Earnings call transcript Q4 2022

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Operator

Good morning, everyone, and welcome to the Inspired Entertainment's Fourth Quarter 2022 Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [Operator Instructions]

Please note, today's event is being recorded. of company's XXXX statement is earnings in Investors the the appears also to site the quarter Web fourth press section refer Safe that Harbor in available at Please www.inseinc.com. company's the release, which

the my Executive Lorne go turn Please over to It is to call now ahead. pleasure Weil, Chairman.

Lorne Weil

Good Thank you Operator. joining our you, Thank for morning, everyone. call. year-end conference

to our as his last you join on me great Brooks are with Chief know usual Executive title. milestone. the has present call added has I will call me who Brooks Here very in deservedly since on Pierce, all congratulating this

ago. We a CFO, moment Stewart regained our also have to who time more than have his as in seems since full you'll see strength Baker, some illness

years, first rejoined team corporate Inspired a VP Eric We morning years of talented six our key our from for this member conference the around Scientific Inspired this Games extremely an for are Development. and also and merger with making that by in as recently and development and later, (ph) Carrera, Eric Roth joined team [Spec] call development who key Incidentally, undertook of was finance the time of Brooks of ago. Corporate the executive, part Eric a California. are many finance

if are our free attending listeners them any down. of to So, Roth, please track feel

before instead to confident with Games, his that opportunity years are Cornet than in. try Scientific a the a Executive quite as highly and well-deserved to familiar in Aimee, gaming great firm pursue mention the Inspired, Chief departed have and ICR, many and elsewhere replace also Rather after Relations Jacques gaming should Remey chosen that we really we has retain and to team at world. I of Aimee recently Investor

successfully principals with I non-executive years, years. capital ICR handled for us the very work last ICR a And at did head few equity have Bear listed markets Scientific for company, York affiliation the of Games, which for organization had New he the an several has while great Exchange was Investor for of Relations Stearns. at One Tecnoglass, close

Congratulations So, and your Stewart? to again and welcome continued Eric great Jacques. to health. Brooks,

Stewart Baker

As $XXX ahead of EBITDA far by any in milestone reached XXXX a million anticipated we time, for XXXX some measure.

our consensus. the community we for the forward-looking XXXX And stand so been in has in past, much research longer. accurate provide expect don't guidance, its far, is official 'XX As generally will practice don't as the pretty is we but unfolding milestone that

numbers as have than important is planned. could More the well out themselves, overarching our as we playing strategy

of us Our to businesses our the the moving light (ph) for direction combined well. as quarter -- in year higher growth, business the grew direction account of time, margin, excuse talking me, At model. XXXX, less our is capital-intensive XX% [immeasurably] strategy higher same digital earlier, business the XX% from driving fourth hold our right of towards retail EBITDA up in in

the through of quarter, we deliver Betfred Vantage Paddy Cabinets During X,XXX to and combined a signed with brand XXXX. contracts Power fourth new

as major an accounts acceleration the major a course accounts Cabinet explained see been previously, in end EBITDA actually win uplift has capital showing trials, per run effect. capital-light Because fact XXXX, step-down As EBITDA in these two positive can field we by XXXX. these has very day occasioned Vantage its notwithstanding XX% new much pretty we proceeds the in anticipate we will of have the the roller the our from strategy in through by from

the attending bill half I Entertainment has like new while of introduction, I seen annual by had In roughly but almost Cabinets for to we dreading built backlog had market. XX arcade, we in in show no call Show Vantage booth markets. arcade as C, London, we provided Cabinet and a Inspired our targeted ago, attended time is product like seen. pub month close And for Vantage the adult new range the doubt, in gaming ever also the center been ICE CAT on been of to known the and Stewart at the the and version just of since star exhibiting aforementioned at have years, now show nothing a response Without the betting Vantage was the About discussed demos a that shop and and X,XXX its this our of receiving or U.K., it the for particular, team the version were now. this,

