INSE Inspired Entertainment Inc

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q/A

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2023

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period _______________

 

Commission File Number: 001-36689

 

INSPIRED ENTERTAINMENT, INC.

(Exact name of registrant as specified in its charter)

 

Delaware		47-1025534
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)
250 West 57th Street, Suite 415
New York, NY		10107
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (646) 565-3861

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Date File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer ☐		Accelerated filer ☒
Non-accelerated filer ☐		Smaller reporting company ☒
		Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.0001 per share		INSE		The NASDAQ Stock Market LLC

 

As of May 5, 2023, there were 26,267,352 shares of the Company’s common stock issued and outstanding.

 

As of February 22, 2024, there were 26,219,021 shares of the Company’s common stock issued and outstanding.

 

 

 

TABLE OF CONTENTS

 

PART I.	FINANCIAL INFORMATION	1
ITEM 1.	FINANCIAL STATEMENTS	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income	2
	Condensed Consolidated Statement of Stockholders’ Deficit	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	22
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	43
ITEM 4.	CONTROLS AND PROCEDURES	44
PART II.	OTHER INFORMATION	45
ITEM 1.	LEGAL PROCEEDINGS	45
ITEM 1A.	RISK FACTORS	45
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	45
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	45
ITEM 4.	MINE SAFETY DISCLOSURES	45
ITEM 5.	OTHER INFORMATION	45
ITEM 6.	EXHIBITS	46
SIGNATURES		47

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

References in this report to “we,” “us,” “our,” the “Company” and “Inspired” refer to Inspired Entertainment, Inc. and its subsidiaries unless the context suggests otherwise.

 

Certain statements and other information set forth in this report, including in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere herein, may relate to future events and expectations, and as such constitute “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Section 27A of the Securities Act of 1933, as amended (the “Securities Act”). Our forward-looking statements include, but are not limited to, statements regarding our business strategy, plans and objectives and our expected or contemplated future operations, results, financial condition, beliefs and intentions. In addition, any statements that refer to projections, forecasts or other characterizations or predictions of future events or circumstances, including any underlying assumptions on which such statements are expressly or implicitly based, are forward-looking statements. The words “anticipate”, “believe”, “continue”, “can”, “could”, “estimate”, “expect”, “intend”, “may”, “might”, “plan”, “possible”, “potential”, “predict”, “project”, “scheduled”, “seek”, “should”, “would” and similar expressions, among others, and negatives expressions including such words, may identify forward-looking statements.

 

Our forward-looking statements reflect our current expectations about our future results, performance, liquidity, financial condition, prospects and opportunities, and are based upon information currently available to us, our interpretation of what we believe to be significant factors affecting our business and many assumptions regarding future events. Actual results, performance, liquidity, financial condition, prospects and opportunities could differ materially from those expressed in, or implied by, our forward-looking statements. This could occur as a result of various risks and uncertainties, including the following:

 

	●	government regulation of our industries;
	●	our ability to compete effectively in our industries;
	●	the effect of evolving technology on our business;
	●	our ability to renew long-term contracts and retain customers, and secure new contracts and customers;
	●	our ability to maintain relationships with suppliers;
	●	our ability to protect our intellectual property;
	●	our ability to protect our business against cybersecurity threats;
	●	our ability to successfully grow by acquisition as well as organically;
	●	fluctuations due to seasonality;
	●	our ability to attract and retain key members of our management team;
	●	our need for working capital;
	●	our ability to secure capital for growth and expansion;
	●	changing consumer, technology and other trends in our industries;
	●	our ability to successfully operate across multiple jurisdictions and markets around the world;
	●	changes in local, regional and global economic and political conditions; and
	●	other factors described in the reports and documents we file from time to time with the U.S. Securities and Exchange Commission (the “SEC”).

 

In light of these risks and uncertainties, and others discussed in this report, there can be no assurance that any matters covered by our forward-looking statements will develop as predicted, expected or implied. Readers should not place undue reliance on any forward-looking statements. Except as expressly required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason. We advise you to carefully review the reports and documents we file from time to time with the SEC.

 

 

EXPLANATORY NOTE

 

This Amendment No. 1 to Form 10-Q (this “Amendment” or “Form 10-Q/A”) amends the Annual Report on Form 10-Q for the quarter ended March 31, 2023 originally filed with the Securities and Exchange Commission (“SEC”) on May 10, 2023 (the “Original Filing”) by Inspired Entertainment, Inc. (the “Company,” “we,” “our” or “us”).

 

Restatement and Revision

 

As previously reported by the Company in a Current Report on Form 8-K filed with the SEC on November 8, 2023, the Audit Committee (the “Audit Committee”) of the Board of Directors of the Company, in consultation with the Company’s management, determined that (i) the Company’s previously issued audited consolidated financial statements as of December 31, 2021 and 2022 and for the years ended December 31, 2020, 2021 and 2022 included in the Company’s Annual Report on Form 10-K, (ii) associated reports of the Company’s independent registered public accounting firm, Marcum LLP (“Marcum”), and (iii) the Company’s previously issued unaudited condensed consolidated financial statements during those years and for the first and second quarters of 2023 included in the Company’s Quarterly Reports on Form 10-Q (the “Subject Periods”) contained accounting errors relating to the compliance with U.S. GAAP in connection with the Company’s accounting policies for capitalizing software development costs. The errors related primarily to the application of the relevant accounting standards to projects, including the timing of capitalization with respect to software development projects and the nature of costs eligible for capitalization.

 

As a result of these errors, the Audit Committee determined that the Company’s previously issued consolidated financial statements for the Subject Periods should no longer be relied upon and should be restated. Similarly, any previously issued or filed reports, press releases, earnings releases, investor presentations or other communications of the Company describing the Company’s financial results or other financial information relating to the Subject Periods should no longer be relied upon.

 

Additionally, the previous reports of Marcum on the Company’s consolidated financial statements as of December 31, 2021 and 2022 and for the years ended December 31, 2020, 2021 and 2022 likewise should no longer be relied upon.

 

As of the date of this report, the Company has filed with the SEC an amendment to its Annual Report on Form 10-K for the year ended December 31, 2022 and to the Quarterly Report on Form 10-Q for the period ended June 30, 2023 that include financial statements that amend and restate the previously issued unaudited consolidated financial statements originally filed with such filings and reports. The foregoing Quarterly Reports amend and restate the financial statements as of and for the comparable 2022 periods.

 

This quarterly report on Form 10-Q for the three months ended March 31, 2023 includes financial statements that amend and restate the Company’s unaudited financial statements as of and for the three month periods ended March 31, 2023 and 2022. Please see Note 2 to the unaudited financial statements included in this Quarterly Report on Form 10-Q for a discussion of the restatement and the impact on the specific accounts in such unaudited financial statements.

 

 

Although on December 31, 2023, the Company was a smaller reporting company, as defined in Rule 12b-2 promulgated under the Exchange Act, the Company ceased to be a smaller reporting company for periods on and after January 1, 2024.

 

Changes Reflected in the Restatement

 

For the convenience of the reader, this Amendment sets forth our Original Filing in its entirety, as amended by the changes related to the restatement. This Amendment does not reflect events occurring after the filing of our Original Filing, or modify or update those disclosures, except as applicable in our financial statement footnote subsequent event disclosures. The following sections of our Original Filing have been amended:

 

● Part I- Item 1 – Business;

● Part I - Item 1A Risk Factors;

● Part I – Item 4 Controls and Procedures;

● Part II - Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations; and

● Part II - Item 8 - Financial Statements.

 

This Amendment has been signed as of the date hereof and all certifications of our Principal Executive Officer and Principal Financial Officer are given as the date hereof. Accordingly, this Amendment should be read in conjunction with our filings made with the Securities and Exchange Commission subsequent to the filing of the Original Filing, including any amendments to those filings.

 

Restatement Background

 

As previously reported by the Company on a Current Report on Form 8-K filed with the SEC on March 23, 2023, on March 17, 2023, the Company dismissed Marcum as its independent registered public accounting firm, and engaged KPMG LLP (“KPMG”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2023 and the related interim periods. In connection with the preparation of the financial statements of the Company for the quarterly period ended September 30, 2023, KPMG identified certain accounting errors relating to compliance with U.S. GAAP in connection with the Company’s accounting policies for capitalizing software development costs. The errors related primarily to the application of the relevant accounting standards to projects, including the timing of capitalization with respect to software development projects and the nature of costs eligible for capitalization.

 

 

As previously reported by the Company on Form 8-K filed with the SEC on November 8, 2023, on November 2, 2023, the Audit Committee,, in consultation with the Company’s management, determined that (i) the Company’s previously issued audited consolidated financial statements as of December 31, 2021 and 2022 and for the years ended December 31, 2020, 2021 and 2022 included in the Company’s Annual Report on Form 10-K, (ii) associated reports of the Company’s independent registered public accounting firm, and (iii) the Company’s previously issued unaudited condensed consolidated financial statements during those years and for the first and second quarters of 2023 included in the Company’s Quarterly Reports on Form 10-Q contained the accounting errors set forth above. Following the determination by the Audit Committee, the Company retained independent accounting consultants and undertook an investigation with respect to the appropriate accounting treatment of its software development costs and other matters.

 

As previously reported by the Company on a Current Report on Form 8-K filed with the SEC on November 29, 2023, on November 22, 2023, the Company dismissed KPMG as its independent registered public accounting firm and re-engaged Marcum as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2023 and the related interim periods.

 

Other Adjustments

 

In addition to the material software development matters described above, various other material and immaterial prior period errors or misstatements have been identified including in the areas of revenue, inventory, leasing, pension, earnings per share and other reclassification and minor items. For additional information regarding the revision of prior interim periods see Part I, Item 1 “Financial Statements and Supplementary Data-Note 2 to the Consolidated Financial Statements - Restatement of Previously Issued Financial Statements.”

 

Internal Control Over Financial Reporting

 

Management has reassessed its evaluation of the effectiveness of its internal control over financial reporting as of December 31, 2022, based on the framework established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management has concluded that, due to the additional material weaknesses identified relating to the failure to properly design and operate monitoring control activities, the Company did not maintain effective internal control over financial reporting as of December 31, 2022. As such, Management’s Reports on Internal Control over Financial Reporting as of December 31, 2022 should no longer be relied upon. For a description of the material weakness in internal control over financial reporting and actions taken, and to be taken, to address the material weakness, see Part II, Item 8 “Financial Statements and Supplementary Data” and Item 9A. “Controls and Procedures” of this Form 10-K/A. In addition, the Company’s independent registered public accounting firm has restated its report on the Company’s internal control over financial reporting to add additional material weaknesses and continues to issue an adverse opinion.

 

 

PART I - FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

 

		March 31, 2023, as restated				December 31, 2022, as restated
		(Unaudited)
Assets
Cash		$	27.8			$	25.0
Accounts receivable, net			32.9				40.4
Inventory			34.6				30.3
Prepaid expenses and other current assets			30.7				31.2
Total current assets			126.0				126.9
Property and equipment, net			47.4				45.1
Software development costs, net			19.5				18.3
Other acquired intangible assets subject to amortization, net			14.3				14.6
Goodwill			57.0				55.5
Operating lease right of use asset			15.7				16.0
Costs of obtaining and fulfilling customer contracts, net			7.7				7.0
Other assets			4.1				3.8
Total assets		$	291.7			$	287.2
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable		$	22.2			$	23.7
Accrued expenses			35.6				29.0
Corporate tax and other current taxes payable			3.4				10.1
Deferred revenue, current			4.9				4.6
Operating lease liabilities			4.0				3.9
Other current liabilities			3.2				3.6
Total current liabilities			73.3				74.9
Long-term debt			285.5				277.6
Finance lease liabilities, net of current portion			1.2				1.2
Deferred revenue, net of current portion			2.3				2.8
Operating lease liabilities			11.9				12.3
Other long-term liabilities			4.0				4.0
Total liabilities			378.2				372.8
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; 26,263,070 shares and 25,909,516 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively			—				—
Additional paid in capital			381.2				378.2
Accumulated other comprehensive income			48.3				50.8
Accumulated deficit			(516.0	)			(514.6	)
Total stockholders’ deficit			(86.5	)			(85.6	)
Total liabilities and stockholders’ deficit		$	291.7			$	287.2

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(in millions, except share and per share data)

(Unaudited)

 

		2023, as restated				2022, as restated
		Three Months Ended March 31,
		2023, as restated				2022, as restated
Revenue:
Service		$	57.5			$	56.0
Product sales			7.4				4.3
Total revenue			64.9				60.3
Cost of sales:
Cost of service (1)			(15.0	)			(16.8	)
Cost of product sales			(6.7	)			(2.5	)
Selling, general and administrative expenses			(29.2	)			(23.2	)
Acquisition and integration related transaction expenses			—				(0.2	)
Depreciation and amortization			(9.4	)			(10.7	)
Net operating income			4.6				6.9
Other expense
Interest expense, net			(6.3	)			(6.5	)
Gain on disposal of business			—				0.9
Other finance income			0.1				0.3
Total other expense, net			(6.2	)			(5.3	)
Net (loss) income before income taxes			(1.6	)			1.6
Income tax benefit (expense)			0.2				(0.1	)
Net (loss) income			(1.4	)			1.5
Other comprehensive income:
Foreign currency translation (loss) gain			(2.9	)			3.5
Reclassification of loss on hedging instrument to comprehensive income			0.2				0.2
Actuarial gains on pension plan			0.2				0.1
Other comprehensive income			(2.5	)			3.8
Comprehensive (loss) income		$	(3.9	)		$	5.3
Net income (loss) per common share – basic		$	(0.05	)		$	0.05
Net income (loss) per common share - diluted		$	(0.05	)		$	0.05
Weighted average number of shares outstanding during the period – basic			27,974,182				28,437,052
Weighted average number of shares outstanding during the period – diluted			27,974,182				29,362,382
Supplemental disclosure of stock-based compensation expense
Stock-based compensation included in:
Selling, general and administrative expenses		$	(2.9	)		$	(2.8	)

 

(1)	Excluding depreciation and amortization

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

THREE MONTHS ENDED MARCH 31, 2023

(in millions, except share data)

(Unaudited)

 

		Shares				Amount				capital				income				deficit				deficit
		Common stock								Additional paid in				Accumulated other comprehensive				Accumulated				Total stockholders’
		Shares				Amount				capital				income				deficit				deficit
Balance as of December 31, 2022, as restated			25,909,516				—				378.2				50.8				(514.6	)			(85.6	)
Foreign currency translation adjustments			—				—				—				(2.9	)			—				(2.9	)
Actuarial gains on pension plan			—				—				—				0.2				—				0.2
Reclassification of loss on hedging instrument to comprehensive income			—				—				—				0.2				—				0.2
Issuances under stock plans			353,554				—				—				—				—				—
Stock-based compensation expense			—				—				3.0				—				—				3.0
Net loss			—				—				—				—				(1.4	)			(1.4	)
Balance as of March 31, 2023, as restated			26,263,070			$	—			$	381.2			$	48.3			$	(516.0	)		$	(86.5	)

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

THREE MONTHS ENDED MARCH 31, 2022

(in millions, except share data)

(Unaudited)

 

		Common stock								Additional paid in				Accumulated other comprehensive				Accumulated				Total stockholders’
		Shares				Amount				capital				income				deficit				deficit
Balance as of December 31, 2021, as restated			26,433,562				—				372.3				43.8				(524.8	)			(108.7	)
Balance			26,433,562				—				372.3				43.8				(524.8	)			(108.7	)
Foreign currency translation adjustments			—				—				—				3.5				—				3.5
Actuarial gains on pension plan			—				—				—				0.1				—				0.1
Reclassification of loss on hedging instrument to comprehensive income			—				—				—				0.2				—				0.2
Issuances under stock plans			447,060				—				—				—				—				—
Stock-based compensation expense			—				—				2.7				—				—				2.7
Net income			—				—				—				—				1.5				1.5
Net income (loss)			—				—				—				—				1.5				1.5
Balance as of March 31, 2022, as restated			26,880,622			$	—			$	375.0			$	47.6			$	(523.3	)		$	(100.7	)
Balance			26,880,622			$	—			$	375.0			$	47.6			$	(523.3	)		$	(100.7	)

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

INSPIRED ENTERTAINMENT, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)

 

		2023, as restated				2022, as restated
		Three Months Ended March 31,
		2023, as restated				2022, as restated
Cash flows from operating activities:
Net (loss) income		$	(1.4	)		$	1.5
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization			9.4				10.7
Amortization of right of use asset			0.8				1.0
Profit on sale of trade and assets			—				(0.9	)
Stock-based compensation expense			2.9				2.8
Contract cost expense			(2.6	)			(1.6	)
Reclassification of loss on hedging instrument to comprehensive income			0.2				0.2
Non-cash interest expense relating to senior debt			0.3				0.4
Changes in assets and liabilities:
Accounts receivable			8.3				(2.2	)
Inventory			(3.5	)			(11.6	)
Prepaid expenses and other assets			1.0				—
Corporate tax and other current taxes payable			(6.2	)			(7.2	)
Accounts payable			(2.1	)			4.2
Deferred revenues and customer prepayment			(0.2	)			—
Accrued expenses			5.6				7.1
Operating lease liabilities			(0.9	)			(1.0	)
Other long-term liabilities			—				(0.7	)
Net cash provided by operating activities			11.6				2.7
Cash flows from investing activities:
Purchases of property and equipment			(5.5	)			(5.6	)
Acquisition of subsidiary company assets			—				(0.6	)
Disposal of trade and assets			—				1.3
Acquisition of third-party company trade and assets			(0.6	)			—
Purchases of capital software			(2.8	)			(3.9	)
Net cash used in investing activities			(8.9	)			(8.8	)
Cash flows from financing activities:
Repayments of finance leases			(0.5	)			(0.1	)
Net cash used in financing activities			(0.5	)			(0.1	)
Effect of exchange rate changes on cash			0.6				(0.8	)
Net increase (decrease) in cash			2.8				(7.0	)
Cash, beginning of period			25.0				47.8
Cash, end of period		$	27.8			$	40.8
Supplemental cash flow disclosures
Cash paid during the period for interest		$	0.1			$	0.2
Cash paid during the period for income taxes		$	0.1			$	—
Cash paid during the period for operating leases		$	2.1			$	1.7
Supplemental disclosure of noncash investing and financing activities
Lease liabilities arising from obtaining right of use assets		$	(0.1	)		$	—
Property and equipment transferred to inventory		$	—			$	0.6

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

1. Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated

 

Company Description and Nature of Operations

 

We are a global gaming technology company, supplying content, platform, gaming terminals and other products and services to online and land-based regulated lottery, betting and gaming operators worldwide through a broad range of distribution channels, predominantly on a business-to-business basis. We provide end-to-end digital gaming solutions (i) on our own proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices and online computer applications and (ii) through third party networks. Our content and other products can be found through the consumer-facing portals of our interactive customers and, through our land-based customers, in licensed betting offices, adult gaming centers, pubs, bingo halls, airports, motorway service areas and leisure parks.

 

Management Liquidity Plans

 

As of March 31, 2023, the Company’s cash on hand was $27.8 million, and the Company had working capital in addition to cash of $24.9 million. The Company recorded a net loss of $1.4 million and net income of $1.5 million for the three months ended March 31, 2023 and 2022, respectively. Net income/losses include non-cash stock-based compensation of $2.9 million and $2.8 million for the three months ended March 31, 2023 and 2022, respectively. 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. Cash flows provided by operations amounted to $11.6 million and $2.7 million for the three months ended March 31, 2023 and 2022, respectively. The change year on year was due primarily to improved working capital levels, with the three months ended March 31, 2023 benefitting from favorable receipts due to the timing of sales, and the three months ended March 31, 2022 showing significant inventory increases after the Company made the strategic decision to secure components and protect sales in a challenging global supply chain market. Working capital of $52.7 million includes a non-cash settled item of $4.9 million of deferred income. Management currently believes that, absent any long-term coronavirus (“COVID-19”) impact (see below), 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 May 2024.

