Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Aug. 05, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | Inspired Entertainment, Inc. | |
Entity Central Index Key | 0001615063 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 | |
Entity Reporting Status Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Incorporation State Country Code | DE | |
Entity Interactive Data Current | Yes | |
Entity File Number | 001-36689 | |
Entity Common Stock, Shares Outstanding | 22,818,071 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Current assets | ||
Cash | $ 33.7 | $ 22.5 |
Accounts receivable, net | 10.7 | 14.3 |
Inventory, net | 5.6 | 5.2 |
Fair value of hedging instrument | 0.5 | 0.8 |
Prepaid expenses and other current assets | 11.8 | 15.8 |
Total current assets | 62.3 | 58.6 |
Property and equipment, net | 31.6 | 45.7 |
Software development costs, net | 38.1 | 40 |
Other acquired intangible assets subject to amortization, net | 3.2 | 5.7 |
Goodwill | 44.7 | 45.8 |
Other assets | 7.8 | 12.1 |
Total assets | 187.7 | 207.9 |
Current liabilities | ||
Accounts payable | 9.5 | 14.4 |
Accrued expenses | 14.8 | 14.3 |
Earnout liability | 8 | |
Corporate tax and other current taxes payable | 1.4 | 2 |
Deferred revenue, current | 10.2 | 9.2 |
Other current liabilities | 5.6 | 3.9 |
Current portion of long-term debt | 9.3 | |
Current portion of capital lease obligations | 0.2 | 0.5 |
Total current liabilities | 51 | 52.3 |
Long-term debt | 132.4 | 131.2 |
Capital lease obligations, net of current portion | 0.1 | |
Deferred revenue, net of current portion | 18.4 | 23.9 |
Derivative liability | 4 | 7.8 |
Other long-term liabilities | 4.5 | 5.1 |
Total liabilities | 210.3 | 220.4 |
Commitments and contingencies | ||
Stockholders' deficit | ||
Preferred stock; $0.0001 par value; 1,000,000 shares authorized | ||
Common stock; $0.0001 par value; 49,000,000 shares authorized; 22,193,955 shares and 20,860,591 shares issued and outstanding at June 30, 2019 and September 30, 2018, respectively | ||
Additional paid in capital | 343.1 | 328.5 |
Accumulated other comprehensive income | 54.2 | 58.5 |
Accumulated deficit | (419.9) | (399.5) |
Total stockholders' deficit | (22.6) | (12.5) |
Total liabilities and stockholders' deficit | 187.7 | 207.9 |
Series A Preferred Stock | ||
Stockholders' deficit | ||
Preferred stock; $0.0001 par value; 1,000,000 shares authorized |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2019 | Sep. 30, 2018 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized | 1,000,000 | 1,000,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 49,000,000 | 49,000,000 |
Common stock, issued | 22,193,955 | 20,860,591 |
Common stock, outstanding | 22,193,955 | 20,860,591 |
Series A Preferred Stock | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized | 1,000,000 | 1,000,000 |
Preferred stock, designated | 49,000 | 49,000 |
Preferred stock, issued | ||
Preferred stock, outstanding |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue: | ||||
Total revenue | $ 26.7 | $ 36.9 | $ 60.4 | $ 74.4 |
Cost of sales, excluding depreciation and amortization: | ||||
Selling, general and administrative expenses | (12.8) | (15.2) | (27.5) | (30.9) |
Stock-based compensation expense | (2.3) | (1.5) | (4.4) | (2.7) |
Acquisition related transaction expenses | (0.7) | (1.6) | (0.2) | |
Depreciation and amortization | (9.1) | (10.6) | (18.8) | (21.7) |
Net operating loss | (4.5) | 1.6 | (5.2) | 0.8 |
Other (expense) income | ||||
Interest income | 0.1 | 0.1 | 0.1 | |
Interest expense | (4) | (5.2) | (8.5) | (10.3) |
Change in fair value of earnout liability | (0.6) | (2.3) | 3.1 | |
Change in fair value of derivative liability | (1.3) | (0.1) | 1.5 | |
Other finance income (expense) | (0.9) | 0.2 | 0.3 | 0.4 |
Total other expense, net | (6.1) | (5.6) | (10.5) | (5.2) |
Loss before income taxes | (10.6) | (4) | (15.7) | (4.4) |
Income tax benefit (expense) | (0.1) | (0.1) | ||
Net loss | (10.7) | (4) | (15.7) | (4.5) |
Other comprehensive (loss)/income: | ||||
Foreign currency translation (loss)/gain | 0.7 | (0.2) | 0.2 | 0.1 |
Change in fair value of hedging instrument | 2.4 | 0.3 | ||
Reclassification of gain on hedging instrument to comprehensive income | (2.6) | (1.1) | ||
Actuarial (losses) gains on pension plan | (2) | 3 | (1.1) | 4.3 |
Other comprehensive (loss)/income | (1.5) | 2.8 | (1.7) | 4.4 |
Comprehensive loss | $ (12.2) | $ (1.2) | $ (17.4) | $ (0.1) |
Net loss per common share - basic and diluted (in dollars per share) | $ (0.48) | $ (0.19) | $ (0.73) | $ (0.22) |
Weighted average number of shares outstanding during the period - basic and diluted (in shares) | 22,193,955 | 20,860,591 | 21,583,648 | 20,859,711 |
Service | ||||
Revenue: | ||||
Total revenue | $ 25.6 | $ 34.5 | $ 56.4 | $ 67.8 |
Cost of sales, excluding depreciation and amortization: | ||||
Cost of goods and services sold | (5.3) | (5.9) | (10.7) | (11.9) |
Hardware | ||||
Revenue: | ||||
Total revenue | 1.1 | 2.4 | 4 | 6.6 |
Cost of sales, excluding depreciation and amortization: | ||||
Cost of goods and services sold | $ (1) | $ (2.1) | $ (2.6) | $ (6.2) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders’ Deficit (Unaudited) - USD ($) $ in Millions | Common stock | Additional paid in capital | Accumulated other comprehensive income | Accumulated deficit | Total |
Balance at Sep. 30, 2017 | $ 323.5 | $ 53.1 | $ (378.9) | $ (2.3) | |
Balance, shares at Sep. 30, 2017 | 20,402,602 | ||||
Foreign currency translation adjustments | 0.1 | 0.1 | |||
Actuarial losses on pension plan | (2) | (2) | |||
Change in fair value of hedging instrument | |||||
Shares issued on exercise of warrants | |||||
Shares issued on exercise of warrants, shares | 50 | ||||
Shares issued upon cashless exercise of RSUs | (1.1) | (1.1) | |||
Shares issued upon cashless exercise of RSUs, shares | 445,723 | ||||
Stock-based compensation expense | 0.8 | 0.8 | |||
Reclassification of RSUs to derivative liability due to modification | (1.5) | (1.5) | |||
Net loss | (4.2) | (4.2) | |||
Balance at Dec. 31, 2017 | 321.7 | 51.2 | (383.1) | (10.2) | |
Balance, shares at Dec. 31, 2017 | 20,848,375 | ||||
Foreign currency translation adjustments | 0.3 | 0.3 | |||
Actuarial losses on pension plan | 1.3 | 1.3 | |||
Shares issued upon cashless exercise of RSUs | |||||
Shares issued upon cashless exercise of RSUs, shares | 12,216 | ||||
Stock-based compensation expense | 1 | 1 | |||
Reclassification of RSUs from derivative liability due to stockholder approval of equity plan | 2.8 | 2.8 | |||
Net loss | (0.5) | (0.5) | |||
Balance at Mar. 31, 2018 | 325.5 | 52.8 | (383.6) | (5.3) | |
Balance, shares at Mar. 31, 2018 | 20,860,591 | ||||
Balance at Dec. 31, 2017 | 321.7 | 51.2 | (383.1) | (10.2) | |
Balance, shares at Dec. 31, 2017 | 20,848,375 | ||||
Foreign currency translation adjustments | 0.1 | ||||
Actuarial losses on pension plan | 4.3 | ||||
Change in fair value of hedging instrument | |||||
Reclassification of gain on hedging instrument to comprehensive income | |||||
Net loss | (4.5) | ||||
Balance at Jun. 30, 2018 | 327 | 55.6 | (387.6) | (5) | |
Balance, shares at Jun. 30, 2018 | 20,860,591 | ||||
Balance at Mar. 31, 2018 | 325.5 | 52.8 | (383.6) | (5.3) | |
Balance, shares at Mar. 31, 2018 | 20,860,591 | ||||
Foreign currency translation adjustments | (0.2) | (0.2) | |||
Actuarial losses on pension plan | 3 | 3 | |||
Stock-based compensation expense | 1.5 | 1.5 | |||
Net loss | (4) | (4) | |||
Balance at Jun. 30, 2018 | 327 | 55.6 | (387.6) | (5) | |
Balance, shares at Jun. 30, 2018 | 20,860,591 | ||||
Balance at Sep. 30, 2018 | 328.5 | 58.5 | (399.5) | $ (12.5) | |
Balance, shares at Sep. 30, 2018 | 20,860,591 | 20,860,591 | |||
Foreign currency translation adjustments | |||||
Actuarial losses on pension plan | (2.8) | (2.8) | |||
Change in fair value of hedging instrument | 2.6 | 2.6 | |||
Reclassification of gain on hedging instrument to comprehensive income | (2.4) | (2.4) | |||
Shares issued upon cashless exercise of RSUs | |||||
Shares issued upon cashless exercise of RSUs, shares | 9,806 | ||||
Stock-based compensation expense | 1.4 | 1.4 | |||
Net loss | (4.7) | (4.7) | |||
Balance at Dec. 31, 2018 | 329.9 | 55.9 | (404.2) | (18.4) | |
Balance, shares at Dec. 31, 2018 | 20,870,397 | ||||
Foreign currency translation adjustments | (0.5) | (0.5) | |||
Actuarial losses on pension plan | 0.9 | 0.9 | |||
Change in fair value of hedging instrument | (2.1) | (2.1) | |||
Reclassification of gain on hedging instrument to comprehensive income | 1.5 | 1.5 | |||
Shares issued on earnout | 8.6 | 8.6 | |||
Shares issued on earnout, shares | 1,323,558 | ||||
Stock-based compensation expense | 1.7 | 1.7 | |||
Net loss | (5) | (5) | |||
Balance at Mar. 31, 2019 | 340.2 | 55.7 | (409.2) | (13.3) | |
Balance, shares at Mar. 31, 2019 | 22,193,955 | ||||
Balance at Dec. 31, 2018 | 329.9 | 55.9 | (404.2) | (18.4) | |
Balance, shares at Dec. 31, 2018 | 20,870,397 | ||||
Foreign currency translation adjustments | 0.2 | ||||
Actuarial losses on pension plan | (1.1) | ||||
Change in fair value of hedging instrument | 0.3 | ||||
Reclassification of gain on hedging instrument to comprehensive income | (1.1) | ||||
Net loss | (15.7) | ||||
Balance at Jun. 30, 2019 | 343.1 | 54.2 | (419.9) | $ (22.6) | |
Balance, shares at Jun. 30, 2019 | 22,193,955 | 22,193,955 | |||
Balance at Mar. 31, 2019 | 340.2 | 55.7 | (409.2) | $ (13.3) | |
Balance, shares at Mar. 31, 2019 | 22,193,955 | ||||
Foreign currency translation adjustments | 0.7 | 0.7 | |||
Actuarial losses on pension plan | (2) | (2) | |||
Change in fair value of hedging instrument | 2.4 | 2.4 | |||
Reclassification of gain on hedging instrument to comprehensive income | (2.6) | (2.6) | |||
Conversion of awards previously classified as derivatives | 0.8 | 0.8 | |||
Stock-based compensation expense | 2.1 | 2.1 | |||
Net loss | (10.7) | (10.7) | |||
Balance at Jun. 30, 2019 | $ 343.1 | $ 54.2 | $ (419.9) | $ (22.6) | |
Balance, shares at Jun. 30, 2019 | 22,193,955 | 22,193,955 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net loss | $ (15.7) | $ (4.5) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 18.8 | 21.7 |
Stock-based compensation expense | 4.4 | 2.7 |
Change in fair value of derivative liability | 0.1 | (1.5) |
Change in fair value of earnout liability | 2.3 | (3.1) |
Foreign currency translation on senior bank debt | 0.3 | |
Foreign currency translation on cross currency swaps | (0.6) | |
Non-cash interest expense relating to senior debt | 0.9 | 3.9 |
Changes in assets and liabilities: | ||
Accounts receivable | 0.8 | (5.5) |
Inventory | (0.5) | (2.1) |
Prepaid expenses and other assets | 4.5 | 2.8 |
Corporate tax and other current taxes payable | (0.5) | (0.8) |
Accounts payable | 4.4 | 3.8 |
Other current liabilities | ||
Deferred revenues and customer prepayment | (2.1) | 3.9 |
Accrued expenses | 2.4 | (0.7) |
Other long-term liabilities | 0.2 | (2.7) |
Net cash provided by operating activities | 19.7 | 17.9 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (2) | (12) |
Purchases of capital software | (7.8) | (9.3) |
Net cash used in investing activities | (9.8) | (21.3) |
Cash flows from financing activities: | ||
Repayments of capital leases | (0.3) | (0.3) |
Proceeds from issuance of revolver and long-term debt | 9.3 | 3.2 |
Net cash provided by financing activities | 9 | 2.9 |
Effect of exchange rate changes on cash | (1.2) | (0.3) |
Net increase in cash | 17.7 | (0.8) |
Cash, beginning of period | 22.5 | 11 |
Cash, end of period | 33.7 | 10.2 |
Supplemental cash flow disclosures | ||
Cash paid during the period for interest | 8.2 | 6.2 |
Cash paid during the period for income taxes | ||
Supplemental disclosure of noncash investing and financing activities | ||
Additional paid in capital reclassified from derivative liability | $ 0.8 | $ 2.8 |
Nature of Operations, Managemen
Nature of Operations, Management's Plans and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations, Management's Plans and Summary of Significant Accounting Policies | 1. Nature of Operations, Management's Plans and Summary of Significant Accounting Policies Company Description and Nature of Operations Inspired Entertainment, Inc. (the "Company," "we," "our," and "us") is a global business-to-business gaming technology company, supplying Server Based Gaming ("SBG") and Virtual Sports (which includes Interactive) systems to regulated lottery, betting and gaming operators worldwide through an "omni-channel" distribution strategy. We provide end-to-end digital gaming solutions on our proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices such as smartphones and tablets and online computer and social applications. The Company was formed in Delaware on May 30, 2014 under the name Hydra Industries Acquisition Corp. ("Hydra") as a "blank check company" for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, recapitalization or other similar business transaction, one or more operating businesses or assets. On December 23, 2016 (the "Closing Date"), the Company consummated a business combination by acquiring Inspired Gaming Group ("Inspired") pursuant to a share sale agreement dated as of July 13, 2016 (the "Sale Agreement"). Pursuant to the Sale Agreement, the Company acquired all of the outstanding equity and shareholder loan notes of Inspired. The transaction was accounted for as a reverse merger where Inspired was the acquirer and Hydra was the acquired company. We refer to the acquisition and the other transactions contemplated by the Sale Agreement, collectively, as the "Business Combination" or the "Merger." Management Liquidity Plans As of June 30, 2019, the Company's cash on hand was $33.7 million and the Company had working capital of $11.3 million. As of June 30, 2019, $2.9 million of our cash on hand had arisen from our operations in Greece and was being held in local accounts. In the ordinary course of business, we seek, from time to time, to transfer funds earned in Greece to our accounts outside of Greece. However, Greece imposes capital controls that can delay or prevent the flow of capital out of the country. The Company recorded net losses of $10.7 million and $4.0 million for the six months ended June 30, 2019 and 2018, respectively. The net losses arose principally from non-cash items, including stock-based compensation and the change in the value of the earnout liability, and, in the 2018 period, from payment-in-kind interest on the previous senior debt that is no longer a liability. Historically, the Company has generally had positive cash flows from operating activities and has relied on a combination of cash flows provided by operations and the incurrence of debt and/or the refinancing of existing debt to fund its obligations. Working capital of $11.3 million includes a non-cash settled item of $10.2 million of deferred income. Management currently believes that the Company's cash balances on hand, cash flows expected to be generated from operations, ability to control and defer capital projects and amounts available from the Company's external borrowings will be sufficient to fund the Company's net cash requirements through August 2020. Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the United States Securities and Exchange Commission ("SEC"). Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management's opinion, however, that the accompanying unaudited interim condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. On September 24, 2018, the Board of Directors approved a change in the Company's fiscal year end from September 30 to December 31 commencing with the year ending December 31, 2019. As such, our last completed fiscal year ended on September 30, 2018, the three-month period from October 1, 2018 to December 31, 2018 was a transitional period and the six-month period from January 1, 2019 to June 30, 2019 is the first half of fiscal 2019. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements and notes thereto for the periods ended September 30, 2018 and 2017. The financial information as of September 30, 2018 is derived from the audited consolidated financial statements presented in the Company's Annual Report on Form 10-K filed with the SEC on December 10, 2018. The interim results for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any future interim periods. Principles of Consolidation All monetary values set forth in these unaudited interim condensed consolidated financial statements are in US Dollars ("USD") unless otherwise stated herein. The accompanying unaudited interim condensed consolidated financial statements include the results of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. Foreign Currency Translation For most of our operations, the British pound ("GBP") is our functional currency. Our reporting currency is the USD. We also have operations where the local currency is the functional currency, including our operations in mainland Europe and South America. Assets and liabilities of foreign operations are translated at period-end rates of exchange, equity is translated at historical rates of exchange and results of operations are translated at the average rates of exchange for the period. Gains or losses resulting from translating the foreign currency financial statements are recorded as a separate component of accumulated other comprehensive loss in stockholders' deficit. Gains or losses resulting from foreign currency transactions are included in selling, general and administrative expenses, interest income (expense) and other finance (costs) income in the consolidated statements of operations and comprehensive loss. Use of Estimates The preparation of unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates these estimates, including those related to the revenue recognition for contracts involving software and non-software elements, allowance for doubtful accounts, inventory reserve for net realizable value, currency swaps, valuation of hedging activities, goodwill and intangible assets, useful lives of long-lived assets, stock-based compensation, valuation allowances on deferred taxes, earnout liability, pension liability, commitments and contingencies and litigation, among others. