|
|
|
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Adjusted
EBITDA1
|
|
$
34.9
|
$
17.7
|
96.9%
|
$
72.1
|
$
49.0
|
47.2%
|
|
1Reconciliation to US GAAP shown
below.
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|
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2Percentage change is not
meaningful
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With the filing of its Form 10-K for fiscal year 2020, the
Company expects to have comprehensively realigned its segments into
Gaming, Virtual Sports, Interactive and Leisure7, as represented
below.
- Gaming: Gaming machines located in UK licensed betting offices
("LBOs"), casinos, gaming halls and high street adult gaming
centers ("AGCs")
- Virtual Sports: Retail and Online Virtual Sports
- Interactive: Slot and table game offerings from our Gaming
segment as well as interactive-only content via our remote gaming
servers
- Leisure: Digital and analog gaming and amusement machines
located in UK pubs, bowling alleys, motorway service areas
("MSAs"), bingo halls and leisure parks.
The restatements do not change any 2019 or 2020 reported results
at the consolidated Inspired level.
"As we look ahead, we believe we are well situated to navigate
our business through short-term challenges and over the long term,"
said Stewart Baker, Executive Vice
President and Chief Financial Officer of Inspired. "We have
established a strong liquidity position, successfully improved our
overall cost structure, including non-COVID-19 related
improvements, and streamlined our operations, including increased
synergies from the NTG acquisition. We are using this
opportunity to reclassify our financial segments to better mirror
the way we evaluate our business and allocate resources and capital
spending. Going forward, we remain focused on executing our
strategic plan to drive margin expansion, deliver profitable
growth, increase cashflows and maximize shareholder value."
Recent Highlights (as of March 11,
2021)
Gaming
- 58 North American Valor™ Sales in the Fourth
Quarter – This brings total Valor terminal sales since
launch to 429. The Company has commitments for 30 additional units
thus far in the first quarter 2021.
- Paddy Power contract
renewal – Signed new two-year contract in the fourth
quarter requiring no further significant capital expenditure.
- $32.5 Million Payment on
Backdated VAT Tax Rebate – Inspired received
$32.5 million from one of our SBG
customers in the fourth quarter 2020 related to our contractual
revenue share of their UK VAT rebate. We have received $42.2 million of total VAT-related revenue in
2020 with an incremental $3.1 million
in recoveries received in the first quarter 2021.
- Agreement with Sisal to Convert Games in Italy - Inspired sold 774 existing
installed VLTs to Sisal in the fourth quarter 2020 with a further
850 existing installed VLTs to be sold in 2021 as part of our
strategy to focus on technology and games in Italy rather than on hardware operations.
Virtual Sports
- New Retail and Online Virtual Sports Agreements –
In the first quarter 2021, Inspired signed new agreements to
provide Virtual Sports across online and retail Virtuals product
sets to Snaitech in Italy, The
CAGE Companies in the Caribbean
and Entain for all of their brands, including Ladbrokes, Coral,
BetMGM, bwin, Sportingbet, partypoker, Gala and Foxy Bingo.
- Online Virtual Sports Launches – Online Virtual
Sports were launched with Fortuna-owned brand Casa Pariurilor, a
major online brand in Romania, in
the fourth quarter 2020, and are expected to launch with Stoiximan
in the second quarter 2021. Stoiximan is a leading Greek online
gaming site owned by OPAP S.A.
- Land-based Virtuals Developments – In the
fourth quarter, the Company signed with Intralot to make the
Washington DC Lottery the latest North American lottery to launch
our land-based Virtual Sports. The Pennsylvania Lottery's 2020 full
year sales from its Virtual Sports grew 255% year over year even
with sports bars in Pennsylvania
closed for a large part of the year and also after normalizing for
promotions.
- Virtual Plug & Play™ ("VPP") –The Company has
signed agreements with Caesars and BetMGM to launch our new
complete end-to-end Online Virtual Sports offering in New Jersey.
- High-Profile Virtual Events – During the
fourth quarter, Inspired held the virtual Lexus Melbourne Cup and
the Greatest Ever Cox Plate, which were both televised in
Australia.
Interactive
- New Customers – Interactive content
launched with 16 new customers during the quarter across
Germany, Belgium, Greece, Italy, New
Jersey and the UK in the quarter, including OPAP, Skill on
Net and Unibet in New Jersey.
- Expanded Portfolio of Interactive Aggregators
– Launched a selection of premium slots on Scientific Games,
Everymatrix, Microgaming, Relax, SBTech, Playtech and Pariplay
content aggregation platforms during the fourth quarter.
- New Jurisdictions – Granted a provisional license
to supply online games by the Michigan Gaming Control Board in the
first quarter 2021 with games expected to launch in early 2021.
Also granted a supplier license by the West Virginia Lottery
Commission in the fourth quarter 2020, with commitments to
distribute content in 2021.
- New Content – Eight games launched during
the quarter including our very successful holiday trio of Santa
King Megaways™, Santa Stacked Free Spins™ and Christmas Cash Pots™.
Content from the NTG acquisition has proven to be extremely popular
and outperformed internal expectations.
- Germany Deployment - Delivered 10 games to
the German market for its opening in the fourth quarter 2020. All
new Inspired games will be compliant with German regulations.
Leisure
- MOTO Long-Term Contract Extension – Inspired will
continue to provide its gaming machines and services to MOTO, the
UK's largest motorway service operator.
1
|
|
Assuming
GBP:USD exchange rate of 1.37 at December 31, 2020.
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2
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Aggregate
Online Revenue includes revenue derived from Online Virtual Sports
and Interactive online.