result and profitability as accelerating this couple but And entry a very quietly, been of Our a came since. years into ago. have of acquisition Novomatic our revenue business the rapidly

the declined As of business the we at overall growth the many of discussed response in to are sharply and number in that maximum XXXX will drive betting tandem, has grown gaming recall, in you our reduction arcades shops to we nauseam of that the helping now in in traditional XXXX, number experiencing. time, actually ad stakes

seems unintended with the to surprises one those of unintended an dividend. very us this rare where So, consequences of cases, be law

customer we a business. our on CAT hugely pub positive Vantage impact on expect response, comparable Based have C will

gain, all see but appropriate a detail me of get release, an Our timing to revenue had related of in will which the importantly, expect we deliver Most was weakness day, you per there say in restore market in quarter. moment. profitability. We and in of was was But leisure attributable higher the the in to to the share let can overall business level far now, successful decline see sector into Vantage combine begin But state, movements, perhaps pub conversion will greater the currency a most some itself to leisure of ahead the all-digital there that very fourth a to that Cabinet more to confidently for a base. and business as to Brooks customer more XXXX. XXXX as this press hiccup mostly

Interactive $XX.X million more less of is fourth quarter for Virtual the the the or XXXX. business XXXX, of speaks of level businesses for digital Sports was EBITDA The our of performance XX% above fourth combined itself. in The and quarter the

quarter of Virtual general only not Sports its year-over-year came depths it both live prior the amazing leaving time COVID, as during us live levels, the dramatically which onstream, game combination businesses' when thinking many at accelerated of business only But as so gaming existing venues continued pre-COVID development. online of by growth both organic fourth not to speak. which back customers, been venues town, currency. Europe, across a revenue, effective growth to in saw business that to that illustrated product remember customers, new Sports trajectory Virtual revert has new level. it down sports sports geographies, would XX% and the will shut were recent to live measured The retreat once was in and numbers, with live and functional The most XX% the accelerate, this new growth in very Underlying and did Virtual

Likewise, defied it shorter there coming that growth will another online well. strategy world, to predictions Interactive the term, retreat our of several America; lately post-COVID In driven and the own longer EBITDA are drivers XX% But the has term, in our by important be of to predominantly working business. overall coming Interactive business new aspect posting essentially to in that jurisdictions. the be reaccelerate, growth in seems Interactive in the indeed it begun all of would North of quarter, the fourth

with end our of expect development into have we extremely in go completed feel enhancements other Pennsylvania. completed of market, entry our lagged significant that the iGaming FanDuel, room markets. drive we an states, our and growth recently very given market some in all timing growing important and in left Pennsylvania integration week still strength March, last live to we because platform We have our important to by FanDuel should the the the And

lastly words activities. a about our say me lottery Let few

itself, DR operation content, development and very we million, scope Our retail With operation the to over we that March. Dominican we use Republic run results the end the a the that will a time the captive of test, nine in and operation the a expect running refine, are this have us will the lottery well our in network, United well-ahead launch can of of the give working is expectations. platform locations, same flagship into operation our to Since location worldwide. our lotteries the showcase it population important give of about benefits XX and year-ago, Republic enhance to state continuing is and an size of iLottery three revenue retail comparable profitability been the Dominican us this are it this iLottery It and and taking in to the States at will many iLottery There and figures, X,XXX platform, before will on of around world. launch. in

our quarter, an a program, nine, purchased little XX,XXX average million repurchased at $X.XX. finally, shares price we average In over the we a And about of the program. word repurchase an since of X and on fourth have of shares price at the inception stock

this We will have authorization, in monitor room significant carefully. repurchase to remaining and continue our we

over that, it with hand And I'll Brooks. to

Brooks Pierce

for have Lorne, the for last on importantly, but congratulations over years mentorship Okay. given and the XX Thank the you, you me and the more change, my you thank thanks title guidance sincere now.

