INSPIRED ENTERTAINMENT Reports Record Profits for FY2022 Q4
April 2, 2023
Earnings Overview
On March 13th, 2023, INSPIRED ENTERTAINMENT ($NASDAQ:INSE) released its Q4 results for the fiscal year ending on December 31st, 2022. Compared to the same period in 2021, the company showed a 358.3% increase in total revenue and a 17.3% growth in net income, amounting to USD 3.1 million and USD 78.6 million respectively.
Transcripts Simplified
All participants will be in a listen-only mode. Operator Instructions. After today’s presentation, there will be an opportunity to ask questions. Operator Instructions. Today’s conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the call over to your host, Mr. Lawrence Levy, President and CEO of Inspired Entertainment. Sir, please go ahead. Thank you and good morning everyone. Joining me today on the call are our Chief Financial Officer, Mr. Sam Linsky; and our Chief Legal Officer, Ms. Bonnie Spanier. Before we begin, Iwould like to remind everyone that any forward-looking statements made during this call are subject to risks and uncertainties that could cause actual results to differ materially from what is discussed on this call. We undertake no obligation to publicly update or revise any forward-looking statements made during this call, whether as a result of new information, future events or otherwise.
Adjusted EBITDA for the quarter was $8 million, an increase of 8% from last year. We made considerable progress in the first quarter with our VLT business across Europe and Mexico as we continue to capitalize on our proven land-based games and technology platform. Finally, we had several key operational wins in the quarter that I’m pleased to report will further expand our presence in existing and new markets across Europe, Latin America and Asia Pacific. With that, I’ll now turn it over to Sam Linsky to discuss our financials in more detail. Thank you Lawrence and good morning everyone. Now I’ll turn it back over to Lawrence for closing remarks. Thank you Sam. We continue to capture market opportunities with our proven land-based games and technology platform as well as strengthen our presence in existing and new markets across Europe, Latin America and Asia Pacific. That concludes today’s call. Thank you for your time and interest in Inspired Entertainment.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Inspired Entertainment. More…
| Total Revenues | Net Income | Net Margin |
| 285.4 | 22.3 | 7.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Inspired Entertainment. More…
| Operations | Investing | Financing |
| 34.8 | -40.4 | -11.1 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Inspired Entertainment. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 309.4 | 367.1 | -2.23 |
Key Ratios Snapshot
Some of the financial key ratios for Inspired Entertainment are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 23.0% | -6.2% | 17.8% |
| FCF Margin | ROE | ROA |
| -1.8% | -58.7% | 10.3% |
Stock Price
On Monday, INSPIRED ENTERTAINMENT reported record profits for its fiscal year 2022 fourth quarter, yet its stock prices plummeted nonetheless. The company opened at $14.7, but closed at $14.0 – a 7.5% drop from its prior closing price of 15.2. Despite the record profits, investors were apparently spooked by the company’s declining stock prices. The disappointing stock market performance is especially concerning considering the company’s reported profits for the fiscal year 2022 fourth quarter.
However, despite the strong profitability numbers, INSPIRED ENTERTAINMENT’s stock prices failed to reflect the good news. This could be due to the company’s plans to increase its marketing and advertising budget in order to reach more customers. The increased spending could put a strain on the company’s bottom line, which may have worried some investors and caused them to sell off their shares. Despite the drop in stock prices, INSPIRED ENTERTAINMENT remains committed to its plans. The company’s CEO indicated that they are confident in their strategy and believe that it will ultimately benefit shareholders in the long run. Moving forward, investors should keep a close eye on INSPIRED ENTERTAINMENT’s stock prices and profitability to see if the company can continue to deliver strong results. Live Quote…
Analysis
At GoodWhale, we recently conducted an analysis of INSPIRED ENTERTAINMENT‘s fundamentals. According to our Risk Rating, INSPIRED ENTERTAINMENT is a medium risk investment in terms of both financial and business aspects. In further detail, we have detected two potential risk warnings in the income sheet and balance sheet of the company. If you’re considering investing in INSPIRED ENTERTAINMENT, take a look at our analysis to better inform your decision. Just register on GoodWhale.com for complete access. We delve deep into the financials to identify risk warnings you may not have seen on the surface. Our Risk Rating system is designed to help you make informed decisions that are right for you and your portfolio. With GoodWhale, you can get the data and insights you need to make the best possible investments. Join us today and get started with your next smart investment. More…
Peers
The competition in the gaming industry is becoming increasingly fierce. Inspired Entertainment Inc is up against some tough competition from Greek Organisation of Football Prognostics SA, Galaxy Gaming Inc, and NanoTech Gaming Inc. All of these companies are vying for a piece of the pie in the gaming industry.
– Greek Organisation of Football Prognostics SA ($OTCPK:GOFPY)
The company’s market cap is 4.66B as of 2022 and its ROE is 40.93%. The company’s main business is providing football prognostics and it operates in Greece, Cyprus, Bulgaria, Romania and Serbia.
– Galaxy Gaming Inc ($OTCPK:GLXZ)
Galaxy Gaming is a gaming company that designs, develops, and manufactures casino table games and gaming machines. The company has a market cap of $54.5 million and a return on equity of -17.74%. Galaxy Gaming is headquartered in Las Vegas, Nevada.
Summary
Inspired Entertainment‘s financial results for the fourth quarter of fiscal year 2022 (ending December 31 2022) revealed an impressive 358.3% increase in total revenue to USD 3.1 million and a 17.3% rise in net income to USD 78.6 million, year over year. Despite such strong results, the stock price dropped on the same day, likely due to investor anticipation of new products and services from the company in the future. To assess the potential of Inspired Entertainment as an investment, investors should closely monitor the company’s upcoming offerings, their impact on revenue, and how the stock fares in response to such developments.
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