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3
|
|
"Adjusted
EBITDA" and "Adjusted EBITDA Margin" are non-GAAP financial
measures defined below under "Non-GAAP Financial Measures" and
reconciled to the most directly comparable GAAP measures in the
accompanying supplemental table. Adjusted EBITDA Margin is
calculated as a percent of Revenue.
|
4
|
|
Please see
supplemental disclosures at the end of the release.
|
5
|
|
Currency
movements in the quarter did not materially affect the reported
results.
|
6
|
|
Assuming GBP:USD
exchange rate of 1.39 as of March 10, 2021.
|
7
|
|
Inspired has provided
restated 2019 and 2020 figures to reflect the adoption of this new
segment reporting structure in an accompanying supplemental table
as well as in the "Inspired Segment Reclassification" disclosure
presentation found on the Company's website.
|
Overview of Fourth Quarter Results Versus Prior Year Fourth
Quarter on a Reported Basis
Gaming Revenue was $50.5
million, an increase of 52.3% from $33.2 million in the fourth quarter 2019, in part
due to $32.5 million in VAT-related
revenue. Gaming Service Revenue was $44.3 million, an increase of 102.1% from
$21.9 million in the fourth quarter
2019. Gaming service revenue was favorably impacted by the
VAT-related revenue, which was offset by COVID-19 Closures in the
UK ($6.8 million), Greece ($2.3
million) and Italy
($1.7 million). Gaming Product
Revenue declined to $6.2
million from $11.3 million in
the fourth quarter 2019. Revenue during the quarter consisted
of the sale of Valor™ terminals ($1.4
million), Sabre Hydra™ electronic table games and machine
sales in Italy ($0.9 million).
Virtual Sports Revenue, which no longer includes
Interactive but does include Online Virtual Sports, increased 1.8%
to $8.7 million from $8.5 million in the fourth quarter 2019. Due to
the COVID-19 Closures and resulting growing migration to gaming
online, Online Virtual Sports increased $3.0
million year-over-year while retail revenue declined
$2.8 million.
Interactive Revenue increased 99.5% to $4.2 million from $2.1
million in the fourth quarter 2019. The revenue growth
came primarily from our existing customer base in Europe, reflecting the growing migration of
end users to online platforms, an increase in the volume and
popularity of the Company's new proprietary content, significantly
improved game quality and strong account management.
Additionally, Inspired launched with over 42 new online customers
in 2020 throughout the UK, New
Jersey, Canada,
Greece, Mexico, Germany, Belgium, Italy and Sweden and further expanded its base of
interactive aggregators.
Leisure Service Revenue was $7.7
million in the fourth quarter 2020 compared to $21.8 million in the prior year period.
Revenue from pubs, leisure parks and MSAs was lower than the prior
year as a result of the COVID-19 Closures. Revenue generated
from pub customers was $2.8 million,
compared to $10.5 million in the
prior year period; leisure park customers was $2.6 million, compared to $5.9 million in the prior year period; and MSA
customers was $1.8 million, compared
to $4.2 million in the prior year
period. Leisure Product Revenue was $0.6 million in the fourth quarter 2020 versus
$0.8 million in the prior year
period.
Total Company SG&A expenses decreased by
$7.2 million, or 23.0%, on a reported
basis, to $24.1 million. This
decrease was driven by staff cost savings of $3.7 million due to the furlough scheme and
synergies achieved, a cost savings on facility costs of
$1.0 million, $1.0 million reduction in professional fees and
$0.7 million of lower travel and
expense costs due to the COVID-19 pandemic. Italian
tax-related costs decreased by $0.4
million (excluded from Adjusted EBITDA) and costs of group
restructure decreased by $0.2 million
(excluded from Adjusted EBITDA).
Total Company Net Cash Provided by Operating Activities Less
Capital Expenditures during the quarter increased to an
inflow of $13.4 million from an
outflow of $2.6 million in the prior
year period representing a $16.0
million increase in cash generation. This was helped
by a $31.7 million VAT-related income
payment and partly offset by a $12.6
million bi-annual interest payment.
Segment Reporting Reclassification
In prior years, and up to and including the interim period nine
months ended September 30, 2020, the
Company operated its business along three operating segments:
Server Based Gaming, Virtual Sports (which included Interactive)
and Acquired Businesses. During the period subsequent to
September 30, 2020, the Company has
completed the process of changing its internal structure, which has
been ongoing since the NTG Acquisition, and as a result has changed
the composition of its operating segments. The Company now operates
its business along four operating segments, which are segregated
based on the basis of revenue stream: Gaming, Virtual Sports,
Interactive and Leisure. The Company believes this method of
segment reporting reflects both the way its business segments are
now managed and the way the performance of each segment is now
evaluated.
As part of the recharacterization exercise, certain items of
Revenue, Cost of Sales and Selling and Administrative Expenses have
been recharacterized to ensure consistency with similar items
across the Group. The revenue recharacterizations are to ensure
spares and similar items are reflected with other items of hardware
(Product Sales). The recharacterization has no impact on the
previously reported Company Revenue, Adjusted EBITDA, Net Operating
Loss, Net Loss or Net Comprehensive Loss for the year ended
December 31, 2019.
The Company has provided reclassified 2019 and 2020 reported
results to reflect the adoption of this new segment reporting
structure in an accompanying supplemental table as well as in the
"Inspired New Segment Reporting" disclosure presentation found on
the Company's website.
Non-GAAP Financial Measures
We use certain non-GAAP financial measures, including EBITDA and
Adjusted EBITDA, to analyze our operating performance. We use these
financial measures to manage our business on a day-to-day basis. We
believe that these measures are also commonly used in our industry
to measure performance. For these reasons, we believe that these
non-GAAP financial measures provide expanded insight into our
business, in addition to standard U.S. GAAP financial measures.
There are no specific rules or regulations for defining and using
non-GAAP financial measures, and as a result the measures we use
may not be comparable to measures used by other companies, even if
they have similar labels. The presentation of non-GAAP financial
information should not be considered in isolation from, or as a
substitute for, or superior to, financial information prepared and
presented in accordance with U.S. GAAP. You should consider our
non-GAAP financial measures in conjunction with our U.S. GAAP
financial measures.
We define our non-GAAP financial measures as follows:
EBITDA is defined as net loss excluding
depreciation and amortization, interest expense, interest income
and income tax expense.
Adjusted EBITDA is defined as net loss
excluding depreciation and amortization, interest expense, interest
income and income tax expense, and other additional exclusions and
adjustments. Such additional excluded amounts include
stock-based compensation U.S. GAAP charges where the associated
liability is expected to be settled in stock, and changes in the
value of earnout liabilities and income and expenditure in relation
to legacy portions of the business (being those portions where
trading no longer occurs) including closed defined benefit pension
schemes. Additional adjustments are made for items considered
outside the normal course of business, including (1) restructuring
costs, which include charges attributable to employee severance,
management changes, restructuring, dual running costs, costs
related to facility closures and integration costs, (2) merger and
acquisition costs and (3) gains or losses not in the ordinary
course of business. This does not include any adjustments related
to COVID-19.