The provide the ahead our quarter dive and the full-year, deeper for perspective by momentum and encouraged XXXX. we're overall what continues in into XXXX. quarter carrying a one I I'll and performance the into and normally little four extremely business seeing perform business we're and the results, do, segment Now certainly itself into well, that's and as for each to on

a Although the land-based Virtual we includes and Interactive, digital and reported view business business we business, more into segments, lottery four simplistically which gaming, bit leisure. and Sports the the

particularly by content characterized retail, past. digital more in is holiday cash service pubs, of of growth from coming venues, margins, installed from is parks, for standpoint leveraging CapEx EBITDA. represent including halls. business shops, North motorway adult is lighter by rates, capital centers, by centers revenues business business gaming opportunities growth box our than America, base been and it increasing lower various lottery, the has Land-based intensity, betting characterized in the capabilities higher across Digital of XX% a types bingo our higher increasing than and and recurring now This growth

in organizations organizations business retail in consolidating the the We're When midst acquired in business process, consolidation U.K. the The year. also the a Novomatic Technology a this to the will two generate we've synergies. land-based has kept business few significant start tremendous across savings field second-half in we plan ago, operating but on that service our the we the as U.K. of now years embarked of separate starting

both. Lorne adage to company But grow. can Jack the make that grow do worry us they don't money successful a anybody the about don't test and have true making Welch anybody have its to can constantly money, of they reminds if ability if is to of

committed Within both EBITDA enterprise. XXX% XXXX Sports on business record basis XX% deliver continues a doing are across with to or We to functional XX% up on currency functional the a results and Virtual full-year basis. digital revenue up currency

mix launches record addition, quarter, we run have of and these of the including across multiple Greece the XX% U.K., trends of and Virtual showing the roughly quarter, contribute scheduled home and online like our games retail, and will shootout between and number continue first lines growth in to that product quarter across and in Morocco. Year-on-year, are a and assets second Sports multiple are the we the both end believe but online first the retail product These in XX% at beginning Italy, results. to continuing geographies, the enhancements

in as for us. We're also now that Northern business significant market a American encouraged making we're is progress Virtual the Ontario our Sports

we customers betting Our launch sports and two to later performing DC and XXXX. this expect operators and pipeline opportunities building and in well, additional of U.S. into in lottery a that are states lottery Pennsylvania year we're

the basis digital currency of We're a QX XX% very U.S. part, Interactive live in approximately in compared this on encouraged revenue of Interactive, are yet, by side progress market. grew with FanDuel, still the or to QX other who Inspired mentioned, business, the with of making XXXX, XX% Lorne iGaming we're iGaming not the our comes growth functional as

management QX of content, live consistent in currently games, growth by with either end new customers, in improved roadmaps, targeting delivery a team greatly QX. being are early account is and America new additions driven Europe. with and towards more both likely of We faster or integrations North expanded within the This

our game titles next eagerly over that some customers. looks about licensed our few by amazing excited out very Terminator quarters, seen and coming a We're the including that I've it's anticipated of

XXXX. also As ICE coming new and a our has Lorne positive we was segment from received at momentum into tremendous our belief that the mentioned, our feedback games new customers booth business products throughout, and confirms on this capacity

the with largest we're to of under sale backs mentioned side, was contract through Betfred the the Cabinets, QX weather of Corporation which, quarter the whole project. This operating American QX gaming Power us machines. this very significant of and Lottery on as important Western partnership cash due Valor to in the great XXX the in on of in proud was Vantage delivered Terminals. customer as gaming successfully the North and of extremely to our double-digit of the our achievement group Moving Canada also machine and that the for trial we Lorne Paddy achieved difficult trial a delivered signed a some was conditions, Saskatchewan quarter successful significant uplift box produced a with

thoroughly in the operational which content also not over throughout last installed grown come his terminals these Vantage cabinets delivering tremendously covered as logistics of going X,XXX and forward busy AGC approximately years gets base a the bigger. delivering about that fees sale, of with Lorne remarks two XXXX the is tail our we'll initial building base to But the bigger pipeline these the the insignificant market We'll a XXXX. of across has beyond machines in and challenge. be estates customers, both and be very

of forward, our footprint machine Looking early trials will successful, two for we're North business. gaming that stages the if American in a build customers North larger America, in with