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. We regularly evaluate these significant factors and make adjustments when facts and circumstances dictate. Actual results may differ from these estimates. Revenue Recognition The Company adopted Accounting Standards Codification ("ASC") 606 – Revenue from Contracts with Customers" ("ASC 606") as of January 1, 2019 using the modified retrospective method. This method allows the Company to apply ASC 606 to new contracts entered into after January 1, 2019, and to its existing contracts for which revenue earned through December 31, 2018 has been recognized under the guidance in effect prior to the effective date of ASC 606. The revenue recognition processes the Company applied prior to adoption of ASC 606 align with the recognition and measurement guidance of the new standard, therefore adoption of ASC 606 did not require a cumulative adjustment to opening equity. Under ASC 606, a performance obligation is a promise within a contract to transfer a distinct good or service, or a series of distinct goods and services, to a customer. Revenue is recognized when performance obligations are satisfied and the customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for goods or services. Under the standard, a contract's transaction price is allocated to each distinct performance obligation. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: 1. identify the contracts with a customer; 2. identify the performance obligations within the contract, including whether they are distinct and capable of being distinct in the context of the contract; 3. determine the transaction price; 4. allocate the transaction price to the performance obligations in the contract; and 5. recognize revenue when, or as, the Company satisfies each performance obligation. Step 1 – Identify the contract The Company identifies contracts with its customers when all parties have approved the contract and are committed to perform their respective obligations, when each party's rights and the payment terms regarding the goods or services to be transferred can be identified. The contract must also have commercial substance, and it must be probable that the Company will collect the consideration to which it will be entitled. Contracts entered into at or near the same time with the same customer or related parties of the customer are accounted for as one contract if any of the following criteria are met: a. Contracts were negotiated as a single commercial package (including whether a contract would be loss-making without taking into account the consideration received under another contract) b. Consideration in one contract depends on the other contract c. Goods or services (or some of the goods or services) are a single performance obligation. Step 2 – Identify performance obligations Performance obligations are identified by considering whether a good or service is distinct. The Company considers a good or service to be distinct only when the customer can benefit from it either on its own or together with other resources that are readily available, and when the promise to transfer the good or service to the customer is separately identifiable from other promises in the contract. The Company applies the series guidance to its performance obligations where the following criteria apply: a. Each distinct good or service in the series meets the criteria to be a performance obligation satisfied over time. b. The same method would be used to measure progress toward complete satisfaction of the performance obligation to transfer each distinct good or service in the series to the customer. Step 3 – Determine the transaction price The Company considers all amounts to which it has rights in exchange for the goods or services transferred in determining the transaction price. This includes fixed and variable consideration. Typically, consideration is stated in the contract with the customer. The Company assesses usage-based fees to determine whether they qualify as variable consideration. It also considers the impact of any liquidated damages clauses or service level agreements. Where the Company's performance obligations are determined to be a series, variable consideration is not estimated upfront in accordance with the exception allowed by ASC 606. Where non-refundable upfront fees are included in the Company's contracts with customer, the Company considers whether or not they represent payment for a transferred good or service. Where they represent payment for future goods or services, the Company further considers whether they represent a material right. Step 4 – Allocate the transaction price The Company allocates a transaction price to each performance obligation based on the relative standalone selling prices of the goods or services being provided. Where a contract includes multiple performance obligations, the Company determines the standalone selling price at contract inception of the distinct good or service underlying each performance obligation in the contract and allocates the transaction price in proportion to those standalone selling prices. Where possible, the Company uses the price charged for the good or service to other customers in similar circumstances as evidence of standalone selling price. Where this is not possible, the standalone selling price is estimated by experienced management using the best available judgement. With respect to performance obligations that are considered to be a series, where appropriate and where the required criteria are met, variable consideration is allocated entirely to a distinct good or service that is part of a series. Step 5 – Recognize revenue The Company recognizes revenue over time for performance obligations that meet one of the following criteria: a. The customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs. b. The Company's performance creates or enhances an asset that the customer controls as the asset is created or enhanced. c. The Company's performance does not create an asset with an alternative use to the Company, and the Company has an enforceable right to payment for performance completed to date Revenue for the Company's remaining performance obligations that do not meet one of the above criteria is recognized at the point at which the customer obtains control of the good or service. Server Based Gaming Revenue Revenue from SBG terminals, access to our content and SBG platform, including electronic table gaming products is recognized in accordance with the criteria set forth in ASC 606 and is usually based upon a contracted percentage of the operator's net winnings from the terminals' daily use. Where this is not the case, revenue is based upon a fixed daily or weekly usage fee. We recognize revenue from these arrangements in accordance with the series guidance over time on a daily basis over the term of the arrangement, or when not specified over the expected customer relationship period. Performance obligations under these arrangements may include the delivery and installation of our SBG terminals for use over a term, as well as service obligations related to hardware repairs and server based content and maintenance. Consideration with respect to these performance obligations typically takes the form of usage based fees, billed at the end of a set period (usually monthly) and due typically 30 days from the date of the invoice. We sometimes bill for SBG arrangements up front in order to help fund our working capital and development requirements, or at the request of a customer. Upfront fees on SBG arrangements are deferred and recognized ratably over time, or when not specified over the expected customer relationship period, where they represent payment for future goods and services. In the case where we receive upfront fees pursuant to which there are no further obligations and no undelivered elements, we will recognize the upfront fees upon delivery. Upfront fees are normally billed upon signing of the relevant agreement, and become due and payable at set times thereafter. Hardware sales take the form of a transfer of ownership of our developed gaming terminals, and are recognized at a point in time upon delivery as they are considered to meet the required criteria to be considered distinct. Payment for hardware sales is typically due a set number of days after delivery. SBG arrangements typically include service level agreements, consisting of a specified amount of 'uptime' with financial penalties for breaches in excess of specified levels. Virtual Sports Revenue Revenue from licensing of our gaming software is recognized in accordance with the criteria set forth in ASC 606. Virtual sports retail revenue, which includes the provision of virtual sports content and services to retail betting outlets, and virtual sports online and mobile revenue, which includes the provision of virtual sports content and services to mobile and online operators, is based upon a contracted percentage of the operator's net winnings or a fixed rental fee. We recognize revenue for these fees over time on a daily or weekly basis in accordance with the series guidance over the term of the arrangement. Consideration with respect to these performance obligations typically takes the form of usage based fees, billed at the end of a set period (usually monthly) and due typically 30 days from the date of the invoice. These arrangements also typically include a perpetual license billed up front, granted to the customer for access to our gaming platform and content. As these up front bills represent payment for future services, revenue from the licensing of perpetual licenses is recognized ratably over time, or when not specified, over the expected customer relationship period. Upfront fees are normally billed upon signing of the relevant agreement, and become due and payable at set times thereafter. Revenue from the development of bespoke games licensed on a perpetual basis to mobile and online operators is recognized at a point in time on delivery and acceptance by the customer. We have no ongoing service obligations subsequent to customer acceptance of our bespoke games, and they meet the criteria to be considered as distinct. Payment for bespoke games is typically due a set number of days after delivery. Virtual Sports arrangements typically include service level agreements, consisting of a specified amount of 'uptime' with financial penalties for breaches in excess of specified levels. Disaggregation of revenue Information on disaggregation of revenue is included in Note 25 "Segment Reporting and Geographic Information." |
Accounts Receivable
Accounts Receivable | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Accounts Receivable | 2. Accounts Receivable Accounts receivable consist of the following: June 30, 2019 September 30, (in millions) Trade receivables $ 13.1 $ 17.8 Less: long-term receivable recorded in other assets (1.8 ) (2.2 ) Other receivables 0.1 0.1 Allowance for doubtful accounts (0.7 ) (1.4 ) Total accounts receivable, net $ 10.7 $ 14.3 |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | 3. Inventory Inventory consists of the following: June 30, 2019 September 30, (in millions) Component parts $ 3.7 $ 3.6 Finished goods 1.9 1.6 Total inventories $ 5.6 $ 5.2 Component parts include parts for gaming terminals. Included in component parts are reserves for excess and slow-moving inventory of $0.2 million and $0.5 million as of June 30, 2019 and September 30, 2018, respectively. Our finished goods inventory primarily consists of gaming terminals which are ready for sale. |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 6 Months Ended |
Jun. 30, 2019 | |
Prepaid Expense and Other Assets [Abstract] | |
Prepaid Expenses and Other Assets | 4. Prepaid Expenses and Other Assets Prepaid expenses and other assets consist of the following: June 30, September 30, (in millions) Prepaid expenses and other assets $ 4.6 $ 5.0 Unbilled accounts receivable 7.2 10.8 Total prepaid expenses and other assets $ 11.8 $ 15.8 |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | 5. Property and Equipment, net June 30, September 30, (in millions) Short-term leasehold property $ 0.3 $ 0.4 Video lottery terminals 116.7 121.7 Construction in progress 0.3 — Computer equipment 8.6 8.7 Plant and machinery 1.9 2.5 127.8 133.3 Less: accumulated depreciation and amortization (96.2 ) (87.6 ) $ 31.6 $ 45.7 Depreciation and amortization expense amounted to $4.4 million and $5.4 million for the three months ended June 30, 2019 and 2018, respectively, and $9.2 million and $10.7 million for the six months ended June 30, 2019 and 2018, respectively. |
Software Development Costs, Net
Software Development Costs, Net | 6 Months Ended |
Jun. 30, 2019 | |
Research and Development [Abstract] | |
Software Development Costs, net | 6. Software Development Costs, net Software development costs, net consisted of the following: June 30, September 30, (in millions) Software development costs $ 109.3 $ 100.9 Less: accumulated amortization (71.2 ) (60.9 ) $ 38.1 $ 40.0 During the three months ended June 30, 2019 and 2018, the Company capitalized $3.7 million and $4.4 million of software development costs, respectively. During the six months ended June 30, 2019 and 2018, the Company capitalized $7.4 million and $8.8 million of software development costs, respectively. Amounts in the above table include $1.0 million and $1.3 million of internal use software at June 30, 2019 and September 30, 2018, respectively. The total amount of software costs amortized was $3.9 million and $4.4 million for the three months ended June 30, 2019 and 2018, respectively, and $8.0 million and $9.0 million for the six months ended June 30, 2019 and 2018, respectively. Software costs written down to net realizable value amounted to $0.0 million for the three months ended June 30, 2019 and 2018, respectively, and $0.0 million and $0.3 million for the six months ended June 30, 2019 and 2018, respectively. The weighted average amortization period was 3.1 years for the three and six months ended June 30, 2019 and 3.2 years for the three and six months ended June 30, 2018. The estimated software amortization expense for the years ending December 31 are as follows: Year ending December 31, (in millions) 2019 (six months) $ 7.7 2020 14.1 2021 9.2 2022 4.4 2023 2.0 Thereafter 0.7 Total $ 38.1 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | 7. Intangible Assets and Goodwill The following tables present certain information regarding our intangible assets. Amortizable intangible assets are being amortized on a straight-line basis over their estimated useful lives of ten years with no estimated residual values, which materially approximates the expected pattern of use. June 30, September 30, (in millions) Trademarks $ 17.2 $ 17.6 Customer relationships 14.7 15.1 31.9 32.7 Less: accumulated amortization (28.7 ) (27.0 ) $ 3.2 $ 5.7 Aggregate intangible asset amortization expense amounted to $0.8 million and $0.9 million for the three months ended June 30, 2019 and 2018, respectively, and $1.6 million and $1.7 million for the six months ended June 30, 2019 and 2018, respectively. The estimated intangible asset amortization expense for the years ending December 31 are as follows: Year ending December 31, (in millions) 2019 (six months) $ 1.6 2020 1.6 Total $ 3.2 Goodwill The difference in the carrying amount of goodwill at June 30, 2019 and September 30, 2018 (amounting to $1.1 million), as reported in the accompanying unaudited interim condensed consolidated balance sheets, is attributable to foreign currency translation adjustments. |
Other Assets
Other Assets | 6 Months Ended |
Jun. 30, 2019 | |
Other Assets, Noncurrent [Abstract] | |
Other Assets | 8. Other Assets Other assets consist of the following: June 30, September 30, (in millions) Pension surplus $ 2.7 $ 5.3 Long term receivables 1.8 2.2 Long term prepaid expenses and other assets 3.3 4.6 $ 7.8 $ 12.1 |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | 9. Accrued Expenses Accrued expenses consist of the following: June 30, September 30, (in millions) Direct costs of sales $ 3.3 $ 4.4 Payroll and related costs 4.3 3.1 Accrued corporate cost expenses 0.8 3.2 Asset retirement obligations 1.0 0.5 Contract termination costs 0.2 — Interest payable - cash 0.1 0.1 Other creditors 5.1 3.0 $ 14.8 $ 14.3 |