We believe Adjusted EBITDA, when considered along with other
performance measures, is a particularly useful performance measure,
because it focuses on certain operating drivers of the business,
including sales growth, operating costs, selling and administrative
expense and other operating income and expense. We believe Adjusted
EBITDA can provide a more complete understanding of our operating
results and the trends to which we are subject, and an enhanced
overall understanding of our financial performance and prospects
for the future. Adjusted EBITDA is not intended to be a measure of
liquidity or cash flows from operations or a measure comparable to
net income or loss, because it does not take into account certain
aspects of our operating performance (for example, it excludes
non-recurring gains and losses which are not deemed to be a normal
part of underlying business activities). Our use of Adjusted
EBITDA may not be comparable to the use by other companies of
similarly termed measures. Management compensates for these
limitations by using Adjusted EBITDA as only one of several
measures for evaluating our operating performance. In addition,
capital expenditures, which affect depreciation and amortization,
interest expense, and income tax benefit (expense), are evaluated
separately by management.
Functional Currency at Constant
rate. Currency impacts shown have been calculated as
the current-period average GBP: USD rate less the equivalent
average rate in the prior period, multiplied by the current period
amount in our functional currency (GBP). The remaining difference,
referred to as functional currency at constant rate, is calculated
as the difference in our functional currency, multiplied by the
prior-period average GBP: USD rate, as a proxy for functional
currency at constant rate movement.
Currency Movement represents the difference
between the results in our reporting currency (USD) and the results
on a functional currency at constant rate basis.
Pro Forma financial information is intended
to illustrate the combined impact of the Company's Acquired
Businesses by showing how the specific transaction might have
affected historical financial statements had the acquisition
occurred at the beginning of the acquirer's most recently completed
fiscal year.
Reconciliations from net loss, as shown in our Consolidated
Statements of Operations and Comprehensive Loss, to Adjusted EBITDA
are shown below. The 2019/2020 EBITDA comparison does not include
the Acquired Businesses in the 2019 results.
Supplemental Disclosure
Inspired's audit of its 2020 annual consolidated financial
statements is not yet complete and accordingly all financial
amounts referred to in this news release are unaudited and
represent management's estimates. These amounts are subject
to audit and may be subject to change as a result. The
Company intends to file its consolidated financial results for the
year ended December 31, 2020,
together with its Management's Discussion and Analysis for the
corresponding period on the Company's website at
www.inseinc.com.
Conference Call and Webcast
Inspired management will host a conference call and simultaneous
webcast at 9:00 a.m. ET /
2:00 p.m. UK on Thursday, March 11, 2021 to discuss the financial
results and general business trends.
Telephone: The dial-in number to
access the call live is 1-844-746-0725 (US) or 1-412-317-5264
(International). Participants should ask to be joined into the
Inspired Entertainment call.
Webcast: A live audio-only webcast of the
call can be accessed through the "Events and Presentations" page of
the Company's website at www.inseinc.com under the Investors
link. Please follow the registration prompts.
Replay of the call: A telephone replay
of the call will be available one hour after the conclusion of the
call until March 18, 2021 by dialing
1-877-344-7529 (US) or 1-412-317-0088 (International), via replay
access code 10152597. A replay of the webcast will also be
available on the Company's website at www.inseinc.com.
About Inspired Entertainment, Inc.
Inspired offers an expanding portfolio of content, technology,
hardware and services for regulated gaming, betting, lottery,
social and leisure operators across land-based and mobile
channels around the world. The Company's gaming, virtual
sports, interactive and leisure products appeal to a wide variety
of players, creating new opportunities for operators to grow their
revenue. The Company operates in approximately 35
jurisdictions worldwide, supplying gaming systems with
associated terminals and content for more than 50,000 gaming
machines located in betting shops, pubs, gaming halls and other
route operations; virtual sports products through more than 44,000
land-based channels; interactive games for 100+ websites; and a
variety of amusement entertainment solutions with a total installed
base of more than 19,000 devices. Additional information
can be found at www.inseinc.com.
Forward Looking Statements
This news release may contain "forward-looking statements"
within the meaning of the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as
"anticipate," "believe," "expect," "estimate," "plan," "will,"
"would" and "project" and other similar expressions that indicate
future events or trends or are not statements of historical
matters. These statements are based on Inspired's management's
current expectations and beliefs, as well as a number of
assumptions concerning future events.
Forward-looking statements are subject to known and unknown
risks, uncertainties, assumptions and other important factors, many
of which are outside of Inspired's control and all of which could
cause actual results to differ materially from the results
discussed in the forward-looking statements. Accordingly,
forward-looking statements should not be relied upon as
representing Inspired's views as of any subsequent date, and
Inspired does not undertake any obligation to update
forward-looking statements to reflect events or circumstances after
the date they were made, whether as a result of new information,
future events or otherwise, except as required by law. You are
advised to review carefully the "Risk Factors" section of
Inspired's annual report on Form 10-K for the fiscal year ended
December 31, 2019 and in Inspired's
subsequent quarterly reports on Form 10-Q, which are available,
free of charge, on the U.S. Securities and Exchange Commission's
website at www.sec.gov. In addition, the statements made by
the Company with respect to the potential future impact of COVID-19
on the Company's business and operations, and the Company's
expected responses thereto, are forward-looking statements. The
Company encourages investors to visit its website from time to
time, as information is updated and new information is posted. The
Company does not undertake to update its forward-looking
statements, except as may be required by law.