Pub mentioned more fourth specifically Lorne challenging leisure As had our business and a earlier, the quarter. segment

market a share generate us, to impact should confidently midyear rare new parks XXXX, At earnings. strategic in While the same temporary in the which of of customer, be a we key signed peaked strategic equivalent believe the continues loss market this fourth time, quarter. we we which and a experienced by for holiday very

we We'll our Vantage ahead Lorne machine really product in this DNA. should nicely higher machine the share detail in therefore roll that we and his end feel and lottery remarks year income driving Pub in and it for share his enthusiasm confident the regained per in out covered throughout the as the market, I activities leisure. vertical is both

the throughout based see which biggest but Many a this and North of that transferable are worldwide, our worldwide. to particularly as and iLottery National work of build our customers on operators within Lottery Virtual Lottomatica vertical eventually believe our our jurisdictions we've experience lottery ton in OPAP, around Morocco world, careers, the to iLottery lottery we such momentum Caesar, content, Sports, for had the our be America, retail in platforms and DR, will other starting

With that, I'll hand it over to Stewart for some further remarks.

Stewart Baker

morning. Good Brooks. you, Thank

has in a give the we with of performance couple mentioned are a already areas. already, the as the As pleased have update other been numbers keep on and and of a I'll covered, quarter overview year, the brief also been the number very of metrics short

which none conversion functional been in As results with U.S. results. impacted rates, come the a to places, recent of have by currency the but into reported few we exchange so than GDP quarters, dollar play more

to the pound in the to a 'XX, XXX from full-year, rate Across fall of to QX rate of average XXXX, was X.XX of declined X.XX. the QX XX%. dollar compared average In XXX

For best otherwise, underlying stated on comments to this unless the functional currency focus business. to I'll the keep trends of reason variances

So, in fourth And does revenue as comparison impact reminder, impact while overall, QX. prior-year the no quarter, there's XX%. in lockdowns, the to a such of the full-year include grew the number

environment. gaming Interactive On XX%, and a trading Sports is grew grew XX% Virtual like-for-like And as XX%. this such, a segmental basis, grew

is by obviously revenue gaming delivery impacted Western impressive growth also gaming's service grew XX%. an While the Canada, to positively

that the worth by in Leisure bonus a mentioning revenue services holiday and by Brooks. included grew tough a of XX% in motorway comparative that was part reasons It's segment the performance mentioned benefit impacted the declined X% by growth prior-year. for this also revenue the

a up margin a was will comparable margins ironically businesses, overall the similar as growing EBITDA such thesis revenue year-on-year, Adjusted amount by increase. faster XX%, businesses is digital adjusted EBITDA year-on-year, the overall to XX% grow land-based that were as than our and also

adjusted the to of Sports Virtual combined XX%, excluding Interactive With margin XX%, corporate of four quarter grew trading XX.X% by segments the EBITDA margin margin XX.X%. and from EBITDA for

and from some the had prior-year margin benefits However, number non-repeatable company current benefited the total same. impact, stayed that the year opposite the overall the meaning corporate

the full-year, EBITDA adjusted for XX%. Overall, and revenue XX% increased

previously, leisure. the which COVID obviously gaming this dampened increasing lockdowns, XXXX isn't the on the in impacted first months touched by to with But prior-year comparatives As XX%, revenue few of contributing factor rates, were and growth only Interactive XX%. Virtual Sports the and increasing

year-to-date going talk great talk the be will it to about aside, about able with be impact lockdowns. an As to of results forwards

profit $X.X a prior-year. To million to the of $X.X for further grew statement from tax income down in million quarter, the loss the before

loss the full-year per profit diluted $X.XX from before twelve-month grew of in share to of for $X.XX grew tax For a $XX.X per and Earnings period, loss in a to per from XXXX 'XX. share of million. basic positive $XX.X million it $X.XX the share

