Inspired(US:INSE)2020-11-12 21:18Revenue Performance - For the three months ended September 30, 2020, approximately 79.6% of revenue was generated in the UK, compared to 60.2% in the same period of 2019[102]. - During the nine months ended September 30, 2020, approximately 74.5% of revenue was derived from the UK, compared to 61.7% in the same period of 2019[103]. - Approximately 20% of revenue for the three months ended September 30, 2020, came from sales outside the UK, down from 40% in the same period of 2019[105]. - Total reported revenue for the three months ended September 30, 2020 increased by $33.5 million, or 125.9%, to $60.1 million, including $24.3 million from Acquired Businesses and $9.3 million from VAT-related income[115]. - Total revenue for the three months ended September 30, 2020, increased by $7.2 million to $25.5 million, representing a 39.3% increase compared to the same period in 2019[151]. - Total revenue for the nine months ended September 30, 2020, increased by $41.0 million, or 47.2%, to $128.0 million, significantly impacted by COVID-19 restrictions[192]. Profitability and Loss - Net operating profit was $8.2 million compared to a net operating loss of $5.7 million in the prior period, largely due to VAT-related income[126]. - Net profit for the period was $0.3 million compared to a net loss of $8.5 million in the prior period, primarily due to VAT-related income and growth in Virtual Sports[132]. - Net operating loss for the nine months ended September 30, 2020, was $12.9 million, a 19.4% increase compared to the previous year[191]. - The company reported a net loss of $41.6 million for the nine months ended September 30, 2020, compared to a net loss of $24.2 million in the prior year[255]. Expenses and Costs - Cost of sales, excluding depreciation and amortization, increased by $6.7 million, or 95.5%, to $13.7 million, with $7.2 million attributable to Acquired Businesses[119]. - Selling, general and administrative expenses rose by $10.4 million, or 90.5%, to $21.9 million, driven by $12.1 million from Acquired Businesses[121]. - Selling, general and administrative expenses increased by $22.6 million, or 58.0%, to $61.6 million, driven by incremental expenses from Acquired Businesses[200]. - Depreciation and amortization increased by $5.7 million, or 68.6%, to $14.0 million, driven by Acquired Businesses[125]. - Depreciation and amortization rose by $12.8 million, or 47.4%, to $39.9 million, driven by incremental depreciation from acquired businesses[203]. Market and Product Development - The company is focused on expanding into underpenetrated markets and newly regulated jurisdictions to add new customers[95]. - The company aims to develop new omni-channel products to extend its strong positions in Virtual Sports, Interactive, and SBG[95]. - The company launched Scheduled Online Virtuals in Turkey and New Jersey, marking strategic expansions into new markets[171]. Customer Metrics - Customer Gross Win per unit per day decreased by £4.82, or 6.5%, to £69.24[134]. - Customer Net Win per unit per day decreased by £2.24, or 4.2%, to £50.85[134]. - Customer Gross Win per unit per day in the UK market increased by 7.1%, driven by recovery post COVID-19 shutdowns[143]. - Customer Net Win per unit per day in Italy decreased by 47.9% compared to the previous year, primarily due to increased gaming taxes and the impact of card readers[146]. - The number of live customers at the end of the period increased to 129, up by 26.5% from 102 in 2019[166]. - Average installed base for SBG terminals decreased by 2,066 units, or 5.9%, to 32,698[134]. Acquisitions and Business Segments - The company completed the acquisition of the Gaming Technology Group on October 1, 2019, enhancing its product portfolio and distribution capabilities[96]. - Acquired Businesses service revenue for the quarter was $22.4 million, with $5.9 million generated from Pub customers for gaming machines and other rental products[187]. - Total revenue from Acquired Businesses Segment was $53.5 million, with service revenue at $45.6 million and hardware revenue at $7.9 million[239]. - Acquired Businesses hardware revenue was $1.9 million, including the sale of 173 machines and spare parts[189]. Cash Flow and Liquidity - Net cash provided by operating activities increased to $31.5 million from $22.4 million year-on-year, representing a $9.1 million increase[255]. - Net cash used in investing activities rose to $22.0 million, an increase of $5.5 million due to higher spending on property and equipment[263]. - As of September 30, 2020, the company had liquidity of $43.9 million in cash and cash equivalents, compared to $29.6 million as of September 30, 2019, representing a 48.5% increase[265]. - The company reported a working capital inflow of $17.3 million for the nine months ended September 30, 2020, compared to an inflow of $11.0 million for the same period in 2019, indicating a 57.3% increase[265]. Debt and Obligations - The company had total contractual obligations of $440.3 million as of September 30, 2020, with $31.6 million due within one year[284]. - The company’s long-term debt included a senior term loan facility of £145.8 million and €93.1 million, with cash interest rates of 8.97% and 7.75% per annum, respectively[274]. - There were no breaches of the debt covenants in the periods ended September 30, 2020, and September 30, 2019[282].