Contract Liabilities and Other
Contract Liabilities and Other Disclosures | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Contract Liabilities and Other Disclosures | 10. Contract Liabilities and Other Disclosures The following table summarizes the changes in contract liabilities: Deferred Income (in millions) Balance at October 1, 2018 $ (33.1 ) Revenue recognized 9.5 Revenue deferred (5.6 ) Foreign currency translation adjustments 0.6 Balance at June 30, 2019 $ (28.6 ) Deferred Income (in millions) Balance at October 1, 2017 $ (27.3 ) Revenue recognized 10.6 Revenue deferred (16.9 ) Foreign currency translation adjustments 0.5 Balance at September 30, 2018 $ (33.1 ) Revenue recognized that was included in the deferred income balance at the beginning of the period amounted to $7.3 million and $7.7 million for the six months ended June 30, 2019 and the year ended September 30, 2018, respectively. The following table summarizes contract related balances (other than deferred income disclosed above): Accounts Unbilled Customer (in millions) At October 1, 2018 $ 17.8 $ 10.8 $ (3.7 ) At June 30, 2019 13.1 7.2 (5.1 ) Accounts Unbilled Customer (in millions) At October 1, 2017 $ 25.5 $ 9.5 $ (4.3 ) At September 30, 2018 17.8 10.8 (3.7 ) |
Other Liabilities
Other Liabilities | 6 Months Ended |
Jun. 30, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Other Liabilities | 11. Other Liabilities Other liabilities consist of the following: June 30, September 30, (in millions) Customer prepayments and deposits $ 5.1 $ 3.7 Fair value of hedging instrument 0.5 0.2 Total other liabilities, current 5.6 3.9 Other payables, net of current portion — 0.5 Asset retirement obligations 0.3 0.4 Senior debt exit premium 4.2 4.2 Total other liabilities, long-term 4.5 5.1 $ 10.1 $ 9.0 |
Long Term and Other Debt
Long Term and Other Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long Term and Other Debt | 12. Long Term and Other Debt 2018 Refinancing On August 13, 2018, the Company and certain of its subsidiaries entered into a series of transactions that effected the refinancing of the external borrowings of the Company and its subsidiaries, replacing our senior term and revolving facilities with senior notes of $140.0 million and a revolving credit facility of £7.5 million. The senior notes, which were issued under a Note Purchase Agreement and Guaranty (the "Note Purchase Agreement"), have a 5-year duration and carry a cash interest rate of 9% plus 3-month LIBOR, and the revolving credit facility has a 3-year duration and carries a cash interest rate on any utilization at 4% plus 3-month LIBOR, with any unutilized amount carrying a 1.4% cash interest cost. In connection with the refinancing, the Company also entered into a 3-year, fixed-rate, cross-currency swap (see Note 13). For additional information regarding the 2018 refinancing and related agreements, see Note 12 in our 2018 10-K. During the six months ended June 30, 2019, the Company borrowed the full amount available under the revolving credit facility, for an aggregate amount outstanding of $9.3 million at June 30, 2019, which is included in current portion of long-term debt in the accompanying condensed balance sheet. Outstanding Debt and Capital Leases The following reflects outstanding debt and capital leases as of the dates indicated below: Principal Unamortized Book value, (in millions) Senior bank debt $ 149.3 $ (7.6 ) $ 141.7 Capital leases and hire purchase contract 0.2 — 0.2 Total long-term debt outstanding 149.5 (7.6 ) 141.9 Less: current portion of long-term debt (9.5 ) — (9.5 ) Long-term debt, excluding current portion $ 140.0 $ (7.6 ) $ 132.4 Principal Unamortized Book value, (in millions) Senior bank debt $ 140.0 $ (8.7 ) $ 131.3 Capital leases and hire purchase contract 0.5 — 0.5 Total long-term debt outstanding 140.5 (8.7 ) $ 131.8 Less: current portion of long-term debt (0.5 ) — (0.5 ) Long-term debt, excluding current portion $ 140.0 $ (8.7 ) $ 131.3 The Company is in compliance with all relevant financial covenants and the long term debt portion is correctly classified as such in line with the underlying agreements. Long term debt as of June 30, 2019 matures as follows: Fiscal period: Senior bank Capital leases Total (in millions) 2019 $ 9.3 $ 0.2 $ 9.5 2020 — — — 2021 — — — 2022 — — — 2023 140.0 — 140.0 Total $ 149.3 $ 0.2 $ 149.5 |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging Activities | 13. Derivatives and Hedging Activities In connection with the 2018 refinancing (see Note 12), the Company entered into a 3-year, fixed-rate, cross-currency swap with Nomura Global Financial Products Inc. which swaps the principal and interest payments that will be payable in USD under the Note Purchase Agreement to Euros ("EUR"), in part, and GBP, in part. Specifically, with respect to the principal payments 1/3 of the payments will be swapped from USD to EUR and 2/3 of the payments from USD to GBP. Additionally, with respect to the interest payments 1/3 will be swapped from USD to GBP and 2/3 from USD to EUR. The swap provides for a foreign exchange rate of $1.13935 USD per €1 EUR and $1.27565 USD per £1 GBP. Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its assets and liabilities and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company's derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company's known or expected cash receipts and its known or expected cash payments principally related to the Company's borrowings. Certain of the Company's foreign operations expose the Company to fluctuations of foreign interest rates and exchange rates. These fluctuations may impact the value of the Company's cash receipts and payments in terms of the Company's functional currency. The Company enters into derivative financial instruments to protect the value or fix the amount of certain liabilities in terms of its functional currency, GBP. Hedges of Multiple Risks The Company has variable-rate borrowings denominated in currencies other than its functional currency. As a result, the Company is exposed to fluctuations in both the underlying variable interest rate and the foreign currency of the borrowing against its functional currency, GBP. The Company uses derivatives including cross-currency interest rate swaps to manage its exposure to fluctuations in the variable borrowing rate and the GBP-USD exchange rate. Cross-currency interest rate swaps involve exchanging fixed rate interest payments for floating rate interest receipts both of which will occur at the GBP-USD forward exchange rates in effect upon entering into the instrument. The Company designates these derivatives as cash flow hedges of both interest rate and foreign exchange risks. For derivatives designated and that qualify as cash flow hedges of both interest rate risk and foreign exchange risk, the gain or loss on the derivative is recorded in Accumulated Other Comprehensive Income and subsequently reclassified in the periods during which the hedged transaction affects earnings within the same income statement line item as the earnings effect of the hedged transaction. The Company estimates that during the year ended December 31, 2019, $1.5 million will be reclassified as a reduction to interest expense. As of June 30, 2019 and September 30, 2018, the Company had the following outstanding derivatives designated as cash flow hedges that were used to hedge both interest rate risk and foreign exchange risk: Foreign Currency Derivative Number of Pay Fixed Receive (in millions) Cross currency interest rate swaps 1 GBP 36.6 USD 46.7 Non-designated Hedges Derivatives not designated as hedges are not speculative and are used to manage the Company's exposure to interest rate movements and other identified risks but do not meet the strict hedge accounting requirements. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in earnings. As of June 30, 2019 and September 30, 2018, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships: Foreign Currency Derivative Number of Pay Fixed Receive (in millions) (in millions) Cross currency interest rate swaps 1 EUR 81.9 USD 93.3 The table below presents the fair value of the Company's derivative financial instruments as well as their classification in the consolidated balance sheet as of June 30, 2019. Balance Sheet Asset Balance Sheet Liability (in millions) (in millions) Derivatives designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ 0.5 Derivative Liability $ (0.8 ) Total derivatives designated as hedging instruments $ 0.5 $ (0.8 ) Derivatives not designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ — Derivative Liability $ (3.8 ) Total derivatives not designated as hedging instruments $ — $ (3.8 ) The table below presents the fair value of the Company's derivative financial instruments as well as their classification in the consolidated balance sheet as of September 30, 2018. Balance Sheet Asset Balance Sheet Liability (in millions) (in millions) Derivatives designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ 0.8 Derivative Liability $ (3.4 ) Total derivatives designated as hedging instruments $ 0.8 $ (3.4 ) Derivatives not designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ — Derivative Liability $ (4.4 ) Total derivatives not designated as hedging instruments $ — $ (4.4 ) The table below presents the effect of fair value and cash flow hedge accounting on accumulated other comprehensive income as of June 30, 2019. Amount of Gain Location of Gain (in millions) (in millions) Interest Rate and Foreign Exchange Products $ 0.3 Interest Expense $ 0.9 Foreign Currency Remeasurement 0.2 Total $ 0.3 $ 1.1 There were no effects of fair value and cash flow hedge accounting on accumulated other comprehensive income as of June 30, 2018. The table below presents the effect of the Company's derivative financial instruments on the consolidated income statements as of June 30, 2019. Interest Expense Foreign Currency Remeasurement (in millions) Total amounts of income and expense line items presented in the statement of operations and comprehensive loss in which the effects of fair value or cash flow hedges are recorded $ 8.5 $ (0.3 ) Gain/(loss) on cash flow hedging relationships in Subtopic 815-20 $ 0.9 $ 0.2 There were no effects of the Company's derivative financial instruments on the consolidated income statements as of June 30, 2018. The table below presents the effect of the Company's derivative financial instruments that are not designated as hedging instruments in the consolidated income statement as of June 30, 2019. Derivatives Not Designated as Hedging Instruments under Subtopic 815-20 Location of Income Recognized in Amount of Income Recognized in (in millions) Interest Rate and Foreign Exchange Products Change in fair value of derivative liability $ (0.1 ) There were no effects of the Company's derivative financial instruments that are not designated as hedging instruments in the consolidated income statement as of June 30, 2018. The table below presents a gross presentation, the effects of offsetting, and a net presentation of the Company's derivatives as of June 30, 2019 and September 30, 2018. The net amounts of derivative assets or liabilities can be reconciled to the tabular disclosure of fair value. The tabular disclosure of fair value provides the location that derivative assets and liabilities are presented on the consolidated balance sheet. The ISDA Master Agreement between Gaming Acquisitions Limited and Nomura Global Financial Products, Inc. is documented using the 2002 Form and the ISDA standard set-off provision in Section 6(f) of the ISDA Master Agreement apply to both parties and is only modified to include Affiliates of the Payee. There is no CSA and thus there is no collateral posting. The only other security for the ISDA include a guaranty of Nomura's obligations from Nomura Holdings, Inc. and with respect to Gaming Acquisitions Limited, its obligations under the ISDA are cross-collateralized with the debt obligations under the Credit Agreement in the same pool of collateral that supports the debt obligations. Offsetting of Derivative Assets June 30, 2019 Gross Amounts Not Offset in the Statement of Financial Position Gross Amounts Gross Net Amounts the Statement Financial Cash Net (in millions) Fair value of hedging instrument $ 0.5 $ — $ 0.5 $ — $ — $ — Offsetting of Derivative Liabilities June 30, 2019 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 4.6 $ — $ 4.6 $ — $ — $ — Offsetting of Derivative Assets September 30, 2018 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 0.8 $ — $ 0.8 $ — $ — $ — Offsetting of Derivative Liabilities September 30, 2018 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 7.8 $ — $ 7.8 $ — $ — $ — Credit-risk-related Contingent Features The Company has entered into an industry standard ISDA Master Agreement, with a negotiated Scheduled thereto (the "ISDA Agreement"), with the counterparty to its derivative transactions and which ISDA Agreement sets forth various provisions which govern the trading relationship between the Company and its counterparty. Such provisions include certain events which, if triggered by either party, may give rise to an acceleration of the ISDA Agreement, thus triggering the exchange of a breakage payment between the parties. The ISDA Agreement with the Company's derivative counterparty contains a provision where the Company could be declared in default on its derivative obligations if, among others, its repayment of the underlying indebtedness is accelerated by the lender due to the Company's default on the indebtedness. The ISDA Agreement can also be accelerated if the Company's creditworthiness becomes materially weaker as the result of a merger, change of control or substantial change in capital structure or if the Company's obligations under the ISDA Agreement are no longer secured with the underlying indebtedness. As of June 30, 2019 and September 30, 2018, the fair value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk, related to the ISDA Agreements was ($4.1) and ($7.0), respectively. As of June 30, 2019, the Company has not posted any collateral related to the ISDA Agreement, as no collateral is required under the terms of such ISDA Agreement. If the Company had breached any of the provision under the ISDA Agreement which resulted in an acceleration of the ISDA Agreement at June 30, 2019, it could have been required to settle its obligations under the ISDA Agreement at its termination value of $5.6. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 14. Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset and liability in an orderly transaction between market participants at the measurement date. We estimate the fair value of our assets and liabilities utilizing an established three-level hierarchy. The hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date as follows: Level 1: Quoted prices in active markets for identical assets or liabilities. Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities. Level 2 inputs also include non-binding market consensus prices that can be corroborated with observable market data, as well as quoted prices that were adjusted for security-specific restrictions. Level 3: Unobservable inputs that are supported by little or no market activity that are significant to the fair value of the asset or liability. Level 3 inputs also include non-binding market consensus prices or non-binding broker quotes that are unable to be corroborated with observable market data. The fair value of our financial assets and liabilities is determined by reference to market data and other valuation techniques as appropriate. We believe the fair value of our financial instruments, which are principally cash, accounts receivable, prepaid expenses and other current assets, accounts payable and other long term liabilities, approximates their recorded values. For each period, derivative financial instrument assets and liabilities measured at fair value on a recurring basis are included in the financial statements as per the table below. June 30, September 30, Level 2019 2018 (in millions) Earnout liability (see Note 15) 3 $ — $ 8.0 Derivative liability (see Notes 13 and 16) 2 $ 4.0 $ 7.8 Long term receivable (included in other assets) 2 $ 1.8 $ 2.2 Level 3 liabilities are valued using unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the derivative liabilities. For fair value measurements categorized within Level 3 of the fair value hierarchy, the Company's principal financial officer, who reports to the principal executive officer, determines its valuation policies and procedures. The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company's Principal Financial Officer and approved by the Principal Executive Officer. Level 3 financial liabilities consist of the earnout liability for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate (see Note 15). At June 30, 2019 and September 30, 2018, there were no transfers in or out of Level 3 from other levels in the fair value hierarchy. |