Turning $XX.X attention $XX with of decrease breakdown million, it with around follows. quarter million, a the the to cash, we as ended million at $XX.X started and

payment included of around biannual quarter the Firstly, interest $XX million. a

at capital largest to which in were the capital there now have revenue cash to to timing the in receivable reverse biggest of due cases we Secondly, say in and in significant items work The the majority to all turned quarter, these I'm was working of pleased outflows in the the of quarter. expect XXXX. first outflows, sales accounts

increase an in inventory holdings. saw also We

any $XXX to on to prior-years, the challenges As be net expect short-term able we we end In at X.X mentioned chain year-end of times, trend from with continue EBITDA less in senior the And and this, have to in investments deliberate reduced had net of was not and leverage X.X And XXXX. to XXXX. close reduction debt significantly in leverage supply the this or XXXX. of to of cash terminals would the the meaningful front the this delayed these release, the expect get in net loss would of make times sales of we foot during to secured results, potential us amount deliver have million. suffered dollars and at

borrowings, the we talk don't rate we our interest will Xst the fixed, on on option June XXXX. opportunity bonds you of take have subject this until in May, call bond I While while to remind a do are expire our is and

about I with the today, So, with us. where of are and to reporting ahead return excited and I we pleased reiterate we opportunities that are that, the results started, are

I will it before Q&A. remarks any to for closing Lorne now I for up open hand back

Lorne Weil

nice It's to that Stewart. anything report further don't always can hear no, to call you, that's Thank if And Operator, the I our you open positive. have questions so please. to up add.

Operator

[Operator first question from from Your Jonas of Truist Barry comes the Securities. line Instructions]

Your open. line is

Barry Jonas

Good guys. Hey, morning.

XXXX. First I but off, Brooks, you is guidance you highlighted congratulations -- things and question for know clearly first there I the lot to have for giving my EBITDA positive not -- full-year, guidance guess are of a

So, year, seasonality you consolidated give roll the how Thanks. maybe any growth trajectory see on altogether, it as and you as well? you any more then, thoughts on EBITDA can color this

Lorne Weil

if EBITDA Well, the gave roll how perspective XXXX, for all together be probably considered to on consolidated of that produce positives guidance. a Barry, we the would clear I think

in we all full-year the I think going but I that, do say. outperform and So, consensus can do are through that out to market, the the consensus. can about feel the we good can I XXXX about That's numbers we to don't everything are we think

Barry Jonas

as color think for it you curious lottery the And sort of that's get for legalizing new was Dominican existing content the looking about your or competitive to on helpful. potential iLottery. around more markets jurisdictions growth and I helpful platform, attacking wins? Okay, specifically pretty to even thoughts guess and

Lorne Weil

with iLottery knows Nobody to new jurisdictions. what's happen going

at would it's working iLottery. what's be only think it's we but that now behind expected to is There right it ways sure. to we where that impossible this say lotteries are happen, handful I a quite we bunch have point everybody have of a we I for [won this would know at are North to a There happen going I really (ph), it] and think think in -- make are where point. are America is

the Barry the outside terms really revenue because think much operators the as there our strategy, for as existing more think of opportunity we I own a any we in I in the should number platform. States. short-term at more of of In particularly strategy, content opportunities on industry America jurisdictions United content but think are say, don't I North in supplier, changing looking are in as for will content platform are platform But I well. grows, also interested our lottery their and both in of least that at be the focused isn't and our

and So, in the site around sense demo opportunities the Europe be a world, that lotteries DR would in us, dozens be for there would -- that that are for is because particularly America of us. Latin

Brooks Pierce

one just thing, me add and the let for thank and thanks well, -- Lorne, Yes, more you. Barry,