 

There have been no COVID-19 restrictions in the United Kingdom since July 2021 and social distancing measures throughout Greece and Italy are no longer in force as of the second quarter of 2022. There have been no COVID-19 restrictions in the United States and social distancing measures are no longer in force. While states have varying requirements based on occupation, no mandates related to, or would prohibit, our normal business operations.

 

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.

 

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 years ended December 31, 2022 and 2021. The financial information as of December 31, 2022 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K/A filed with the SEC on February 27, 2024. The interim results for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future interim periods.

 

Newly Adopted Accounting Standards

 

On January 1, 2023, the Company adopted Topic 326 Financial Instruments – Credit Losses (“ASC 326”). ASC 326 affects loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. It requires an entity to recognize expected credit losses rather than incurred losses for financial assets and requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.

 

The adoption of ASC 326 did not have a material impact. Disclosures with respect to allowances for credit losses are given in footnote 4 to these financial statements.

 

6

 

 

2. Restatement of Previously Issued Financial Statements

 

Restatement Background

 

On November 2, 2023, the Company in concurrence with the Company’s audit committee, concluded that our 2023 and 2022 consolidated financial statements and our unaudited consolidated financial statements as of and for each of the first two quarterly periods in 2023 and all quarterly periods in 2022, included in our Quarterly Reports on Form 10-Q for the respective periods(collectively the “Prior Period Financial Statements”), should no longer be relied upon due to misstatements that are described below, and that we would restate such financial statements to make the necessary accounting corrections. Details of the restated consolidated financial statements as of March 31, 2023 and for the three months ended March 31, 2023 and 2022 are provided below (“Restatement Items”). Details of the restated consolidated financial statements as of December 31, 2022 are provided in the amendment to the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2022, filed with the SEC as of the date of this report.

 

The Restatements Items reflect adjustments to correct errors in certain financial statement areas including capitalized software and costs to fulfill a contract, revenue and costs to obtain a contract, inventory, goodwill and intangibles, leasing, pension, and other reclassifications and immaterial errors identified. The nature and impact of these adjustments are described below and also detailed in the tables below.

 

The Company issued a revision for capitalized software and related amortization expense in the quarterly report on Form 10-Q filed on August 11, 2023 for the period ended June 30, 2023 (the “Revision”).This revision related to certain completed software development projects that were, but should not have been, delayed in the shift from work in progress to completed projects. Consequently, the commencement of amortization for certain projects was delayed and the reported amortization was lower than the actual amortization. The Revision covers the period ended March 31, 2023 and the year ended December 31, 2022 and is distinct from the capitalized software restatements below. The tables below have been updated to separate the impact of the Restatement Items from the Revision.

 

Restatement Items

 

Capitalized software and Costs to fulfill a contract – The Company historically assessed and applied incorrectly the accounting frameworks for developing external use software under ASC 985-20, Costs of Software to Be Sold, Leased or Marketed, and internal-use software under ASC 350-40, Intangibles – Goodwill and Other – Internal-Use Software and ASC 340-40, Other Assets and Deferred Costs – Contracts with Customers. In addition, the Company determined routine software updates and certain minor software enhancements were inappropriately capitalized and capitalized labor rates inappropriately included certain indirect costs including overhead, and non-development activities. Consequently, certain amortization was inappropriate. The corrections resulted in a decrease in Software development costs, net of $17.6 million and an increase in Cost of obtaining and fulfilling customer contracts, of $7.2 million as of March 31, 2023. The corrections resulted in an increase to Selling, general and administrative expenses of $1.1 million and $0.5 million as well as a decrease in Depreciation and amortization of $1.1 million and $0.7 million for the three months ended March 31, 2023 and 2022, respectively. In addition, the Revision resulted in a decrease in Software development costs, net of $1.0 million for the three months ended March 31, 2023. Refer to reference “a” below.

 

Revenue and Costs to obtain a contract – The Company identified corrections needed related to ASC 606, Revenue from Contracts with Customers. The Company identified certain performance obligations were delivered and therefore should have been recognized at a specific point in time (rather than over time). Additionally, we identified that (i) for certain Interactive Aggregator contracts, revenue should have been reported on a net, rather than gross, basis and (ii) certain parts the Company acquired and sold to its contract manufacturer should not have been reported as revenue. These two items have no impact to profit. The Company also identified an immaterial contract that should have been recognized as sales type lease rather than an operating lease. Lastly, the Company had historically expensed certain commissions in the period incurred instead of capitalizing and amortizing them under the accounting framework for costs to obtain contracts with customers pursuant to ASC 606, Revenue from Contracts with Customers, and ASC 340-40, Other Assets and Deferred Costs – Contracts with Customers. The corrections resulted in a decrease in Property and equipment, net of $0.3 million as of March 31, 2023. The corrections also resulted in a decrease in Deferred revenue, current of $0.2 million, a decrease in Deferred revenue, net of current position of $0.9 million as of March 31, 2023 and an increase in Costs of obtaining and fulfilling customer contracts, net of $0.8 million as of March 31, 2023. The corrections also resulted in a decrease in Revenue - service of $0.7 million and $1.0 million for the three months ended March 31, 2023 and 2022, respectively, a $0.3 million decrease in Revenue – product sales for the three months ended March 31, 2023 and an $0.7 million increase in Revenue – product sales for the three months ended March 31, 2022, a decrease in Cost of sales – service of $2.3 million and $1.9 million for the three months ended March 31, 2023 and 2022, respectively, and a $0.2 million decrease and $0.5 million increase in Cost of sales – product sales for the three months ended March 31, 2023 and 2022, respectively. The corrections also resulted in an increase in Depreciation and amortization increased by $1.6 million and $1.4 million for the three months ended March 31, 2023 and 2022, respectively. Refer to reference “b” below. Note 6, “Contract Liabilities and Other Disclosures” and Note 16, “Segment Reporting and Geographic Information” have also been corrected.

 

7

 

 

Inventory – The Company identified an error in the amount capitalized for field inventory, repair and consumable items. The correction resulted in a decrease of inventory of $1.9 million for the three months ended March 31, 2023. Refer to reference “c” below. Note 5, “Inventory” has also been corrected.

 

Goodwill and intangibles – Through review of the appropriate reporting units and asset groups to assess impairments at under ASC 350, Intangibles – Goodwill and Other and ASC 360, Property, Plant and Equipment, the Company identified a triggering event in the first quarter of 2020, related to the beginning of the COVID-19 pandemic, for which impairment assessment was required for (i) Server Based Gaming (“SBG”) and Acquired Business reporting units and (ii) all landbased asset groups. Based on the assessment, we determined that an impairment of acquired business goodwill and long-lived assets occurred in the first quarter of 2020. Additionally, we determined that a significant number of synergies existed from the acquisition in the fourth quarter of 2019 and therefore a portion of the acquisition goodwill should have been reallocated to other reporting units upon acquisition. The corrections resulted in a decrease of Depreciation and amortization of $0.1 million for the three months ended March 31, 2022 and a decrease in Other acquired intangible assets subject to amortization, net of $1.2 million as of March 31, 2023. Refer to reference “d” below.

 

Leasing – The Company identified errors related to leasing, which primarily related to the Company not historically including in-substance fixed payments related to certain leases according to the accounting framework in ASC 842, Leases. The corrections resulted in an increase in Operating lease right of use asset of $7.6 million, an increase in current Operating lease liabilities of $1.2 million and an increase in long-term Operating lease liabilities of $6.3 million as of March 31, 2023. Refer to reference “e” below. Note 13, “Leases” has also been corrected.

 

Basic and diluted net income (loss) per share – An error to shares outstanding primarily relates to the Company not including deferred settlement equity awards that had vested in the number of outstanding shares used in the calculation of basic and diluted weighted average number of shares outstanding pursuant to ASC 260, Earnings Per Share. Refer to reference “h” below. Note 9, “Net earnings (loss) per share” has also been corrected.

 

Pension – The Company had corrections to pension that primarily related to no longer updating the plan liability/ asset quarterly to comply with US GAAP. The corrections resulted in a reclassification of $1.8 million from Accumulated other comprehensive income to Other long-term liabilities as of March 31, 2023. In addition, the Company corrected the benefit obligation and fair value of plan assets for the buy-in contract.  The Company corrected the measurement of the plan assets and the estimated fair value of the buy in contract. Note 15, “Pension Plan” has also been corrected. Refer to reference “g” below.

 

Other errors identified – Through the restatement process, the Company has reclassified certain costs for salaries of service employees and recorded an adjustment related to foreign currency impacts on an intangible. In addition to the reclassification and intangible adjustment, the Company has corrected other adjustments that are quantitatively immaterial, individually and in aggregate, because we are correcting for these material errors, we have decided to correct these other adjustments. Refer to reference “f” below.

 

Income tax – The Company updated the income tax effects for the Restatement Items. Note 11, “Income Taxes” has also been updated.

 

8

 

 

Summary impact of Restatement Items to Prior Period Financial Statements

 

The following tables present the effect of the Restatement Items on the Company’s consolidated balance sheets for the periods indicated (in millions, except per share):

 Schedule of Restatement Items to Prior Period Financial Statements

		As of March 31, 2023 (unaudited)
		As Previously				Previous				Restatement								Restatement
		Reported				Revision				Adjustments				As Restated				References
Assets
Cash		$	27.8			$	-			$	-			$	27.8
Accounts receivable, net			33.0				-				(0.1	)			32.9			f
Inventory, net			36.5				-				(1.9	)			34.6			c
Prepaid expenses and other current assets			31.1				-				(0.4	)			30.7			f
Total current assets			128.4				-				(2.4	)			126.0
Property and equipment, net			47.7				-				(0.3	)			47.4			b
Software development costs, net			38.1				(1.0	)			(17.6	)			19.5			a
Other acquired intangible assets subject to amortization, net			14.6				-				(0.3	)			14.3			d, f
Goodwill			75.8				-				(18.8	)			57.0			d
Operating lease right of use asset			8.1				-				7.6				15.7			e
Cost of obtaining and fulfilling customer contracts, net			-				-				7.7				7.7			a, b
Other assets			3.8				-				0.3				4.1			f
Total assets		$	316.5			$	(1.0	)		$	(23.8	)		$	291.7
Liabilities and Stockholders’ Deficit
Current liabilities
Accounts payable			22.2				-				-				22.2
Accrued expenses			34.9				-				0.7				35.6			f
Corporate tax and other current taxes payable			5.0				-				(1.6	)			3.4
Deferred revenue, current			5.1				-				(0.2	)			4.9			b
Operating lease liabilities			2.8				-				1.2				4.0			e
Other current liabilities			3.2				-				-				3.2
Total current liabilities			73.2				-				0.1				73.3
Long-term debt			285.5				-				-				285.5
Finance lease liabilities, net of current portion			1.2				-				-				1.2
Deferred revenue, net of current portion			3.2				-				(0.9	)			2.3			b
Operating lease liabilities			5.6				-				6.3				11.9			e
Other long-term liabilities			2.2				-				1.8				4.0			g
Total liabilities		$	370.9			$	-			$	7.3			$	378.2
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; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively			-				-				-				-
Additional paid in capital			381.2				-				-				381.2
Accumulated other comprehensive income			46.8				-				1.5				48.3
Accumulated deficit			(482.4	)			(1.0	)			(32.6	)			(516.0	)
Total stockholders’ deficit			(54.4	)			(1.0	)			(31.1	)			(86.5	)
Total liabilities and stockholders’ deficit		$	316.5			$	(1.0	)		$	(23.8	)		$	291.7

 

9

 

 

The following tables present the effect of the Restatement Items on the Company’s consolidated statement of operations for the periods indicated (in millions, except share and per share amounts):

 

		For Three Months Ended March 31, 2023 (unaudited)
		As Previously				Restatement								Restatement
		Reported				Adjustments				As Restated				References
Revenue:
Service		$	58.3			$	(0.8	)		$	57.5			b, f
Product sales			7.7				(0.3	)			7.4			b
Total Revenue			66.0				(1.1	)			64.9
Cost of Sales
Cost of service(1)			(10.9	)			(4.1	)			(15.0	)		b, f
Cost of product sales			(5.8	)			(0.9	)			(6.7	)		b, c
Selling, general and administrative expenses			(34.3	)			5.1				(29.2	)		a, f
Acquisition and integration related transaction expenses			-				-				-
Depreciation and amortization			(8.9	)			(0.5	)			(9.4	)		a, b
Net operating income (loss)			6.1				(1.5	)			4.6
							-
Other expense
Interest expense, net			(6.3	)			-				(6.3	)
Gain on disposal of business			-				-				-
Other finance income (expense)			0.1				-				0.1
Total other expense, net			(6.2	)			-				(6.2	)
							-
Net loss before income taxes			(0.1	)			(1.5	)			(1.6	)
Income tax (expense) benefit			(0.1	)			0.3				0.2
Net loss			(0.2	)			(1.2	)			(1.4	)
Other comprehensive income (loss)
Foreign currency translation gain (loss)			(1.7	)			(1.2	)			(2.9	)
Reclassification of loss on hedging instrument to comprehensive income			0.2				-				0.2
Actuarial gains (losses) on pension plan			2.0				(1.8	)			0.2			g
Other comprehensive income (loss)			0.5				(3.0	)			(2.5	)
Comprehensive income (loss)		$	0.3			$	(4.2	)		$	(3.9	)
Net income (loss) per common share - basic		$	(0.01	)		$	(0.04	)		$	(0.05	)
Net income (loss) per common share - diluted		$	(0.01	)		$	(0.04	)		$	(0.05	)
Weighted average number of shares outstanding during the year - basic			26,155,346				1,818,836				27,974,182			h
Weighted average number of shares outstanding during the year - diluted			26,155,346				1,818,836				27,974,182
Stock-based compensation included in:
Selling, general, and administrative expenses		$	(2.9	)						$	(2.9	)

 

(1)	Excluding depreciation and amortization

 

10

 

 

		For Three Months Ended March 31, 2022 (unaudited)
		As Previously				Restatement								Restatement
		Reported				Adjustments				As Restated				References
Revenue:
Service		$	57.0			$	(1.0	)		$	56.0			b
Product Sales			3.6				0.7				4.3			b
Total Revenue			60.6				(0.3	)			60.3
Cost of Sales
Cost of Service			(11.8	)			(5.0	)			(16.8	)		b, f
Cost of Product sales			(2.1	)			(0.4	)			(2.5	)		b, c
Selling, general and administrative expenses			(29.6	)			6.4				(23.2	)		a, f
Acquisition and integration related transaction expenses			(0.1	)			(0.1	)			(0.2	)
Depreciation and amortization			(10.1	)			(0.6	)			(10.7	)		a, b, d
Net operating income (loss)			6.9				-				6.9
Other expense
Interest expense, net			(6.5	)			-				(6.5	)
Gain on disposal of business			0.9				-				0.9
Other finance income (expense)			0.3				-				0.3
Total other expense, net			(5.3	)			-				(5.3	)
Net income before income taxes			1.6				-				1.6
Income tax expense			(0.1	)			-				(0.1	)
Net income			1.5				-				1.5
Other comprehensive income:
Foreign currency translation (loss) gain			2.4				1.1				3.5
Reclassification of loss on hedging instrument to comprehensive income			0.2				-				0.2
Actuarial gains (losses) on pension plan			0.7				(0.6	)			0.1			g
Other comprehensive income			3.3				0.5				3.8
Comprehensive income		$	4.8			$	0.5			$	5.3
Net income (loss) per common share - basic		$	0.06			$	(0.01	)		$	0.05
Net income (loss) per common share - diluted		$	0.05			$	-			$	0.05
Weighted average number of shares outstanding during the year - basic			26,850,326				1,586,726				28,437,052			h
Weighted average number of shares outstanding during the year - diluted			29,294,973				67,409				29,362,382

 

11

 

 

The following tables present the effect of the Restatement Items on the Company’s consolidated statements of stockholders’ equity (deficit) for the periods indicated (in millions, except per share amounts):

 

														Accumulated
										Additional				other								Total
		Common Stock								paid in				comprehensive				Accumulated				stockholders’				Restatement
		Shares				Amount				capital				income				deficit				deficit				References
Balance as of March 31, 2023 (As Previously Reported)			26,263,070				-				381.2				46.8				(482.4	)			(54.4	)
Previous Revision			-				-				-				-				(1.0	)			(1.0	)
Restatement Items			-				-				-				1.5				(32.6	)			(31.1	)
Balance as of March 31, 2023 (As Restated) (Unaudited)			26,263,070			$	-			$	381.2			$	48.3			$	(516.0	)		$	(86.5	)

 

														Accumulated
										Additional				other								Total
		Common Stock								paid in				comprehensive				Accumulated				stockholders’				Restatement
		Shares				Amount				capital				income				deficit				deficit				References
Balance as of March 31, 2022 (As Previously Reported)			26,880,622				-				375.0				47.1				(492.6	)			(70.5	)
Balance			26,880,622				-				375.0				47.1				(492.6	)			(70.5	)
Restatement Items			-				-				-				0.5				(30.7	)			(30.2	)
Balance as of March 31, 2022 (As Restated) (Unaudited)			26,880,622			$	-			$	375.0			$	47.6			$	(523.3	)		$	(100.7	)
Balance			26,880,622			$	-			$	375.0			$	47.6			$	(523.3	)		$	(100.7	)

 

12

 

 

The following tables present the effect of the Restatement Items on the Company’s consolidated statements of cashflows for the periods indicated (in millions):

 

		Three Months Ended March 31, 2023 (unaudited)
		As Previously				Previous				Restatement								Restatement
		Reported				Revision				Adjustments				As Restated				References
Cash flows from operating activities:
Net income (loss)		$	(0.2	)		$	-			$	(1.2	)		$	(1.4	)		a, b, c, f
Adjustments to reconcile net income (loss) to net cash provided by operating activities:							-
Depreciation and amortization			8.9				-				0.5				9.4			a, b, d
Amortization of right of use asset			0.5				-				0.3				0.8			e
Profit on sale of trade and asset
Stock-based compensation expense			2.9				-				-				2.9
Contract cost expense			-				-				(2.6	)			(2.6	)		a, b
Reclassification of loss on hedging instrument to comprehensive income			0.2				-				-				0.2
Non-cash interest expense relating to senior debt			0.3				-				-				0.3
Changes in assets and liabilities:							-
Accounts receivable			8.5				-				(0.2	)			8.3			g
Inventory			(4.6	)			-				1.1				(3.5	)		c, g
Prepaid expenses and other assets			1.6				-				(0.6	)			1.0			f, g
Corporate tax and other current taxes payable			(3.8	)			-				(2.4	)			(6.2	)		g
Accounts payable			(4.1	)			-				2.0				(2.1	)		g
Deferred revenues and customer prepayment			(0.3	)			-				0.1				(0.2	)		g
Accrued expenses			5.5				-				0.1				5.6			f, g
Other lease liabilities			(0.6	)			-				(0.3	)			(0.9	)		g
Other long-term liabilities			-				-				-				-
Net cash provided by operating activities			14.8				-				(3.2	)			11.6
Cash flows from investing activities:
Purchases of property and equipment			(6.1	)			-				0.6				(5.5	)		g
Acquisition of subsidiary company assets			-				-								-
Acquisition of third-party company trade and assets			(0.6	)			-				-				(0.6	)
Disposal of trade and assets
Purchases of capital software			(4.8	)			-				2.0				(2.8	)		a, g
Net cash used in investing activities			(11.5	)			-				2.6				(8.9	)
Cash flows from financing activities:
Repayments of finance leases			(0.5	)			-				-				(0.5	)
Net cash used in financing activities			(0.5	)			-				-				(0.5	)
Effect of exchange rate changes on cash			-				-				0.6				0.6			g
Net increase (decrease) in cash			2.8				-				-				2.8
Cash, beginning of period			25.0				-				0				25.0
Cash, end of period		$	27.8				-				0				27.8
Supplemental cash flow disclosures
Cash paid during the period for interest		$	0.1			$	-			$	-			$	0.1
Cash paid during the period for income taxes		$	0.1			$	-			$	-			$	0.1
Cash paid during the period for operating leases		$	1.2			$	-			$	0.9			$	2.1
Supplemental disclosure of noncash investing and financing activities
Lease liabilities arising from obtaining right of use assets		$	(0.1	)		$				$				$	(0.1	)
Property and equipment acquired through finance lease
Property and equipment transferred to inventory