Earnout Liability
Earnout Liability | 6 Months Ended |
Jun. 30, 2019 | |
Earnout Liability [Abstract] | |
Earnout Liability | 15. Earnout Liability An earnout payment of up to 2,500,000 shares of the Company's common stock, subject to certain customary anti-dilution adjustments (the "Earnout Consideration"), was payable pursuant to the Sale Agreement to the previous owners of Inspired based on the financial performance of the Company's businesses in six specific countries, China, Colombia, Greece, Norway, Spain and Ukraine (collectively, the "Earnout Jurisdictions"), as measured by earnings before interest, taxes, depreciation and amortization ("EBITDA") for the twelve months ended September 30, 2018 (the "Earnout Period"), with the maximum earnout payment of 2,500,000 shares issuable if such EBITDA results with respect to the Earnout Jurisdictions was equal to or greater than £15,000. Based on the EBITDA results for such fiscal year with respect to the Earnout Jurisdictions, the Company issued 1,323,558 shares of common stock as Earnout Consideration in March 2019, resulting in an aggregate amount of $8.6 million recorded upon the settlement of the earnout liability, with a corresponding credit to stockholders' deficit. The following table provides a reconciliation of the beginning and ending balances for the earnout liability measured using significant unobservable inputs (Level 3): (in millions) Balance – September 30, 2018 $ 8.0 Change in fair value of earnout liability 0.6 Settlement of earnout liability (8.6 ) Balance – June 30, 2019 $ — All movements in the balance during the six months ended June 30, 2019 were due to movements in the price of the Company's common stock |
Derivative Liability
Derivative Liability | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Liability [Abstract] | |
Derivative Liability | 16. Derivative Liability The Company's 2018 Omnibus Incentive Plan (the "2018 Plan") was adopted by the Company's Board of Directors in September 2018 subject to approval by the Company's stockholders, which was obtained in May 2019. Initial awards covering an aggregate of 542,770 restricted stock units ("RSUs") were approved under the 2018 Plan with respect to fiscal 2018 to members of management and other participants with a three-year vesting schedule (i.e., one-third vesting on each of December 31, 2019, 2020 and 2021). These awards, which were subject to cancellation in the event stockholders did not approve the 2018 Plan during 2019, were initially classified as a derivative liability due to the grant terms containing a commitment by the Company to make a liquidated damages payment to the participants in cash (with respect to the value of one-third of the award) in the event stockholders did not approve the 2018 Plan by the first scheduled vesting date. Such obligation was eliminated upon stockholder approval of the 2018 Plan being obtained, which resulted in the liability being reclassified to additional paid in capital at the fair value amount of $0.8 million. See Note 13, "Derivatives and Hedging Activities," for a discussion of the Company's cross-currency swap. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 17. Stock-Based Compensation The Company's stock-based compensation plans authorize awards of RSUs, stock options and other equity-related awards. Awards granted under the 2018 Plan prior to stockholder approval being obtained in May 2019 consisted of: (1) the 542,770 RSUs approved for management and other participants with respect to fiscal 2018 as to which the contingent cash-settlement feature lapsed upon approval of the 2018 Plan by stockholders (see Note 16, "Derivative Liability") and (2) 572,346 RSUs approved for management and other participants with respect to fiscal 2019 comprised of two components: (i) 50% represent performance-based target RSUs that require both attainment of Company performance criteria for 2019 and the participants remaining employed for a three-year service period; and (ii) 50% represent service-based RSUs that vest over a period of three years. In addition, an aggregate of 86,500 RSUs were awarded during the quarter ended June 30, 2019 (following approval of the 2018 Plan by stockholders) as new hire or special recognition grants. As of June 30, 2019, there were (i) 2,489,197 shares subject to outstanding awards under the Prior Plans, including 1,092,633 shares subject to market-price vesting conditions, and (ii) 1,201,616 shares subject to outstanding awards under the 2018 Plan, including 286,181 shares subject to performance-based target awards as to which the number that ultimately may vest would range from 0% to 200% based on the performance level attained. As of June 30, 2019, there were 1,348,384 shares available for new awards under the 2018 Plan (or 1,062,203 shares if we reflect inclusion of performance-based awards at the maximum level of performance) and no shares available for new awards under the Prior Plans. All awards consist of RSUs and Restricted Stock. The Company also has an employee stock purchase plan ("ESPP") that authorizes the issuance of up to an aggregate of 500,000 shares of common stock pursuant to purchases thereunder by employees. The ESPP, which was approved by stockholders in July 2017, is administered by the Compensation Committee which has discretion to designate the length of offering periods and other terms subject to the requirements of the ESPP. The Company began a twelve-month offering period under the ESPP on June 3, 2019 that authorizes employees to contribute up to 10% of their base compensation to purchase a maximum of 1,000 shares. The shares will be purchased on the last day of the offering period at a discounted price that will equal to 85% of the lower of: (i) the closing price at the beginning of the offering period and (ii) the closing price at the end of the offering period. A summary of the Company's RSUs activity during the nine month period ended June 30, 2019 is as follows: Number of Unvested Outstanding at September 30, 2018 2,272,261 Granted 721,522 Forfeited (13,202 ) Vested (39,053 ) Unvested Outstanding at June 30, 2019 2,941,528 In addition, during the nine months ended June 30, 2019, a total of 9,806 shares were issued and 1,059 shares withheld for taxes in connection with the net settlement of awards of RSUs. Stock-based compensation is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. The Company recognized stock-based compensation expense for Restricted Stock and RSU's amounting to $2.3 million and $1.5 for the three months ended June 30, 2019 and 2018, respectively, and $4.4 million and 2.7 million for the six months ended June 30, 2019 and 2018, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss (Income) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss (Income) | 18. Accumulated Other Comprehensive Loss (Income) The accumulated balances for each classification of comprehensive loss (income) are presented below: Foreign Currency Translation Adjustments Change in Fair Value of Hedging Instrument Unrecognized Pension Benefit Costs Accumulated Other Comprehensive (Income) (in millions) Balance at September 30, 2018 $ (78.9 ) $ 0.1 $ 20.3 $ (58.5 ) Change during the period 0.5 0.4 1.9 2.8 Balance at March 31, 2019 (78.4 ) 0.5 22.2 (55.7 ) Change during the period (0.7 ) 0.2 2.0 1.5 Balance at June 30, 2019 $ (79.1 ) $ 0.7 $ 24.2 $ (54.2 ) |
Net Loss per Share
Net Loss per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 19. Net Loss per Share Basic loss per share ("EPS") is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to all dilutive potential shares of common stock outstanding during the period, including stock options, restricted stock, RSUs and warrants, using the treasury stock method, and convertible debt or convertible preferred stock, using the if-converted method. Diluted EPS excludes all dilutive potential of shares of common stock if their effect is anti-dilutive. The computation of diluted EPS excludes the common stock equivalents of the following potentially dilutive securities because their inclusion would be anti-dilutive: Three and Six Months Ended 2019 2018 Earnout Shares — 2,500,000 RSUs 3,066,697 1,759,164 Unvested Restricted Stock 624,116 624,116 Stock Warrants 9,539,565 9,539,615 13,230,328 14,422,895 |
Other Finance Income (Costs)
Other Finance Income (Costs) | 6 Months Ended |
Jun. 30, 2019 | |
Other Nonoperating Income (Expense) [Abstract] | |
Other Finance Income (Costs) | 20. Other Finance Income (Costs) Other finance income (costs) consisted of the following for the three and six months ended June 30, 2019 and 2018: Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 (in millions) (in millions) Pension interest cost $ (0.7 ) $ (0.7 ) $ (1.4 ) $ (1.5 ) Expected return on pension plan assets 0.9 0.9 1.8 1.9 Foreign currency translation on senior bank debt (3.2 ) — (0.3 ) — Foreign currency remeasurement on hedging instrument 2.1 — 0.2 — $ (0.9 ) $ 0.2 $ 0.3 $ 0.4 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 21. Income Taxes Income taxes are accounted for under the asset and liability method. Our provision for income taxes is principally based on current period income (loss), changes in deferred tax assets and liabilities and changes in estimates with regard to uncertain tax positions. We estimate current tax expense and assess temporary differences resulting from differing treatments of items for tax and accounting purposes using enacted tax rates in effect for each taxing jurisdiction in which we operate for the period in which those temporary differences are expected to be recovered or settled. These differences result in deferred tax assets and liabilities. Our total deferred tax assets are principally comprised of depreciation and net operating loss carry forwards. The effective income tax rate for the three months ended June 30, 2019 and 2018 was 0.9% and 1.0%, respectively, resulting in a $0.1 million and $0.0 million income tax expense, respectively. The effective income tax rate for the six months ended June 30, 2019 and 2018 was 0.0% and 2.8%, respectively, resulting in a $0.0 million and $0.1 million income tax (expense)/benefit, respectively. The income tax benefit for the three and six months ended June 30, 2019 differs from the amount that would be expected after applying the statutory U.S. federal income tax rate primarily due to changes in the valuation allowance for deferred taxes and the net losses generated by the Company’s non-US foreign subsidiaries. The income tax expense for the three and six months ended June 30, 2018 differs from the amount that would be expected after applying the statutory U.S. federal income tax rate primarily due to the impact of the U.S. statutory tax rate change on deferred tax assets and liabilities, the changes in the valuation allowance for deferred taxes and the net losses generated by the Company’s non-US foreign subsidiaries. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considered the scheduled reversal of deferred income tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on the consideration of these items, management determined that it is more likely than not that the Company will not realize the deferred income tax asset balances and therefore, recorded a full valuation allowance of $59.0 million as of June 30, 2019. The utilization of the Company’s pre-Merger net operating losses is subject to a limitation due to the “change of ownership provisions” under Section 382 of the Internal Revenue Code and similar state provisions. |
Related Parties
Related Parties | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Parties | 22. Related Parties HG Vora Special Opportunities Master Fund, Ltd. ("HGV Fund"), which purchased promissory notes issued in connection with the 2018 refinancing of our debt facilities (see Note 12), owns approximately 16.5% of our common stock and warrants to purchase additional shares. HGV Fund is also a stockholder and investor in Leisure Acquisition Corp., a special purpose acquisition company affiliated with two members of our management. Interest expense paid to HGV Fund with respect to the promissory notes for the three and six months ended June 30, 2019 amounted to $4.1 million and $8.2 million, respectively. We occupy office space leased by a company affiliated with our Executive Chairman, Hydra Management LLC, and incur amounts monthly in maintenance expenses primarily for the lease of the office. Expenditure amounted to less than $100,000 during the three and six months ended June 30, 2019 and 2018, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 23. Commitments and Contingencies Legal Matters From time to time, the Company may become involved in lawsuits and legal matters arising in the ordinary course of business. While the Company believes that, currently, it has no such matters that are material, there can be no assurance that existing or new matters arising in the ordinary course of business will not have a material adverse effect on the Company's business, financial condition or results of operations. Acquisitions On June 11, 2019, the Company entered into an agreement to acquire Novomatic UK's Gaming Technology Group. The acquisition is subject to the approvals of regulatory authorities and other customary closing conditions. The cost of the acquisition, excluding fees, is the Euro equivalent of $120 million. The Company anticipates financing the transaction by refinancing all existing indebtedness and entering into an agreement for a new £220 million loan (made up of £ and Euro components) and a £20 million revolver facility. |
Pension Plan
Pension Plan | 6 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Pension Plan | 24. Pension Plan We operate a combined scheme which comprises a defined benefit section and a defined contribution section in the UK. The defined benefit section is closed to future accruals for services rendered to the Company. On March 15, 2019, it was agreed that no further deficit reduction contributions shall be made to the scheme, except in the event that the scheme funding level does not progress as expected, in which case contingent contributions would be made subject to an agreed maximum amount. No contingent contributions will become payable during the year ending December 31, 2019. The Company will continue to make expense allowance contributions to the scheme; however, no further expense allowance contributions will be made during the year ending December 31, 2019. The total amount of employer contributions paid during the six months ended June 30, 2019 amounted to $0.2 million. For the six months ended June 30, 2019 and 2018, the components of total periodic benefit costs were as follows: Six Months Ended June 30, 2019 2018 (in millions) Components of net periodic benefit: Interest cost $ 1.4 $ 1.5 Expected return on plan assets (1.8 ) (1.9 ) Net periodic benefit $ (0.4 ) $ (0.4 ) |
Segment Reporting and Geographi