Contact:
For Investors
Aimee Remey
aimee.remey@inseinc.com
+1 646 565-6938
For Press and Sales
inspiredsales@inseinc.com
INSPIRED
ENTERTAINMENT, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED BALANCE SHEETS (in millions, except share
data)
|
|
|
|
December 31,
2020
|
|
|
December 31,
2019
|
|
Assets
|
|
|
|
|
|
|
Cash
|
|
$
|
47.1
|
|
|
$
|
29.1
|
|
Accounts receivable,
net
|
|
|
27.5
|
|
|
|
24.2
|
|
Inventory,
net
|
|
|
17.6
|
|
|
|
18.8
|
|
Prepaid expenses and
other current assets
|
|
|
16.8
|
|
|
|
23.2
|
|
Total current
assets
|
|
|
109.0
|
|
|
|
95.3
|
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
|
65.5
|
|
|
|
79.3
|
|
Software development
costs, net
|
|
|
42.4
|
|
|
|
46.9
|
|
Other acquired
intangible assets subject to amortization, net
|
|
|
7.7
|
|
|
|
9.9
|
|
Goodwill
|
|
|
83.7
|
|
|
|
80.9
|
|
Right of use
asset
|
|
|
12.5
|
|
|
|
9.4
|
|
Investment
|
|
|
—
|
|
|
|
0.6
|
|
Other
assets
|
|
|
3.3
|
|
|
|
5.1
|
|
Total
assets
|
|
$
|
324.1
|
|
|
$
|
327.4
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Deficit
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
17.9
|
|
|
$
|
22.2
|
|
Accrued
expenses
|
|
|
31.4
|
|
|
|
31.2
|
|
Corporate tax and
other current taxes payable
|
|
|
14.4
|
|
|
|
6.6
|
|
Deferred revenue,
current
|
|
|
11.5
|
|
|
|
10.1
|
|
Operating lease
liabilities
|
|
|
3.6
|
|
|
|
3.6
|
|
Other current
liabilities
|
|
|
2.5
|
|
|
|
1.9
|
|
Current portion of
long-term debt
|
|
|
—
|
|
|
|
2.6
|
|
Current portion of
finance lease liabilities
|
|
|
0.6
|
|
|
|
0.1
|
|
Total current
liabilities
|
|
|
81.9
|
|
|
|
78.3
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
297.5
|
|
|
|
270.5
|
|
Finance lease
liabilities, net of current portion
|
|
|
0.2
|
|
|
|
—
|
|
Deferred revenue, net
of current portion
|
|
|
11.4
|
|
|
|
17.7
|
|
Derivative
liability
|
|
|
1.7
|
|
|
|
—
|
|
Operating lease
liabilities
|
|
|
9.2
|
|
|
|
5.2
|
|
Other long-term
liabilities
|
|
|
10.9
|
|
|
|
5.2
|
|
Total
liabilities
|
|
|
412.8
|
|
|
|
376.9
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
deficit
|
|
|
|
|
|
|
|
|
Preferred stock;
$0.0001 par value; 1,000,000 shares authorized
|
|
|
—
|
|
|
|
—
|
|
Series A Junior
Participating Preferred stock; $0.0001 par value; 1,000,000 shares
authorized; 49,000 shares designated; no shares issued and
outstanding at December 31, 2020 and December 31, 2019
|
|
|
—
|
|
|
|
—
|
|
Common stock; $0.0001
par value; 49,000,000 shares authorized; 22,430,475 shares and
22,230,768 shares issued and outstanding at December 31, 2020 and
December 31, 2019, respectively
|
|
|
—
|
|
|
|
—
|
|
Additional paid in
capital
|
|
|
350.6
|
|
|
|
346.6
|
|
Accumulated other
comprehensive income
|
|
|
31.1
|
|
|
|
45.1
|
|
Accumulated
deficit
|
|
|
(470.4)
|
|
|
|
(441.2)
|
|
Total
stockholders' deficit
|
|
|
(88.7)
|
|
|
|
(49.5)
|
|
Total liabilities
and stockholders' deficit
|
|
$
|
324.1
|
|
|
$
|
327.4
|
|
INSPIRED
ENTERTAINMENT, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS (in millions, except share
data) (Unaudited)
|
|
|
|
Three Months
Ended
December 31
|
|
|
Twelve Months
Ended
December 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
64.9
|
|
|
$
|
54.3
|
|
|
$
|
178.7
|
|
|
$
|
134.5
|
|
Product
|
|
|
6.8
|
|
|
|
12.1
|
|
|
|
21.1
|
|
|
|
18.9
|
|
Total
revenue
|
|
|
71.7
|
|
|
|
66.4
|
|
|
|
199.8
|
|
|
|
153.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales,
excluding depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
service
|
|
|
(8.3)
|
|
|
|
(10.1)
|
|
|
|
(30.1)
|
|
|
|
(25.4)
|
|
Cost of
product
|
|
|
(4.5)
|
|
|
|
(8.0)
|
|
|
|
(14.4)
|
|
|
|
(12.9)
|
|
Selling, general and
administrative expenses
|
|
|
(24.1)
|
|
|
|
(31.3)
|
|
|
|
(84.8)
|
|
|
|
(70.4)
|
|
Stock-based
compensation expense
|
|
|
(1.7)
|
|
|
|
(2.4)
|
|
|
|
(4.8)
|
|
|
|
(9.0)
|
|
Acquisition and
integration related transaction expenses
|
|
|
(1.4)
|
|
|
|
(1.8)
|
|
|
|
(7.0)
|
|
|
|
(6.7)
|
|
Depreciation and
amortization
|
|
|
(12.4)
|
|
|
|
(14.9)
|
|
|
|
(52.3)
|
|
|
|
(42.0)
|
|
Net operating
income (loss)
|
|
|
19.3
|
|
|
|
(2.1)
|
|
|
|
6.4
|
|
|
|
(13.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
0.1
|
|
|
|
—
|
|
|
|
0.6
|
|
|
|
0.1
|
|
Interest
expense
|
|
|
(8.1)
|
|
|
|
(14.9)
|
|
|
|
(30.6)
|
|
|
|
(27.8)
|
|
Change in fair value
of earnout liability
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2.3)
|
|
Change in fair value
of derivative liability
|
|
|
—
|
|
|
|
0.2
|
|
|
|
—
|
|
|
|
3.0
|
|
Loss from equity
method investee
|
|
|
—
|
|
|
|
(0.1)
|
|
|
|
(0.5)
|
|
|
|
(0.1)
|
|
Other finance income
(expense)
|
|
|
1.2
|
|
|
|
4.1
|
|
|
|
(4.7)
|
|
|
|
3.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other
expense, net
|
|
|
(6.8)
|
|
|
|
(10.7)
|
|
|
|
(35.2)
|
|
|
|
(23.9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes
|
|
|
12.5
|
|
|
|
(12.8)
|
|
|
|
(28.8)
|
|
|
|
(36.9)
|
|
Income tax
expense
|
|
|
(0.1)
|
|
|
|
—
|
|
|
|
(0.4)
|
|
|
|
(0.1)
|
|
Net income
(loss)