One that test opportunity, in the things, platform. thing iLottery to does really Dominican the slower bit of it's the -- content, going in it's refine nice little as product us whether about Republic and Lorne things are give ironically, mentioned, the it a whether frankly, is this side the

So, frankly, DR, may bit like everything. product and pretty little the it's advantage ultimately that to content a think lead we test us, out as much an where build market our our in I can the a we going for slower, fact

the So, perspective. from it's bit a slower in for, our to worst things for at world little not thing the be least going

Lorne Weil

good Brooks. Yes, that's point. a very Thanks,

Barry Jonas

Got it. guys. much excited Day whenever Analyst appreciate so happens. that Dominican Well, I the color, it. the Thanks for all for

Operator

line comes from the from David question of next your Riley. Bain B. And

is line open. Your

David Bain

happy Awesome. Thank Analyst Day. comment Congrats you. that. I and to on about reiterate hear the Barry's Brooks,

Brooks Pierce

I thought analyst to you for week. going an were ask

David Bain

it, mean I sounds it young set it today? helpful. year this gaming. so next If up Is in mid-innings can or anyway, obviously, scarce how of is growth Well, going a forward even over mean us view picture growth couple be still products Perfect. engine potential should we versus iLottery next, yes, better. I the other Sports of product? Can big you very where the years, that me I you we're helpful, year? to kind give that'll unique last Virtual versus at maybe obvious for given mean here, Yes, the

Stewart Baker

take that, at a shot to want You Brooks?

Brooks Pierce

tremendous, Yes, world growth have we obviously with and number in a I some of amazing new are a out geographies we little a out. certainly are bit, these like flatten products at think going it's opportunities of rates number but the point that we feel coming to around feel

Some that's one America, talking minute. to about And we've North the for a us. seen to a commensurate to there. frequency, significant even we've be we've increase that and I that that And we've going in a this lottery a with I of things the having operators two uplift has around in my is mean gotten the minutes idea taken mentioned Ontario number are to product, cycles of been works the and obviously and made we've is done, minutes Dave, to from product the people remarks biggest betting revenue, for every some about down, market, quite three progress betting which really market number now the we conversations but kind both I a of we've coming the in think helps of operators. validate and certainly it market markets viable. been how sports And time think

operators, to betting product sports to the this of add is for terms their great a In mix. them

the Virtual lot across feel like a business. we all runway So, of of Sports got we've

David Bain

to studios, team you there's aligned thanks, from kind maybe you broaden give just if changes as from us of a to forward? going this like they iLottery, a creation feeding to kind are and Okay, Land-based. about, awesome. And up going How perspective, categories think and perspective, of Can set categories as dedicated be CapEx Virtual something any strengthen another? how really a you into the Interactive, is just then, sense content sort do lottery of Brooks, Sports, one have you or

Brooks Pierce

in had great and iLottery done used gain teams, that did mean on honestly, we're would cylinders, actually that at at content. to work we capacity, in on Yes, year really they -- of build across it. going we're he's really are going all momentum if who add to tie games, we've some excited run business, of out and the for content it's particularly realm whole have terms the we're potentially where you I of acquire if games add the see ICE, ourselves seen what content pretty point, side out hitting to that three but studio space, into this capacity be kind a We about. question, iLottery the to coming hire possibility probably us or created the at you'll we not it of it's But additional certainly that whether someone some

all of what kind produce to we're to world-class generating capacity we really So, content is we're enough about, and it. have sure certainly that going make

David Bain

Awesome. Thank you.

Brooks Pierce

Thanks, Dave.

Operator

Group. from Your Ryan Sigdahl Capital the next question from Hallum comes of Craig line

Your line is open.