 

13

 

 

		Reported				Adjustments				As Restated				References
		Three Months Ended March 31, 2022 (unaudited)
		As Previously				Restatement								Restatement
		Reported				Adjustments				As Restated				References
Cash flows from operating activities:
Net income (loss)		$	1.5			$	-			$	1.5			a, b, c, d, f
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization			10.1				0.6				10.7			a, b, d
Amortization of right of use asset			0.7				0.3				1.0			e
Profit on sale of trade and asset			-				(0.9	)			(0.9	)		f
Stock-based compensation expense			2.8				-				2.8
Contract Cost expense			-				(1.6	)			(1.6	)		a, b
Reclassification of loss on hedging instrument to comprehensive income			0.2				-				0.2
Non-cash interest expense relating to senior debt			0.4				-				0.4
Changes in assets and liabilities:
Accounts receivable			(2.1	)			(0.1	)			(2.2	)		g
Inventory			(11.9	)			0.3				(11.6	)		c, g
Prepaid expenses and other assets			0.9				(0.9	)			-			g
Corporate tax and other current taxes payable			(7.2	)			-				(7.2	)
Accounts payable			4.3				(0.1	)			4.2			g
Deferred revenues and customer prepayment			(0.3	)			0.3				-			a, b, g
Accrued expenses			7.1				-				7.1
Operating lease liabilities			(0.7	)			(0.3	)			(1.0	)		e
Other long-term liabilities			(0.7	)			-				(0.7	)
Net cash provided by operating activities			5.1				(2.4	)			2.7
Cash flows from investing activities:
Purchases of property and equipment			(5.2	)			(0.4	)			(5.6	)
Acquisition of subsidiary company assets			(0.6	)			-				(0.6	)
Disposal of trade and assets			-				1.3				1.3
Purchases of capital software			(5.1	)			1.2				(3.9	)
Net cash used in investing activities			(10.9	)			2.1				(8.8	)
Cash flows from financing activities:
Repayments of finance leases			(0.1	)			-				(0.1	)
Net cash (used in) provided by financing activities			(0.1	)			-				(0.1	)
Effect of exchange rate changes on cash			(1.1	)			0.3				(0.8	)		g
Net increase in cash			(7.0	)			-				(7.0	)
Cash, beginning of period			47.8				-				47.8
Cash, end of period		$	40.8			$	-			$	40.8
Supplemental cash flow disclosures
Cash paid during the period for interest		$	0.2			$	-			$	0.2
Cash paid during the period for income taxes		$	-			$	-			$	-
Cash paid during the period for operating leases		$	0.9			$	0.8			$	1.7
Supplemental disclosure of noncash investing and financing activities
Property and equipment acquired through finance lease		$	-			$	-			$	-
Property and equipment transferred to inventory		$	0.6			$	-			$	0.6

 

14

 

 

3. Acquisitions and Disposals

 

In January 2022, the Company sold its Italian VLT business, including all terminal and other assets, staff costs and facilities and contracts to a non-connected party for total proceeds of €1.1 million ($1.3 million), recognizing a profit on disposal of €0.8 million ($0.9 million). The Company continues to serve these Italian markets in the form of the provision of platform and games.

 

4. Allowance for Credit Losses, as restated

 

Changes in the allowance for doubtful accounts are as follows:

Schedule of Changes in Allowance for Doubtful accounts 

		March 31, 2023				December 31, 2022
		(in millions)
Beginning balance		$	(1.4	)		$	(1.8	)
Additional provision for doubtful accounts			(0.1	)			(0.2	)
Recoveries			0.1				—
Write offs			—				0.4
Foreign currency translation adjustments			—				0.2
Ending balance		$	(1.4	)		$	(1.4	)

 

5. Inventory, as restated

Schedule of Inventory 

		March 31, 2023				December 31, 2022
		(in millions)
Component parts		$	21.4			$	20.7
Work in progress			2.9				3.6
Finished goods			10.3				6.0
Total inventories		$	34.6			$	30.3

 

Component parts include parts for gaming terminals. Our finished goods inventory primarily consists of gaming terminals which are ready for sale.

 

6. Contract Liabilities and Other Disclosures, as restated

 

The following table summarizes contract related balances:

Schedule of Contract Related Balances

		Accounts Receivable				Unbilled Accounts Receivable				Deferred Income				Customer Prepayments and Deposits
		(in millions)
At March 31, 2023		$	36.7			$	15.4			$	(7.2	)		$	(2.6	)
At December 31, 2022		$	44.6			$	18.0			$	(7.4	)		$	(2.4	)

 

Revenue recognized that was included in the deferred income balance at the beginning of the period amounted to $1.2 million and $2.5 million for the three months ended March 31, 2023 and 2022, respectively.

 

For the periods ended March 31, 2023 and 2022 respectively, there was no significant amounts of revenue recognized as a result of changes in contract transaction price related to performance obligations that were satisfied in the respective prior periods.

 

15

 

 

7. Stock-Based Compensation

 

A summary of the Company’s RSU activity during the three months ended March 31, 2023 is as follows:

 Schedule of Restricted Stock Unit Activity

		Number of Shares
Unvested Outstanding at January 1, 2023			1,647,544
Granted (1)			495,225
Forfeited			(6,266	)
Vested			(219,272	)
Unvested Outstanding at March 31, 2023			1,917,231

 

(1)	The amount shown as granted in the table includes 219,213 performance-based target RSUs as to which the number that ultimately vests would range from 0% to 200% of the target amount of RSUs (a maximum of 438,426 RSUs based on attainment of Adjusted EBITDA targets for 2023).

 

The Company issued a total of 353,554 shares during the three months ended March 31, 2023 which included an aggregate of 332,227 shares issued in connection with the net settlement of RSUs that vested during the prior year (on December 30, 2022).

 

8. Accumulated Other Comprehensive Loss (Income), as restated

 

The accumulated balances for each classification of comprehensive loss (income) are presented below:

 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 January 1, 2023			(84.2	)			0.3				33.1				(50.8	)
Change during the period			2.9				(0.2	)			(0.2	)			2.5
Balance at March 31, 2023		$	(81.3	)		$	0.1			$	32.9			$	(48.3	)

 

		Foreign Currency Translation Adjustments				Change in Fair Value of Hedging Instrument				Unrecognized Pension Benefit Costs				Accumulated Other Comprehensive (Income)
		(in millions)
Balance at January 1, 2022			(71.5	)			1.0				26.7				(43.8	)
Change during the period			(3.5	)			(0.2	)			(0.1	)			(3.8	)
Balance at March 31, 2022		$	(75.0	)		$	0.8			$	26.6			$	(47.6	)

 

In connection with the issuance of Senior Secured Notes and the entry into an RCF Agreement, on May 19, 2021, the Company terminated all of its interest rate swaps. Accordingly, hedge accounting is no longer applicable. The amounts previously recorded in Accumulated Other Comprehensive Income are amortized into Interest expense over the terms of the hedged forecasted interest payments. Losses reclassified from Accumulated Other Comprehensive Income into Interest expense in the Consolidated Statements of Operations and Income for the three months ended March 31, 2023 and March 31, 2022 amounted to $0.2 million and $0.2 million, respectively.

 

16

 

 

9. Net Earnings (Loss) per Share, as restated

 

Basic income/(loss) per share (“EPS”) is computed by dividing net income/(loss) attributable 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 RSUs, using the treasury stock method, and convertible debt or convertible preferred stock, using the if-converted method, unless the inclusion would be anti-dilutive.

 

The computation of diluted EPS excludes the common stock equivalents of the following potentially dilutive securities because they were either contingently issuable shares or because their inclusion would be anti-dilutive:

 Schedule of Anti-dilutive Securities Excluded from Computation of Earnings per Share

		2023				2022
		Three Months Ended March 31,
		2023				2022
RSUs		$	1,917,231			$	695,372

 

The following table reconciles the numerators and denominators of the basic and diluted EPS computations for the three months ended March 31, 2022. There were no reconciling items for the three months ended March 31, 2023.

Schedule of Numerators and Denominators of the Basic and Diluted EPS Computations 

		Income (Numerator)				Shares (Denominator)				Per-Share Amount, Three Months Ended March 31, 2022
		(in millions)
Basic EPS
Income available to common stockholders		$	1.5				28,437,052			$	0.05
Effect of Dilutive Securities
RSUs			—				925,330				—
Diluted EPS
Income available to common stockholders		$	1.5			$	29,362,382			$	0.05

 

The calculation of Basic EPS includes the effects of 1,893,136 and 1,591,632 shares for the three months ended March 31 2023 and 2022, respectively, with respect to RSU awards that have vested but have not yet been issued.

 

10. Other Finance Income (Expense)

 

Other finance income (expense) consisted of the following:

 Schedule of Other Finance Income (expense)

		2023				2022
		Three Months Ended March 31,
		2023				2022
		(in millions)
Pension interest cost		$	(0.8	)		$	(0.6	)
Expected return on pension plan assets			0.9				0.9
Other finance income (expense)		$	0.1			$	0.3

 

11. Income Taxes, as restated

 

The effective income tax rate for the three months ended March 31, 2023 and 2022 was 13.2% and 5.3%, as restated, respectively, resulting in a $0.2 million income tax benefit and $0.1 million income tax expense, respectively.

 

The effective tax rate reported in any given year will continue to be influenced by a variety of factors including the level of pre-tax income or loss, the income mix between jurisdictions, and any discrete items that may occur.

 

The Company recorded a valuation allowance against all of our deferred tax assets as of both March 31, 2023 and 2022. We intend to continue maintaining a full valuation allowance on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. However, given our current earnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a significant portion of the valuation allowance will no longer be needed. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve.

 

12. Related Parties

 

Macquarie Corporate Holdings Pty Limited (UK Branch) (“Macquarie UK”), (an arranger and lending party under our RCF Agreement) is an affiliate of MIHI LLC, which beneficially owned approximately 11.51% of our common stock as of March 31, 2023. Macquarie UK did not hold any of the Company’s aggregate senior debt at March 31, 2023 or December 31, 2022. Interest expense payable to Macquarie UK for the three months ended March 31, 2023 and 2022 amounted to $0.0 million and $0.0 million, respectively. MIHI LLC is also a party to a stockholders agreement with the Company and other stockholders, dated December 23, 2016, pursuant to which, subject to certain conditions, MIHI LLC, jointly with Hydra Industries Sponsor LLC, are permitted to designate two directors to be nominated for election as directors of the Company at any annual or special meeting of stockholders at which directors are to be elected, until such time as MIHI LLC and Hydra Industries Sponsor LLC in the aggregate hold less than 5% of the outstanding shares of the Company.

 

On December 31, 2021, the Company entered into a consultancy agreement with Richard Weil, the brother of A. Lorne Weil, our Executive Chairman, under which he received a success fee in the amount of $0.1 million for services he provided in connection with our acquisition of Sportech Lotteries, LLC. The success fee was paid during the year ended December 31, 2022. Under the agreement, as extended in November 2022, he will provide consulting services relating to the lottery in the Dominican Republic through to June 30, 2023 at a rate of $10,000 per month and, with respect to such services, the aggregate amount incurred by the Company in consulting fees for each of the three months ended March 31, 2023 and March 31, 2022 was $30,000.

 

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13. Leases, as restated

 

Certain of our arrangements include leases for equipment installed at customer locations. As the lessor, we combine lease and non-lease components for all classes of underlying assets in arrangements that involve operating leases. The single combined component is accounted for under ASC 606, Revenue from Contracts with Customers based on the consideration that the non-lease components are the predominant items in the arrangements. If a component cannot be combined, the consideration is allocated between the lease component and the non-lease component based on relative standalone selling price. The lease component is accounted for under ASC 842, Leases and the non-lease component is accounted for under ASC 606.

 

Lease income from operating leases and from sales type leases is not material for any of the periods presented.

 

14. Commitments and Contingencies

 

Employment Agreements

 

We are party to employment agreements with our executive officers and other employees of the Company and our subsidiaries which contain, among other terms, provisions relating to severance and notice requirements.

 

Arrangements with Daniel B. Silvers, former Executive Vice President and Chief Strategy Officer

 

Effective January 10, 2023, Mr. Silvers stepped down from his position as Executive Vice President and Chief Strategy Officer of the Company. Pursuant to Mr. Silvers’ employment agreement dated December 14, 2016, as amended, Mr. Silvers was entitled to receive a base salary at a rate of $385,000 per year, a target annual bonus of not less than 100% of his base salary and a maximum annual bonus of 200% of his base salary. He was also entitled to reimbursement for private medical insurance and to certain severance benefits.

 

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.

 

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15. Pension Plan, as restated

 

We operate a defined contribution plan in the US, and both defined benefit and defined contribution pension schemes in the UK. The defined contribution scheme assets are held separately from those of the Company in independently administered funds.

 

Defined Benefit Pension Scheme

 

The defined benefit scheme has been closed to new entrants since April 1, 1999 and closed to future accruals for services rendered to the Company for the entire financial statement periods presented. The Actuarial Valuation of the scheme as at March 31, 2021, determined that the statutory funding objective was not met, i.e., there were insufficient assets to cover the scheme’s technical provisions and there was a funding shortfall.

 

In June 2022, a recovery plan was put in place to eliminate the funding shortfall. The plan expects the shortfall to be eliminated by October 31, 2026. Deficit reduction contributions of 1.1 million and expense contributions of $0.3 million will be payable during the year ending December 31, 2023.

 

The total amount of employer contributions paid during the three months ended March 31, 2023 amounted to $0.3 million.

 

The following table presents the components of our net periodic pension benefit:

 

Schedule of Defined Benefit Plans

		2023				2022
		Three Months Ended March 31,
		2023				2022
		(in millions)
Components of net periodic pension benefit:
Interest cost		$	0.8			$	0.6
Expected return on plan assets			(0.9	)			(0.9	)
Amortization of net loss			0.2				0.1
Net periodic benefit		$	0.1			$	(0.2	)

 

The following table sets forth the estimate of the combined funded status of the pension plans and their reconciliation to the related amounts recognized in our consolidated financial statements at the respective measurement dates:

Schedule of Pension Plans and their Reconciliation 

		March 31, 2023				December 31, 2022
		(in millions)
Change in benefit obligation:
Benefit obligation at beginning of period		$	71.2			$	122.7
Interest cost			0.8				2.2
Actuarial loss (gain)			—				(39.0	)
Benefits paid			(0.7	)			(3.5	)
Foreign currency translation adjustments			1.9				(11.2	)
Benefit obligation at end of period		$	73.2			$	71.2
Change in plan assets:
Fair value of plan assets at beginning of period		$	69.1			$	125.7
Actual gain (loss) on plan assets			0.9				(42.4	)
Employer contributions			0.3				1.4
Benefits paid			(0.7	)			(3.5	)
Foreign currency translation adjustments			1.8				(12.1	)
Fair value of assets at end of period		$	71.4			$	69.1
Amount recognized in the consolidated balance sheets:
Unfunded status (non-current)		$	(1.8	)		$	(2.1	)
Net amount recognized		$	(1.8	)		$	(2.1	)

 

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16. Segment Reporting and Geographic Information, as restated

 

The Company operates its business along four operating segments, which are segregated on the basis of revenue stream: Gaming, Virtual Sports, Interactive and Leisure. 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), and total capital expenditures for the periods ended March 31, 2023 and March 31, 2022, 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, right of use assets, cash, prepaid expenses and property and equipment and software development costs relating to corporate/shared functions.

 

Segment Information

 Schedule of Segment Reporting Information by Segment

Three Months Ended March 31, 2023

 

		Gaming				Virtual Sports				Interactive				Leisure				Corporate Functions				Total
		(in millions)
Revenue:
Service		$	20.2			$	14.8			$	5.9			$	16.6			$	—			$	57.5
Product sales			6.9				—				—				0.5				—				7.4
Total revenue			27.1				14.8				5.9				17.1				—				64.9
Cost of sales, excluding depreciation and amortization:
Cost of service			(5.9	)			(0.4	)			(0.3	)			(8.4	)			—				(15.0	)
Cost of product sales			(5.8	)			—				—				(0.9	)			—				(6.7	)
Selling, general and administrative expenses			(5.7	)			(1.7	)			(2.5	)			(6.9	)			(9.5	)			(26.3	)
Stock-based compensation expense			(0.3	)			(0.2	)			(0.2	)			(0.1	)			(2.1	)			(2.9	)
Acquisition and integration related transaction expenses			—				—				—				—				—				—
Depreciation and amortization			(4.5	)			(0.8	)			(0.6	)			(3.1	)			(0.4	)			(9.4	)
Segment operating income (loss)			4.9				11.7				2.3				(2.3	)			(12.0	)			4.6
Net operating income																						$	4.6
Total capital expenditures for the three months ended March 31, 2023		$	2.4			$	0.4			$	1.1			$	5.2			$	0.5			$	9.6

 

20

 

 

Three Months Ended March 31, 2022

 

		Gaming				Virtual Sports				Interactive				Leisure				Corporate Functions				Total
		(in millions)
Revenue:
Service		$	21.1			$	11.3			$	4.6			$	19.0			$	—			$	56.0
Product sales			3.7				—				—				0.6				—				4.3
Total revenue			24.8				11.3				4.6				19.6				—				60.3
Cost of sales, excluding depreciation and amortization:
Cost of service			(6.0	)			(0.4	)			(0.3	)			(10.1	)			—				(16.8	)
Cost of product sales			(2.3	)			—				—				(0.2	)			—				(2.5	)
Selling, general and administrative expenses			(5.0	)			(1.7	)			(1.4	)			(6.6	)			(5.7	)			(20.4	)
Stock-based compensation expense			(0.3	)			(0.1	)			(0.1	)			(0.2	)			(2.1	)			(2.8	)
Acquisition and integration related transaction expenses			(0.1	)			—				—				—				(0.1	)			(0.2	)
Depreciation and amortization			(5.2	)			(0.8	)			(0.6	)			(3.6	)			(0.5	)			(10.7	)
Segment operating income (loss)			5.9				8.3				2.2				(1.1	)			(8.4	)			6.9
Net operating income																						$	6.9
Total capital expenditures for the three months ended March 31, 2022		$	2.9			$	0.5			$	0.9			$	4.0			$	1.2			$	9.5

 

Geographic Information

 

Geographic information for revenue is set forth below:

 Schedule of Geographic Information

		2023				2022
		Three Months Ended March 31,
		2023				2022
		(in millions)
Total revenue
UK		$	49.0			$	45.9
Greece			5.6				5.6
Rest of world			10.3				8.8
Total		$	64.9			$	60.3
Total revenue		$	64.9			$	60.3

 

UK revenue includes revenue from customers headquartered in the UK, but whose revenue is generated globally.