|
|
|
12.4
|
|
|
|
(12.8)
|
|
|
|
(29.2)
|
|
|
|
(37.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation (loss) gain
|
|
|
(4.7)
|
|
|
|
(3.1)
|
|
|
|
(5.4)
|
|
|
|
(2.4)
|
|
Change in fair value
of hedging instrument
|
|
|
(0.2)
|
|
|
|
(0.5)
|
|
|
|
(2.9)
|
|
|
|
2.9
|
|
Reclassification of
loss (gain) on hedging instrument to comprehensive
income
|
|
|
0.5
|
|
|
|
0.1
|
|
|
|
1.5
|
|
|
|
(4.4)
|
|
Actuarial losses on
pension plan
|
|
|
(2.6)
|
|
|
|
(2.7)
|
|
|
|
(7.2)
|
|
|
|
(6.9)
|
|
Other
comprehensive loss
|
|
|
(7.0)
|
|
|
|
(6.2)
|
|
|
|
(14.0)
|
|
|
|
(10.8)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss
|
|
$
|
5.4
|
|
|
$
|
(19.0)
|
|
|
$
|
(43.2)
|
|
|
$
|
(47.8)
|
|
Net income (loss)
per common share – basic
|
|
$
|
0.55
|
|
|
$
|
(0.58)
|
|
|
$
|
(1.30)
|
|
|
$
|
(1.69)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share –diluted
|
|
$
|
0.49
|
|
|
$
|
(0.58)
|
|
|
$
|
(1.30)
|
|
|
$
|
(1.69)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding during the period – basic and
diluted
|
|
|
22,407,307
|
|
|
|
22,197,191
|
|
|
|
22,399,333
|
|
|
|
21,892,964
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding during the period
–diluted
|
|
|
25,073,435
|
|
|
|
22,197,191
|
|
|
|
22,399,333
|
|
|
|
21,892,964
|
|
INSPIRED
ENTERTAINMENT, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions)
(Unaudited)
|
|
|
Year
Ended
December 31,
2020
|
|
|
Year
Ended
December 31,
2019
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
Net loss
|
|
$
|
(29.2)
|
|
|
$
|
(37.0)
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
52.3
|
|
|
|
42.0
|
|
Amortization of right
of use asset
|
|
|
3.6
|
|
|
|
1.0
|
|
Stock-based
compensation expense
|
|
|
4.8
|
|
|
|
9.0
|
|
Change in fair value
of derivative liability
|
|
|
—
|
|
|
|
(3.0)
|
|
Change in fair value
of earnout liability
|
|
|
—
|
|
|
|
2.3
|
|
Impairment of
investment in equity method investee
|
|
|
0.7
|
|
|
|
—
|
|
Foreign currency
translation on senior bank debt
|
|
|
5.6
|
|
|
|
0.8
|
|
Foreign currency
translation on cross currency swaps
|
|
|
—
|
|
|
|
(3.6)
|
|
Reclassification of
loss on hedging instrument to comprehensive income
|
|
|
0.9
|
|
|
|
—
|
|
Non-cash interest
expense relating to senior debt
|
|
|
3.4
|
|
|
|
9.0
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(2.9)
|
|
|
|
3.3
|
|
Inventory
|
|
|
1.3
|
|
|
|
2.0
|
|
Prepaid expenses and
other assets
|
|
|
8.8
|
|
|
|
3.3
|
|
Corporate tax and
other current taxes payable
|
|
|
6.6
|
|
|
|
(3.6)
|
|
Accounts
payable
|
|
|
(4.8)
|
|
|
|
6.9
|
|
Deferred revenues and
customer prepayment
|
|
|
(5.7)
|
|
|
|
(9.5)
|
|
Accrued
expenses
|
|
|
10.9
|
|
|
|
7.2
|
|
Operating lease
liabilities
|
|
|
(2.8)
|
|
|
|
(1.3)
|
|
Other long-term
liabilities
|
|
|
(0.6)
|
|
|
|
1.9
|
|
Net cash provided
by operating activities
|
|
|
52.9
|
|
|
|
30.7
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
|
|
(15.4)
|
|
|
|
(10.5)
|
|
Cash paid for NTG
Acquisition
|
|
|
-
|
|
|
|
(105.9)
|
|
Purchases of capital
software
|
|
|
(14.5)
|
|
|
|
(17.0)
|
|
Net cash used in
investing activities
|
|
|
(29.9)
|
|
|
|
(133.4)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of long-term debt
|
|
|
—
|
|
|
|
270.6
|
|
Proceeds from
issuance of revolver
|
|
|
—
|
|
|
|
2.8
|
|
Repayments of
revolver and long-term debt, including exit premium
|
|
|
(4.2)
|
|
|
|
(144.2)
|
|
Payment of financing
costs
|
|
|
—
|
|
|
|
(15.2)
|
|
Debt fees
incurred
|
|
|
(3.1)
|
|
|
|
—
|
|
Repayments of finance
leases
|
|
|
(0.9)
|
|
|
|
(0.5)
|
|
Net cash (used in)
provided by financing activities
|
|
|
(8.2)
|
|
|
|
113.5
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
|
3.2
|
|
|
|
2.3
|
|
Net increase in
cash
|
|
|
18.0
|
|
|
|
13.1
|
|
Cash, beginning of
period
|
|
|
29.1
|
|
|
|
16.0
|
|
Cash, end of
period
|
|
$
|
47.1
|
|
|
$
|
29.1
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash
flow disclosures
|
|
|
|
|
|
|
|
|
Cash paid during the
period for interest
|
|
$
|
13.3
|
|
|
$
|
12.6
|
|
Cash paid during the
period for income taxes
|
|
$
|
0.2
|
|
|
$
|
—
|
|
Cash paid during the
period for operating leases
|
|
$
|
3.3
|
|
|
$
|
2.2
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of noncash investing and financing
activities
|
|
|
|
|
|
|
|
|
Additional paid in
capital from net settlement of RSUs
|
|
$
|
(0.7)
|
|
|
$
|
(0.9)
|
|
Lease liabilities
arising from obtaining right of use assets
|
|
$
|
(6.8)
|
|
|
$
|
(9.6)
|
|
Adjustment to
goodwill arising from adjustment to fair value of assets
acquired
|
|
$
|
(0.2)
|
|
|
$
|
—
|
|
Property and
equipment acquired through finance lease
|
|
$
|
1.5
|
|
|
$
|
—
|
|
Capitalized interest
payments
|
|
$
|
10.6
|
|
|
$
|
—
|
|
Assets arising from
asset retirement obligations
|
|
$
|
1.0
|
|
|
$
|
—
|
|
Additional paid in
capital reclassified from derivative liability
|
|
$
|
—
|
|
|
$
|
0.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INSPIRED
ENTERTAINMENT, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