Segment Reporting and Geographic Information | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting and Geographic Information | 25. Segment Reporting and Geographic Information The Company operates its business along two operating segments, which are segregated based on the basis of revenue stream: Service Based Gaming and Virtual Sports (which includes Interactive). The Company believes this method of segment reporting reflects both the way its business segments are managed and the way the performance of each segment is evaluated. The following tables present revenue, cost of sales, excluding depreciation and amortization, selling, general and administrative expenses, depreciation and amortization, stock-based compensation expense and acquisition related transaction expenses, operating profit/(loss), total assets and total capital expenditures for the periods ended June 30, 2019 and 2018, respectively, by business segment. Certain unallocated corporate function costs have not been allocated to the Company's reportable operating segments because these costs are not allocable and to do so would not be practical. Corporate function costs consist primarily of selling, general and administrative expenses, depreciation and amortization, capital expenditures, cash, prepaid expenses and property and equipment and software development costs relating to corporate/shared functions. As a result of improved processes that have allowed us to more accurately allocate costs between reporting segments, we have reclassified the previously reported segment allocation of selling, general and administrative expenses and stock-based compensation expense for the three and six months ended June 30, 2018. Segment Information Three Months Ended June 30, 2019 Server Virtual Corporate Total (in millions) Revenue: Service $ 16.4 $ 9.2 $ — $ 25.6 Hardware 1.1 — — 1.1 Total revenue 17.5 9.2 — 26.7 Cost of sales, excluding depreciation and amortization: Cost of service (4.4 ) (0.9 ) — (5.3 ) Cost of hardware (1.0 ) — — (1.0 ) Selling, general and administrative expenses (6.0 ) (2.1 ) (4.7 ) (12.8 ) Stock-based compensation expense (0.5 ) (0.3 ) (1.5 ) (2.3 ) Acquisition related transaction expenses — — (0.7 ) (0.7 ) Depreciation and amortization (7.2 ) (1.4 ) (0.5 ) (9.1 ) Segment operating income (loss) (1.6 ) 4.5 (7.4 ) (4.5 ) Net operating loss $ (4.5 ) Total assets at June 30, 2019 $ 81.0 $ 64.9 $ 41.8 $ 187.7 Total goodwill at June 30, 2019 $ — $ 44.7 $ — $ 44.7 Total capital expenditures for the three months ended June 30, 2019 $ 2.1 $ 1.6 $ 0.5 $ 4.2 Three Months Ended June 30, 2018 Server Virtual Corporate Total (in millions) Revenue: Service $ 24.5 $ 10.0 $ — $ 34.5 Hardware 2.4 — — 2.4 Total revenue 26.9 10.0 — 36.9 Cost of sales, excluding depreciation and amortization: Cost of service (4.6 ) (1.3 ) — (5.9 ) Cost of hardware (2.1 ) — — (2.1 ) Selling, general and administrative expenses (8.5 ) (2.4 ) (4.3 ) (15.2 ) Stock-based compensation expense (0.3 ) (0.2 ) (1.0 ) (1.5 ) Depreciation and amortization (8.8 ) (1.5 ) (0.3 ) (10.6 ) Segment operating income (loss) 2.6 4.6 (5.6 ) 1.6 Net operating loss $ 1.6 Total assets at September 30, 2018 $ 103.4 $ 69.5 $ 35.0 $ 207.9 Total goodwill at September 30, 2018 $ — $ 45.8 $ — $ 45.8 Total capital expenditures for the three months ended June 30, 2018 $ 11.9 $ 2.2 $ — $ 14.1 Six Months Ended June 30, 2019 Server Virtual Corporate Total (in millions) Revenue: Service $ 37.2 $ 19.2 $ — $ 56.4 Hardware 4.0 — — 4.0 Total revenue 41.2 19.2 — 60.4 Cost of sales, excluding depreciation and amortization: Cost of service (8.8 ) (1.9 ) — (10.7 ) Cost of hardware (2.6 ) — — (2.6 ) Selling, general and administrative expenses (12.6 ) (4.3 ) (10.6 ) (27.5 ) Stock-based compensation expense (0.9 ) (0.6 ) (2.9 ) (4.4 ) Acquisition related transaction expenses — — (1.6 ) (1.6 ) Depreciation and amortization (14.9 ) (2.9 ) (1.0 ) (18.8 ) Segment operating income (loss) 1.4 9.5 (16.1 ) (5.2 ) Net operating loss $ (5.2 ) Total capital expenditures for the six months ended June 30, 2019 $ 5.0 $ 3.0 $ 0.7 $ 8.7 Six Months Ended June 30, 2018 Server Virtual Corporate Total (in millions) Revenue: Service $ 48.1 $ 19.7 $ — $ 67.8 Hardware 6.6 — — 6.6 Total revenue 54.7 19.7 — 74.4 Cost of sales, excluding depreciation and amortization: Cost of service (9.3 ) (2.6 ) — (11.9 ) Cost of hardware (6.2 ) — — (6.2 ) Selling, general and administrative expenses (16.7 ) (5.3 ) (8.9 ) (30.9 ) Stock-based compensation expense (0.6 ) (0.5 ) (1.6 ) (2.7 ) Acquisition related transaction expenses — — (0.2 ) (0.2 ) Depreciation and amortization (17.5 ) (3.6 ) (0.6 ) (21.7 ) Segment operating income (loss) 4.4 7.7 (11.3 ) 0.8 Net operating loss $ 0.8 Total capital expenditures for the six months ended June 30, 2018 $ 20.7 $ 3.7 $ 0.1 $ 24.5 Geographic Information Geographic information for revenue is set forth below: Three Months Ended Six Months Ended June 30, 2019 2018 2019 2018 (in millions) (in millions) Total revenue UK $ 15.5 $ 22.6 $ 37.7 $ 47.2 Greece 4.8 7.6 9.6 13.1 Italy 4.2 4.2 8.4 9.0 Rest of world 2.2 2.5 4.7 5.1 Total $ 26.7 $ 36.9 $ 60.4 $ 74.4 Geographic information of our non-current assets excluding goodwill is set forth below: June 30, September 30, (in millions) Total non-current assets excluding goodwill UK $ 45.1 $ 60.0 Greece 28.4 36.2 Italy 2.1 3.4 Rest of world 5.1 3.9 Total $ 80.7 $ 103.5 Software development costs are included as attributable to the market in which they are utilized. |
Customer Concentration
Customer Concentration | 6 Months Ended |
Jun. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Customer Concentration | 26. Customer Concentration During the three months ended June 30, 2019, three customers represented at least 10% of revenues, accounting for 19%, 16% and 10% of the Company's revenues. During the three months ended June 30, 2018, three customers represented at least 10% of revenues, accounting for 23%, 21% and 11% of the Company's revenues. All these customers were served by both the Server Based Gaming and Virtual Sports segments. During the six months ended June 30, 2019, three customers represented at least 10% of revenues, accounting for 21%, 15% and 11% of the Company's revenues. During the six months ended June 30, 2018, three customers represented at least 10% of revenues, accounting for 23%, 17% and 15% of the Company's revenues. All these customers were served by both the Server Based Gaming and Virtual Sports segments. At June 30, 2019, two customers represented at least 10% of accounts receivable, accounting for 17% and 12% of the Company's accounts receivable. At September 30, 2018, three customers represented at least 10% of accounts receivable, accounting for 15%, 13% and 12% of the Company's accounts receivable. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | 27. Subsequent Events The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date that the financial statements were issued. Based upon this review, the Company did not identify subsequent events that would have required adjustment or disclosure in the consolidated financial statements. |
Nature of Operations, Managem_2
Nature of Operations, Management's Plans and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company Description and Nature of Operations | Company Description and Nature of Operations Inspired Entertainment, Inc. (the “Company,” “we,” “our,” and “us”) is a global business-to-business gaming technology company, supplying Server Based Gaming (“SBG”) and Virtual Sports (which includes Interactive) systems to regulated lottery, betting and gaming operators worldwide through an “omni-channel” distribution strategy. We provide end-to-end digital gaming solutions on our proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices such as smartphones and tablets and online computer and social applications. The Company was formed in Delaware on May 30, 2014 under the name Hydra Industries Acquisition Corp. (“Hydra”) as a “blank check company” for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, recapitalization or other similar business transaction, one or more operating businesses or assets. On December 23, 2016 (the “Closing Date”), the Company consummated a business combination by acquiring Inspired Gaming Group (“Inspired”) pursuant to a share sale agreement dated as of July 13, 2016 (the “Sale Agreement”). Pursuant to the Sale Agreement, the Company acquired all of the outstanding equity and shareholder loan notes of Inspired. The transaction was accounted for as a reverse merger where Inspired was the acquirer and Hydra was the acquired company. We refer to the acquisition and the other transactions contemplated by the Sale Agreement, collectively, as the “Business Combination” or the “Merger.” |
Management Liquidity Plans | Management Liquidity Plans As of June 30, 2019, the Company’s cash on hand was $33.7 million and the Company had working capital of $11.3 million. As of June 30, 2019, $2.9 million of our cash on hand had arisen from our operations in Greece and was being held in local accounts. In the ordinary course of business, we seek, from time to time, to transfer funds earned in Greece to our accounts outside of Greece. However, Greece imposes capital controls that can delay or prevent the flow of capital out of the country. The Company recorded net losses of $10.7 million and $4.0 million for the six months ended June 30, 2019 and 2018, respectively. The net losses arose principally from non-cash items, including stock-based compensation and the change in the value of the earnout liability, and, in the 2018 period, from payment-in-kind interest on the previous senior debt that is no longer a liability. Historically, the Company has generally had positive cash flows from operating activities and has relied on a combination of cash flows provided by operations and the incurrence of debt and/or the refinancing of existing debt to fund its obligations. Working capital of $11.3 million includes a non-cash settled item of $10.2 million of deferred income. Management currently believes that the Company’s cash balances on hand, cash flows expected to be generated from operations, ability to control and defer capital projects and amounts available from the Company’s external borrowings will be sufficient to fund the Company’s net cash requirements through August 2020. |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, or cash flows. It is management’s opinion, however, that the accompanying unaudited interim condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. On September 24, 2018, the Board of Directors approved a change in the Company’s fiscal year end from September 30 to December 31 commencing with the year ending December 31, 2019. As such, our last completed fiscal year ended on September 30, 2018, the three-month period from October 1, 2018 to December 31, 2018 was a transitional period and the six-month period from January 1, 2019 to June 30, 2019 is the first half of fiscal 2019. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the periods ended September 30, 2018 and 2017. The financial information as of September 30, 2018 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K filed with the SEC on December 10, 2018. The interim results for the three and six months ended June 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any future interim periods. |
Principles of Consolidation | Principles of Consolidation All monetary values set forth in these unaudited interim condensed consolidated financial statements are in US Dollars (“USD”) unless otherwise stated herein. The accompanying unaudited interim condensed consolidated financial statements include the results of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. |
Foreign Currency Translation | Foreign Currency Translation For most of our operations, the British pound (“GBP”) is our functional currency. Our reporting currency is the USD. We also have operations where the local currency is the functional currency, including our operations in mainland Europe and South America. Assets and liabilities of foreign operations are translated at period-end rates of exchange, equity is translated at historical rates of exchange and results of operations are translated at the average rates of exchange for the period. Gains or losses resulting from translating the foreign currency financial statements are recorded as a separate component of accumulated other comprehensive loss in stockholders’ deficit. Gains or losses resulting from foreign currency transactions are included in selling, general and administrative expenses, interest income (expense) and other finance (costs) income in the consolidated statements of operations and comprehensive loss. |
Use of Estimates | Use of Estimates The preparation of unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates these estimates, including those related to the revenue recognition for contracts involving software and non-software elements, allowance for doubtful accounts, inventory reserve for net realizable value, currency swaps, valuation of hedging activities, goodwill and intangible assets, useful lives of long-lived assets, stock-based compensation, valuation allowances on deferred taxes, earnout liability, pension liability, commitments and contingencies and litigation, among others. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. We regularly evaluate these significant factors and make adjustments when facts and circumstances dictate. Actual results may differ from these estimates. |
Revenue Recognition | Revenue Recognition The Company adopted Accounting Standards Codification ("ASC") 606 – Revenue from Contracts with Customers" ("ASC 606") as of January 1, 2019 using the modified retrospective method. This method allows the Company to apply ASC 606 to new contracts entered into after January 1, 2019, and to its existing contracts for which revenue earned through December 31, 2018 has been recognized under the guidance in effect prior to the effective date of ASC 606. The revenue recognition processes the Company applied prior to adoption of ASC 606 align with the recognition and measurement guidance of the new standard, therefore adoption of ASC 606 did not require a cumulative adjustment to opening equity. Under ASC 606, a performance obligation is a promise within a contract to transfer a distinct good or service, or a series of distinct goods and services, to a customer. Revenue is recognized when performance obligations are satisfied and the customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for goods or services. Under the standard, a contract's transaction price is allocated to each distinct performance obligation. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: 1. identify the contracts with a customer; 2. identify the performance obligations within the contract, including whether they are distinct and capable of being distinct in the context of the contract; 3. determine the transaction price; 4. allocate the transaction price to the performance obligations in the contract; and 5. recognize revenue when, or as, the Company satisfies each performance obligation. Step 1 – Identify the contract The Company identifies contracts with its customers when all parties have approved the contract and are committed to perform their respective obligations, when each party's rights and the payment terms regarding the goods or services to be transferred can be identified. The contract must also have commercial substance, and it must be probable that the Company will collect the consideration to which it will be entitled. Contracts entered into at or near the same time with the same customer or related parties of the customer are accounted for as one contract if any of the following criteria are met: a. Contracts were negotiated as a single commercial package (including whether a contract would be loss-making without taking into account the consideration received under another contract) b. Consideration in one contract depends on the other contract c. Goods or services (or some of the goods or services) are a single performance obligation. Step 2 – Identify performance obligations Performance obligations are identified by considering whether a good or service is distinct. The Company considers a good or service to be distinct only when the customer can benefit from it either on its own or together with other resources that are readily available, and when the promise to transfer the good or service to the customer is separately identifiable from other promises in the contract. The Company applies the series guidance to its performance obligations where the following criteria apply: a. Each distinct good or service in the series meets the criteria to be a performance obligation satisfied over time. b. The same method would be used to measure progress toward complete satisfaction of the performance obligation to transfer each distinct good or service in the series to the customer. Step 3 – Determine the transaction price The Company considers all amounts to which it has rights in exchange for the goods or services transferred in determining the transaction price. This includes fixed and variable consideration. Typically, consideration is stated in the contract with the customer. The Company assesses usage-based fees to determine whether they qualify as variable consideration. It also considers the impact of any liquidated damages clauses or service level agreements. Where the Company's performance obligations are determined to be a series, variable consideration is not estimated upfront in accordance with the exception allowed by ASC 606. Where non-refundable upfront fees are included in the Company's contracts with customer, the Company considers whether or not they represent payment for a transferred good or service. Where they represent payment for future goods or services, the Company further considers whether they represent a material right. Step 4 – Allocate the transaction price The Company allocates a transaction price to each performance obligation based on the relative standalone selling prices of the goods or services being provided. Where a contract includes multiple performance obligations, the Company determines the standalone selling price at contract inception of the distinct good or service underlying each performance obligation in the contract and allocates the transaction price in proportion to those standalone selling prices. Where possible, the Company uses the price charged for the good or service to other customers in similar circumstances as evidence of standalone selling price. Where this is not possible, the standalone selling price is estimated by experienced management using the best available judgement. With respect to performance obligations that are considered to be a series, where appropriate and where the required criteria are met, variable consideration is allocated entirely to a distinct good or service that is part of a series. Step 5 – Recognize revenue The Company recognizes revenue over time for performance obligations that meet one of the following criteria: a. The customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs. b. The Company's performance creates or enhances an asset that the customer controls as the asset is created or enhanced. c. The Company's performance does not create an asset with an alternative use to the Company, and the Company has an enforceable right to payment for performance completed to date Revenue for the Company's remaining performance obligations that do not meet one of the above criteria is recognized at the point at which the customer obtains control of the good or service. |
