NASDAQ$INSE

Inspired Entertainment Inc · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Inspired reported third quarter 2020 financial results.

Inspired Entertainment reported strong Q3 2020 results, demonstrating the resilience of its recurring revenue stream and the recovery of its retail business. The company benefited from its growing online presence and improved its overall cost structure.

  • SBG Revenue increased 39.0% to $25.5 million, including $9.3 million in VAT-related income.
  • Virtual Sports Revenue, including Interactive, increased 31.6% to $10.9 million.
  • Online business grew 75% year-over-year.
  • Received a VAT-related income payment of $9.3 million during the third quarter.

Headline financials

Total Revenue

$60.1M

Previous: -$100K+60200.0%
EPS (adj)

$0.01

Previous: -$0.38+102.6%
Capital Expenditures

-$11.9M

Previous: -$4.9M-142.9%
Free Cash Flow

-$11.6M

Previous: -$13.4M+13.4%
Net Income

$300K

Previous: -$8.5M+103.5%
Operating Income

$8.2M

Previous: $5.7M+43.9%
Gross Profit

$60.1M

Previous: -$100K+60200.0%
Cash & Equivalents

$43.9M

Previous: $29.6M+48.3%
Total Assets

$320M

Previous: $175M+82.6%
Stock-Based Comp

$1.1M

Previous: $2.2M-50.0%

Revenue & EPS history

Inspired · Revenue · Quarterly

$60.1M

Q3 2020-60,200%vs Q3 2019
Beat estimate in 8 of 13 quarters(62%)
ActualEstimate

Revenue by segment

Inspired · $72.5M total across 4 segments · Q4 2022

  • Gaming
    $31.9M
  • Leisure
    $19.4M
  • Virtual Sports
    $14.9M
  • Interactive
    $6.3M

Forward guidance

Inspired anticipates a negative impact in the fourth quarter due to the recent resurgence of COVID-19-driven measures in parts of Europe.

Tailwinds

  • The fundamentally local nature of the business comprised of small venues.
  • Ability for machines in the field to be turned on immediately when venues reopen.
  • The vast majority of the business is driven by contracted, recurring revenue.
  • Backlog remains intact post-lockdown.
  • Focused and disciplined on emerging from this pandemic even stronger.

Headwinds

  • Several European countries have re-imposed restrictions on operations.
  • Restrictions include complete or partial closures of land-based retail customer’s venues.
  • Revenue from land-based retail customers has been impacted thus far in the fourth quarter.
  • Closures of physical locations in England, Italy and Greece.
  • Anticipate these events will have a negative impact on our fourth quarter 2020 results.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2020

Historical avgQ3 2020

+2.8%

Avg return

Earnings day

+2.5%

Avg return

5 days after

+2.6%

Avg return

30 days after

45%

20 / 44 earnings

Positive

+23.3%

Q1 2022

Best reaction

-11.8%

Q4 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+12.2%+1.9%+3.6%
Q4 2025-4.4%-21.1%-18.0%
Q3 2025+12.8%+9.9%+15.7%
Q1 2025+4.6%+13.7%+8.4%
Q4 2024+9.6%+5.6%-12.4%
Q3 2024+4.6%+6.6%-4.3%
Q2 2024+5.1%+2.9%+7.0%
Q1 2024-6.5%-7.2%-3.1%
Q4 2023-3.9%-7.1%-8.5%
Q3 2023-7.6%-6.9%-4.8%
Q2 2023-4.5%-2.4%-6.0%
Q1 2023+11.1%+12.3%+19.9%
Q4 2022-11.8%-17.8%-23.7%
Q3 2022+16.5%+21.5%+25.3%
Q2 2022+14.8%+11.8%+1.0%
Q1 2022+23.3%+25.2%+35.2%
Q4 2021+10.7%+18.1%-16.9%
Q3 2021+6.0%-0.2%-19.3%
Q2 2021+4.1%+2.1%+3.4%
Q1 2021-0.9%-7.0%+37.7%
Q4 2020+23.2%+29.4%+19.8%
Q3 2020+18.0%+12.0%+32.0%
Q2 2020-3.6%+3.9%-10.9%
Q1 2020+7.6%+16.1%+60.2%
Q4 2019-11.8%-17.9%-51.8%
Q3 2019+0.2%-3.3%-6.9%
Q2 2019+14.3%+7.5%+7.5%
Q1 2019-5.1%-3.0%-2.1%
Q4 2018-3.4%-5.6%+5.1%
Q3 2018-6.9%-7.9%-17.1%
Q2 2018+22.1%+22.1%+9.6%
Q1 2018-7.6%-14.5%-19.1%
Q4 2017-8.4%-5.8%+2.9%
Q3 2017-0.5%+0.5%+22.3%
Q1 2017-2.8%+1.9%+18.0%
Q4 2016-5.3%-5.7%-9.5%
Q3 2016+0.0%-1.5%+0.5%
Q2 2016+0.0%+3.2%+0.0%
Q1 2016+0.0%
Q4 2015+0.1%
Q3 2015+0.0%
Q2 2015+0.0%
Q1 2015-0.4%
Q4 2014+0.0%
Q3 2014

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