(Unaudited)
|
|
|
|
|
For the
Three-Month
Period ended
|
|
For the
Twelve-Month
Period ended
|
|
|
|
|
|
|
Unaudited
|
|
|
|
Unaudited
|
|
|
Unaudited
|
|
|
Unaudited
|
|
|
|
|
|
|
Dec
31,
|
|
|
|
Dec
31,
|
|
|
Dec
31,
|
|
|
Dec
31,
|
|
|
|
(In
millions)
|
|
|
2020
|
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
|
|
Net gain
(loss)
|
|
|
$
|
12.4
|
|
|
|
$
|
(12.8)
|
|
|
$
|
(29.2)
|
|
|
$
|
(37.0)
|
|
|
|
Items Relating to
Discontinued Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
charges
|
|
|
|
0.1
|
|
|
|
|
0.2
|
|
|
|
0.6
|
|
|
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items outside the
normal course of business:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of group
restructure
|
|
|
|
—
|
|
|
|
|
0.1
|
|
|
|
0.8
|
|
|
|
3.3
|
|
|
|
Acquisition and
integration related transaction expenses
|
|
|
|
1.4
|
|
|
|
|
1.8
|
|
|
|
7.0
|
|
|
|
6.7
|
|
|
|
Impairment on
interest in equity method investee
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
0.7
|
|
|
|
—
|
|
|
|
Italian tax
related costs relating to prior years
|
|
|
|
—
|
|
|
|
|
0.4
|
|
|
|
—
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation expense
|
|
|
|
1.7
|
|
|
|
|
2.4
|
|
|
|
4.8
|
|
|
|
9.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
|
12.4
|
|
|
|
|
14.9
|
|
|
|
52.3
|
|
|
|
42.0
|
|
|
|
Total other expense,
net
|
|
|
|
6.8
|
|
|
|
|
10.6
|
|
|
|
34.7
|
|
|
|
23.9
|
|
|
|
Income tax
|
|
|
|
0.1
|
|
|
|
|
—
|
|
|
|
0.4
|
|
|
|
0.1
|
|
|
|
Adjusted
EBITDA
|
|
|
$
|
34.9
|
|
|
|
$
|
17.7
|
|
|
$
|
72.1
|
|
|
$
|
49.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
|
£
|
26.6
|
|
|
|
£
|
13.8
|
|
|
£
|
55.5
|
|
|
£
|
38.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange Rate - $
to £
|
|
|
|
1.32
|
|
|
|
|
1.29
|
|
|
|
1.29
|
|
|
|
1.28
|
|
|
|
Scheduled Online
Virtual Sports and Interactive Total Pro Forma
Revenue
|
|
|
|
Three Months
Ended
|
|
|
|
Twelve Months
Ended
|
|
|
|
|
31-Dec
|
|
Change
|
|
31-Dec
|
|
Change
|
(In millions of
GBP)
|
|
2020
|
|
2019
|
|
%
|
|
2020
|
|
2019
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue £'m -
Scheduled Online Virtuals
|
|
£4.6
|
|
£2.4
|
|
89.7%
|
|
£15.7
|
|
£10.0
|
|
57.7%
|
Total Revenue £'m –
Interactive(1)
|
|
£3.2
|
|
£1.6
|
|
94.4%
|
|
£10.3
|
|
£3.7
|
|
180.6%
|
Pro Forma Total
Revenue £'m - Scheduled Online Virtuals and
Interactive
|
|
£7.8
|
|
£4.1
|
|
91.6%
|
|
£26.1
|
|
£13.7
|
|
90.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
in millions of
USD
|
|
$10.3
|
|
$5.3
|
|
94.3%
|
|
$33.7
|
|
$17.5
|
|
92.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange Rate - $
to £
|
|
1.32
|
|
1.29
|
|
|
|
1.29
|
|
1.28
|
|
|
|
|
(1)
|
For 2019 periods,
Interactive revenue is shown on a pro forma basis.
|
ADJUSTED EBITDA
RECONCILIATION BY SEGMENT (Unaudited)
|
|
Three Months Ended
December 31, 2020
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain
(loss)
|
|
$
|
28.3
|
|
|
$
|
5.1
|
|
|
$
|
1.4
|
|
|
$
|
(5.6)
|
|
|
$
|
(16.8)
|
|
|
$
|
12.4
|
|
Items Relating to
Discontinued Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
charges
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items outside the
normal course of business:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1.4
|
|
|
|
1.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation expense
|
|
|
0.3
|
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
0.1
|
|
|
|
1.1
|
|
|
|
1.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
6.6
|
|
|
|
1.1
|
|
|
|
0.6
|
|
|
|
3.7
|
|
|
|
0.4
|
|
|
|
12.4
|
|
Total other expense
(net)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6.8
|
|
|
|
6.8
|
|
Income tax
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
|
|
0.1
|
|
Adjusted
EBITDA
|
|
$
|
35.2
|
|
|
$
|
6.3
|
|
|
$
|
2.1
|
|
|
$
|
(1.8)
|
|
|
$
|
(6.9)
|
|
|
$
|
34.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
£
|
26.5
|
|
|
£
|
4.9
|
|
|
£
|
1.6
|
|
|
£
|
(1.3)
|
|
|
£
|
(5.1)
|
|
|
£
|
26.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange rate - $
to £
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.32
|
|
Three Months Ended
December 31, 2019
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain
(loss)
|
|
$
|
1.6
|
|
|
$
|
5.4
|
|
|
$
|
—
|
|
|
$
|
1.6
|
|
|
$
|
(21.5)
|
|
|
$
|
(12.8)
|
|
Items Relating to
Discontinued Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
charges
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.2
|
|
|
|
0.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items outside the
normal course of business:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of group
restructure
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1.9
|
|
|
|
1.9
|
|
Italian tax related
costs relating to prior years
|
|
|
—
|
|
|
|
0.4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation expense
|
|
|
0.3
|
|
|
|
0.2
|
|
|
|
0.1
|
|
|
|
—
|
|
|
|
1.8
|
|
|
|
2.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
8.6
|
|
|
|
0.6
