Revenue increased 72% to $71. 3 million from $41. 5 million in prior year Virtual Sports Revenue increased 71% year-over-year to a record quarterly level - $14. 0 million Net Income increased to $7. 5 million , or $0. 26 per diluted share, from a Net Loss of $43. 8 million in prior year Adjusted EBITDA 1 increased 227% to $26. 1 million from $8. 0 million in prior year Secured long-term strategic partnership with William Hill for UK gaming estate Since announcing its share repurchase program, Inspired has repurchased 734,349 shares of common stock for $7. 1 million (average price of $9. 73 per share) as of August 9, 2022 NEW YORK , Aug. 9, 2022 /PRNewswire/ -- Inspired Entertainment, Inc. ("Inspired" or the "Company") (NASDAQ: INSE ), a leading B2B provider of gaming content, technology, hardware and services, today reported unaudited financial results for the three-month period ended June 30, 2022 . Total Revenue increased 72% year-over-year for the three months ended June 30, 2022 on a reported basis 2 and 91% in functional currency. The results reflect a continuation of the trends seen in the last quarter, including growth in the Company's aggregate online business, which includes the Virtual Sports and Interactive segments, and ongoing strength in the Gaming and Leisure segments. Virtual Sports Revenue increased 71% year-over-year to a record $14. 0 million on a reported basis (90% in functional currency), with Online Virtual Sports Revenue increasing 99% year-over-year in functional currency. Subsequent to the end of the quarter, DC Lottery became the second North American lottery to launch Inspired's Virtual Sports, both in retail and online. Interactive Revenue was flat year-over-year on a reported basis (increased 12% in functional currency), with growth in business volumes primarily driven by North America and Greece . Results in the UK were impacted by many of our UK operator customers enhancing protections for players in advance of the proposed UK Gambling Act review. During the quarter, we went live with seven operators in Ontario and Rush Street in Pennsylvania with several additional customer launches in these new jurisdictions expected throughout the remainder of 2022. Early indications from these new markets (Adjusted EBITDA grew 15% in June versus prior year in functional currency) suggest future growth opportunities driven by geographic expansion of iGaming into new North American markets as well as enhancements to our technology, content and product offerings. Gaming Revenue increased 57% on a reported basis (75% in functional currency) and Leisure Revenue increased 130% year-over-year on a reported basis (157% in functional currency), as recurring revenues returned to pre-COVID-19 performance levels and Leisure benefited from a strong local holiday business. Strength in the Gaming and Leisure businesses continues as major UK contracts/extensions were signed with William Hill , Greene King and Mitchells & Butlers. Net Income improved to $7. 5 million , or $0. 28 per basic share and $0. 26 per diluted share, from a net loss of $43. 8 million , or $(1. 94) per basic and diluted share, in the prior-year period. Adjusted EBITDA increased 227% year-over-year on a reported basis (262% in functional currency). Adjusted EBITDA Margin 1 improved to 37% in second quarter 2022 compared to 19% in second quarter 2021. ________________________________ 1 "Adjusted EBITDA" and "Adjusted EBITDA Margin" are non-GAAP financial measures defined below under "Non-GAAP Financial Measures" and reconciled to the most directly comparable GAAP measures in the accompanying supplemental table. Adjusted EBITDA Margin is calculated as a percent of Revenue. 2 Reported income statement results assume GBP:USD exchange rate was GBP 1. 26: USD 1. 00 for the three months ended June 30, 2022 and GBP 1. 40: USD 1. 00 for the three months ended June 30, 2021. "This quarter's underlying performance is a testament to the resiliency of our diversified business model as well as what we perceive to be the continued strength in consumer spending across our segments – notwithstanding ongoing macro trends," said Lorne Weil , Executive Chairman of Inspired. "Virtual Sports was, once again, the standout in the quarter, producing its fourth record-setting Revenue and Adjusted EBITDA quarter in a row, with online Virtual Sports doubling year-over-year versus strong comparatives, speaking to our strong product development and increased market penetration. Interactive revenue increased year-over-year on a functional currency basis as we increased our footprint through numerous integrations. In our land-based business, we're delighted to see that customer gross win per unit in betting shops and holiday parks was ahead of pre-COVID levels as consumers continue to frequent betting shops and pubs and are staying local for holidays. " Weil continued, "We are very excited about the