November 14, 2020 3 min read


Inspired’s Positive Outlook Confirmed by Strong Q3 Growth

Gaming technology and content provider Inspired Entertainment released Thursday its third quarter earnings report, posting steady growth in revenues, as well as positive outlook for the future.

Discounted Revenue Unchanged YoY

Inspired generated during the reported three-month period total revenue of $60.1 million, nearly four times more compared to the $15.6 million for the previous quarter and more than double from the $26.6 million in the third quarter in 2019.

Discounting the $9.3 million received from a UK customer due to a contractual share of revenue and a customer’s VAT rebate, and the $24.3 million from Novomatic Gaming Technology Group which was acquired by Inspired Entertainment in October 2019, revenue in Q3 2020 is almost unchanged year-over-year.

“This quarter’s impressive results demonstrate the long-term health of our business and the resiliency of our recurring revenue stream.”

Lorne Weil, Executive Chairman, Inspired Entertainment

Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) in the third quarter was $25 million, more than tenfold increase on a sequential basis from the $2.1 million, and nearly three times more compared to the $8.8 million in Q3 2019. Discounting the $9.1 million of VAT related-income and $5.1 million generated by the acquired business, adjusted EBITDA posted 24.7% increase year-over-year.

“We have proven in the third quarter that our retail business is well-positioned to recover from COVID-19-related impacts at the same time as we have benefitted from our growing online presence.”

Lorne Weil, Executive Chairman, Inspired Entertainment

Growing Presence of Online Products

Total online revenue for the company posted $7.8 million for the quarter, up nearly 75% compared to the same three-month period last year, confirming the growing presence of its product offerings across gaming and Virtual Sports online channels.

“Despite the challenges of COVID-19 in the quarter, our SBG retail business largely returned to its pre-pandemic performance and our online business grew 75% year-over-year even with the return of sports and retail.”

Lorne Weil, Executive Chairman, Inspired Entertainment

Stewart Baker, Executive Vice President and CFO of Inspired Entertainment, noted that, besides the operational results, the company improved its overall cost structure, achieving “third quarter margin improvements and increased cash flow”.

The VAT-related income, expected to reach a total of $45.9 million, after the additional $32.5 million already received in the fourth quarter and the further anticipated $4.1 million, would be used to pay down debt and improve Inspired’s liquidity position, Baker pointed out.

Regarding the company’s future outlook, its executive chairman highlighted that the focus would be to navigate through the pandemic and get out of it even stronger, and set out strong foundations for future growth and expansion of online business, North American customer base and pub and leisure digitization in the UK.

Lead Author

With 4 years experience as an analyst, Julie—or ‘Jewels’, as we aptly refer to her in the office—is nothing short of a marvel-worthy in her attention to the forex and cryptocurrency space as she quickly became the first pick to co-pilot education to the masses with Mike.

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