Server Based Gaming Revenue | Server Based Gaming Revenue Revenue from SBG terminals, access to our content and SBG platform, including electronic table gaming products is recognized in accordance with the criteria set forth in ASC 606 and is usually based upon a contracted percentage of the operator’s net winnings from the terminals’ daily use. Where this is not the case, revenue is based upon a fixed daily or weekly usage fee. We recognize revenue from these arrangements in accordance with the series guidance over time on a daily basis over the term of the arrangement, or when not specified over the expected customer relationship period. Performance obligations under these arrangements may include the delivery and installation of our SBG terminals for use over a term, as well as service obligations related to hardware repairs and server based content and maintenance. Consideration with respect to these performance obligations typically takes the form of usage based fees, billed at the end of a set period (usually monthly) and due typically 30 days from the date of the invoice. We sometimes bill for SBG arrangements up front in order to help fund our working capital and development requirements, or at the request of a customer. Upfront fees on SBG arrangements are deferred and recognized ratably over time, or when not specified over the expected customer relationship period, where they represent payment for future goods and services. In the case where we receive upfront fees pursuant to which there are no further obligations and no undelivered elements, we will recognize the upfront fees upon delivery. Upfront fees are normally billed upon signing of the relevant agreement, and become due and payable at set times thereafter. Hardware sales take the form of a transfer of ownership of our developed gaming terminals, and are recognized at a point in time upon delivery as they are considered to meet the required criteria to be considered distinct. Payment for hardware sales is typically due a set number of days after delivery. SBG arrangements typically include service level agreements, consisting of a specified amount of ‘uptime’ with financial penalties for breaches in excess of specified levels. |
Virtual Sports Revenue | Virtual Sports Revenue Revenue from licensing of our gaming software is recognized in accordance with the criteria set forth in ASC 606. Virtual sports retail revenue, which includes the provision of virtual sports content and services to retail betting outlets, and virtual sports online and mobile revenue, which includes the provision of virtual sports content and services to mobile and online operators, is based upon a contracted percentage of the operator’s net winnings or a fixed rental fee. We recognize revenue for these fees over time on a daily or weekly basis in accordance with the series guidance over the term of the arrangement. Consideration with respect to these performance obligations typically takes the form of usage based fees, billed at the end of a set period (usually monthly) and due typically 30 days from the date of the invoice. These arrangements also typically include a perpetual license billed up front, granted to the customer for access to our gaming platform and content. As these up front bills represent payment for future services, revenue from the licensing of perpetual licenses is recognized ratably over time, or when not specified, over the expected customer relationship period. Upfront fees are normally billed upon signing of the relevant agreement, and become due and payable at set times thereafter. Revenue from the development of bespoke games licensed on a perpetual basis to mobile and online operators is recognized at a point in time on delivery and acceptance by the customer. We have no ongoing service obligations subsequent to customer acceptance of our bespoke games, and they meet the criteria to be considered as distinct. Payment for bespoke games is typically due a set number of days after delivery. Virtual Sports arrangements typically include service level agreements, consisting of a specified amount of ‘uptime’ with financial penalties for breaches in excess of specified levels. |
Disaggregation of revenue | Disaggregation of revenue Information on disaggregation of revenue is included in Note 25 “Segment Reporting and Geographic Information.” |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Schedule of accounts receivable | June 30, 2019 September 30, (in millions) Trade receivables $ 13.1 $ 17.8 Less: long-term receivable recorded in other assets (1.8 ) (2.2 ) Other receivables 0.1 0.1 Allowance for doubtful accounts (0.7 ) (1.4 ) Total accounts receivable, net $ 10.7 $ 14.3 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | June 30, 2019 September 30, (in millions) Component parts $ 3.7 $ 3.6 Finished goods 1.9 1.6 Total inventories $ 5.6 $ 5.2 |
Prepaid Expenses and Other As_2
Prepaid Expenses and Other Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Prepaid Expense and Other Assets [Abstract] | |
Schedule of prepaid expenses and other assets | June 30, September 30, (in millions) Prepaid expenses and other assets $ 4.6 $ 5.0 Unbilled accounts receivable 7.2 10.8 Total prepaid expenses and other assets $ 11.8 $ 15.8 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment, net | June 30, September 30, (in millions) Short-term leasehold property $ 0.3 $ 0.4 Video lottery terminals 116.7 121.7 Construction in progress 0.3 — Computer equipment 8.6 8.7 Plant and machinery 1.9 2.5 127.8 133.3 Less: accumulated depreciation and amortization (96.2 ) (87.6 ) $ 31.6 $ 45.7 |
Software Development Costs, N_2
Software Development Costs, Net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Research and Development [Abstract] | |
Schedule of software development costs, net | June 30, September 30, (in millions) Software development costs $ 109.3 $ 100.9 Less: accumulated amortization (71.2 ) (60.9 ) $ 38.1 $ 40.0 |
Schedule of estimated software amortization expense | Year ending December 31, (in millions) 2019 (six months) $ 7.7 2020 14.1 2021 9.2 2022 4.4 2023 2.0 Thereafter 0.7 Total $ 38.1 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets and goodwill | June 30, September 30, (in millions) Trademarks $ 17.2 $ 17.6 Customer relationships 14.7 15.1 31.9 32.7 Less: accumulated amortization (28.7 ) (27.0 ) $ 3.2 $ 5.7 |
Schedule of estimated intangible asset amortization expense | Year ending December 31, (in millions) 2019 (six months) $ 1.6 2020 1.6 Total $ 3.2 |
Other Assets (Tables)
Other Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Other Assets, Noncurrent [Abstract] | |
Schedule of other assets | June 30, September 30, (in millions) Pension surplus $ 2.7 $ 5.3 Long term receivables 1.8 2.2 Long term prepaid expenses and other assets 3.3 4.6 $ 7.8 $ 12.1 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities | June 30, September 30, (in millions) Direct costs of sales $ 3.3 $ 4.4 Payroll and related costs 4.3 3.1 Accrued corporate cost expenses 0.8 3.2 Asset retirement obligations 1.0 0.5 Contract termination costs 0.2 — Interest payable - cash 0.1 0.1 Other creditors 5.1 3.0 $ 14.8 $ 14.3 |
Contract Liabilities and Othe_2
Contract Liabilities and Other Disclosures (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of changes in contract liabilities | Deferred Income (in millions) Balance at October 1, 2018 $ (33.1 ) Revenue recognized 9.5 Revenue deferred (5.6 ) Foreign currency translation adjustments 0.6 Balance at June 30, 2019 $ (28.6 ) Deferred Income (in millions) Balance at October 1, 2017 $ (27.3 ) Revenue recognized 10.6 Revenue deferred (16.9 ) Foreign currency translation adjustments 0.5 Balance at September 30, 2018 $ (33.1 ) |
Schedule of contract related balances (other than deferred income disclosed above) | Accounts Unbilled Customer (in millions) At October 1, 2018 $ 17.8 $ 10.8 $ (3.7 ) At June 30, 2019 13.1 7.2 (5.1 ) Accounts Unbilled Customer (in millions) At October 1, 2017 $ 25.5 $ 9.5 $ (4.3 ) At September 30, 2018 17.8 10.8 (3.7 ) |
Other Liabilities (Tables)
Other Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of other liabilities | June 30, September 30, (in millions) Customer prepayments and deposits $ 5.1 $ 3.7 Fair value of hedging instrument 0.5 0.2 Total other liabilities, current 5.6 3.9 Other payables, net of current portion — 0.5 Asset retirement obligations 0.3 0.4 Senior debt exit premium 4.2 4.2 Total other liabilities, long-term 4.5 5.1 $ 10.1 $ 9.0 |
Long Term and Other Debt (Table
Long Term and Other Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of outstanding debt and capital leases | Principal Unamortized Book value, (in millions) Senior bank debt $ 149.3 $ (7.6 ) $ 141.7 Capital leases and hire purchase contract 0.2 — 0.2 Total long-term debt outstanding 149.5 (7.6 ) 141.9 Less: current portion of long-term debt (9.5 ) — (9.5 ) Long-term debt, excluding current portion $ 140.0 $ (7.6 ) $ 132.4 Principal Unamortized Book value, (in millions) Senior bank debt $ 140.0 $ (8.7 ) $ 131.3 Capital leases and hire purchase contract 0.5 — 0.5 Total long-term debt outstanding 140.5 (8.7 ) $ 131.8 Less: current portion of long-term debt (0.5 ) — (0.5 ) Long-term debt, excluding current portion $ 140.0 $ (8.7 ) $ 131.3 |
Schedule of maturities of long-term debt | Fiscal period: Senior bank Capital leases Total (in millions) 2019 $ 9.3 $ 0.2 $ 9.5 2020 — — — 2021 — — — 2022 — — — 2023 140.0 — 140.0 Total $ 149.3 $ 0.2 $ 149.5 |
Derivatives and Hedging Activ_2
Derivatives and Hedging Activities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of outstanding derivatives designated as cash flow hedges that were used to hedge both interest rate risk and foreign exchange risk: | Foreign Currency Derivative Number of Pay Fixed Receive (in millions) Cross currency interest rate swaps 1 GBP 36.6 USD 46.7 |
outstanding derivatives that were not designated as hedges in qualifying hedging relationships: | Foreign Currency Derivative Number of Pay Fixed Receive (in millions) (in millions) Cross currency interest rate swaps 1 EUR 81.9 USD 93.3 |
Schedule of fair value of derivative financial instruments | The table below presents the fair value of the Company's derivative financial instruments as well as their classification in the consolidated balance sheet as of June 30, 2019. Balance Sheet Asset Balance Sheet Liability (in millions) (in millions) Derivatives designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ 0.5 Derivative Liability $ (0.8 ) Total derivatives designated as hedging instruments $ 0.5 $ (0.8 ) Derivatives not designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ — Derivative Liability $ (3.8 ) Total derivatives not designated as hedging instruments $ — $ (3.8 ) The table below presents the fair value of the Company's derivative financial instruments as well as their classification in the consolidated balance sheet as of September 30, 2018. Balance Sheet Asset Balance Sheet Liability (in millions) (in millions) Derivatives designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ 0.8 Derivative Liability $ (3.4 ) Total derivatives designated as hedging instruments $ 0.8 $ (3.4 ) Derivatives not designated as hedging instruments: Interest Rate and Foreign Exchange Products Fair Value of Hedging Instruments $ — Derivative Liability $ (4.4 ) Total derivatives not designated as hedging instruments $ — $ (4.4 ) |
Schedule of accumulated other comprehensive income | Amount of Gain Location of Gain (in millions) (in millions) Interest Rate and Foreign Exchange Products $ 0.3 Interest Expense $ 0.9 Foreign Currency Remeasurement 0.2 Total $ 0.3 $ 1.1 |
Schedule of consolidated income statements | Interest Expense Foreign Currency Remeasurement (in millions) Total amounts of income and expense line items presented in the statement of operations and comprehensive loss in which the effects of fair value or cash flow hedges are recorded $ 8.5 $ (0.3 ) Gain/(loss) on cash flow hedging relationships in Subtopic 815-20 $ 0.9 $ 0.2 |
Schedule of financial instruments not designated as hedging instruments | Derivatives Not Designated as Hedging Instruments under Subtopic 815-20 Location of Income Recognized in Amount of Income Recognized in (in millions) Interest Rate and Foreign Exchange Products Change in fair value of derivative liability $ (0.1 ) |
Schedule of offsetting of derivative assets and liabilities | Offsetting of Derivative Assets June 30, 2019 Gross Amounts Not Offset in the Statement of Financial Position Gross Amounts Gross Net Amounts the Statement Financial Cash Net (in millions) Fair value of hedging instrument $ 0.5 $ — $ 0.5 $ — $ — $ — Offsetting of Derivative Liabilities June 30, 2019 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 4.6 $ — $ 4.6 $ — $ — $ — Offsetting of Derivative Assets September 30, 2018 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 0.8 $ — $ 0.8 $ — $ — $ — Offsetting of Derivative Liabilities September 30, 2018 Gross Amounts Not Offset in the Gross Amounts Gross Net Amounts Financial Cash Net (in millions) Fair value of hedging instrument $ 7.8 $ — $ 7.8 $ — $ — $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of derivative financial instrument assets and liabilities measured at fair value on a recurring basis | June 30, September 30, Level 2019 2018 (in millions) Earnout liability (see Note 15) 3 $ — $ 8.0 Derivative liability (see Notes 13 and 16) 2 $ 4.0 $ 7.8 Long term receivable (included in other assets) 2 $ 1.8 $ 2.2 |
Earnout Liability (Tables)
Earnout Liability (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnout Liability [Abstract] | |
Schedule of earnout liability measured using significant unobservable inputs (Level 3) | (in millions) Balance – September 30, 2018 $ 8.0 Change in fair value of earnout liability 0.6 Settlement of earnout liability (8.6 ) Balance – June 30, 2019 $ — |
Stock - Based Compensation (Tab
Stock - Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of restricted stock unit activity | Number of Unvested Outstanding at September 30, 2018 2,272,261 Granted 721,522 Forfeited (13,202 ) Vested (39,053 ) Unvested Outstanding at June 30, 2019 2,941,528 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Income) (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive (loss) income | Foreign Currency Translation Adjustments Change in Fair Value of Hedging Instrument Unrecognized Pension Benefit Costs Accumulated Other Comprehensive (Income) (in millions) Balance at September 30, 2018 $ (78.9 ) $ 0.1 $ 20.3 $ (58.5 ) Change during the period 0.5 0.4 1.9 2.8 Balance at March 31, 2019 (78.4 ) 0.5 22.2 (55.7 ) Change during the period (0.7 ) 0.2 2.0 1.5 Balance at June 30, 2019 $ (79.1 ) $ 0.7 $ 24.2 $ (54.2 ) |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of antidilutive securities excluded from computation of earnings per share | Three and Six Months Ended 2019 2018 Earnout Shares — 2,500,000 RSUs 3,066,697 1,759,164 Unvested Restricted Stock 624,116 624,116 Stock Warrants 9,539,565 9,539,615 13,230,328 14,422,895 |
Other Finance Income (Costs) (T
Other Finance Income (Costs) (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Other Nonoperating Income (Expense) [Abstract] | |
Schedule of other finance income (costs) | Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 (in millions) (in millions) Pension interest cost $ (0.7 ) $ (0.7 ) $ (1.4 ) $ (1.5 ) Expected return on pension plan assets 0.9 0.9 1.8 1.9 Foreign currency translation on senior bank debt (3.2 ) — (0.3 ) — Foreign currency remeasurement on hedging instrument 2.1 — 0.2 — $ (0.9 ) $ 0.2 $ 0.3 $ 0.4 |
Pension Plan (Tables)
Pension Plan (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of defined benefit plans | Six Months Ended June 30, 2019 2018 (in millions) Components of net periodic benefit: Interest cost $ 1.4 $ 1.5 Expected return on plan assets (1.8 ) (1.9 ) Net periodic benefit $ (0.4 ) $ (0.4 ) |
Segment Reporting and Geograp_2