 

Geographic information of our non-current assets excluding goodwill is set forth below:

 

		March 31, 2023				December 31, 2022
		(in millions)
UK		$	87.5			$	82.7
Greece			5.1				5.8
Rest of world			16.1				16.3
Total		$	108.7			$	104.8
Total non-current assets excluding goodwill		$	108.7			$	104.8

 

Software development costs are included as attributable to the market in which they are utilized.

 

17. Customer Concentration

 

During the three months ended March 31, 2023, there was one customer that represented at least 10% of the Company’s revenues, accounting for 15% of the Company’s revenues. This customer was served by the Virtual Sports and Interactive segments. During the three months ended March 31, 2022, there was one customer that represented at least 10% of the Company’s revenues, accounting for 12% of the Company’s revenues. This customer was served by the Virtual Sports and Interactive segments.

 

At March 31, 2023 no customers represented at least 10% of the Company’s accounts receivable. At December 31, 2022, there was one customer that represented at least 10% of the Company’s accounts receivable, accounting for 24% of the Company’s accounts receivable.

 

18. 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. Other than as described below, and except for the effects of the restatement as discussed in Note 2 to the consolidated financial statements, the Company did not identify subsequent events that would have required adjustment or disclosure in the consolidated financial statements.

 

On April 10, 2023, the Company’s Board of Directors adopted the 2023 Omnibus Incentive Plan (the “2023 Plan”), subject to the approval of our stockholders, which was obtained at the Company’s annual meeting of stockholders held on May 9, 2023. The 2023 Plan authorizes a total of 2,700,000 shares to be issued pursuant to awards and will also replace the Company’s predecessor plan (the 2021 Plan) such that shares available for grant under the 2021 Plan would instead be available for grant under the 2023 Plan. Upon approval of the 2023 Plan, the sign-on RSUs previously disclosed for Messrs. Weil and Pierce as part of amendments to their employment contracts in January 2023 were effective (comprising an aggregate of 250,000 performance-based RSUs and 125,000 stock price-based RSUs).

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and related notes thereto included elsewhere in this report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual future results could differ materially from the historical results discussed below. Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those referenced in the section titled “Risk Factors” included elsewhere in this report.

 

Forward-Looking Statements

 

We make forward-looking statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operations. For definitions of the term Forward-Looking Statements, see the definitions provided in the Cautionary Note Regarding Forward-Looking Statements at the start of this Quarterly Report on Form 10-Q for the period ended March 31, 2023.

 

Seasonality

 

Our results of operations can fluctuate due to seasonal trends and other factors. Sales of our gaming machines can vary quarter on quarter due to both supply and demand factors. Player activity for our holiday parks is generally higher in the second and third quarters of the year, particularly during the summer months and slower during the first and fourth quarters of the year. Historical seasonality has been impacted by COVID-19 business disruptions and could continue to be impacted in future periods.

 

Revenue

 

We generate revenue in four principal ways: i) on a participation basis, ii) on a fixed rental fee basis, iii) through product sales, (iv) services provided and v) through software license fees. Participation revenue generally includes a right to receive a share of our customers’ gaming revenue, typically as a share of net win but sometimes as a share of the handle or “coin in” which represents the total amount wagered.

 

Geographic Range

 

Geographically, the majority of our revenue is derived from, and the majority of our non-current assets are attributable to, our UK operations. The remainder of our revenue is derived from, and non-current assets attributable to, Greece and the rest of the world (including North America).

 

For the three months ended March 31, 2023, and the three-months ended March 31, 2022 we derived approximately 76% of our revenue from the UK (including customers headquartered in the UK but whose revenue is generated globally), 9% from Greece, and the remaining 15% across the rest of the world. 

 

As of March 31, 2023, our non-current assets (excluding goodwill) were attributable as follows: 80% to the UK, 5% to Greece and 15% across the rest of the world.

 

Foreign Exchange

 

Our results are affected by changes in foreign currency exchange rates as a result of the translation of foreign functional currencies into our reporting currency and the re-measurement of foreign currency transactions and balances. The impact of foreign currency exchange rate fluctuations represents the difference between current rates and prior-period rates applied to current activity. The geographic region in which the largest portion of our business is operated is the UK and the British pound (“GBP”) is considered to be our functional currency. Our reporting currency is the U.S. dollar (“USD”). Our results are translated from our functional currency of GBP into the reporting currency of USD using average rates for profit and loss transactions and applicable spot rates for period-end balances. The effect of translating our functional currency into our reporting currency, as well as translating the results of foreign subsidiaries that have a different functional currency into our functional currency, is reported separately in Accumulated Other Comprehensive Income.

 

During the three months ended March 31, 2023 and March 31, 2022, we derived approximately 25% of our revenue from sales to customers outside the UK.

 

In the section “Results of Operations” below, currency impacts shown have been calculated as the current-period average GBP:USD rate less the equivalent average rate in the prior period, multiplied by the current period amount in our functional currency (GBP). The remaining difference, referred to as functional currency at constant rate, is calculated as the difference in our functional currency, multiplied by the prior-period average GBP:USD rate. This is not a U.S. GAAP measure, but is one which management believes gives a clearer indication of results. In the tables below, variances in particular line items from period to period exclude currency translation movements, and currency translation impacts are shown independently.

 

Non-GAAP Financial Measures

 

We use certain financial measures that are not compliant with U.S. GAAP (“Non-GAAP financial measures”), including EBITDA and Adjusted EBITDA, to analyze our operating performance. In this discussion and analysis, we present certain non-GAAP financial measures, define and explain these measures and provide reconciliations to the most comparable U.S. GAAP measures. See “Non-GAAP Financial Measures” below.

 

Results of Operations

 

Our results are affected by changes in foreign currency exchange rates, primarily between our functional currency (GBP) and our reporting currency (USD). During the periods ended March 31, 2023 and March 31, 2022, the average GBP:USD rates were for the three-month period 1.21 and 1.34, respectively.

 

 

The following discussion and analysis of our results of operations has been organized in the following manner:

 

	●	a discussion and analysis of the Company’s results of operations for the three-month period ended March 31, 2023, compared to the same period in 2022; and
	●	a discussion and analysis of the results of operations for each of the Company’s segments (Gaming, Virtual Sports, Interactive and Leisure) for the three-month periods ended March 31, 2023, compared to the same period in 2022, including KPI analysis.

 

In the discussion and analysis below, certain data may vary from the amounts presented in our consolidated financial statements due to rounding.

 

For all reported variances, refer to the overall company and segment tables shown below. All variances discussed in the overall company and segment results are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.

 

Restatement of Previously Issued Financial Statements

 

Restatement Background

 

On November 2, 2023, the Company in concurrence with the Company’s audit committee, concluded that our 2023 and 2022 consolidated financial statements and our unaudited consolidated financial statements as of and for each of the first two quarterly periods in 2023 and all quarterly periods in 2022, included in our Quarterly Reports on Form 10-Q for the respective periods(collectively the “Prior Period Financial Statements”), should no longer be relied upon due to misstatements that are described below, and that we would restate such financial statements to make the necessary accounting corrections. Details of the restated consolidated financial statements as of March 31, 2023 and for the three months ended March 31, 2023 and 2022 are provided below (“Restatement Items”).

 

The Restatements Items reflect adjustments to correct errors in certain financial statement areas including capitalized software and costs to fulfill a contract, revenue and costs to obtain a contract, inventory, goodwill and intangibles, leasing, pension, and other reclassifications and immaterial errors identified. The nature and impact of these adjustments are described in footnote 2 of the financial statements. ..

 

The Company issued a revision for capitalized software and related amortization expense in the quarterly report on Form 10-Q filed on August 11, 2023 for the period ended June 30, 2023 (the “Revision”). This revision related to certain completed software development projects that were, but should not have been, delayed in the shift from work in progress to completed projects. Consequently, the commencement of amortization for certain projects was delayed and the reported amortization was lower than the actual amortization. The Revision covers the period ended June 30, 2023 and the year ended December 31, 2022 and is distinct from the capitalized software restatements below. The tables below have been updated to separate the impact of the Restatement Items from the Revision.

 

Overall Company Results

 

Three Months ended March 31, 2023, compared to Three Months ended March 31, 2022

 

										Variance
(In millions)		For the Three-Month Period ended								2023 vs 2022
		March 31, 2023 As Restated				March 31, 2022 As Restated				Variance Attributable to Currency Movement				Variance on a Functional currency basis				Total Functional Currency Variance %				Total Reported Variance %
Revenue:
Service		$	57.5			$	56.0			$	(6.0	)		$	7.5				13.4	%			2.7	%
Product			7.4				4.3				(0.7	)			3.8				88.4	%			72.1	%
Total revenue			64.9				60.3				(6.7	)			11.3				18.7	%			7.6	%
Cost of Sales, excluding depreciation and amortization:
Cost of Service			(15.0	)			(16.8	)			1.5				0.3				1.8	%			(10.7	)%
Cost of Product			(6.7	)			(2.5	)			0.7				(4.9	)			196.0	%			168.0	%
Selling, general and administrative expenses			(26.3	)			(20.4	)			2.8				(8.7	)			42.6	%			28.9	%
Stock-based compensation			(2.9	)			(2.8	)			0.3				(0.4	)			14.3	%			3.6	%
Acquisition and integration related transaction expenses			-				(0.2	)			-				0.2				N/A				N/A
Depreciation and amortization			(9.4	)			(10.7	)			0.7				0.6				(5.6%	)			(12.1	%)
Net operating Income (Loss)			4.6				6.9				(0.7	)			(1.6	)			(23.2	%)			(33.3	%)
Other income (expense)
Interest expense, net			(6.3	)			(6.5	)			0.7				(0.5	)			7.7	%			(3.1	)%
Profit on disposal of trade & assets			-				0.9				(0.0	)			(0.9	)			N/A				N/A
Other finance income (expense)			0.1				0.3				(0.0	)			(0.2	)			(66.7	%)			(66.7	%)
Total other income (expense), net			(6.2	)			(5.3	)			0.7				(1.6	)			30.2	%			17.0	%
Net Income (loss) from continuing operations before income taxes			(1.6	)			1.6				(0.0	)			(3.2	)			(200	%)			(200	%)
Income tax expense			0.2				(0.1	)			(0.0	)			0.3				(300.0	%)			(300.0	%)
Net Income (Loss)		$	(1.4	)		$	1.5			$	(0.0	)		$	(2.9	)			(193.3	%)			(193.3	%)
Exchange Rate - $ to £			1.21				1.34

 

See “Segments Results” below for a more detailed explanation of the significant changes in our components of revenue within the individual segment results of operations.

 

 

Revenue

 

Consolidated Reported Revenue by Segment (As Restated)

 

 

●	There was no VAT-related revenue for the three-months ended March 31, 2023. For the three-months ended March 31, 2022 VAT-related revenue was $0.9 million.

 

“VAT-related revenue” are payments from UK customers related to our contractual revenue share of their value-added tax rebate.

 

For the three months ended March 31, 2023, revenue on a functional currency (at constant rate) basis increased by $11.3 million, or 19%.

 

For the three-month period, Gaming service revenue grew by $1.2 million predominantly due to an increase in UK markets of $1.4 million. Gaming Product revenue increased by $3.9 million predominately due to UK product sales. Virtual Sports and Interactive grew by $5.1 million and $2.0 million, respectively, with $4.6 million of the Virtuals Sports increase from Online and $0.5 million from Retail. Interactive growth was driven by revenue growth in the UK, US and Canada. These increases were offset by Leisure service revenue reduction of $0.8 million predominately driven by the reduction in the number of machines operated in the Pubs sector primarily due to the structured withdrawal of non-core low-margin amusement and prize vend machines as recognized in the third quarter of 2022 as well as the reduction in the number of gaming machines.

 

Cost of Sales, excluding depreciation and amortization

 

Cost of sales, excluding depreciation and amortization, for the three months ended March 31, 2023, increased by $4.6 million, or 24%. The increase was driven a $4.9 million increase in cost of product, predominately driven by the increase in Product sales.

 

Selling, general and administrative expenses

 

Selling, general and administrative (“SG&A”) expenses for the three months ended March 31, 2023 increased by $8.7 million, or 43%.

 

The increase was driven primarily by the costs of group restructure of $2.9 million (removed from Adjusted EBITDA), an increase in non-staff costs of $3.0 million, of which the largest proportion was driven by exhibition costs of $0.8 million that were not incurred in the prior period, and an increase in staff cost of $2.4 million,  driven by an increase in heads predominantly from an investment in the technology and commercial areas of our business.

 

Stock-based compensation

 

During the three months ended March 31, 2023, the Company recorded expenses of $2.9 million compared to expenses of $2.8 million for the three months ended March 31, 2022. All expenses were related to outstanding awards. The three months ended March 31, 2023 included an expense of $0.7 million relating to the group restructure.

 

Depreciation and amortization

 

Depreciation and amortization decreased for the three-month period by $0.6 million. This was driven by Leisure with a reduction of $0.2 million due to assets being fully written down, partly offset by $0.1 and $0.3 million increases in both Virtual Sports and Interactive respectively for depreciation and amortization expenses.

 

Net operating income/(loss)

 

During the three-month period, net operating income was $4.6 million, a decrease of $1.6 million compared to the prior year period. The decrease was attributable primarily to the increase in Selling, general and administrative expenses and in Stock-based compensation (including the cost of group restructure). This was partially offset by the increase in gross margin as well as the decrease in depreciation and amortization expenses.

 

Net Income/ (loss)

 

For the three-months ended March 31, 2023 net loss was $1.4 million, compared to a net income of $1.5 million in the prior period. The $2.9 million decline year-over-year, was primarily due to the cost of group restructure driving the decline in net operating income, an increase in interest expense, net of $0.5 million, due to $0.4 million increase in charges relating to a discounted unwind on provisions for dilapidations linked to various properties, as well as decreases in other finance income of $0.2 million and gain on disposal of trade and assets of $0.9 million compared to the prior year period.

 

 

Deferred Tax

 

We recorded a valuation allowance against all of our deferred tax assets as of both March 31, 2023, and March 31, 2022. We intend to continue maintaining a full valuation allowance on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. However, given our current earnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a significant portion of the valuation allowance will no longer be needed. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve.

 

Segment Results (for the three months ended March 31, 2023, compared to the three months ended March 31, 2022)

 

Gaming

 

We generate revenue from our Gaming segment through the delivery of our gaming terminals preloaded with proprietary gaming software, server based content, as well as services such as terminal repairs, maintenance, software upgrades and upgrades on a when and if available basis and content development.. We receive rental fees for machines, typically in conjunction with long-term contracts, on both a participation and fixed fee basis. Our participation contracts are typically structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and any relevant regulatory levies) from gaming terminals placed in our customers’ facilities. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.

 

Revenue growth for our Gaming business is principally driven by changes in (i) the number of operator customers we have, (ii) the number of Gaming machines in operation, (iii) the net win performance of the machines and (iv) the net win percentage that we receive pursuant to our contracts with our customers.

 

Gaming, Key Performance Indicators

 

		For the Three-Month Period ended								Variance
		March 31, 2023				March 31, 2022				2023 vs 2022
Gaming		As Restated				As restated								%
End of period installed base (# of terminals) (2)			34,711				34,401				310				0.9	%
Total Gaming - Average installed base (# of terminals) (2)			34,778				34,593				185				0.5	%
Participation - Average installed base (# of terminals) (2)			30,793				31,420				(627	)			(2.0	%)
Fixed Rental - Average installed base (# of terminals)			3,985				3,173				812				25.6	%
Service Only - Average installed base (# of terminals)			14,160				17,915				(3,755	)			(21.0	%)
Customer Gross Win per unit per day (1) (2)		£	98.3			£	86.7			£	11.6				13.4	%
Customer Net Win per unit per day (1) (2)		£	71.5			£	63.5			£	8.0				12.6	%
Inspired Blended Participation Rate			5.8	%			5.6	%			0.2	%
Inspired Fixed Rental Revenue per Gaming Machine per week		£	49.6			£	42.7			£	6.9				16.2	%
Inspired Service Rental Revenue per Gaming Machine per week		£	5.1			£	4.6			£	0.5				10.9	%
Gaming Long term license amortization (£’m)		£	0.8			£	1.2			£	(0.4	)			(33.3	%)
Number of Machine sales			688				419				269				64.2	%
Average selling price per terminal		£	7,880			£	6,467			£	1,413				21.8	%

 

(1)	Includes all SBG terminals in which the Company takes a participation revenue share across all territories.
(2)	Includes circa 2,500 of lottery terminals where the share is on handle instead of net win.

 

 

In the table above:

 

“End of Period Installed Base” is equal to the number of deployed Gaming terminals at the end of each period that have been placed on a participation or fixed rental basis. Gaming participation revenue, which comprises the majority of Gaming Service revenue, is directly related to the participation terminal installed base. This is the medium by which our customers generate revenue and distribute a revenue share to the Company. To the extent all other KPIs and certain other factors remain constant, the larger the installed base, the higher the Company’s revenue would be for a given period. Management gives careful consideration to this KPI in terms of driving growth across the segment. This does not include Service Only terminals.

 

Revenue is derived from the performance of the installed base as described by the Gross and Net Win KPIs.

 

If the End of Period Installed Base is materially different from the Average Installed Base (described below), we believe this gives an indication as to potential future performance. We believe the End of Period Installed Base is particularly useful for assessing new customers or markets, to indicate the progress being made with respect to entering new territories or jurisdictions.

 

“Total Gaming - Average Installed Base” is the average number of deployed Gaming terminals during the period split by Participation terminals and Fixed Rental terminals. Therefore, it is more closely aligned to revenue in the period. We believe this measure is particularly useful for assessing existing customers or markets to provide comparisons of historical size and performance. This does not include Service Only terminals.

 

“Participation - Average Installed Base” is the average number of deployed Gaming terminals that generated revenue on a participation basis.

 

“Fixed Rental - Average Installed Base” is the average number of deployed Gaming terminals that generated revenue on a fixed rental basis.

 

“Service Only - Average Installed Base” is the average number of terminals that generated revenue on a Service only basis.

 

“Customer Gross Win per unit per day” is a KPI used by our management to (i) assess impact on the Company’s revenue, (ii) determine changes in the performance of the overall market and (iii) evaluate the impacts of regulatory change and our new content releases on our customers. Customer Gross Win per unit per day is the average per unit cash generated across all Gaming terminals in which the Company takes a participation revenue share across all territories in the period, defined as the difference between the amounts staked less winnings to players divided by the Average Installed Base in the period, then divided by the number of days in the period.

 

Gaming revenue accrued in the period is derived from Customer Gross Win accrued in the period after deducting gaming taxes (defined as a regulatory levy paid by the Customer to government bodies) and applying the Company’s contractual revenue share percentage.

 

Our management believes Customer Gross Win measures are meaningful because they represent a view of customer operating performance that is unaffected by our revenue share percentage and allow management to (1) readily view operating trends, (2) perform analytical comparisons and benchmarking between customers and (3) identify strategies to improve operating performance in the different markets in which we operate.

 

“Customer Net Win per unit per day” is Customer Gross Win per unit per day after giving effect to the deduction of gaming taxes.

 

“Inspired Blended Participation Rate” is the Company’s average revenue share percentage across all participation terminals where revenue is earned on a participation basis, weighted by Customer Net Win per unit per day.

 

 

“Inspired Fixed Rental Revenue per Gaming Machine per week” is the Company’s average fixed rental amount across all fixed rental terminals where revenue is generated on a fixed fee basis, per unit per week.

 

“Inspired Service Rental Revenue per Gaming Machine per week” is the Company’s average service rental amount across all service only rental terminals where revenue is generated on a service only fixed fee basis, per unit per week.

 

“Gaming Long term license amortization” is the upfront license fee per terminal which is typically spread over the life of the terminal.