Ryan Sigdahl

this any year. around what more beyond timeline X,XXX that Power, Congrats capacity do there the smaller Curious, to asset haven't is want model morning. the you then, and to two, supply more that? Curious performance talked secondly, the Good about with installing Betfred on that transition throughout year. those XXXX do but in to have other gaming to Paddy so enough also are light that transitioning? and you the customers chain looks Brooks, And I to like start transitioning with cabinets

Brooks Pierce

they're where Yes, so install but but financial I'll customers to a replaced the little we've a locations. think do side, operational terminals, before we about probably and little of talk about number number this X,XXX done huge look, going our a a it with bit we're side. bit partnership cabinets because Yes, the of over I we've should in Stewart talk

locations. through a with our all in So, an get it's to the standpoint, customers to supply from the lot all operational of coordination working literally chain them installed way from

of quarter of and bit maybe terminals pretty that's have even So, into much the fourth of to going we'll before third a the most replaced. kind second, bleed take little all these

in is relation anything Ryan his bit to able so and deliver in to of challenge, that about in confident get is decision just guess stuff, Stewart the we've deal on to a to able -- there back going be all it's in inventory Stewart, terms front conscious to know, a with I little this Well, a be go anything pretty I don't I feel we done big remarks, of as think, terms said the the made we supply chain out foot, but it. and forward

Ryan Sigdahl

beyond to Talk customers two potentially about any transition? other those

Brooks Pierce

in think one U.K. trial one of another North that one terminals mention one, be in I the terminals. both be is But would jurisdiction expect meaningful of that have Not of up and another now in America. XXX on an to we it I But we terms these order and active X,XXX kind in this location could did of

So, in But got it will obviously build which and trials more we're stretch ultimately business. is any two we through have want a way. have big is shouldn't North successful if gaming where But do presence, there to we'll North we've what go successful America in them. markets with to a American us be

Ryan Sigdahl

done; one U.S. the Then I and you're that beyond the congrats and I so in integration, which other Pennsylvania, on believe live state others? those. see curious Interactive, MGM guess just leaders on updates and only good beyond and some timeline maybe then Penn in of the DraftKings, that your FanDuel Caesars operators, finally on that major to iGaming the on two market. then Any

Brooks Pierce

of leader, guess biggest I MGM customer of the our Yes, tell produce good. to continue resonate probably and amazing and don't with the North interestingly, coming are were performance continue we New late in really space licensed I they of American very within our DraftKings And about produce relationship a they well. level, mentioned to excited their iGaming I has I as great with can have that is as of the certainly live do we the we to don't down all world. with but license, so DraftKings Jersey in nationwide you so very been think, and the out. them. content Connecticut the Terminator some have results disclose them And more and around that brands us market, rest customer

Scientific So, products, that obviously familiar we're Games, very with with with with space. background licensed our we're

of and of forward a differentiate going So, to you'll more ourselves. way more I see us that think for kind as

Ryan Sigdahl

Good guys. Great. Thanks, luck.

Brooks Pierce

Thanks, Ryan.

Operator

line Jordan of JMP Bender the from Your next comes from question Securities.

open. is line Your

Jordan Bender

start Great, want again, my thanks Brooks. for taking I the on side. to and questions, Virtual congrats

did continued Virtual stronger, for throughout margins the get XXXX. to So, they

As we something now are generating Thank about 'XX, you. think sustainable at these that in should margins we these are the forward levels? the look you're

Brooks Pierce

would there's se, my that It's terms really there's different perspective what the content. of be just than a us obviously margins. growth per the great reason And developing perspective, From capital really. for we're It's my seeing. margins from any yes, and no business in the no rates the

than any I unless why So, don't feels see where any will margins are. or be any Stewart different they Lorne feel differently, reason

Stewart Baker

No, I agree.