current trends in our business and what's to come, including our recent Interactive launches in Ontario and particularly in Pennsylvania , where we are witnessing strong results with only one customer live and we have several additional customer launches to follow in the year, and the launch of Virtual Sports with the DC Lottery, our second North American lottery. We have also successfully negotiated a long-term strategic partnership/extension with William Hill on the Gaming front and signed key contract extensions with customers in the UK pub industry, including Greene King and Mitchells & Butlers. In addition, we have an exciting pipeline of new products and further enhancements to our existing Virtuals products. We are making Virtuals history with the first ever women-led virtual soccer product and we have signed baseball legend Mickey Mantle , in addition to our previously announced signing of Babe Ruth, for our Home Run ShootOut™ game, which is expected to launch in early 2023. " "The long-term fundamentals and health of the business are the strongest they have been in my tenure. The growth dynamics of our markets remain compelling as a wider audience engages with online betting and gaming and new jurisdictions open up, creating further opportunities. With the return of our retail customer base, we remain confident that our diversification and proven ability to grow our business will enable us to deliver further progress against our strategy," Weil concluded. Summary of Second Quarter 2022 Segment Financial Results (unaudited) Three Months Ended June 30, Reported Variance Currency Movement 2022 2 Functional Currency Variance 2 (In $ millions) 2022 2021 % $ % Total Revenue Gaming $25. 5 $ 16. 2 57 % $(2. 9) 75 % Virtual Sports 14. 0 8. 2 71 % (1. 5) 90 % Interactive 5. 8 5. 8 -- (0. 7) 12 % Leisure 26. 0 11. 3 130 % (3. 0) 157 % Total Company Revenue $71. 3 $ 41. 5 72 % $(8. 1) 91 % Net operating income (loss) 13. 4 (9. 7) NM 3 (1. 6) NM 3 Net income (loss) 7. 5 (43. 8) NM 3 (0. 9) NM 3 Net income (loss) per basic share $0. 28 $(1. 94) NM 3 NM 3 NM 3 Net income (loss) per diluted share $0. 26 $(1. 94) NM 3 NM 3 NM 3 Non-GAAP Financial Measures Adjusted EBITDA 1 Gaming $ 9. 5 $3. 5 168 % $(1. 1) 195 % Virtual Sports 12. 0 6. 4 88 % (1. 3) 109 % Interactive 3. 1 3. 6 (12 %) (0. 3) -- Leisure 7. 7 (0. 2) NM 3 (0. 9) NM 3 Corporate (6. 2) (5. 3) (17 %) 0. 7 (32 %) Total Company Adjusted EBITDA 1 $26. 1 $8. 0 227 % $(2. 9) 262 % Adjusted EBITDA Margin 1 37 % 19 % 1 Reconciliation to US GAAP shown below 2 Currency movement calculated by translating 2022 and 2021 performances at 2021 exchange rates 3 Percentage change is not meaningful Stewart Baker , Executive Vice President and Chief Financial Officer, stated, "We are particularly pleased with our second quarter results, given the prevailing perception of headwinds from the macro-economic environment as well as the impact from foreign exchange rates. Given our ongoing strong performance in the face of these headwinds, the long-term outlook of the Company and the strength of our balance sheet, we have utilized our board-approved share buyback program to repurchase nearly 750,000 shares of Inspired common stock, as of August 9 th , at an average price of $9. 73 per share (before trading expenses). Moving forward, we see continued pressure from FX rates, however our underlying business has maintained the same trend. We will continue to be disciplined in our approach to capital deployment, while also focused on executing on our strategic plan to deliver profitable growth, increase cash flows and maximize shareholder value. " Recent Highlights (as of August 9, 2022 ) Corporate Share Repurchase Program – Inspired purchased 485,848 shares of its common stock for $5. 1 million in the second quarter and 248,501 shares for $2. 0 million in third quarter 2022 (through August 9, 2022 ). The timing and amount of future repurchases will be subject to the discretion of Inspired based on market conditions and other opportunities that Inspired may have for the use or investment of its cash balances. Moody's Upgrade – Subsequent to the end of the quarter, Moody's Investors Services upgraded Inspired's corporate rating to B2 with a positive outlook from a previous rating of B3 with a stable outlook. Interactive New Jurisdictions – In second quarter 2022, Inspired went live with seven operators in Ontario and Rush Street in Pennsylvania . Inspired expects to launch with additional customers in Pennsylvania throughout the remainder of 2022. New Customers – During the quarter, Interactive content was launched with fifteen operator brands, including six new customers, one of which was the Netherlands Lottery. Subsequent to the end of the quarter, Interactive content was launched with FanDuel in Ontario . New Content – Twelve new games were launched during second quarter 2022 across the estate, including Big Wheel Bonus™ and Catch of the Day ™, as well as a number of operator and brand specific titles. This was an increase from eight games launched in first quarter 2022. iLottery – Loto Quebec launched Inspired's first iLottery title, Pharaon Reaction™, in June 2022 . The game was among the Top 5 Loto Quebec iLottery games in the second quarter 2022. Virtual Sports North American Deployments – In the second quarter, we launched a new and improved Race2Riches®, a tailored lottery variant of Inspired's V-Play Horses 2. 