 

Our overall Gaming revenue from terminals placed on a participation basis can therefore be calculated as the product of the Participation - Average Installed Base, the Customer Net Win per unit per day, the number of days in the period, and the Inspired Blended Participation Rate, which is equal to “Participation Revenue”.

 

“Number of Machine sales” is the number of terminals sold during the period.

 

“Average selling price per terminal” is the total revenue in GBP of the Gaming terminals sold divided by the “number of Machine sales”.

 

Gaming, Recurring Revenue

 

		For the Three-Month Period ended								Variance
		March 31,				March 31,				2023 vs 2022
(In £ millions)		2023 As Restated				2022 As Restated								%
Gaming Recurring Revenue
Total Gaming Revenue		£	22.3			£	18.5			£	3.8				20.5	%
Gaming Participation Revenue		£	11.5			£	10.3			£	1.2				11.7	%
Gaming Other Fixed Fee Recurring Revenue		£	3.6			£	3.0			£	0.6				20.0	%
Gaming Project Recurring Revenue		£	0.2			£	0.2			£	0.0				0.0	%
Gaming Long-term license amortization		£	0.8			£	1.2			£	(0.4	)			(33.3	)%
Total Gaming Recurring Revenue *		£	16.1			£	14.7			£	1.4				9.5	%
Gaming Recurring Revenue as a % of Total Gaming Revenue †			72.2	%			79.5	%			(7.3	)
Total Gaming excluding VAT-related revenue		£	22.3			£	17.8
Gaming Recurring Revenue as a % of Total Gaming Revenue (excluding VAT-related revenue)			72.2	%			82.6	%

 

Set forth below is a breakdown of our Gaming recurring revenue. Gaming recurring revenue principally consists of Gaming participation revenue and fixed rental revenue.

 

*	Does not reflect VAT-related revenue.
†	Total Gaming Revenue for the three-month period ended March 31, 2023 has no VAT-related revenue, for the three-month period ended March 31, 2022, includes £0.7 million of VAT-related revenue, which is not reflected in Gaming Recurring Revenue for that period. Excluding VAT-related revenue, Gaming Recurring Revenue was 72% and 83%, respectively of Total Gaming Revenue for such period.
	Note – For the three-months ending March 31, 2022, there has been some recharacterization between Gaming Participation Revenue and Other Fixed fee revenue to ensure consistency with similar items across the Group.

 

 

In the table above:

 

“Gaming Participation Revenue” includes our share of revenue generated from (i) our Gaming terminals placed in gaming and lottery venues; and (ii) licensing of our game content and intellectual property to third parties.

 

“Gaming Other Fixed Fee Recurring Revenue” includes service revenue in which the Company earns a periodic fixed fee on a contracted basis.

 

“Gaming Long term license amortization” – see the definition provided above.

 

“Total Gaming Recurring Revenue” is equal to Gaming Participation Revenue plus Gaming Other Fixed Fee Recurring Revenue.

 

Gaming, Service Revenue by Region

 

Set forth below is a breakdown of our Gaming service revenue by geographic region. Gaming Service revenue consists principally of Gaming participation revenue, Gaming other fixed fee revenue, Gaming long-term license amortization and Gaming other non-recurring revenue. See “Gaming Segment Revenue” below for a discussion of gaming service revenue between the periods under review.

 

		For the Three-Month Period ended								Variance
(In millions)		March 31, 2023				March 31, 2022				2023 vs 2022								Total Functional Currency %
Service Revenue:
UK LBO		$	9.7			$	10.2			$	(0.5	)			(4.9	)%			5.7	%
UK VAT - Related Income			-				0.9			$	(0.9	)			(100.0	)%			(100.0	)%
UK Other			3.4				3.0				0.4				13.3	%			25.6	%
Italy			0.8				0.7				0.1				14.3	%			36.0	%
Greece			4.3				4.8				(0.5	)			(10.4	%)			(2.2	)%
Rest of the World			0.6				0.2				0.4				200.0	%			228.1	%
Lotteries			1.4				1.3				0.1				7.7	%			20.2	%
Total Service revenue		$	20.2			$	21.1			$	(0.9	)			(4.3	%)			6.0	%
Exchange Rate - $ to £			1.21				1.34

 

Note: Exchange rate in the table is calculated by dividing the USD total service revenue by the GBP total service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

Gaming, key events

 

Total Gaming Customer Gross Win per unit per day (in our functional currency, GBP) for the three-months ended March 31, 2023, increased by £11.6, or 13%, to £98.3. The increase was driven by a combination of new content in the UK LBO and Greek markets, removal of all remaining COVID-19 restrictions in Greece, and some shop redistribution of revenue from low performing venue closures in the UK LBO market.

 

The new “Vantage” terminal, 200 of which have now been on trial for 45 weeks across two major customers, showed 13% growth compared to the current estate terminals. The full rollout of 6,500 “Vantage” terminals into these two major customers is expected to be complete by the end of 2023.

 

The overall participation rate for our installed base increased to 5.8% for the three months ended March 31, 2023 from 5.6% for the three months ended March 31, 2022. The increase was driven by a shift in customer mix.

 

In the Non-LBO UK gaming estate, Inspired recorded outright sales of 200 “Flex” terminals to a major customer during the three-month period, delivering revenue of $2.0 million. The new terminals were a combination of replacement and new venue installs. In addition to the product sale component, these new terminals generate additional recurring rental fees. Inspired also delivered the first significant sales volume of the “Community Cops & Robbers” triple player product.

 

During the first quarter of 2023, Inspired agreed to refresh the Greek estate with 2,000 new “Valor” and 500 new “Vantage” terminals. These terminals are expected to be delivered by the end of 2023 which are expected to be installed into venues during the early part of 2024.

 

In the North American market, Inspired recorded service revenue in Illinois from 475 game pack sales, the first of this type. Each game pack includes seven new titles, two of which were delivered in the first quarter of 2023 and the remainder by the end of 2023.

 

 

Gaming, Results of Operations

 

										Variance
(In millions)		For the Three-Month Period ended								2023 vs 2022
		March 31, 2023 As Restated				March 31, 2022 As Restated				Variance Attributable to Currency Movement				Variance on a Functional currency basis				Total Functional Currency Variance %				Total Reported Variance %
Revenue:
Service		$	20.2			$	21.1			$	(2.1	)		$	1.2				5.7	%			(4.3	%)
Product			6.9				3.7			$	(0.7	)		$	3.9				105.4	%			86.5	%
Total revenue			27.1				24.8				(2.8	)			5.1				20.6	%			9.3	%
Cost of Sales, excluding depreciation and amortization:
Cost of Service			(5.9	)			(6.0	)		$	0.6				(0.5	)			8.3	%			(1.7	%)
Cost of Product			(5.8	)			(2.3	)		$	0.6				(4.1	)			178.3	%			152.2	%
Total cost of sales			(11.7	)			(8.3	)			1.2				(4.6	)			55.4	%			41.0	%
Selling, general and administrative expenses			(5.7	)			(5.0	)		$	0.6				(1.3	)			26.0	%			14.0	%
Stock-based compensation			(0.3	)			(0.3	)		$	0.0				(0.0	)			0.0	%			0.0	%
Acquisition and integration related transaction expenses			-				(0.1	)			-				0.1				N/A				N/A
Depreciation and amortization			(4.5	)			(5.2	)		$	0.7				-				0.0	%			(13.5	%)
Net operating Income (Loss)		$	4.9			$	5.9			$	(0.3	)		$	(0.7	)			(11.9	%)			(16.9	%)
Profit on disposal of trade & assets			-				0.9				-				(0.9	)			N/A				N/A
Net Income (Loss)		$	4.9			$	6.8			$	(0.3	)		$	(1.6	)			(23.5	%)			(27.9	%)
Exchange Rate - $ to £			1.21				1.34

 

Note: Exchange rate in the table is calculated by dividing the USD total revenue by the GBP total revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

All variances discussed in the Gaming results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.

 

Gaming Revenue

 

During the three-month period, Gaming revenue increased by $5.1 million, or 21%. This was driven by a $1.2 million increase in Service revenue and a $3.9 million increase in Product revenue.

 

The increase in Gaming Service revenue was driven by $1.4 million from the UK market, $0.7 million from the rest of the world and $0.3 million from Lotteries. This was partially offset by lower VAT-related revenue of $0.9 million.

 

Product revenue increase was primarily driven by higher Product sales of $3.5 million of UK sales and $0.5 million of mainland Europe sales.

 

Gaming Operating Income

 

Operating income decreased for the three-month period by $0.7 million. This decrease was primarily due to the increase in revenues of $5.1 million. This was offset by an increase in cost of sales of $4.6 million and increase of $1.3 million in SG&A, driven by exhibition costs that were not incurred in the prior year.

 

 

Gaming Net Income

 

For the three-month period, Net income decreased by $1.6 million. This was due to the increase in Operating income, offset by the $0.9 million profit from the disposal of trade and assets from the sale of part of the Italian VLT operations in prior year.

 

Virtual Sports

 

We generate revenue from our Virtual Sports segment through the on-premise solution and hosting of our products. We primarily receive fees on a participation basis. Our participation contracts are typically structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and other promotional costs and any relevant regulatory levies) from Virtual Sports content placed on our customers’ websites or in our customers’ facilities. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.

 

Revenue growth for our Virtual Sports segment is principally driven by the number of customers we have, the net win performance of the games and the net win percentage that we receive pursuant to our contracts with our customers.

 

Virtual Sports, Key Performance Indicators

 

		For the Three-Month Period ended								Variance
		March 31,				March 31,				2023 vs 2022
Virtuals		2023 As Restated				2022 As Restated								%
No. of Live Customers at the end of the period			58				62				(4	)			(6.5	)%
Average No. of Live Customers			58				62				(4	)			(6.5	%)
Total Revenue (£’m)		£	12.2			£	8.4			£	3.8				45.2	%
Total Revenue £’m - Retail		£	2.5			£	2.2			£	0.3				13.6	%
Total Revenue £’m - Online Virtuals		£	9.7			£	6.2			£	3.5				56.5	%

 

In the table above:

 

“No. of Live Customers at the end of the period” and “Average No. of Live Customers” represent the number of customers from which there is Virtual Sports revenue at the end of the period and the average number of customers from which there is Virtual Sports revenue during the period, respectively.

 

“Total Revenue (£m)” represents total revenue for the Virtual Sports segment, including recurring and upfront service revenue. Total revenue is also divided between “Total Revenue (£m) – Retail,” which consists of revenue earned through players wagering at Virtual Sports venues, “Total Revenue (£m) – Online Virtuals,” which consists of revenue earned through players wagering on Virtual Sports online.

 

Virtual Sports, Recurring Revenue

 

Set forth below is a breakdown of our Virtual Sports recurring revenue, which consists of Retail Virtuals and Online Virtuals recurring revenue as well as long-term license amortization. See “Virtual Sports Segment Revenue” below for a discussion of Virtual Sports Service revenue between the periods under review.

 

 

		For the Three-Month Period ended								Variance
		March 31,				March 31,				2023 vs 2022
(In £ millions)		2023 As Restated				2022 As Restated								%
Virtual Sports Recurring Revenue
Total Virtual Sports Revenue		£	12.2			£	8.4			£	3.8				45.2	%
Recurring Revenue - Retail Virtuals		£	2.5			£	2.2			£	0.3				13.6	%
Recurring Revenue - Online Virtuals		£	9.6			£	6.1			£	3.5				57.4	%
Total Virtual Sports Long-term license amortization		£	-			£	-			£	-				-
Total Virtual Sports Recurring Revenue		£	12.1			£	8.3			£	3.8				45.8	%
Virtual Sports Recurring Revenue as a Percentage of Total Virtual Sports Revenue			99.1	%			98.8	%			0.3

 

“Recurring Revenue” includes our share of revenue generated from (i) our Virtual Sports products placed with operators; (ii) licensing our game content and intellectual property to third parties; and (iii) our games on third-party online gaming platforms that are interoperable with our game servers.

 

“Virtual Sports Long term license amortization” is the upfront license fee which is typically spread over the life of the contract.

 

Virtual Sports, key events

 

During the period, we launched a full suite of games including V-Play Soccer™ and V-Play Basketball™ in Ontario with multiple operators and V-Play Tie-Break Tennis™ with bet365. We launched Online Virtuals via the VPP platform in Turkey with Milli Piyango, in partnership with leading operator SisalSans.

 

We signed a new contract and went live with Mozzarbet for V-Play Plug & Play™ in three new African territories.

 

We launched two new products, Virtual Motor Racing and U.S Horses into Entain’s U.K. retail estate. We also launched V-Play Horses™ with Eurobet in Italy.

 

We have also announced a new partnership with Aristocrat Gaming™ to bring a new virtual sports experience to football fans worldwide through their global licensing agreement with the National Football League (NFL).

 

 

Virtual Sports, Results of Operations

 

										Variance
(In millions)		For the Three-Month Period ended								2023 vs 2022
		March 31, 2023 As Restated				March 31, 2022 As Restated				Variance Attributable to Currency Movement				Variance on a Functional currency basis				Total Functional Currency Variance %				Total Reported Variance %
Service Revenue		$	14.8			$	11.3			$	(1.6	)		$	5.1				45.1	%			31.0	%
Cost of Service			(0.4	)			(0.4	)			0.1				(0.1	)			25.0	%			0.0	%
Selling, general and administrative expenses			(1.7	)			(1.7	)			0.2				(0.2	)			(11.8	)%			0.0	%
Stock-based compensation			(0.2	)			(0.1	)			0.0				(0.1	)			100.0	%			100.0	%
Depreciation and amortization			(0.8	)			(0.8	)			0.1				(0.1	)			12.5	%			-
Net operating Income (Loss)		$	11.7			$	8.3			$	(1.2	)		$	4.6				55.4	%			41.0	%
Exchange Rate - $ to £			1.21				1.34

 

Note: Exchange rate in the table is calculated by dividing the USD service revenue by the GBP service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

All variances discussed in the Virtual Sports results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.

 

Virtual Sports revenue

 

During the three-month period, revenue increased by $5.1 million, or 45%. This increase was driven by a $4.6 million increase in Online Virtuals, primarily driven by the growth from our existing online customers along with expanding jurisdictions, as well as increases in Retail Virtuals of $0.5 million.

 

Virtual Sports operating income

 

Operating income increased by $4.6 million in the three-month period. This increase was primarily due to the increase in revenue of $5.1 million, partly offset by an increase of $0.2 million in SG&A costs and an increase in depreciation and amortization of $0.1 million.

 

Interactive

 

We generate revenue from our Interactive segment through the various games content made available via third party aggregation platforms with Inspired’s remote gaming server or directly on the Company’s remote gaming server platform, and services such as customer support, platform maintenance, updates and upgrades. Typically, we receive fees on a participation basis. Our participation contracts are usually structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays and other promotional costs and any relevant regulatory levies) from Interactive content placed on our customers’ websites. Typically, we recognize revenue from these arrangements on a daily basis over the term of the contract.

 

Revenue growth for our Interactive segment is principally driven by the number of customers we have, the number of live games, the net win performance of the games and the net win percentage that we receive pursuant to our contracts with our customers.

 

 

Interactive, Key Performance Indicators

 

		For the Three-Month Period ended								Variance
		March 31,				March 31,				2023 vs 2022
Interactive		2023				2022								%
No. of Live Customers at the end of the period			138				112				26				23.2	%
Average No. of Live Customers			135				111				24				21.6	%
No. of Games available at the end of the period			271				242				29				12.0	%
Average No. of Games available			270				239				31				13.0	%
No. of Live Games at the end of the period			247				242				5				2.1	%
Average No. of Live Games			246				239				7				2.9	%
Total Revenue (£’m)		£	4.9			£	3.4			£	1.5				44.2	%

 

In the table above:

 

“No. of Live Customers at the end of the period” and “Average No. of Live Customers” represent the number of customers from which there is Interactive revenue at the end of the period and the average number of customers from which there is Interactive revenue during the period, respectively.

 

“No. of Games available at the end of the period” and “Average No. of Games available” represents the number of games that are available for operators to deploy at the end of the period (including inactive legacy games still available and inactive new games that are available but have not yet gone live with any operators) and the average number of games that are available for operators to deploy during the period, respectively. This incorporates both live games and inactive games.

 

“No. of Live Games at the end of the period” and “Average No. of Live Games” represents the number of games from which there is Interactive revenue at the end of the period and the average number of games from which there is Interactive revenue during the period, respectively.

 

“Total Revenue (£m)” represents total revenue for the Interactive segment, including recurring and upfront service revenue.

 

Interactive, key events

 

During the period ended March 2023, we went live with seven new operators, including 32Red, AGLC and theScore. In addition, we entered new markets with five operators, including The Stars Group in Italy and bet365 in Spain.

 

During the period we deployed five new games, including a new online game with the Terminator™ licensed brand. Our B2B Game software permit was approved in Sweden, permitting us to continue to deploy iGaming and Virtual Sports software in the country. We also signed a contract with Alchemybet to build a new Slingo Gold Cash Free Spins.

 

 

Subsequent to the period end, we launched iGaming content with Fanduel in Michigan.

 

Interactive, Results of Operations

 

										Variance
(In millions)		For the Three-Month Period ended								2023 vs 2022
		March 31, 2023 As Restated				March 31, 2022 As Restated				Variance Attributable to Currency Movement				Variance on a Functional currency basis				Total Functional Currency Variance %				Total Reported Variance %
Service Revenue		$	5.9			$	4.6			$	(0.7	)		$	2.0				43.5	%			28.3	%
Cost of Service			(0.3	)			(0.3	)			0.0				0.0				0.0	%			0.0	%
Selling, general and administrative expenses			(2.5	)			(1.4	)			0.3				(1.4	)			100.0	%			78.6	%
Stock-based compensation			(0.2	)			(0.1	)			0.0				(0.1	)			100.0	%			100.0	%
Depreciation and amortization			(0.6	)			(0.6	)			0.3				(0.3	)			50.0	%			-
Net operating Income (Loss)		$	2.3			$	2.2			$	(0.1	)		$	0.2				9.1	%			4.5	%
Exchange Rate - $ to £			1.21				1.35

 

Note: Exchange rate in the table is calculated by dividing the USD service revenue by the GBP service revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

All variances discussed in the Interactive results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.

 

Interactive revenue

 

During three-month period, revenue increased by $2.0 million, or 44%, primarily driven by revenue growth in the UK, US and Canada due to the consistent launch of new content across the estate and increased promotional activity through exclusive deals with tier-one customers.

 

Interactive operating income

 

Operating income for the three-month period increased by $0.2 million. This increase was driven by the increase in revenue, partially offset by a $1.4 million increase in SG&A expenses driven by exhibition costs that were not incurred during the prior year period as well and increase in staff costs due to an investment in new technology and commercial heads.

 

 

Leisure

 

We typically generate revenue from our Leisure segment through the supply of our gaming and amusement machines. We receive rental fees for machines, typically on a long-term contract basis, on both a participation and fixed fee basis. Our participation contracts are usually structured to pay us a percentage of net win (defined as net revenue to our operator customers, after deducting player winnings, free bets or plays, any relevant regulatory levies and minimum fixed incomes where applicable) from machines placed in our customers’ facilities. We generally recognize revenue from these arrangements on a daily basis over the term of the contract.

 

Revenue growth for our Leisure segment is principally driven by the number of customers we have, the number of machines in operation, the net win performance of the machines and the net win percentage that we receive pursuant to our contracts with our customers.