|
|
|
|
0.7
|
|
|
|
3.8
|
|
|
|
1.2
|
|
|
|
14.9
|
|
Total other expense
(net)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.6
|
|
|
|
10.6
|
|
Income tax
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Adjusted
EBITDA
|
|
$
|
10.5
|
|
|
$
|
6.6
|
|
|
$
|
0.8
|
|
|
$
|
5.5
|
|
|
$
|
(5.7)
|
|
|
$
|
17.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
£
|
8.1
|
|
|
£
|
5.1
|
|
|
£
|
0.6
|
|
|
£
|
4.3
|
|
|
£
|
(4.3)
|
|
|
£
|
13.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange rate - $
to £
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.29
|
|
Twelve Months
Ended December 31, 2020
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain
(loss)
|
|
$
|
29.5
|
|
|
$
|
21.0
|
|
|
$
|
4.9
|
|
|
$
|
(15.8)
|
|
|
$
|
(68.8)
|
|
|
$
|
(29.2)
|
|
Items Relating to
Discontinued Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
charges
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.6
|
|
|
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items outside the
normal course of business:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of group
restructure
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.8
|
|
|
|
0.8
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7.0
|
|
|
|
7.0
|
|
Impairment on
interest in equity method investee
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.7
|
|
|
|
0.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation expense
|
|
|
0.8
|
|
|
|
0.4
|
|
|
|
0.3
|
|
|
|
0.1
|
|
|
|
3.2
|
|
|
|
4.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
27.6
|
|
|
|
3.7
|
|
|
|
2.3
|
|
|
|
16.9
|
|
|
|
1.8
|
|
|
|
52.3
|
|
Total other expense
(net)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
34.7
|
|
|
|
34.7
|
|
Income tax
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.4
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
$
|
57.9
|
|
|
$
|
25.1
|
|
|
$
|
7.5
|
|
|
$
|
1.3
|
|
|
$
|
(19.7)
|
|
|
$
|
72.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
£
|
44.3
|
|
|
£
|
19.6
|
|
|
£
|
5.9
|
|
|
£
|
0.9
|
|
|
£
|
(15.2)
|
|
|
£
|
55.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange rate - $
to £
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.29
|
|
Twelve Months
Ended December 31, 2019
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain
(loss)
|
|
$
|
0.3
|
|
|
$
|
21.5
|
|
|
$
|
(3.0)
|
|
|
$
|
2.3
|
|
|
$
|
(58.1)
|
|
|
$
|
(37.0)
|
|
Items Relating to
Discontinued Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension
charges
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.6
|
|
|
|
0.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items outside the
normal course of business:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs of group
restructure
|
|
|
1.1
|
|
|
|
—
|
|
|
|
0.1
|
|
|
|
—
|
|
|
|
2.0
|
|
|
|
3.3
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6.7
|
|
|
|
6.7
|
|
Italian tax related
costs relating to prior years
|
|
|
—
|
|
|
|
0.4
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation expense
|
|
|
1.0
|
|
|
|
0.6
|
|
|
|
0.2
|
|
|
|
0.1
|
|
|
|
7.1
|
|
|
|
9.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
30.4
|
|
|
|
2.6
|
|
|
|
2.9
|
|
|
|
3.8
|
|
|
|
2.4
|
|
|
|
42.0
|
|
Total other expense
(net)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
23.9
|
|
|
|
23.9
|
|
Income tax
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
|
|
0.1
|
|
Adjusted
EBITDA
|
|
$
|
33.0
|
|
|
$
|
25.2
|
|
|
$
|
0.1
|
|
|
$
|
6.1
|
|
|
$
|
(15.4)
|
|
|
$
|
49.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
|
£
|
25.5
|
|
|
£
|
19.7
|
|
|
£
|
0.1
|
|
|
£
|
4.8
|
|
|
£
|
(11.9)
|
|
|
£
|
38.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchange rate - $
to £
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.28
|
|
INSPIRED
ENTERTAINMENT, INC. SEGMENT PERFORMANCE
(Unaudited)
|
|
Three Months Ended
December 31, 2020
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
|
|
(in
millions)
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
44.3
|
|
|
$
|
8.7
|
|
|
$
|
4.2
|
|
|
$
|
7.7
|
|
|
$
|
—
|
|
|
$
|
64.9
|
|
Product
|
|
|
6.2
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.6
|
|
|
|
—
|
|
|
|
6.8
|
|
Total
revenue
|
|
|
50.5
|
|
|
|
8.7
|
|
|
|
4.2
|
|
|
|
8.3
|
|
|
|
—
|
|
|
|
71.7
|
|
Cost of sales,
excluding depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
service
|
|
|
(4.7)
|
|
|
|
(0.7)
|
|
|
|
(0.8)
|
|
|
|
(2.1)
|
|
|
|
—
|
|
|
|
(8.3)
|
|
Cost of
product
|
|
|
(4.0)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(0.5)
|
|
|
|
—
|
|
|
|
(4.5)
|
|
Selling, general and
administrative expenses
|
|
|
(6.7)
|
|
|
|
(1.7)
|
|
|
|
(1.3)
|
|
|
|
(7.5)
|
|
|
|
(6.9)
|
|
|
|
(24.1)
|
|
Stock-based
compensation expense
|
|
|
(0.3)
|
|
|
|
(0.1)
|
|
|
|
(0.1)
|
|
|
|
(0.1)
|
|
|
|
(1.1)
|
|
|
|
(1.7)
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1.4)
|
|
|
|
(1.4)
|
|
Depreciation and
amortization
|
|
|
(6.6)
|
|
|
|
(1.1)
|
|
|
|
(0.6)
|
|
|
|
(3.7)
|
|
|
|
(0.4)
|
|
|
|
(12.4)
|
|