Segment Reporting and Geographic Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information by segment | Three Months Ended June 30, 2019 Server Virtual Corporate Total (in millions) Revenue: Service $ 16.4 $ 9.2 $ — $ 25.6 Hardware 1.1 — — 1.1 Total revenue 17.5 9.2 — 26.7 Cost of sales, excluding depreciation and amortization: Cost of service (4.4 ) (0.9 ) — (5.3 ) Cost of hardware (1.0 ) — — (1.0 ) Selling, general and administrative expenses (6.0 ) (2.1 ) (4.7 ) (12.8 ) Stock-based compensation expense (0.5 ) (0.3 ) (1.5 ) (2.3 ) Acquisition related transaction expenses — — (0.7 ) (0.7 ) Depreciation and amortization (7.2 ) (1.4 ) (0.5 ) (9.1 ) Segment operating income (loss) (1.6 ) 4.5 (7.4 ) (4.5 ) Net operating loss $ (4.5 ) Total assets at June 30, 2019 $ 81.0 $ 64.9 $ 41.8 $ 187.7 Total goodwill at June 30, 2019 $ — $ 44.7 $ — $ 44.7 Total capital expenditures for the three months ended June 30, 2019 $ 2.1 $ 1.6 $ 0.5 $ 4.2 Three Months Ended June 30, 2018 Server Virtual Corporate Total (in millions) Revenue: Service $ 24.5 $ 10.0 $ — $ 34.5 Hardware 2.4 — — 2.4 Total revenue 26.9 10.0 — 36.9 Cost of sales, excluding depreciation and amortization: Cost of service (4.6 ) (1.3 ) — (5.9 ) Cost of hardware (2.1 ) — — (2.1 ) Selling, general and administrative expenses (8.5 ) (2.4 ) (4.3 ) (15.2 ) Stock-based compensation expense (0.3 ) (0.2 ) (1.0 ) (1.5 ) Depreciation and amortization (8.8 ) (1.5 ) (0.3 ) (10.6 ) Segment operating income (loss) 2.6 4.6 (5.6 ) 1.6 Net operating loss $ 1.6 Total assets at September 30, 2018 $ 103.4 $ 69.5 $ 35.0 $ 207.9 Total goodwill at September 30, 2018 $ — $ 45.8 $ — $ 45.8 Total capital expenditures for the three months ended June 30, 2018 $ 11.9 $ 2.2 $ — $ 14.1 Six Months Ended June 30, 2019 Server Virtual Corporate Total (in millions) Revenue: Service $ 37.2 $ 19.2 $ — $ 56.4 Hardware 4.0 — — 4.0 Total revenue 41.2 19.2 — 60.4 Cost of sales, excluding depreciation and amortization: Cost of service (8.8 ) (1.9 ) — (10.7 ) Cost of hardware (2.6 ) — — (2.6 ) Selling, general and administrative expenses (12.6 ) (4.3 ) (10.6 ) (27.5 ) Stock-based compensation expense (0.9 ) (0.6 ) (2.9 ) (4.4 ) Acquisition related transaction expenses — — (1.6 ) (1.6 ) Depreciation and amortization (14.9 ) (2.9 ) (1.0 ) (18.8 ) Segment operating income (loss) 1.4 9.5 (16.1 ) (5.2 ) Net operating loss $ (5.2 ) Total capital expenditures for the six months ended June 30, 2019 $ 5.0 $ 3.0 $ 0.7 $ 8.7 Six Months Ended June 30, 2018 Server Virtual Corporate Total (in millions) Revenue: Service $ 48.1 $ 19.7 $ — $ 67.8 Hardware 6.6 — — 6.6 Total revenue 54.7 19.7 — 74.4 Cost of sales, excluding depreciation and amortization: Cost of service (9.3 ) (2.6 ) — (11.9 ) Cost of hardware (6.2 ) — — (6.2 ) Selling, general and administrative expenses (16.7 ) (5.3 ) (8.9 ) (30.9 ) Stock-based compensation expense (0.6 ) (0.5 ) (1.6 ) (2.7 ) Acquisition related transaction expenses — — (0.2 ) (0.2 ) Depreciation and amortization (17.5 ) (3.6 ) (0.6 ) (21.7 ) Segment operating income (loss) 4.4 7.7 (11.3 ) 0.8 Net operating loss $ 0.8 Total capital expenditures for the six months ended June 30, 2018 $ 20.7 $ 3.7 $ 0.1 $ 24.5 |
Schedule of geographic information | Geographic information for revenue is set forth below: Three Months Ended Six Months Ended June 30, 2019 2018 2019 2018 (in millions) (in millions) Total revenue UK $ 15.5 $ 22.6 $ 37.7 $ 47.2 Greece 4.8 7.6 9.6 13.1 Italy 4.2 4.2 8.4 9.0 Rest of world 2.2 2.5 4.7 5.1 Total $ 26.7 $ 36.9 $ 60.4 $ 74.4 Geographic information of our non-current assets excluding goodwill is set forth below: June 30, September 30, (in millions) Total non-current assets excluding goodwill UK $ 45.1 $ 60.0 Greece 28.4 36.2 Italy 2.1 3.4 Rest of world 5.1 3.9 Total $ 80.7 $ 103.5 |
Nature of Operations, Managem_3
Nature of Operations, Management's Plans and Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Cash on hand | $ 33.7 | $ 22.5 | $ 10.2 | $ 11 | $ 33.7 | $ 10.2 | $ 22.5 | ||
Working capital | 11.3 | ||||||||
Net loss | 10.7 | $ 5 | $ 4.7 | $ 4 | $ 0.5 | $ 4.2 | 15.7 | $ 4.5 | |
Earnout liability | 8 | ||||||||
Deferred revenue, current | 10.2 | 10.2 | $ 9.2 | ||||||
Greece [Member] | |||||||||
Cash on hand | $ 2.9 | $ 2.9 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Receivables [Abstract] | ||
Trade receivables | $ 13.1 | $ 17.8 |
Less: long-term receivable recorded in other assets | (1.8) | (2.2) |
Other receivables | 0.1 | 0.1 |
Allowance for doubtful accounts | (0.7) | (1.4) |
Total accounts receivable, net | $ 10.7 | $ 14.3 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Inventory Disclosure [Abstract] | ||
Component parts | $ 3.7 | $ 3.6 |
Finished goods | 1.9 | 1.6 |
Total inventories | $ 5.6 | $ 5.2 |
Inventory (Details Textual))
Inventory (Details Textual)) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Inventory Disclosure [Abstract] | ||
Reserves for excess and slow-moving inventory | $ 0.2 | $ 0.5 |
Prepaid Expenses and Other As_3
Prepaid Expenses and Other Assets (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Prepaid Expense and Other Assets [Abstract] | ||
Prepaid expenses and other assets | $ 4.6 | $ 5 |
Unbilled accounts receivable | 7.2 | 10.8 |
Total prepaid expenses and other assets | $ 11.8 | $ 15.8 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 127.8 | $ 133.3 |
Less: accumulated depreciation and amortization | (96.2) | (87.6) |
Property, plant and equipment, net | 31.6 | 45.7 |
Short-Term Leasehold Property [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 0.3 | 0.4 |
Video Lottery Terminal [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 116.7 | 121.7 |
Construction in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 0.3 | |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 8.6 | 8.7 |
Plant and Machinery [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 1.9 | $ 2.5 |
Property and Equipment, Net (_2
Property and Equipment, Net (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation and amortization expense | $ 4.4 | $ 5.4 | $ 9.2 | $ 10.7 |
Software Development Costs, n_3
Software Development Costs, net (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Research and Development [Abstract] | |||
Software development costs | $ 109.3 | $ 100.9 | |
Less: accumulated amortization | (71.2) | (60.9) | |
Software development costs, net | $ 38.1 | $ 38.1 | $ 40 |
Software Development Costs, N_4
Software Development Costs, Net (Details 1) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 |
Research and Development [Abstract] | |||
2019 (nine months) | $ 7.7 | ||
2020 | 14.1 | ||
2021 | 9.2 | ||
2022 | 4.4 | ||
2023 | 2 | ||
Thereafter | 0.7 | ||
Software development costs, net | $ 38.1 | $ 38.1 | $ 40 |
Software Development Costs, N_5
Software Development Costs, Net (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Research and Development [Abstract] | |||||
Payments to develop software | $ 3.7 | $ 4.4 | $ 7.4 | $ 8.8 | |
Internal use software | 1 | 1 | $ 1.3 | ||
Software costs amortized | 3.9 | 4.4 | 8 | 9 | |
Net realizable value software costs | $ 0 | $ 0 | $ 0 | $ 0.3 | |
Remaining amortization period | 3 years 1 month 6 days | 3 years 2 months 12 days | 3 years 1 month 6 days | 3 years 2 months 12 days |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Intangible assets and goodwill, gross | $ 31.9 | $ 32.7 |
Less: accumulated amortization | (28.7) | (27) |
Intangible assets and goodwill, net | 3.2 | 5.7 |
Trademarks [Member] | ||
Intangible assets and goodwill, gross | 17.2 | 17.6 |
Customer Relationships [Member] | ||
Intangible assets and goodwill, gross | $ 14.7 | $ 15.1 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill (Details 1) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2019 (six months) | $ 1.6 | |
2020 | 1.6 | |
Intangible assets and goodwill, net | $ 3.2 | $ 5.7 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Estimated useful lives | 10 years | ||||
Aggregate intangible asset amortization expense | $ 0.8 | $ 0.9 | $ 1.7 | $ 1.6 | |
Carrying amount of goodwill | $ 1.1 | $ 1.1 | $ 1.1 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Other Assets, Noncurrent [Abstract] | ||
Pension surplus | $ 2.7 | $ 5.3 |
Long term receivables | 1.8 | 2.2 |
Long term prepaid expenses and other assets | 3.3 | 4.6 |
Total | $ 7.8 | $ 12.1 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Payables and Accruals [Abstract] | ||
Direct costs of sales | $ 3.3 | $ 4.4 |
Payroll and related costs | 4.3 | 3.1 |
Accrued corporate cost expenses | 0.8 | 3.2 |
Asset retirement obligations | 1 | 0.5 |
Contract termination costs | 0.2 | |
Interest payable - cash | 0.1 | 0.1 |
Other creditors | 5.1 | 3 |
Accrued expenses, net | $ 14.8 | $ 14.3 |
Contract Liabilities and Othe_3
Contract Liabilities and Other Disclosures (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Balance at beginning | $ (33.1) | $ (27.3) |
Revenue recognized | 9.5 | 10.6 |
Revenue deferred | (5.6) | (16.9) |
Foreign currency translation adjustments | 0.6 | 0.5 |
Balance at ending | $ (28.6) | $ (33.1) |
Contract Liabilities and Othe_4
Contract Liabilities and Other Disclosures (Details 1) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 |
Accounts Receivable | $ 13.1 | $ 17.8 | |
Unbilled Accounts Receivable | 7.2 | 10.8 | |
Customer Prepayments and Deposits | $ (5.1) | $ (3.7) | |
October 1, 2018 [Member] | |||
Accounts Receivable | $ 17.8 | ||
Unbilled Accounts Receivable | 10.8 | ||
Customer Prepayments and Deposits | (3.7) | ||
October 1, 2017 [Member] | |||
Accounts Receivable | 25.5 | ||
Unbilled Accounts Receivable | 9.5 | ||
Customer Prepayments and Deposits | $ (4.3) |
Contract Liabilities and Othe_5
Contract Liabilities and Other Disclosures (Details Textual) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | ||
Revenue recognized in deferred income | $ 7.3 | $ 7.7 |
Other Liabilities (Details)
Other Liabilities (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Other Liabilities Disclosure [Abstract] | ||
Customer prepayments and deposits | $ 5.1 | $ 3.7 |
Fair value of hedging instrument | 0.5 | 0.2 |
Total other liabilities, current | 5.6 | 3.9 |
Other payables, net of current portion | 0.5 | |
Asset retirement obligation | 0.3 | 0.4 |
Senior debt exit premium | 4.2 | 4.2 |
Total other liabilities, long-term | 4.5 | 5.1 |
Other liabilities | $ 10.1 | $ 9 |
Long Term and Other Debt (Detai
Long Term and Other Debt (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Debt Instrument [Line Items] | ||
Senior bank debt | $ 141.7 | $ 131.3 |
Capital leases and hire purchase contract | 0.2 | 0.5 |
Total long-term debt outstanding | 141.9 | 131.8 |
Less: current portion of long-term debt | (9.3) | |
Long-term debt, excluding current portion | 132.4 | 131.3 |
Senior Bank Debt [Member] | ||
Debt Instrument [Line Items] | ||
Senior bank debt | 149.3 | 140 |
Capital leases and hire purchase contract | 0.2 | 0.5 |
Total long-term debt outstanding | 149.5 | 140.5 |
Less: current portion of long-term debt | (9.5) | (0.5) |
Long-term debt, excluding current portion | 140 | 140 |
Unamortized deferred financing charge | (7.6) | (8.7) |
Unamortized deferred financing charge, Total long-term debt outstanding | (7.6) | (8.7) |
Unamortized deferred financing charge, Long-term debt, excluding current portion | $ (7.6) | $ (8.7) |
Long Term and Other Debt (Det_2
Long Term and Other Debt (Details 1) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Debt Instrument [Line Items] | ||
Senior bank debt, Total | $ 141.7 | $ 131.3 |
Capital leases and hire purchase contract, 2019 | 0.2 | |
Capital leases and hire purchase contract, 2020 | ||
Capital leases and hire purchase contract, 2021 | ||
Capital leases and hire purchase contract, 2022 | ||
Capital leases and hire purchase contract, 2023 | ||
Capital leases and hire purchase contract, Total | 0.2 | 0.5 |
Total, 2019 | 9.5 | |
Total, 2020 | ||
Total, 2021 | ||
Total, 2022 | ||
Total, 2023 | 140 | |
Total | 141.9 | $ 131.8 |
Senior Bank Debt [Member] | ||
Debt Instrument [Line Items] | ||
Senior bank debt, 2019 | 9.3 | |
Senior bank debt, 2020 | ||
Senior bank debt, 2021 | ||
Senior bank debt, 2022 | ||
Senior bank debt,2023 | $ 140 |
Long Term and Other Debt (Det_3
Long Term and Other Debt (Details Textual) - USD ($) $ in Millions | Aug. 13, 2018 | Jun. 30, 2019 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Aggregate amount outstanding | $ 9.3 | |
Refinancing of External Borrowings [Member] | Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | P3Y | |
Interest rate | 4.00% | |
Decription of carry cash | Plus 3-month LIBOR | |
Interest cost | 1.40% | |
Refinancing of External Borrowings [Member] | Revolving Credit Facility [Member] | Euro Member Countries, Euro | ||
Debt Instrument [Line Items] | ||
Principal of face amount | $ 7.5 | |
Refinancing of External Borrowings [Member] | Senior term [Member] | ||
Debt Instrument [Line Items] | ||
Principal of face amount | $ 140 | |
Maturity date | P5Y | |
Interest rate | 9.00% | |
Decription of carry cash | Plus 3-month LIBOR |
Derivatives and Hedging Activ_3
Derivatives and Hedging Activities (Details) - Designated as Hedging Instrument [Member] - Cash Flow Hedging [Member] - Cross Currency Interest Rate Swap [Member] $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019USD ($)Instruments | Sep. 30, 2018USD ($)Instruments | |
Number of Instruments | Instruments | 1 | 1 |
Receive Floating Notional | $ 46.7 | $ 46.7 |
GBP [Member] | ||
Pay Fixed Notional | $ 36.6 | $ 36.6 |
Derivatives and Hedging Activ_4
Derivatives and Hedging Activities (Details 1) - Cross Currency Interest Rate Swap [Member] - Not Designated as Hedging Instrument [Member] $ in Millions | Jun. 30, 2019USD ($)Instruments | Sep. 30, 2018USD ($)Instruments |
Number of Instruments | Instruments | 1 | 1 |
Notional | $ 93.3 | $ 93.3 |
EUR [Member] | ||
Notional | $ 81.9 | $ 81.9 |
Derivatives and Hedging Activ_5
Derivatives and Hedging Activities (Details 2) - Fair Value Hedging [Member] - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Designated as Hedging Instrument [Member] | ||
Asset Derivatives Fair Value | $ 0.5 | $ 0.8 |
Liability Derivatives Fair Value | (0.8) | (3.4) |
Not Designated as Hedging Instrument [Member] | ||
Asset Derivatives Fair Value | ||
Liability Derivatives Fair Value | (3.8) | (4.4) |
Other Assets [Member] | Interest Rate and Foreign Exchange Products [Member] | Designated as Hedging Instrument [Member] | ||
Asset Derivatives Fair Value | 0.5 | 0.8 |
Other Assets [Member] | Interest Rate and Foreign Exchange Products [Member] | Not Designated as Hedging Instrument [Member] | ||
Asset Derivatives Fair Value | ||
Other Liabilities [Member] | Interest Rate and Foreign Exchange Products [Member] | Designated as Hedging Instrument [Member] | ||
Liability Derivatives Fair Value | (0.8) | (3.4) |
Other Liabilities [Member] | Interest Rate and Foreign Exchange Products [Member] | Not Designated as Hedging Instrument [Member] | ||
Liability Derivatives Fair Value | $ (3.8) | $ (4.4) |
Derivatives and Hedging Activ_6
Derivatives and Hedging Activities (Details 3) - Fair Value and Cash Flow Hedging [Member] $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Amount of Gain Recognized in Other Comprehensive Income on Derivative | $ 0.3 |
Location of Gain Reclassified from Accumulated Other Comprehensive Income into Income | 1.1 |
Interest Expense [Member] | Interest Rate and Foreign Exchange Products [Member] | |
Amount of Gain Recognized in Other Comprehensive Income on Derivative | 0.3 |
Foreign Currency Remeasurement [Member] | Interest Rate and Foreign Exchange Products [Member] | |
Amount of Gain Recognized in Other Comprehensive Income on Derivative | 0.9 |
Location of Gain Reclassified from Accumulated Other Comprehensive Income into Income | $ 0.2 |
Derivatives and Hedging Activ_7
Derivatives and Hedging Activities (Details 4) - Fair Value and Cash Flow Hedging [Member] $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Foreign Currency Remeasurement [Member] | |
Total amounts of income and expense line items presented in the statement of operations and comprehensive loss in which the effects of fair value or cash flow hedges are recorded | $ (0.3) |
Gain/(loss) on cash flow hedging relationships in Subtopic 815-20 | (0.2) |
Interest Expense [Member] | |
Total amounts of income and expense line items presented in the statement of operations and comprehensive loss in which the effects of fair value or cash flow hedges are recorded | 8.5 |
Gain/(loss) on cash flow hedging relationships in Subtopic 815-20 | $ 0.9 |
Derivatives and Hedging Activ_8
Derivatives and Hedging Activities (Details 5) - Subtopic 815-20 [Member] - Interest Rate and Foreign Exchange Products [Member] - Not Designated as Hedging Instrument [Member] $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Location of Income Recognized In Income On Derivative | Change in fair value of derivative liability |
Amount of Income Recognized in Income on Derivative | $ (0.1) |
Derivatives and Hedging Activ_9
Derivatives and Hedging Activities (Details 6) - Fair Value Hedging [Member] - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Offsetting of Derivative Assets | ||
Gross Amounts of Recognized Assets | $ 0.5 | $ 0.8 |
Gross Amounts Offset in the Statement of Financial Position | ||
Net Amounts of Assets presented in the Statement of Financial Position | 0.5 | 0.8 |
Gross Amounts Not Offset in the Statement of Financial Position | ||
Financial Instruments | ||
Cash Collateral Received | ||
Net Amount | ||
Offsetting of Derivative Liabilities | ||
Gross Amounts of Recognized Liabilities | 4.6 | 7.8 |
Gross Amounts Offset in the Statement of Financial Position | ||
Net Amounts of Liabilities presented in the Statement of Financial Position | 4.6 | 7.8 |
Gross Amounts Not Offset in the Statement of Financial Position | ||
Financial Instruments | ||
Cash Collateral Received | ||
Net Amount |
Derivatives and Hedging Acti_10
Derivatives and Hedging Activities (Details Textual) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2018 | |