 

Leisure, Key Performance Indicators

 

		For the Three-Month Period ended								Variance
		March 31,				March 31,				2023 vs 2022
Leisure		2023				2022								%
End of period installed base Gaming machines (# of terminals)			10,811				11,060				(249	)			(2.3	)%
Average installed base Gaming machines (# of terminals)			10,821				11,248				(427	)			(3.8	)%
End of period installed base Other (# of terminals)			4,546				6,356				(1,810	)			(28.5	)%
Average installed base Other (# of terminals)			4,519				6,524				(2,005	)			(30.7	)%
Pub Digital Gaming Machines - Average installed base (# of terminals)			6,028				6,326				(298	)			(4.7	)%
Pub Analogue Gaming Machines - Average installed base (# of terminals)			499				1,720				(1,221	)			(71.0	)%
MSA and Bingo Gaming Machines - Average installed base (# of terminals)(1)			3,089				3,189				(100	)			(3.1	)%
Inspired Leisure Revenue per Gaming Machine per week		£	66.4			£	64.2			£	2.2				3.4	%
Inspired Pub Digital Revenue per Gaming Machine per week		£	70.3			£	66.1			£	4.2				6.4	%
Inspired Pub Analogue Revenue per Gaming Machine per week		£	36.8			£	39.2			£	(2.4	)			(6.1	)%
Inspired MSA and Bingo Revenue per Gaming Machine per week		£	89.4			£	87.3			£	2.1				2.4	%
Inspired Other Revenue per Machine per week		£	20.1			£	20.2			£	(0.1	)			(0.4	)%
Total Holiday Parks Revenue (Gaming and Non Gaming) (£’m)		£	2.9			£	2.5			£	0.4				16.0	%

 

(1)	Motorway Service Area machines

 

In the table above:

 

“End of period installed base Gaming” and “Average installed base Gaming” represent the number of gaming machines installed (excluding Holiday Park machines) that are Category B and Category C only, from which there is participation or rental revenue at the end of the period or as an average over the period.

 

“End of period installed base Other” and “Average installed base Other” represent the number of all other category machines installed (excluding Holiday Park machines) from which there is participation or rental revenue at the end of the period or as an average over the period.

 

“Revenue per machine unit per week” represents the average weekly participation or rental revenue recognized during the period.

 

 

Leisure, key events

 

During the three months ended March 31, 2023 we successfully installed 370 machines (a mixture of Amusement and Gaming) and commenced operations at holiday park operator Butlins in Bognor Regis with initial performance being strong. Holiday Parks performance across all other sites has been strong in the quarter.

 

In the Pubs business we signed a new 4-year agreement with Stonegate Group, one of the largest UK operators of Pubs in the managed, leased and tenanted sectors.

 

Our Prismatic Cat C estate saw the release of Bonus Fruits, Burning Hot Deluxe and Bullion Bars Pub edition. Our Prismatic performance is the number one cabinet and product across UK Pubs.

 

In the Bingo sector we deployed sixty new Prismatic Fortune community machines to 15 Mecca Bingo sites nationwide in the UK as well as released new content Clockwork Orange Fortune Community.

 

Performance was strong in the quarter across our MSA estate, with successful launches of Anubis Gold and Super Bonus Joker Free Spins. One of our largest customers, Moto completed major AGC refurbishments and new layouts at two of its highest revenue earning sites (Medway and Thurrock) which included investment in Flex and Prismatic machines.

 

Leisure, Results of Operations

 

										Variance
(In millions)		For the Three-Month Period ended								2023 vs 2022
		March 31, 2023 As Restated				March 31, 2022 As Restated				Variance Attributable to Currency Movement				Variance on a Functional currency basis				Total Functional Currency Variance %				Total Reported Variance %
Revenue:
Service		$	16.6			$	19.0			$	(1.6	)		$	(0.8	)			(4.2	)%			(12.6	)%
Product			0.5				0.6				(0.1	)			(0.0	)			(0.0	)%			(16.7	)%
Total revenue			17.1				19.6				(1.7	)			(0.8	)			(4.1	)%			(12.8	)%
Cost of Sales, excluding depreciation and amortization:
Cost of Service			(8.4	)			(10.1	)			0.8				0.9				(8.9	)%			(16.8	)%
Cost of Product			(0.9	)			(0.2	)			0.1				(0.8	)			400.0	%			350.0	%
Total cost of sales			(9.3	)			(10.3	)			0.9				0.1				(1.0	)%			(9.7	)%
Selling, general and administrative expenses			(6.9	)			(6.6	)			0.8				(1.1	)			16.7	%			(4.5	%)
Stock-based compensation			(0.1	)			(0.2	)			0.0				0.1				(50.0	)%			(50.0	)%
Depreciation and amortization			(3.1	)			(3.6	)			0.3				0.2				(5.6	)%			(13.9	)%
Net operating Income (Loss)			(2.3	)			(1.1	)		$	0.3			$	(1.5	)			136.4	%			109.1	%
Exchange Rate - $ to £			1.21				1.34

 

Note: Exchange rate in the table is calculated by dividing the USD total revenue by the GBP total revenue, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

All variances discussed in the Leisure results below are on a functional currency (at constant rate) basis, which excludes the impact of any changes in foreign currency exchange rates.

 

Leisure Revenue

 

For the three-month period, revenue decreased by $0.8 million, primarily due to the structured withdrawal of non-core low-margin amusement and prize vend machines as recognized in the third quarter of 2022 as well as the reduction in the number of gaming machines.

 

Service revenue decreased by $0.8 million, driven by the decline in Pubs of $1.0 million and Bingo Halls of $0.3 million, partly offset by the increase in Holiday parks of $0.5 million.

 

Leisure Operating Income/ (Loss)

 

Operating loss for the three-month period was a loss of $2.3 million compared to a loss of $1.1 million during the prior year period. This was primarily due to the decrease in revenue driven by the decline in the Pubs business and the increase in SG&A expenses driven by the increase in headcount from the investment in technology and service areas of the business as well as exhibitions costs that were not incurred in the prior year period. This was partially offset by a decrease in cost of sales of 0.1 million and a decrease in depreciation and amortization of $0.2 million.

 

 

Non-GAAP Financial Measures

 

We use certain non-GAAP financial measures, including EBITDA and Adjusted EBITDA, to analyze our operating performance. We use these financial measures to manage our business on a day-to-day basis. We believe that these measures are also commonly used in our industry to measure performance. For these reasons, we believe that these non-GAAP financial measures provide expanded insight into our business, in addition to standard U.S. GAAP financial measures. There are no specific rules or regulations for defining and using non-GAAP financial measures, and as a result the measures we use may not be comparable to measures used by other companies, even if they have similar labels. The presentation of non-GAAP financial information should not be considered in isolation from, or as a substitute for, or superior to, financial information prepared and presented in accordance with U.S. GAAP. You should consider our non-GAAP financial measures in conjunction with our U.S. GAAP financial measures.

 

We define our non-GAAP financial measures as follows:

 

EBITDA is defined as net income (loss) excluding depreciation and amortization, interest expense, interest income and income tax expense.

 

Adjusted EBITDA is defined as net income (loss) excluding depreciation and amortization, interest expense, interest income and income tax expense, and other additional exclusions and adjustments (see Adjusted EBITDA reconciliation table). Such additional excluded amounts include stock-based compensation U.S. GAAP charges where the associated liability is expected to be settled in stock, and changes in the value of earnout liabilities and income and expenditure in relation to legacy portions of the business (being those portions where trading no longer occurs) including closed defined benefit pension schemes. Additional adjustments are made for items considered outside the normal course of business, including, but not limited to (1) restructuring costs, which include charges attributable to employee severance, management changes, restructuring, dual running costs, costs related to facility closures and integration costs, (2) merger and acquisition costs and (3) gains or losses not in the ordinary course of business. This does not include any adjustments related to COVID-19.

 

We believe Adjusted EBITDA, when considered along with other performance measures, is a particularly useful performance measure, because it focuses on certain operating drivers of the business, including sales growth, operating costs, selling and administrative expense and other operating income and expense. We believe Adjusted EBITDA can provide a more complete understanding of our operating results and the trends to which we are subject, and an enhanced overall understanding of our financial performance and prospects for the future. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income or loss, because it does not take into account certain aspects of our operating performance (for example, it excludes non-recurring gains and losses which are not deemed to be a normal part of underlying business activities). Our use of Adjusted EBITDA may not be comparable to the use by other companies of similarly termed measures. Management compensates for these limitations by using Adjusted EBITDA as only one of several measures for evaluating our operating performance. In addition, capital expenditures, which affect depreciation and amortization, interest expense, and income tax benefit (expense), are evaluated separately by management.

 

Functional Currency at Constant rate. Currency impacts discussed have been calculated as the current-period average GBP: USD rate less the equivalent average rate in the prior period, multiplied by the current period amount in our functional currency (GBP). The remaining difference, referred to as functional currency at constant rate, is calculated as the difference in our functional currency, multiplied by the prior-period average GBP: USD rate, as a proxy for functional currency at constant rate movement.

 

Currency Movement represents the difference between the results in our reporting currency (USD) and the results on a functional currency (at constant rate) basis.

 

Reconciliations from net loss, as shown in our Consolidated Statements of Operations and Comprehensive Income (Loss), to Adjusted EBITDA are shown below.

 

 

Reconciliation to Adjusted EBITDA by segment for the Three Months ended March 31, 2023

 

		For the Three-Month Period ended
		March 31,
(In millions)		2023 As Restated
		Total				Gaming				Virtual Sports				Interactive				Leisure				Corporate
Net Income/ (loss)		$	(1.4	)		$	4.9			$	11.7			$	2.3			$	(2.3	)		$	(18.0	)
Items Relating to Legacy Activities:
Pension charges (1)			0.2																				0.2
Items outside the normal course of business:
Costs of group restructure (3)			3.0																				3.0
Stock-based compensation expense (4)			2.9				0.3				0.2				0.2				0.1				2.1
Depreciation and amortization (4)			9.4				4.5				0.8				0.6				3.1				0.4
Interest expense net (4)			6.3																				6.3
Other finance expenses / (income) (4)			(0.1	)																			(0.1	)
Income tax (4)			(0.2	)																			(0.2	)
Adjusted EBITDA		$	20.1			$	9.7			$	12.7			$	3.1			$	0.9			$	(6.3	)
Adjusted EBITDA		£	16.5			£	8.0			£	10.4			£	2.5			£	0.8			£	(5.2	)
Exchange Rate - $ to £ (5)			1.21

 

Note: 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; these are shown in the Corporate category.

 

 

Reconciliation to Adjusted EBITDA by segment for the Three Months ended March 31, 2022

 

		For the Three-Month Period ended
		March 31,
(In millions)		2022 As Restated
		Total				Gaming				Virtual Sports				Interactive				Leisure				Corporate
Net Income/ (loss)		$	1.5			$	6.8			$	8.3			$	2.2			$	(1.1	)		$	(14.7	)
Items Relating to Legacy Activities:
Pension charges (1)			0.1																				0.1
Items outside the normal course of business:
Acquisition and integration related transaction expenses (2)			0.2				0.1																0.1
Stock-based compensation expense (4)			2.8				0.3				0.1				0.1				0.2				2.1
Depreciation and amortization (4)			10.7				5.2				0.8				0.6				3.6				0.5
Interest expense net (4)			6.5																				6.5
Profit on disposal of business (6)			(0.9	)			(0.9	)															-
Other finance expenses / (income) (4)			(0.3	)																			(0.3	)
Income tax (4)			0.1																				0.1
Adjusted EBITDA		$	20.7			$	11.5			$	9.2			$	2.9			$	2.7			$	(5.6	)
Adjusted EBITDA		£	15.5			£	8.6			£	6.9			£	2.1			£	2.0			£	(4.1	)
Exchange Rate - $ to £ (5)			1.34

 

Note: 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; these are shown in the Corporate category.

 

Notes to Adjusted EBITDA reconciliation tables above:

 

(1)	“Pension charges” are profit and loss charges included within selling, general and administrative expenses, relating to a defined benefit scheme which was closed to new entrants in 1999 and to future accrual in 2010. As well as the amortization of net loss, the figure also includes charges relating to the Pension Protection Fund (which were historically borne by the pension scheme) and a small amount of associated professional services expenses. These costs are included within Corporate Functions.
(2)	Acquisition and integration related transaction expenses, are as described above in the Results of Operations line item discussions.
(3)	“Costs of group restructure” include redundancy costs, Payments In Lieu of Notice costs and any associated employer taxes. To qualify as being an adjusting item, costs must be part of a large restructuring project, which will net save ongoing future costs.
(4)	Stock-based compensation expense, Depreciation and amortization, Total other expense, net and Income tax are as described above in the Results of Operations line item discussions. Total expense, net includes interest income, interest expense, change in fair value of earnout liability, change in fair value of derivative liability and other finance income.
(5)	Exchange rate in the table is calculated by dividing the USD Adjusted EBITDA by the GBP Adjusted EBITDA, therefore this could be slightly different from the average rate during the period depending on timing of transactions.

 

 

(6)	“Profit on disposal of trade & assets” — In January 2022, the Company sold its Italian VLT business, including all terminals and other assets, staff costs and facilities and contracts to a non-connected party, recognizing a profit on this disposal.

 

Liquidity and Capital Resources

 

Three Months ended March 31, 2023, compared to Three Months ended March 31, 2022

 

		Three Months ended								Variance
(in millions)		Mar 31,				Mar 31,
		2023				2022				2023 to 2022
Net (loss)/profit		$	(1.4	)		$	1.5			$	(2.9	)
Amortization of debt fees			0.3				0.4				(0.1	)
Change in fair value of derivative liabilities and stock-based compensation expense			3.1				3.0				0.1
Depreciation and amortization (incl RoU assets)			10.2				11.7				(1.5	)
Profit on sale of Italian VLT business			0.0				(0.9	)			0.9
Contract cost additions			(2.6	)			(1.6	)			(1.0	)
Other net cash generated/(utilized) by operating activities			2.0				(11.4	)			13.4
Net cash provided by operating activities			11.6				2.7				8.9
Net cash used in investing activities			(8.9	)			(8.8	)			(0.1	)
Net cash used by financing activities			(0.5	)			(0.1	)			(0.4	)
Effect of exchange rates on cash			0.6				(0.8	)			1.4
Net increase/(decrease) in cash and cash equivalents		$	2.8			($	7.0	)		$	9.8

 

Net cash provided by operating activities

 

For the three months ended March 31, 2023, net cash inflow provided by operating activities was $11.6 million, compared to a $2.7 million inflow for the three months ended March 31, 2022, representing a $8.9 million increase in cash generation from operating activities. This increase was driven primarily through improved working capital levels with the three months ended March 31, 2023 benefitting from favorable receipts due to the timing of sales and the three months ended March 31, 2022 showing significant inventory increases after the Company made the strategic decision to secure components and protect sales in a challenging global supply chain market.

 

 

Depreciation and amortization decreased by $1.5 million, to $10.2 million, with reductions of $1.0 million in machine depreciation and $0.2 million for both amortization of intangible assets and amortization of right of use assets.

 

Contract cost additions increased by $1.0 million to $2.6 million for the three months ended March 31,2023 compared to the three months ended March 31, 2022.

 

Other net cash generated/(utilized) by operating activities increased by $13.4 million, to a $2.0 million inflow. The relative movements between the three months ended March 31, 2023 and the three months ended March 31, 2022 resulted in a $10.5 million increase from receivables due to timing of sales, a $8.0 million inventory increase due to a smaller rise in inventory in the three months ended March 31, 2023 compared to the prior year when the Company made the strategic decision to secure components and protect sales in a challenging global supply chain market and a $1.0 million favorable movement in payroll and trading taxes. This was partly offset by a $6.3 million adverse movement in accounts payable due to timing and the prior year movement being impacted by the increase in inventory levels and a $0.3 million adverse movement in deferred revenue creditors.

 

Net cash used in investing activities

 

Net cash utilized in investing activities increased by $0.1 million, to $8.9 million during the three months ended March 31, 2023. This was due to the prior year including $1.3 million relating to the sale of the gaming business in Italy, which has been offset by lower spend on plant, property and equipment (a $0.1 million decrease compared to 2022) and a $1.2 million reduction of spend on capitalized software.

 

Net cash (used)/generated by financing activities

 

During the three months ended March 31, 2023, net cash utilized by financing activities was $0.5 million relating to finance lease spend compared to $0.1 million during the three months ended March 31, 2022.

 

Funding Needs and Sources

 

To fund our obligations, we have historically relied on a combination of cash flows provided by operations and the incurrence of additional debt or the refinancing of existing debt. As of March 31, 2023, we had liquidity consisting of $27.8 million in cash and cash equivalents and a further $24.7 million of undrawn revolver facility. This compares to $40.8 million of cash and cash equivalents as of March 31, 2022, with a further $26.3 million of revolver facilities undrawn. We had a working capital inflow of $2.0 million for the three months ended March 31, 2023, compared to a $11.4 million outflow for the three months ended March 31, 2022.

 

The level of our working capital surplus or deficit varies with the level of machine production we are undertaking and our capitalization as well as the seasonality evident in some of the businesses. In periods with minimal machine volumes and capital spend, our working capital is typically more stable. In periods where significant numbers of machines are being produced, the levels of inventory and creditors are typically higher and there is a natural timing difference between converting the stock into sellable or capitalized plant and settling payments to suppliers. These factors, along with movements in trading activity levels can result in significant working capital volatility. In periods of low activity, our working capital volatility is reduced. Working capital is reviewed and managed with the aim of ensuring that current liabilities are covered by the level of cash held and the expected level of short-term receipts.

 

Some of our business operations require cash to be held within the machines. As of March 31, 2023, $5.5 million of our $27.8 million of cash and cash equivalents were held as operational floats within the machines. At March 31, 2022, $4.9 million of our $40.8 million of cash and cash equivalents were held as operational floats within the machines

 

Management currently believes that the Company’s cash balances on hand, cash flows expected to be generated from operations, and the ability to control and defer capital projects will be sufficient to fund the Company’s net cash requirements through May 2024.

 

 

Long Term and Other Debt

 

(In millions)		March 31, 2023								March 31, 2022
Cash held		£	22.5			$	27.8			£	31.0			$	40.8
Original principal senior debt			(235.0	)			(290.6	)			(235.0	)			(309.3	)
Cash interest accrued			(6.1	)			(7.6	)			(6.1	)			(8.1	)
Finance lease creditors			(1.4	)			(1.7	)			(2.0	)			(2.7	)
Total		£	(220.0	)		$	(272.1	)		£	(212.2	)		$	(279.3	)

 

Debt Covenants

 

Under our debt facilities in place as of March 31, 2023, we are not subject to covenant testing on the Senior Secured Notes. We are, however, subject to covenant testing at the level of Inspired Entertainment Inc., the ultimate holding company, on our Super Senior Revolving Credit Facility which requires the Company to maintain a maximum consolidated senior secured net leverage ratio of 6.0x on March 31, 2022, stepping down to 5.75x on March 31, 2023 and 5.50x from March 31, 2024 and thereafter (the “RCF Financial Covenant”). The RCF Financial Covenant is calculated as the ratio of consolidated senior secured net debt to consolidated pro forma EBITDA (defined as net loss excluding depreciation and amortization, interest expense, interest income and income tax expense) for the 12-month period preceding the relevant quarterly testing date and is tested quarterly on a rolling basis, subject to the Initial Facility (as defined in the RCF Agreement) being drawn on the relevant test date. The RCF Financial Covenant does not include a minimum interest coverage ratio or other financial covenants. Covenant testing at March 31, 2023 showed covenant compliance with a net leverage of 2.6x.

 

There were no breaches of the debt covenants in the periods ended March 31, 2023 or March 31, 2022.

 

Liens and Encumbrances

 

As of March 31, 2023, our senior bank debt was secured by the imposition of a fixed and floating charge in favor of the lender over all the assets of the Company and certain of the Company’s subsidiaries.