Segment operating
income (loss)
|
|
|
28.3
|
|
|
|
5.1
|
|
|
|
1.4
|
|
|
|
(5.6)
|
|
|
|
(9.9)
|
|
|
|
19.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
19.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total capital
expenditures for the three months ended December 31,
2020
|
|
$
|
3.5
|
|
|
$
|
1.2
|
|
|
$
|
0.9
|
|
|
$
|
2.1
|
|
|
$
|
0.4
|
|
|
$
|
8.1
|
|
Three Months Ended
December 31, 2019
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
|
|
(in
millions)
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
21.9
|
|
|
$
|
8.5
|
|
|
$
|
2.1
|
|
|
$
|
21.8
|
|
|
$
|
—
|
|
|
$
|
54.3
|
|
|
Product
|
|
|
11.3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
0.8
|
|
|
|
—
|
|
|
|
12.1
|
|
|
Total
revenue
|
|
|
33.2
|
|
|
|
8.5
|
|
|
|
2.1
|
|
|
|
22.6
|
|
|
|
—
|
|
|
|
66.4
|
|
|
Cost of sales,
excluding depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
service
|
|
|
(5.4)
|
|
|
|
(0.5)
|
|
|
|
(0.3)
|
|
|
|
(3.9)
|
|
|
|
—
|
|
|
|
(10.1)
|
|
|
Cost of
product
|
|
|
(7.4)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(0.6)
|
|
|
|
—
|
|
|
|
(8.0)
|
|
|
Selling, general and
administrative expenses
|
|
|
(9.9)
|
|
|
|
(1.8)
|
|
|
|
(1.0)
|
|
|
|
(12.7)
|
|
|
|
(5.9)
|
|
|
|
(31.3)
|
|
|
Stock-based
compensation expense
|
|
|
(0.3)
|
|
|
|
(0.2)
|
|
|
|
(0.1)
|
|
|
|
—
|
|
|
|
(1.8)
|
|
|
|
(2.4)
|
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1.8)
|
|
|
|
(1.8)
|
|
|
Depreciation and
amortization
|
|
|
(8.6)
|
|
|
|
(0.6)
|
|
|
|
(0.7)
|
|
|
|
(3.8)
|
|
|
|
(1.2)
|
|
|
|
(14.9)
|
|
|
Segment operating
income (loss)
|
|
|
1.6
|
|
|
|
5.4
|
|
|
|
—
|
|
|
|
1.6
|
|
|
|
(10.7)
|
|
|
|
(2.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(2.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total capital
expenditures for the three months ended December 31,
2019
|
|
$
|
5.3
|
|
|
$
|
1.2
|
|
|
$
|
0.3
|
|
|
$
|
2.7
|
|
|
$
|
1.6
|
|
|
$
|
|
11.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended December 31, 2020
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
|
|
(in
millions)
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
92.2
|
|
|
$
|
32.4
|
|
|
$
|
13.3
|
|
|
$
|
40.8
|
|
|
$
|
—
|
|
|
$
|
178.7
|
|
Product
|
|
|
18.3
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2.8
|
|
|
|
—
|
|
|
|
21.1
|
|
Total
revenue
|
|
|
110.5
|
|
|
|
32.4
|
|
|
|
13.3
|
|
|
|
43.6
|
|
|
|
—
|
|
|
|
199.8
|
|
Cost of sales,
excluding depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
service
|
|
|
(15.7)
|
|
|
|
(2.9)
|
|
|
|
(1.9)
|
|
|
|
(9.6)
|
|
|
|
—
|
|
|
|
(30.1)
|
|
Cost of
product
|
|
|
(12.4)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2.0)
|
|
|
|
—
|
|
|
|
(14.4)
|
|
Selling, general and
administrative expenses
|
|
|
(24.5)
|
|
|
|
(4.4)
|
|
|
|
(3.9)
|
|
|
|
(30.8)
|
|
|
|
(21.2)
|
|
|
|
(84.8)
|
|
Stock-based
compensation expense
|
|
|
(0.8)
|
|
|
|
(0.4)
|
|
|
|
(0.3)
|
|
|
|
(0.1)
|
|
|
|
(3.2)
|
|
|
|
(4.8)
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7.0)
|
|
|
|
(7.0)
|
|
Depreciation and
amortization
|
|
|
(27.6)
|
|
|
|
(3.7)
|
|
|
|
(2.3)
|
|
|
|
(16.9)
|
|
|
|
(1.8)
|
|
|
|
(52.3)
|
|
Segment operating
income (loss)
|
|
|
29.5
|
|
|
|
21.0
|
|
|
|
4.9
|
|
|
|
(15.8)
|
|
|
|
(33.2)
|
|
|
|
6.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
6.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended December 31, 2019
|
|
|
|
Gaming
|
|
|
Virtual Sports
|
|
|
Interactive
|
|
|
Leisure
|
|
|
|
Corporate
|
|
|
Total
|
|
|
|
(in
millions)
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service
|
|
$
|
73.8
|
|
|
$
|
33.4
|
|
|
$
|
4.7
|
|
|
$
|
22.6
|
|
|
$
|
—
|
|
|
$
|
134.5
|
|
Product
|
|
|
17.7
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1.2
|
|
|
|
—
|
|
|
|
18.9
|
|
Total
revenue
|
|
|
91.5
|
|
|
|
33.4
|
|
|
|
4.7
|
|
|
|
23.8
|
|
|
|
—
|
|
|
|
153.4
|
|
Cost of sales,
excluding depreciation and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
service
|
|
|
(18.1)
|
|
|
|
(2.6)
|
|
|
|
(0.7)
|
|
|
|
(4.0)
|
|
|
|
—
|
|
|
|
(25.4)
|
|
Cost of
product
|
|
|
(12.0)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(0.9)
|
|
|
|
—
|
|
|
|
(12.9)
|
|
Selling, general and
administrative expenses
|
|
|
(29.7)
|
|
|
|
(6.0)
|
|
|
|
(4.0)
|
|
|
|
(12.7)
|
|
|
|
(18.0)
|
|
|
|
(70.4)
|
|
Stock-based
compensation expense
|
|
|
(1.0)
|
|
|
|
(0.6)
|
|
|
|
(0.2)
|
|
|
|
(0.1)
|
|
|
|
(7.1)
|
|
|
|
(9.0)
|
|
Acquisition and
integration related transaction expenses
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(6.7)
|
|
|
|
(6.7)
|
|
Depreciation and
amortization
|
|
|
(30.4)
|
|
|
|
(2.6)
|
|
|
|
(2.9)
|
|
|
|
(3.8)
|
|
|
|
(2.3)
|
|
|
|
(42.0)
|
|
Segment operating
income (loss)
|
|
|
0.3
|
|
|
|
21.6
|
|
|
|
(3.1)
|
|
|
|
2.3
|
|
|
|
(34.1)
|
|
|
|
(13.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(13.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/inspired-reports-fourth-quarter-and-full-year-2020-results-301245528.html
SOURCE Inspired Entertainment, Inc.