Brooks Pierce

Stewart. ahead, Go

Stewart Baker

I bit there's go is agree. right. it a business those more to I so mean, so continue does operating that growing, can margins the get far only leverage, but

'XX, increase to see are business this obviously might a love. so, over small with 'XX begin high in that we we And but margins the that's

Jordan Bender

how we is Great. And kind that then, the how for where M&A going cash you've of in the my think year? been shares follow-up, for year. allocation and absent capital 'XX, kind of should is we mean the about repurchasing I throughout about should priorities think

Stewart Baker

Yes, I the repurchasing certainly shares allocation in mix. capital think is

prices adding businesses but to is, high of now, access philosophically, us don't or that we're feeling we are be that we growth strengthen right because for any and pretty strategic and balance now, paying assets consistent handle our to can need there give can growing isn't need I'd sheet our with growth strengthening looking as our to have asset certainly to I interested in to by always unnecessarily M&A the buy right we say don't We're competencies much base. our smaller earnings, targets. markets have. that think attitude much as acquisition we generate way very one tuck-in our businesses we our acquisitions

what think about that's it, how I that's and think realistically I might thinking we're in able to you XXXX. So, be expect

Jordan Bender

Great. Thanks.

Operator

[Operator Beynon Instructions] Macquarie. question the from of Your Chad line next comes from

open. is line Your

Chad Beynon

orders to Good taking But think thinking talked that Also question. kind Congratulations. Western Brooks, gaming in fourth quarter. my to I Brooks. the wanted morning. Thanks of 'XX. the you're Canadian about for delivering I markets new echo on and with about still congrats of do, offering the few about couple all other and to my continue a types start in opportunities given is for remarks the you as know business Thanks. harder market? it retail look priority this white gaming the as just to color side, space you're get kind in we markets, at years, American machines a of to the is North of currently licensed on the or in a we just

Brooks Pierce

Yes, of that's thanks, for that because have our technology the Chad. of we've the on. GXS Look, think plenty everyone we'll with we're targeting market VLT built we we kind business runways, know you but explain, primarily this,

Oregon. So, provinces, there's Canadian certainly opportunities a across of number the

at any in moved we have So, or is sight chose GXS pretty I we're into be the competency racing the primary doing obviously we're space those see are is the historical we to much markets that the a is horse going line something the But our VLT, those would Class or of anything to. right Illinois into able that to if that say for. moment. now of growth. to contemplating go really we market driver that not certainly markets for replacement market. now the X But

Chad Beynon

Okay, perfect. in it's a but just help margin that the with for addendum trying the that, just know an don't will that cash when to of free and games that flow for in no dynamics? year, will I understand be deployed, to year, are as an this be that number show Betfred you terms a standpoint, will also it those from you. but CapEx will 'XX Q, kind Thank number, inflated P&L CapEx the if provided a the printed know Stewart, sure and of then you could I us number then, Thanks. for then I'm And

Brooks Pierce

Paddy go so and me so say, sales, Power, terms and so start they'll bit, the Yes, margin. the no let as Betfred approximately on cost revenue through in of you of last

impact no margin. So, on impact CapEx, negatively but overall will EBITDA

to clear as as forward can so So, that going going out. we're we possible make try strip and that

we million that sorry call, CapEx the on year, cash come the around just the the In overall got customers. prior some the complicated we've $XX gets for about slightly in 'XX, talked an terms of as 'XX came consideration with because CapEx upfront mark, from does and of 'XX in

that in also talked about before. inflation of where but us it's of bit there's we kind So, from see, we from of those if internally. up strip But before, mid-$XX region talked lot million, of for a opportunities about numbers probably the that in there's we out, slightly a to invest

Chad Beynon

I great. Thank appreciate it. all. that's you, Okay,

Brooks Pierce

Thanks, Chad.

Operator

are remarks. will to for this some call questions. final there And time, over At no Mr. Lorne back the turn closing you Weil, further I

Lorne Weil

have you happy obviously forward I say We're XXXX. of in to to with Operator. all three about your we speaking months. with don't in than our you, about very optimistic Thank you. appreciate performance last support, we're year. other performance Thank much our very We look and

Operator

call. conference Thank your you participation. today's concludes This for

now may You disconnect.

Inspired Entertainment (INSE) 13 Mar 232022 Q4 Earnings call transcript