 

Share Repurchases

 

The Board of Directors has authorized that the Company may use up to $25.0 million to repurchase Inspired shares of common stock, subject to repurchases being effected on or before May 10, 2025. Management has discretion as to whether to repurchase shares of the Company. There were no repurchases in the three months ended March 31, 2023 but at this point an aggregate of $10.5 million of our shares of common stock had been repurchased.

 

Contractual Obligations

 

As of March 31, 2023, our contractual obligations were as follows:

 

						Less than												More than
Contractual Obligations (in millions)		Total				1 year				1-3 years				3-5 years				5 years
Operating activities
Interest on long term debt		$	80.1			$	22.9			$	45.7			$	11.5			$	-
Financing activities
Senior bank debt - principal repayment			290.6				-				-				290.6				-
Finance lease payments			1.7				0.5				1.2				-				-
Operating lease payments			15.9				4.0				6.0				2.6				3.3
Interest on non-utilization fees			0.9				0.3				0.6				-				-
Total		$	389.2			$	27.7			$	53.5			$	304.7			$	3.3

 

 

Off-Balance Sheet Arrangements

 

As of March 31, 2023, there were no off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K, promulgated by the U.S. Securities and Exchange Commission.

 

Critical Accounting Policies and Accounting Estimates

 

The preparation of our audited consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions. We exercise considerable judgment with respect to establishing sound accounting policies and in making estimates and assumptions that affect the reported amounts of our assets and liabilities, our recognition of revenue and expenses, and our disclosure of commitments and contingencies at the date of the consolidated financial statements. On an on-going basis, we evaluate our estimates and judgments. We base our estimates and judgments on a variety of factors, including our historical experience, knowledge of our business and industry and current and expected economic conditions, that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We periodically re-evaluate our estimates and assumptions with respect to these judgments and modify our approach when circumstances indicate that modifications are necessary. While we believe that the factors we evaluate provide us with a meaningful basis for establishing and applying sound accounting policies, we cannot guarantee that the results will always be accurate. Since the determination of these estimates requires the exercise of judgment, actual results could differ from such estimates.  

 

A description of our critical accounting estimates was provided in the MD&A section of the 2022 Form 10-K. There were no changes in the determination of these estimates during the first three months of 2023.

 

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Our principal market risks are our exposure to changes in foreign currency exchange rates.

 

Interest Rate Risk

 

Following the Company’s refinancing of its debt in May 2021, the external borrowings of £235.0 million ($290.6 million) are provided at a fixed rate. Therefore, movements in rates such as LIBOR do not impact on the current borrowings and the only fluctuation that is expected to be reported will be that solely caused by movements in the exchange rates between the Company’s functional currency and its reporting currency.

 

Foreign Currency Exchange Rate Risk

 

Our operations are conducted in various countries around the world, and we receive revenue and pay expenses from these operations in a number of different currencies. As such, our earnings are subject to movements in foreign currency exchange rates when transactions are denominated in (i) currencies other than GBP, which is our functional currency, or (ii) the functional currencies of our subsidiaries, which is not necessarily GBP. To estimate our foreign currency exchange rate risk, we identify material Euro and US Dollar trading and balance sheet amounts and recalculate the result using a 10% movement in the GBP:US Dollar exchange rate. For the trading figures the 10% movement is based on the average exchange rate throughout the reported period and for the balance sheet figures the 10% movement is based on the exchange rate used at March 31, 2023.

 

Excluding intercompany balances, our Euro functional currency net assets total approximately $8.6 million, and our US Dollar functional currency net assets total approximately $4.1 million. We use a sensitivity analysis model to measure the impact of a 10% adverse movement of foreign currency exchange rates against the US Dollar. A hypothetical 10% adverse change in the value of the Euro and the US Dollar relative to GBP as of March 31, 2023, would result in favorable translation adjustments of approximately $0.8 million and $0.4 million, respectively, recorded in other comprehensive loss.

 

 

Included within our trading results are earnings outside of our functional currency. Retained gains from Euro based entities earned in Euros and retained losses from USD based entities earned in US Dollars in the three months ended March 31, 2023, were €3.1 million and $5.6 million, respectively. A hypothetical 10% adverse change in the value of the Euro and the US Dollar relative to GBP as of March 31, 2023, would result in translation adjustments of approximately $0.3 million favorable and $0.5 million unfavorable, respectively, recorded in trading operations.

 

The majority of the Company’s trading is in GBP, the functional currency, although the reporting currency of the Company is the US Dollar. As such, changes in the GBP:USD exchange rate have an effect on the Company’s results. A 10% weakening of GBP against the US Dollar would change the trading operational results unfavorably by approximately $0.2 million and would result in unfavorable translation adjustments of approximately $6.4 million, recorded in other comprehensive loss.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Disclosure controls and procedures are controls and other procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Certifying Officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer (together, the “Certifying Officers”), we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on the foregoing, our Certifying Officers concluded that our disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2023, due to the material weaknesses described in Item 9A of the Company’s restated Annual Report on Form 10-K/A for the year ended December 31, 2022, filed with the SEC on February 27, 2024. Management is redesigning and implementing existing and additional controls to remediate these material weaknesses Notwithstanding the identified material weaknesses and management’s assessment that our disclosure controls and procedures were not effective at the reasonable assurance level as of March 31, 2023, management believes that the interim consolidated financial statements and footnote disclosures included in this Quarterly Report on Form 10-Q/A fairly present, in all material respects, our financial condition, results of operations, cash flows and disclosures as of and for the periods presented in accordance with generally accepted accounting principles.

 

Changes in Internal Control over Financial Reporting

 

Other than the control changes to remediate the identified material weaknesses, there were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

From time to time, we may become involved in lawsuits and legal proceedings arising in the ordinary course of business. While we believe that, currently, we have 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 our business, financial condition or results of operations.

 

ITEM 1A. RISK FACTORS

 

Our business is subject to a high degree of risk. You should carefully consider the risk factors discussed in our Annual Report on Form 10-K/A for our fiscal year ended December 31, 2022. You should carefully read and assess all of these risk factors. Any of these risks could materially and adversely affect our business, operating results, financial condition and prospects, and cause the value of our common stock to decline, which could cause investors in our common stock to lose all or part of their investments.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

 

ITEM 6. EXHIBITS

 

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q/A:

 

Exhibit Number		Description
10.1#***		Forms of Award Terms for fiscal year 2023 under the Inspired Entertainment, Inc. 2021 Omnibus Incentive Plan (Time-Based Award Terms and Performance-Based Award Terms).
10.2#		Second Addendum, dated January 12, 2023, to the Employment Agreement dated October 9, 2020, as amended, by and between the Company and A. Lorne Weil (incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K of the Company, filed with the SEC on January 17, 2023).
10.3#		Second Addendum, dated January 13, 2023, to the Employment Agreement dated February 17, 2020, as amended, by and between the Company and Brooks H. Pierce (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K of the Company, filed with the SEC on January 17, 2023).
10.4#		Separation and Release Agreement, dated January 10, 2023, between the Company and Daniel B. Silvers (incorporated herein by reference to Exhibit 10.20 to the Annual Report on Form 10-K of the Company, filed with the SEC on March 16, 2023).
10.5#***		Grant Agreements (Time-Based Agreement and Performance-Based Agreement), dated February 14, 2023, between the Company and Daniel B. Silvers.
31.1*		Certification of Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
31.2*		Certification of Principal Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
32.1**		Certification of Principal Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
32.2**		Certification of Principal Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

#	Indicates management contract or compensatory plan.
*	Filed herewith.
**	Furnished herewith.
***	Previously filed with the original Form 10-Q.

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	INSPIRED ENTERTAINMENT, INC.
Date: February 27, 2024		/s/ A. Lorne Weil
	Name:	A. Lorne Weil
	Title:	Executive Chairman
		(Principal Executive Officer)
Date: February 27, 2024		/s/ Marilyn Jentzen
	Name:	Marilyn Jentzen
	Title:	Interim Chief Financial Officer
		(Principal Financial and Accounting Officer)

 

 

EXHIBIT 31.1

 

CERTIFICATION OF THE

PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO

RULE 13a-14(a) AND RULE 15d-14(a)

UNDER THE

SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, A. Lorne Weil, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q/A of Inspired Entertainment, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

Date: February 27, 2024	/s/ A. Lorne Weil
	A. Lorne Weil
	Executive Chairman
	(Principal Executive Officer)

 

 

EXHIBIT 31.2

 

CERTIFICATION OF THE

PRINCIPAL FINANCIAL OFFICER

PURSUANT TO

RULE 13a-14(a) AND RULE 15d-14(a)

UNDER THE

SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Marilyn Jentzen, certify that:

 

1. I have reviewed this Quarterly Report on Form 10-Q/A of Inspired Entertainment, Inc.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

Date: February 27, 2024	/s/ Marilyn Jentzen
	Marilyn Jentzen
	Interim Chief Financial Officer
	(Principal Financial and Accounting Officer)

 

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Inspired Entertainment, Inc. (the “Company”) on Form 10-Q/A for the fiscal period ended March 31, 2023, as filed with the Securities and Exchange Commission (the “Report”), I, A. Lorne Weil, Executive Chairman of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. To my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.

 

Dated: February 27, 2024	By:	/s/ A. Lorne Weil
		A. Lorne Weil

 

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

 

EXHIBIT 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Inspired Entertainment, Inc. (the “Company”) on Form 10-Q/A for the fiscal period ended March 31, 2023, as filed with the Securities and Exchange Commission (the “Report”), I, Marilyn Jentzen, Interim Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

2. To my knowledge, the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Dated: February 27, 2024	By:	/s/ Marilyn Jentzen
		Marilyn Jentzen

 

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

v3.24.0.1

Cover - shares	3 Months Ended
	Mar. 31, 2023	Feb. 22, 2024
Cover [Abstract]
Document Type	10-Q/A
Amendment Flag	true
Amendment Description	This Amendment No. 1 to Form 10-Q (this “Amendment” or “Form 10-Q/A”) amends the Annual Report on Form 10-Q for the quarter ended March 31, 2023 originally filed with the Securities and Exchange Commission (“SEC”) on May 10, 2023 (the “Original Filing”) by Inspired Entertainment, Inc. (the “Company,” “we,” “our” or “us”).
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2023
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	001-36689
Entity Registrant Name	INSPIRED ENTERTAINMENT, INC.
Entity Central Index Key	0001615063
Entity Tax Identification Number	47-1025534
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	250 West 57th Street
Entity Address, Address Line Two	Suite 415
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10107
City Area Code	(646)
Local Phone Number	565-3861
Title of 12(b) Security	Common stock, par value $0.0001 per share
Trading Symbol	INSE
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		26,219,021

v3.24.0.1

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022	Dec. 31, 2021
Assets
Cash	$ 27.8	$ 25.0
Accounts receivable, net	32.9	40.4
Inventory	34.6	30.3
Prepaid expenses and other current assets	30.7	31.2
Total current assets	126.0	126.9
Property and equipment, net	47.4	45.1
Software development costs, net	19.5	18.3
Other acquired intangible assets subject to amortization, net	14.3	14.6
Goodwill	57.0	55.5
Operating lease right of use asset	15.7	16.0
Costs of obtaining and fulfilling customer contracts, net	7.7	7.0
Other assets	4.1	3.8
Total assets	291.7	287.2
Current liabilities
Accounts payable	22.2	23.7
Accrued expenses	35.6	29.0
Corporate tax and other current taxes payable	3.4	10.1
Deferred revenue, current	4.9	4.6
Operating lease liabilities	4.0	3.9
Other current liabilities	3.2	3.6
Total current liabilities	73.3	74.9
Long-term debt	285.5	277.6
Finance lease liabilities, net of current portion	1.2	1.2
Deferred revenue, net of current portion	2.3	2.8
Operating lease liabilities	11.9	12.3
Other long-term liabilities	4.0	4.0
Total liabilities	378.2	372.8
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; 26,263,070 shares and 25,909,516 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively
Additional paid in capital	381.2	378.2
Accumulated other comprehensive income	48.3	50.8	$ 47.6	$ 43.8
Accumulated deficit	(516.0)	(514.6)
Total stockholders’ deficit	(86.5)	(85.6)	$ (100.7)	$ (108.7)
Total liabilities and stockholders’ deficit	$ 291.7	$ 287.2

v3.24.0.1

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	1,000,000	1,000,000
Common stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Common stock, shares authorized	49,000,000	49,000,000	49,000,000
Common stock, shares issued	26,263,070	25,909,516	26,433,562
Common stock, shares outstanding	26,263,070	25,909,516	26,433,562

v3.24.0.1

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2023	Mar. 31, 2022
Revenue:
Total revenue		$ 64.9	$ 60.3
Cost of sales:
Cost of service	[1]	(15.0)	(16.8)
Cost of product sales		(6.7)	(2.5)
Selling, general and administrative expenses		(29.2)	(23.2)
Acquisition and integration related transaction expenses			(0.2)
Depreciation and amortization		(9.4)	(10.7)
Net operating income		4.6	6.9
Other expense
Interest expense, net		(6.3)	(6.5)
Gain on disposal of business			0.9
Other finance income		0.1	0.3
Total other expense, net		(6.2)	(5.3)
Net (loss) income before income taxes		(1.6)	1.6
Income tax benefit (expense)		0.2	(0.1)
Net (loss) income		(1.4)	1.5
Other comprehensive income:
Foreign currency translation (loss) gain		(2.9)	3.5
Reclassification of loss on hedging instrument to comprehensive income		0.2	0.2
Actuarial gains on pension plan		0.2	0.1
Other comprehensive income		(2.5)	3.8
Comprehensive (loss) income		$ (3.9)	$ 5.3
Net income (loss) per common share – basic		$ (0.05)	$ 0.05
Net income (loss) per common share - diluted		$ (0.05)	$ 0.05
Weighted average number of shares outstanding during the period – basic		27,974,182	28,437,052
Weighted average number of shares outstanding during the period – diluted		27,974,182	29,362,382
Stock-based compensation included in:
Selling, general and administrative expenses		$ (2.9)	$ (2.8)
Service [Member]
Revenue:
Total revenue		57.5	56.0
Product Sales [Member]
Revenue:
Total revenue		$ 7.4	$ 4.3
[1] Excluding depreciation and amortization

v3.24.0.1

Condensed Consolidated Statements of Stockholders' Deficit (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2021		$ 372,300,000	$ 43,800,000	$ (524,800,000)	$ (108,700,000)
Balance, shares at Dec. 31, 2021	26,433,562
Foreign currency translation adjustments			3,500,000		3,500,000
Actuarial gains on pension plan			100,000		100,000
Reclassification of loss on hedging instrument to comprehensive income			200,000		200,000
Issuances under stock plans
Issuances under stock plans, shares	447,060
Stock-based compensation expense		2,700,000			2,700,000
Net income (loss)				1,500,000	1,500,000
Balance at Mar. 31, 2022		375,000,000.0	47,600,000	(523,300,000)	(100,700,000)
Balance, shares at Mar. 31, 2022	26,880,622
Balance at Dec. 31, 2022		378,200,000	50,800,000	(514,600,000)	(85,600,000)
Balance, shares at Dec. 31, 2022	25,909,516
Foreign currency translation adjustments			(2,900,000)		(2,900,000)
Actuarial gains on pension plan			200,000		200,000
Reclassification of loss on hedging instrument to comprehensive income			200,000		200,000
Issuances under stock plans
Issuances under stock plans, shares	353,554
Stock-based compensation expense		3,000,000.0			3,000,000.0
Net income (loss)				(1,400,000)	(1,400,000)
Balance at Mar. 31, 2023		$ 381,200,000	$ 48,300,000	$ (516,000,000.0)	$ (86,500,000)
Balance, shares at Mar. 31, 2023	26,263,070

v3.24.0.1

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net (loss) income	$ (1.4)	$ 1.5
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	9.4	10.7
Amortization of right of use asset	0.8	1.0
Profit on sale of trade and assets		(0.9)
Stock-based compensation expense	2.9	2.8
Contract cost expense	(2.6)	(1.6)
Reclassification of loss on hedging instrument to comprehensive income	0.2	0.2
Non-cash interest expense relating to senior debt	0.3	0.4
Changes in assets and liabilities:
Accounts receivable	8.3	(2.2)
Inventory	(3.5)	(11.6)
Prepaid expenses and other assets	1.0
Corporate tax and other current taxes payable	(6.2)	(7.2)
Accounts payable	(2.1)	4.2
Deferred revenues and customer prepayment	(0.2)
Accrued expenses	5.6	7.1
Operating lease liabilities	(0.9)	(1.0)
Other long-term liabilities		(0.7)
Net cash provided by operating activities	11.6	2.7
Cash flows from investing activities:
Purchases of property and equipment	(5.5)	(5.6)
Acquisition of subsidiary company assets		(0.6)
Disposal of trade and assets		1.3
Acquisition of third-party company trade and assets	(0.6)
Purchases of capital software	(2.8)	(3.9)
Net cash used in investing activities	(8.9)	(8.8)
Cash flows from financing activities:
Repayments of finance leases	(0.5)	(0.1)
Net cash used in financing activities	(0.5)	(0.1)
Effect of exchange rate changes on cash	0.6	(0.8)
Net increase (decrease) in cash	2.8	(7.0)
Cash, beginning of period	25.0	47.8
Cash, end of period	27.8	40.8
Supplemental cash flow disclosures
Cash paid during the period for interest	0.1	0.2
Cash paid during the period for income taxes	0.1
Cash paid during the period for operating leases	2.1	1.7
Supplemental disclosure of noncash investing and financing activities
Lease liabilities arising from obtaining right of use assets	(0.1)
Property and equipment transferred to inventory		$ 0.6

v3.24.0.1

Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated	3 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated	1. Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated   Company Description and Nature of Operations   We are a global gaming technology company, supplying content, platform, gaming terminals and other products and services to online and land-based regulated lottery, betting and gaming operators worldwide through a broad range of distribution channels, predominantly on a business-to-business basis. We provide end-to-end digital gaming solutions (i) on our own proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices and online computer applications and (ii) through third party networks. Our content and other products can be found through the consumer-facing portals of our interactive customers and, through our land-based customers, in licensed betting offices, adult gaming centers, pubs, bingo halls, airports, motorway service areas and leisure parks.   Management Liquidity Plans   As of March 31, 2023, the Company’s cash on hand was $27.8 million, and the Company had working capital in addition to cash of $24.9 million. The Company recorded a net loss of $1.4 million and net income of $1.5 million for the three months ended March 31, 2023 and 2022, respectively. Net income/losses include non-cash stock-based compensation of $2.9 million and $2.8 million for the three months ended March 31, 2023 and 2022, respectively. 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. Cash flows provided by operations amounted to $11.6 million and $2.7 million for the three months ended March 31, 2023 and 2022, respectively. The change year on year was due primarily to improved working capital levels, with the three months ended March 31, 2023 benefitting from favorable receipts due to the timing of sales, and the three months ended March 31, 2022 showing significant inventory increases after the Company made the strategic decision to secure components and protect sales in a challenging global supply chain market. Working capital of $52.7 million includes a non-cash settled item of $4.9 million of deferred income. Management currently believes that, absent any long-term coronavirus (“COVID-19”) impact (see below), 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 May 2024.   There have been no COVID-19 restrictions in the United Kingdom since July 2021 and social distancing measures throughout Greece and Italy are no longer in force as of the second quarter of 2022. There have been no COVID-19 restrictions in the United States and social distancing measures are no longer in force. While states have varying requirements based on occupation, no mandates related to, or would prohibit, our normal business operations.   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.   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 years ended December 31, 2022 and 2021. The financial information as of December 31, 2022 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K/A filed with the SEC on February 27, 2024. The interim results for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future interim periods.   Newly Adopted Accounting Standards   On January 1, 2023, the Company adopted Topic 326 Financial Instruments – Credit Losses (“ASC 326”). ASC 326 affects loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. It requires an entity to recognize expected credit losses rather than incurred losses for financial assets and requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.   The adoption of ASC 326 did not have a material impact. Disclosures with respect to allowances for credit losses are given in footnote 4 to these financial statements.