ISDA Agreements [Member] | ||
Fair value of derivatives in a net liability position | $ 4.1 | $ 7 |
Agreement termination value | $ 5.6 | |
Note Purchase Agreement [Member] | Gaming Acquisitions Limited [Member] | Cross Currency Interest Rate Swap [Member] | ||
Term of contract | 3 years | |
Description of terms | The principal and interest payments that will be payable in USD under the Note Purchase Agreement to Euros ("EUR"), in part, and GBP, in part. Specifically, with respect to the principal payments 1/3 of the payments will be swapped from USD to EUR and 2/3 of the payments from USD to GBP. Additionally, with respect to the interest payments 1/3 will be swapped from USD to GBP and 2/3 from USD to EUR. The swap provides for a foreign exchange rate of $1.13935 USD per €1 EUR and $1.27565 USD per £1 GBP. | |
Description of foreign exchange rate | The swap provides for a foreign exchange rate of $1.13935 USD per €1 EUR and $1.27565 USD per £1 GBP. |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Long term receivable (included in other assets) | $ 1.8 | $ 2.2 |
Level 3 [Member] | Fair Value, Recurring [Member] | ||
Earnout liability (see Note 14) | 8 | |
Level 2 [Member] | Fair Value, Recurring [Member] | ||
Derivative liability (see Notes 12 and 15) | 4 | 7.8 |
Long term receivable (included in other assets) | $ 1.8 | $ 2.2 |
Earnout Liability (Details)
Earnout Liability (Details) - Level 3 [Member] $ in Millions | 9 Months Ended |
Jun. 30, 2019USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance | $ 8 |
Change in fair value of earnout liability | 0.6 |
Settlement of earnout liability | 8.6 |
Balance |
Earnout Liability (Details Text
Earnout Liability (Details Textual) | 6 Months Ended |
Jun. 30, 2019shares | |
Earnout Liability [Abstract] | |
Earnout shares issuable | 2,500,000 |
Description of earnout shares issuable | If such EBITDA results with respect to the Earnout Jurisdictions was equal to or greater than £15,000. Based on the EBITDA results for such fiscal year with respect to the Earnout Jurisdictions, the Company issued 1,323,558 shares of common stock as Earnout Consideration in March 2019, resulting in an aggregate amount of $8.6 million recorded upon the settlement of the earnout liability, with a corresponding credit to stockholders deficit. |
Derivative Liability (Details)
Derivative Liability (Details) - 2018 Plan [Member] - Restricted Stock Units (RSUs) [Member] $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($)shares | |
Additional paid in capital | $ | $ 0.8 |
Management [Member] | |
Number of awards outstanding | shares | 542,770 |
Description of award vesting | The 2018 Plan with respect to fiscal 2018 to members of management and other participants with a three-year vesting schedule (i.e., one-third vesting on each of December 31, 2019, 2020 and 2021). |
Stock - Based Compensation (Det
Stock - Based Compensation (Details) - Incentive Plan [Member] - Unvested Restricted Stock [Member] | 9 Months Ended |
Jun. 30, 2019shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Unvested Outstanding at beginning balance | 2,272,261 |
Granted | 721,522 |
Forfeited | (13,202) |
Vested | (39,053) |
Unvested Outstanding at ending balance | 2,941,528 |
Stock - Based Compensation (D_2
Stock - Based Compensation (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | May 31, 2019 | |
Stock-based compensation | $ 4.4 | $ 2.7 | ||||
Issuance of an aggregate shares of common stock | 500,000 | |||||
Employee stock ownership plan, description | The Company began a twelve-month offering period under the ESPP on June 3, 2019 that authorizes employees to contribute up to 10% of their base compensation to purchase a maximum of 1,000 shares. The shares will be purchased on the last day of the offering period at a discounted price that will equal to 85% of the lower of: (i) the closing price at the beginning of the offering period and (ii) the closing price at the end of the offering period. The Company estimates that approximately 10,000 shares will be purchased during this offering period. | |||||
Remaining shares are purchase | 475,400 | |||||
2018 Plan [Member] | ||||||
Authorized shares to be issued | 2,550,000 | |||||
Outstanding awards plan, description | (i) 2,489,197 shares subject to outstanding awards under the Prior Plans, including 1,092,633 shares subject to market-price vesting conditions, and (ii) 1,201,616 shares subject to outstanding awards under the 2018 Plan, including 286,181 shares subject to performance-based target awards as to which the number that ultimately may vest would range from 0% to 200% based on the performance level attained. As of June 30, 2019, there were 1,348,384 shares available for new awards under the 2018 Plan (or 1,062,203 shares if we reflect inclusion of performance-based awards at the maximum level of performance) and no shares available for new awards under the Prior Plans. All awards consist of RSUs and Restricted Stock. | |||||
New awards of restricted shares | 1,348,384 | 1,348,384 | 1,348,384 | |||
Awards granted, description | (1) the 542,770 RSUs approved for management and other participants with respect to fiscal 2018 as to which the contingent cash-settlement feature lapsed upon approval of the 2018 Plan by stockholders (see Note 16, "Derivative Liability") and (2) 572,435 RSUs approved for management and other participants with respect to fiscal 2019 comprised of two components: (i) 50% represent performance-based target RSUs that require both attainment of Company performance criteria for 2019 and the participants remaining employed for a three-year service period; and (ii) 50% represent service-based RSUs that vest over a period of three years. In addition, an aggregate of 86,500 RSUs were awarded during the quarter ended June 30, 2019 (following approval of the 2018 Plan by stockholders) as new hire or special recognition grants. | |||||
RSU's [Member] | ||||||
Number of shares issued | 9,806 | |||||
Number of shares withheld for taxes | 1,059 | |||||
Stock-based compensation | $ 2.3 | $ 1.5 | $ 4.4 | $ 2.7 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Mar. 31, 2019 | |
Foreign Currency Translation Adjustments | ||
Beginning balance | $ (78.4) | $ (78.9) |
Change during the period | (0.7) | 0.5 |
Ending balance | (79.1) | (78.4) |
Change in Fair Value of Hedging Instrument | ||
Beginning balance | 0.5 | 0.1 |
Change during the period | 0.2 | 0.4 |
Ending balance | 0.7 | 0.5 |
Unrecognized Pension Benefit Costs | ||
Beginning balance | 22.2 | 20.3 |
Change during the period | 2 | 1.9 |
Ending balance | 24.2 | 22.2 |
Accumulated Other Comprehensive (Income) | ||
Beginning balance | (55.7) | 58.5 |
Change during the period | 1.5 | 2.8 |
Ending balance | $ 54.2 | $ (55.7) |
Net Loss per Share (Details)
Net Loss per Share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Net Loss per Share (Textual) | ||||
Number of antidilutive securities excluded from computation of earnings per share | 13,230,328 | 14,422,895 | 13,230,328 | 14,422,895 |
RSUs [Member] | ||||
Net Loss per Share (Textual) | ||||
Number of antidilutive securities excluded from computation of earnings per share | 3,066,697 | 1,759,164 | 3,066,697 | 1,759,164 |
Unvested Restricted Stock [Member] | ||||
Net Loss per Share (Textual) | ||||
Number of antidilutive securities excluded from computation of earnings per share | 624,116 | 624,116 | 624,116 | 624,116 |
Earnout Shares [Member] | ||||
Net Loss per Share (Textual) | ||||
Number of antidilutive securities excluded from computation of earnings per share | 2,500,000 | 2,500,000 | ||
Stock Warrants [Member] | ||||
Net Loss per Share (Textual) | ||||
Number of antidilutive securities excluded from computation of earnings per share | 9,539,565 | 9,539,615 | 9,539,565 | 9,539,615 |
Other Finance Income (Costs) (D
Other Finance Income (Costs) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Other Nonoperating Income (Expense) [Abstract] | ||||
Pension interest cost | $ (0.7) | $ (0.7) | $ (1.4) | $ (1.5) |
Expected return on pension plan assets | 0.9 | 0.9 | 1.8 | 1.9 |
Foreign currency translation on senior bank debt | (3.2) | (0.3) | ||
Foreign currency remeasurement on hedging instrument | 2.1 | 0.2 | ||
Other finance income (costs) | $ (0.9) | $ 0.2 | $ 0.3 | $ 0.4 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Taxes (Textual) | ||||
Effective income tax rate (in percent) | 0.90% | 1.00% | 0.00% | 2.80% |
Income tax expense (benefit) | $ 0.1 | $ 0.1 | ||
Valuation allowance | $ 59 |
Related Parties (Detailsl)
Related Parties (Detailsl) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Related Parties (Textual) | ||||
Expenditure amounted to less than | $ 0.1 | $ 0.1 | $ 0.1 | $ 0.1 |
HG Vora Special Opportunities Master Fund, Ltd. [Member] | ||||
Related Parties (Textual) | ||||
Interest expense | $ 4.1 | $ 8.2 | ||
HG Vora Special Opportunities Master Fund, Ltd. [Member] | Convertible Notes Payable [Member] | ||||
Related Parties (Textual) | ||||
Percent of investment owns | 16.50% | 16.50% |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Jun. 11, 2019 |
Commitments and Contingencies (Textual) | |
Cost of the acquisition, description | The cost of the acquisition, excluding fees, is the Euro equivalent of $120 million. The Company anticipates financing the transaction by refinancing all existing indebtedness and entering into an agreement for a new £220 million loan (made up of £ and Euro components) and a £20 million revolver facility. |
Pension Plan (Details)
Pension Plan (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Components of net periodic benefit: | ||||
Interest cost | $ 0.7 | $ 0.7 | $ 1.4 | $ 1.5 |
Expected return on plan assets | $ (0.9) | $ (0.9) | (1.8) | (1.9) |
Net periodic benefit | $ (0.4) | $ (0.4) |
Pension Plan (Details Textual)
Pension Plan (Details Textual) $ in Millions | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Pension Plan (Textual) | |
Employer contributions paid | $ 0.2 |
Segment Reporting and Geograp_3
Segment Reporting and Geographic Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Revenue: | |||||
Total revenue | $ 26.7 | $ 36.9 | $ 60.4 | $ 74.4 | |
Cost of sales, excluding depreciation and amortization: | |||||
Selling, general and administrative expenses | (12.8) | (15.2) | (27.5) | (30.9) | |
Stock-based compensation expense | (4.4) | (2.7) | |||
Acquisition related transaction expenses | (0.7) | (1.6) | (0.2) | ||
Depreciation and amortization | (9.1) | (10.6) | (18.8) | (21.7) | |
Segment operating income (loss) | (4.5) | 1.6 | (5.2) | 0.8 | |
Net operating loss | (4.5) | 1.6 | (5.2) | 0.8 | |
Total assets | 187.7 | 187.7 | $ 207.9 | ||
Total goodwill | 44.7 | 44.7 | 45.8 | ||
Total capital expenditures | 4.2 | 14.1 | 8.7 | 24.5 | |
Corporate Functions [Member] | |||||
Revenue: | |||||
Total revenue | |||||
Cost of sales, excluding depreciation and amortization: | |||||
Total assets | 41.8 | 41.8 | 35 | ||
Total goodwill | |||||
Total capital expenditures | 0.5 | 0.7 | 3.7 | ||
Virtual Sports [Member] | |||||
Revenue: | |||||
Total revenue | 9.2 | 10 | 19.2 | 19.7 | |
Cost of sales, excluding depreciation and amortization: | |||||
Total assets | 64.9 | 64.9 | 69.5 | ||
Total goodwill | 44.7 | 44.7 | 45.8 | ||
Total capital expenditures | 1.6 | 2.2 | 3 | 3.7 | |
Server Based Gaming [Member] | |||||
Revenue: | |||||
Total revenue | 17.5 | 26.9 | 41.2 | 54.7 | |
Cost of sales, excluding depreciation and amortization: | |||||
Total assets | 81 | 81 | 103.4 | ||
Total goodwill | |||||
Total capital expenditures | 2.1 | 11.9 | 5 | 20.7 | |
Hardware [Member] | |||||
Revenue: | |||||
Total revenue | 1.1 | 2.4 | 4 | 6.6 | |
Hardware [Member] | Corporate Functions [Member] | |||||
Revenue: | |||||
Total revenue | |||||
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | |||||
Selling, general and administrative expenses | (4.7) | (4.3) | (10.6) | (8.9) | |
Stock-based compensation expense | (1.5) | (1) | (2.9) | (1.6) | |
Acquisition related transaction expenses | (0.7) | (1.6) | (0.2) | ||
Depreciation and amortization | (0.5) | (0.3) | (1) | (0.6) | |
Segment operating income (loss) | (7.4) | (5.6) | (16.1) | (11.3) | |
Hardware [Member] | Virtual Sports [Member] | |||||
Revenue: | |||||
Total revenue | |||||
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | |||||
Selling, general and administrative expenses | (2.1) | (2.4) | (4.3) | (5.3) | |
Stock-based compensation expense | (0.3) | (0.2) | (0.6) | (0.5) | |
Acquisition related transaction expenses | |||||
Depreciation and amortization | (1.4) | (1.5) | (2.9) | (3.6) | |
Segment operating income (loss) | 4.5 | 4.6 | 9.5 | 7.7 | |
Hardware [Member] | Server Based Gaming [Member] | |||||
Revenue: | |||||
Total revenue | 1.1 | 2.4 | 4 | 6.6 | |
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | (1) | (2.1) | (2.6) | (6.2) | |
Selling, general and administrative expenses | (6) | (8.5) | (12.6) | (16.7) | |
Stock-based compensation expense | (0.5) | (0.3) | (0.9) | (0.6) | |
Acquisition related transaction expenses | |||||
Depreciation and amortization | (7.2) | (8.8) | (14.9) | (17.5) | |
Segment operating income (loss) | (1.6) | 2.6 | 1.4 | 4.4 | |
Service [Member] | |||||
Revenue: | |||||
Total revenue | 25.6 | 34.5 | 56.4 | 67.8 | |
Service [Member] | Corporate Functions [Member] | |||||
Revenue: | |||||
Total revenue | |||||
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | |||||
Selling, general and administrative expenses | (4.7) | (4.3) | (10.6) | (8.9) | |
Stock-based compensation expense | (1.5) | (1) | (2.9) | (1.6) | |
Acquisition related transaction expenses | (0.7) | (1.6) | (0.2) | ||
Depreciation and amortization | (0.5) | (0.3) | (1) | (0.6) | |
Segment operating income (loss) | (7.4) | (5.6) | (16.1) | (11.3) | |
Service [Member] | Virtual Sports [Member] | |||||
Revenue: | |||||
Total revenue | 9.2 | 10 | 19.2 | 19.7 | |
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | (0.9) | (1.3) | (1.9) | (2.6) | |
Selling, general and administrative expenses | (2.1) | (2.4) | (4.3) | (5.3) | |
Stock-based compensation expense | (0.3) | (0.2) | (0.6) | (0.5) | |
Acquisition related transaction expenses | |||||
Depreciation and amortization | (1.4) | (1.5) | (2.9) | (3.6) | |
Segment operating income (loss) | 4.5 | 4.6 | 9.5 | 7.7 | |
Service [Member] | Server Based Gaming [Member] | |||||
Revenue: | |||||
Total revenue | 16.4 | 24.5 | 37.2 | 48.1 | |
Cost of sales, excluding depreciation and amortization: | |||||
Cost of goods and services sold | (4.4) | (4.6) | (8.8) | (9.3) | |
Selling, general and administrative expenses | (6) | (8.5) | (12.6) | (16.7) | |
Stock-based compensation expense | (0.5) | (0.3) | (0.9) | (0.6) | |
Acquisition related transaction expenses | |||||
Depreciation and amortization | (7.2) | (8.8) | (14.9) | $ (17.5) | |
Segment operating income (loss) | $ (1.6) | $ 2.6 | $ 1.4 |
Segment Reporting and Geograp_4
Segment Reporting and Geographic Information (Details 1) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | $ 26.7 | $ 36.9 | $ 60.4 | $ 74.4 |
Italy [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 4.2 | 4.2 | 8.4 | 9 |
UK [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 15.5 | 22.6 | 37.7 | 47.2 |
Greece [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | 4.8 | 7.6 | 9.6 | 13.1 |
Rest of World [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total revenue | $ 2.2 | $ 2.5 | $ 4.7 | $ 5.1 |
Segment Reporting and Geograp_5
Segment Reporting and Geographic Information (Details 2) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total non-current assets excluding goodwill | $ 80.7 | $ 103.5 |
Italy [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total non-current assets excluding goodwill | 2.1 | 3.4 |
Greece [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total non-current assets excluding goodwill | 28.4 | 36.2 |
UK [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total non-current assets excluding goodwill | 45.1 | 60 |
Rest of World [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total non-current assets excluding goodwill | $ 5.1 | $ 3.9 |
Customer Concentration (Details
Customer Concentration (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Accounts Receivable [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.00% | 10.00% | |||
Accounts Receivable [Member] | Customer Two [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 12.00% | 13.00% | |||
Accounts Receivable [Member] | Customer One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 17.00% | 15.00% | |||
Accounts Receivable [Member] | Customer Three [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 12.00% | ||||
Sales Revenue, Net [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.00% | 10.00% | 10.00% | 10.00% | |
Sales Revenue, Net [Member] | Customer Two [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 16.00% | 21.00% | 15.00% | 17.00% | |
Sales Revenue, Net [Member] | Customer One [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 19.00% | 23.00% | 21.00% | 23.00% | |
Sales Revenue, Net [Member] | Customer Three [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.00% | 11.00% | 11.00% | 15.00% |