0™ product, with DC Lottery in approximately 120 retailers throughout DC and on DC Lottery's website and mobile app, via Intralot's multi-streaming platform as part of its current contract with the DC Lottery. Retail and Online Virtual Sports Agreements – During second quarter 2022, we extended our contract with Goldbet covering the provision of Virtual Sports into both their retail and online channels in Italy . We also signed long-term extensions to our contracts with BetFred, covering the provision of Virtual Sports into retail betting shops in the UK, as well as Bet Victor and Niké ( Slovakia ) and additional territories were added to our contract with Kaizen Gaming Betano. New Products – Inspired is making Virtual Sports history with the first-ever, female-led virtual soccer product, V-Play Women's Soccer , which was launched ahead of England winning the 2022 European Women's Football Championship. Women's Virtual Soccer is exclusively available from Inspired as the first and sole supplier of a women's virtual sports event. Inspired also continues to add more history-making players to its Home Run Shootout™ Virtual Sports experience, signing Mickey Mantle in the second quarter, in addition to the previously announced Babe Ruth. Gaming Long-term Strategic Partnership with William Hill – Inspired has successfully negotiated a 12-month extension with William Hill in line with its existing managed services agreement . In conjunction with this extension, Inspired has signed a five-year exclusive contract, to commence following the extension period and subject to a successful trial of the Vantage® cabinet, to supply hardware, content and operational services to William Hill's retail gaming platform. 52 Valor® Sales in Illinois – The sale of 52 units in Illinois brings total Valor terminal sales in Illinois since launch to 816. The Company has commitments for a higher number of units in Illinois in third quarter 2022 than reported in second quarter 2022. New Content in UK LBO Estate – Inspired rolled out new content across the UK LBO estate in second quarter 2022, which has resulted in sequential growth in our customers' gross win per unit per day from first quarter 2022 to second quarter 2022. Leisure New Pubs Contracts – We successfully renewed our contract with Greene King for a further three years and increased our share of the estate. Greene King is the country's leading pub retailer and brewer, running over 2,700 pubs, restaurants and hotels across England , Wales and Scotland . This new contract will utilize Inspired's innovative server-based solution for the pub sector and incorporate the new Vantage® cabinet, which is launching in early 2023. This intelligent operating system and digital cabinet provides added functionality and remote access capabilities not previously available to pub operators. We also signed a three-year extension with Mitchells & Butlers, one of the largest operators of restaurants, pubs and bars in the UK. Holiday Parks – During second quarter 2022, we added five new parks to our holiday parks portfolio and benefited from some parks opening early for the Easter and summer half-term holidays. New Pubs Content – Space Invaders®, Cops 'N' Robbers Bank Buster™ and Scorpion King™ were deployed across the pub estate during second quarter 2022, demonstrating the commitment to leverage Inspired's leading game portfolio for the pub sector. Overview of Second Quarter 2022 Results Versus Second Quarter 2021 on a Reported Basis Total Revenue increased 72% year-over-year to $71. 3 million in the three months ended June 30, 2022 , compared to $41. 5 million in the prior-year period, reflecting strength in the Gaming and Leisure segments following customers' retail venues reopening after COVID-19 lockdowns and continued growth in the online business. Gaming Service Revenue increased $6. 8 million year-over-year due to Inspired's retail recurring revenues exceeding pre-COVID-19 performance levels in second quarter 2022 and the addition of the Company's newly acquired lottery systems contract in the Dominican Republic ( $1. 3 million ). The strong results are driven by the removal of final COVID-19 restrictions across our geographies in May 2022 and the introduction of new content, which has resulted in growth. Gaming Product Revenue increased by $2. 5 million driven by higher sales in the UK from the sale of Flex™ and Sabre Hydr