v3.24.0.1

Restatement of Previously Issued Financial Statements	3 Months Ended
	Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract]
Restatement of Previously Issued Financial Statements	2. Restatement of Previously Issued Financial Statements   Restatement Background   On November 2, 2023, the Company in concurrence with the Company’s audit committee, concluded that our 2023 and 2022 consolidated financial statements and our unaudited consolidated financial statements as of and for each of the first two quarterly periods in 2023 and all quarterly periods in 2022, included in our Quarterly Reports on Form 10-Q for the respective periods(collectively the “Prior Period Financial Statements”), should no longer be relied upon due to misstatements that are described below, and that we would restate such financial statements to make the necessary accounting corrections. Details of the restated consolidated financial statements as of March 31, 2023 and for the three months ended March 31, 2023 and 2022 are provided below (“Restatement Items”). Details of the restated consolidated financial statements as of December 31, 2022 are provided in the amendment to the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2022, filed with the SEC as of the date of this report.   The Restatements Items reflect adjustments to correct errors in certain financial statement areas including capitalized software and costs to fulfill a contract, revenue and costs to obtain a contract, inventory, goodwill and intangibles, leasing, pension, and other reclassifications and immaterial errors identified. The nature and impact of these adjustments are described below and also detailed in the tables below.   The Company issued a revision for capitalized software and related amortization expense in the quarterly report on Form 10-Q filed on August 11, 2023 for the period ended June 30, 2023 (the “Revision”).This revision related to certain completed software development projects that were, but should not have been, delayed in the shift from work in progress to completed projects. Consequently, the commencement of amortization for certain projects was delayed and the reported amortization was lower than the actual amortization. The Revision covers the period ended March 31, 2023 and the year ended December 31, 2022 and is distinct from the capitalized software restatements below. The tables below have been updated to separate the impact of the Restatement Items from the Revision.   Restatement Items   Capitalized software and Costs to fulfill a contract – The Company historically assessed and applied incorrectly the accounting frameworks for developing external use software under ASC 985-20, Costs of Software to Be Sold, Leased or Marketed, and internal-use software under ASC 350-40, Intangibles – Goodwill and Other – Internal-Use Software and ASC 340-40, Other Assets and Deferred Costs – Contracts with Customers. In addition, the Company determined routine software updates and certain minor software enhancements were inappropriately capitalized and capitalized labor rates inappropriately included certain indirect costs including overhead, and non-development activities. Consequently, certain amortization was inappropriate. The corrections resulted in a decrease in Software development costs, net of $17.6 million and an increase in Cost of obtaining and fulfilling customer contracts, of $7.2 million as of March 31, 2023. The corrections resulted in an increase to Selling, general and administrative expenses of $1.1 million and $0.5 million as well as a decrease in Depreciation and amortization of $1.1 million and $0.7 million for the three months ended March 31, 2023 and 2022, respectively. In addition, the Revision resulted in a decrease in Software development costs, net of $1.0 million for the three months ended March 31, 2023. Refer to reference “a” below.   Revenue and Costs to obtain a contract – The Company identified corrections needed related to ASC 606, Revenue from Contracts with Customers. The Company identified certain performance obligations were delivered and therefore should have been recognized at a specific point in time (rather than over time). Additionally, we identified that (i) for certain Interactive Aggregator contracts, revenue should have been reported on a net, rather than gross, basis and (ii) certain parts the Company acquired and sold to its contract manufacturer should not have been reported as revenue. These two items have no impact to profit. The Company also identified an immaterial contract that should have been recognized as sales type lease rather than an operating lease. Lastly, the Company had historically expensed certain commissions in the period incurred instead of capitalizing and amortizing them under the accounting framework for costs to obtain contracts with customers pursuant to ASC 606, Revenue from Contracts with Customers, and ASC 340-40, Other Assets and Deferred Costs – Contracts with Customers. The corrections resulted in a decrease in Property and equipment, net of $0.3 million as of March 31, 2023. The corrections also resulted in a decrease in Deferred revenue, current of $0.2 million, a decrease in Deferred revenue, net of current position of $0.9 million as of March 31, 2023 and an increase in Costs of obtaining and fulfilling customer contracts, net of $0.8 million as of March 31, 2023. The corrections also resulted in a decrease in Revenue - service of $0.7 million and $1.0 million for the three months ended March 31, 2023 and 2022, respectively, a $0.3 million decrease in Revenue – product sales for the three months ended March 31, 2023 and an $0.7 million increase in Revenue – product sales for the three months ended March 31, 2022, a decrease in Cost of sales – service of $2.3 million and $1.9 million for the three months ended March 31, 2023 and 2022, respectively, and a $0.2 million decrease and $0.5 million increase in Cost of sales – product sales for the three months ended March 31, 2023 and 2022, respectively. The corrections also resulted in an increase in Depreciation and amortization increased by $1.6 million and $1.4 million for the three months ended March 31, 2023 and 2022, respectively. Refer to reference “b” below. Note 6, “Contract Liabilities and Other Disclosures” and Note 16, “Segment Reporting and Geographic Information” have also been corrected.     Inventory – The Company identified an error in the amount capitalized for field inventory, repair and consumable items. The correction resulted in a decrease of inventory of $1.9 million for the three months ended March 31, 2023. Refer to reference “c” below. Note 5, “Inventory” has also been corrected.   Goodwill and intangibles – Through review of the appropriate reporting units and asset groups to assess impairments at under ASC 350, Intangibles – Goodwill and Other and ASC 360, Property, Plant and Equipment, the Company identified a triggering event in the first quarter of 2020, related to the beginning of the COVID-19 pandemic, for which impairment assessment was required for (i) Server Based Gaming (“SBG”) and Acquired Business reporting units and (ii) all landbased asset groups. Based on the assessment, we determined that an impairment of acquired business goodwill and long-lived assets occurred in the first quarter of 2020. Additionally, we determined that a significant number of synergies existed from the acquisition in the fourth quarter of 2019 and therefore a portion of the acquisition goodwill should have been reallocated to other reporting units upon acquisition. The corrections resulted in a decrease of Depreciation and amortization of $0.1 million for the three months ended March 31, 2022 and a decrease in Other acquired intangible assets subject to amortization, net of $1.2 million as of March 31, 2023. Refer to reference “d” below.   Leasing – The Company identified errors related to leasing, which primarily related to the Company not historically including in-substance fixed payments related to certain leases according to the accounting framework in ASC 842, Leases. The corrections resulted in an increase in Operating lease right of use asset of $7.6 million, an increase in current Operating lease liabilities of $1.2 million and an increase in long-term Operating lease liabilities of $6.3 million as of March 31, 2023. Refer to reference “e” below. Note 13, “Leases” has also been corrected.   Basic and diluted net income (loss) per share – An error to shares outstanding primarily relates to the Company not including deferred settlement equity awards that had vested in the number of outstanding shares used in the calculation of basic and diluted weighted average number of shares outstanding pursuant to ASC 260, Earnings Per Share. Refer to reference “h” below. Note 9, “Net earnings (loss) per share” has also been corrected.   Pension – The Company had corrections to pension that primarily related to no longer updating the plan liability/ asset quarterly to comply with US GAAP. The corrections resulted in a reclassification of $1.8 million from Accumulated other comprehensive income to Other long-term liabilities as of March 31, 2023. In addition, the Company corrected the benefit obligation and fair value of plan assets for the buy-in contract.  The Company corrected the measurement of the plan assets and the estimated fair value of the buy in contract. Note 15, “Pension Plan” has also been corrected. Refer to reference “g” below.   Other errors identified – Through the restatement process, the Company has reclassified certain costs for salaries of service employees and recorded an adjustment related to foreign currency impacts on an intangible. In addition to the reclassification and intangible adjustment, the Company has corrected other adjustments that are quantitatively immaterial, individually and in aggregate, because we are correcting for these material errors, we have decided to correct these other adjustments. Refer to reference “f” below.   Income tax – The Company updated the income tax effects for the Restatement Items. Note 11, “Income Taxes” has also been updated.     Summary impact of Restatement Items to Prior Period Financial Statements   The following tables present the effect of the Restatement Items on the Company’s consolidated balance sheets for the periods indicated (in millions, except per share):  Schedule of Restatement Items to Prior Period Financial Statements                                   As of March 31, 2023 (unaudited)     As Previously     Previous     Restatement           Restatement     Reported     Revision     Adjustments     As Restated     References Assets                             Cash   $ 27.8     $ -     $ -     $ 27.8       Accounts receivable, net     33.0       -       (0.1 )     32.9     f Inventory, net     36.5       -       (1.9 )     34.6     c Prepaid expenses and other current assets     31.1       -       (0.4 )     30.7     f Total current assets     128.4       -       (2.4 )     126.0                                             Property and equipment, net     47.7       -       (0.3 )     47.4     b Software development costs, net     38.1       (1.0 )     (17.6 )     19.5     a Other acquired intangible assets subject to amortization, net     14.6       -       (0.3 )     14.3     d, f Goodwill     75.8       -       (18.8 )     57.0     d Operating lease right of use asset     8.1       -       7.6       15.7     e Cost of obtaining and fulfilling customer contracts, net     -       -       7.7       7.7     a, b Other assets     3.8       -       0.3       4.1     f Total assets   $ 316.5     $ (1.0 )   $ (23.8 )   $ 291.7                                             Liabilities and Stockholders’ Deficit                                     Current liabilities                                     Accounts payable     22.2       -       -       22.2       Accrued expenses     34.9       -       0.7       35.6     f Corporate tax and other current taxes payable     5.0       -       (1.6 )     3.4       Deferred revenue, current     5.1       -       (0.2 )     4.9     b Operating lease liabilities     2.8       -       1.2       4.0     e Other current liabilities     3.2       -       -       3.2       Total current liabilities     73.2       -       0.1       73.3                                             Long-term debt     285.5       -       -       285.5       Finance lease liabilities, net of current portion     1.2       -       -       1.2       Deferred revenue, net of current portion     3.2       -       (0.9 )     2.3     b Operating lease liabilities     5.6       -       6.3       11.9     e Other long-term liabilities     2.2       -       1.8       4.0     g Total liabilities   $ 370.9     $ -     $ 7.3     $ 378.2                                             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; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively     -       -       -       -       Additional paid in capital     381.2       -       -       381.2       Accumulated other comprehensive income     46.8       -       1.5       48.3       Accumulated deficit     (482.4 )     (1.0 )     (32.6 )     (516.0 )     Total stockholders’ deficit     (54.4 )     (1.0 )     (31.1 )     (86.5 )     Total liabilities and stockholders’ deficit   $ 316.5     $ (1.0 )   $ (23.8 )   $ 291.7           The following tables present the effect of the Restatement Items on the Company’s consolidated statement of operations for the periods indicated (in millions, except share and per share amounts):                               For Three Months Ended March 31, 2023 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Revenue:                       Service   $ 58.3     $ (0.8 )   $ 57.5     b, f Product sales     7.7       (0.3 )     7.4      b Total Revenue     66.0       (1.1 )     64.9                                     Cost of Sales                             Cost of service(1)     (10.9 )     (4.1 )     (15.0 )   b, f Cost of product sales     (5.8 )     (0.9 )     (6.7 )   b, c Selling, general and administrative expenses     (34.3 )     5.1       (29.2 )   a, f Acquisition and integration related transaction expenses     -       -       -       Depreciation and amortization     (8.9 )     (0.5 )     (9.4 )   a, b Net operating income (loss)     6.1       (1.5 )     4.6                     -               Other expense                             Interest expense, net     (6.3 )     -       (6.3 )     Gain on disposal of business     -       -       -       Other finance income (expense)     0.1       -       0.1                                     Total other expense, net     (6.2 )     -       (6.2 )                   -               Net loss before income taxes     (0.1 )     (1.5 )     (1.6 )     Income tax (expense) benefit     (0.1 )     0.3       0.2       Net loss     (0.2 )     (1.2 )     (1.4 )                                   Other comprehensive income (loss)                             Foreign currency translation gain (loss)     (1.7 )     (1.2 )     (2.9 )     Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Actuarial gains (losses) on pension plan     2.0       (1.8 )     0.2     g Other comprehensive income (loss)     0.5       (3.0 )     (2.5 )                                   Comprehensive income (loss)   $ 0.3     $ (4.2 )   $ (3.9 )                                   Net income (loss) per common share - basic   $ (0.01 )   $ (0.04 )   $ (0.05 )     Net income (loss) per common share - diluted   $ (0.01 )   $ (0.04 )   $ (0.05 )                                   Weighted average number of shares outstanding during the year - basic     26,155,346       1,818,836       27,974,182     h Weighted average number of shares outstanding during the year - diluted     26,155,346       1,818,836       27,974,182       Stock-based compensation included in:                             Selling, general, and administrative expenses   $ (2.9 )           $ (2.9 )       (1) Excluding depreciation and amortization                                       For Three Months Ended March 31, 2022 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Revenue:                             Service   $ 57.0     $ (1.0 )   $ 56.0     b Product Sales     3.6       0.7       4.3      b Total Revenue     60.6       (0.3 )     60.3                                     Cost of Sales                             Cost of Service     (11.8 )     (5.0 )     (16.8 )   b, f Cost of Product sales     (2.1 )     (0.4 )     (2.5 )   b, c Selling, general and administrative expenses     (29.6 )     6.4       (23.2 )   a, f Acquisition and integration related transaction expenses     (0.1 )     (0.1 )     (0.2 )     Depreciation and amortization     (10.1 )     (0.6 )     (10.7 )   a, b, d Net operating income (loss)     6.9       -     6.9                                     Other expense                             Interest expense, net     (6.5 )     -       (6.5 )     Gain on disposal of business     0.9       -       0.9       Other finance income (expense)     0.3       -       0.3                                     Total other expense, net     (5.3 )     -       (5.3 )                                   Net income before income taxes     1.6       -       1.6       Income tax expense     (0.1 )     -       (0.1 )     Net income     1.5       -       1.5                                     Other comprehensive income:                             Foreign currency translation (loss) gain     2.4       1.1       3.5       Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Actuarial gains (losses) on pension plan     0.7       (0.6 )     0.1     g Other comprehensive income     3.3       0.5       3.8                                     Comprehensive income   $ 4.8     $ 0.5     $ 5.3                                     Net income (loss) per common share - basic   $ 0.06     $ (0.01 )   $ 0.05       Net income (loss) per common share - diluted   $ 0.05     $ -     $ 0.05                                     Weighted average number of shares outstanding during the year - basic     26,850,326       1,586,726       28,437,052     h Weighted average number of shares outstanding during the year - diluted     29,294,973       67,409       29,362,382           The following tables present the effect of the Restatement Items on the Company’s consolidated statements of stockholders’ equity (deficit) for the periods indicated (in millions, except per share amounts):                                                                   Accumulated                                   Additional     other           Total           Common Stock     paid in     comprehensive     Accumulated     stockholders’     Restatement     Shares     Amount     capital     income     deficit     deficit     References                                                       Balance as of March 31, 2023 (As Previously Reported)     26,263,070       -       381.2       46.8       (482.4 )     (54.4 )     Previous Revision     -       -       -       -       (1.0 )     (1.0 )     Restatement Items     -       -       -       1.5       (32.6 )     (31.1 )     Balance as of March 31, 2023 (As Restated) (Unaudited)     26,263,070     $    -     $ 381.2     $        48.3     $ (516.0 )   $      (86.5 )                                                                       Accumulated                                   Additional     other           Total           Common Stock     paid in     comprehensive     Accumulated     stockholders’     Restatement     Shares     Amount     capital     income     deficit     deficit     References                                                       Balance as of March 31, 2022 (As Previously Reported)     26,880,622       -       375.0       47.1       (492.6 )     (70.5 )     Balance     26,880,622       -       375.0       47.1       (492.6 )     (70.5 )     Restatement Items     -              -       -                0.5       (30.7 )     (30.2 )     Balance as of March 31, 2022 (As Restated) (Unaudited)     26,880,622     $ -     $ 375.0     $ 47.6     $ (523.3 )   $ (100.7 )     Balance     26,880,622     $ -     $ 375.0     $ 47.6     $ (523.3 )   $ (100.7 )         The following tables present the effect of the Restatement Items on the Company’s consolidated statements of cashflows for the periods indicated (in millions):                                             Three Months Ended March 31, 2023 (unaudited)     As Previously     Previous     Restatement           Restatement     Reported     Revision     Adjustments     As Restated     References Cash flows from operating activities:                                     Net income (loss)   $ (0.2 )   $ -     $ (1.2 )   $ (1.4 )   a, b, c, f Adjustments to reconcile net income (loss) to net cash provided by operating activities:             -                       Depreciation and amortization     8.9       -       0.5       9.4     a, b, d Amortization of right of use asset     0.5       -       0.3       0.8     e Profit on sale of trade and asset                                     Stock-based compensation expense     2.9       -       -       2.9       Contract cost expense     -       -       (2.6 )     (2.6 )   a, b Reclassification of loss on hedging instrument to comprehensive income     0.2       -       -       0.2       Non-cash interest expense relating to senior debt     0.3       -       -       0.3       Changes in assets and liabilities:             -                       Accounts receivable     8.5       -       (0.2 )     8.3     g Inventory     (4.6 )     -       1.1       (3.5 )   c, g Prepaid expenses and other assets     1.6       -       (0.6 )     1.0     f, g Corporate tax and other current taxes payable     (3.8 )     -       (2.4 )     (6.2 )   g Accounts payable     (4.1 )     -       2.0       (2.1 )   g Deferred revenues and customer prepayment     (0.3 )     -       0.1       (0.2 )   g Accrued expenses     5.5       -       0.1       5.6     f, g Other lease liabilities     (0.6 )     -       (0.3 )     (0.9 )   g Other long-term liabilities     -       -       -       -       Net cash provided by operating activities     14.8       -       (3.2 )     11.6                                             Cash flows from investing activities:                                     Purchases of property and equipment     (6.1 )     -       0.6       (5.5 )   g Acquisition of subsidiary company assets     -       -               -       Acquisition of third-party company trade and assets     (0.6 )     -       -       (0.6 )     Disposal of trade and assets                                     Purchases of capital software     (4.8 )     -       2.0       (2.8 )   a, g Net cash used in investing activities     (11.5 )     -       2.6       (8.9 )                                           Cash flows from financing activities:                                     Repayments of finance leases     (0.5 )     -       -       (0.5 )     Net cash used in financing activities     (0.5 )     -       -       (0.5 )                                           Effect of exchange rate changes on cash     -       -       0.6       0.6     g Net increase (decrease) in cash     2.8       -       -       2.8       Cash, beginning of period     25.0       -       0       25.0       Cash, end of period   $ 27.8       -       0       27.8                                             Supplemental cash flow disclosures                                     Cash paid during the period for interest   $ 0.1     $ -     $ -     $ 0.1       Cash paid during the period for income taxes   $ 0.1     $ -     $ -     $ 0.1       Cash paid during the period for operating leases   $ 1.2     $ -     $ 0.9     $ 2.1                                             Supplemental disclosure of noncash investing and financing activities                                     Lease liabilities arising from obtaining right of use assets   $ (0.1 )   $                    $                   $ (0.1 )     Property and equipment acquired through finance lease                                     Property and equipment transferred to inventory                                             Reported     Adjustments     As Restated     References     Three Months Ended March 31, 2022 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Cash flows from operating activities:                             Net income (loss)   $ 1.5     $ -     $ 1.5     a, b, c, d, f Adjustments to reconcile net income (loss) to net cash provided by operating activities:                             Depreciation and amortization     10.1       0.6       10.7     a, b, d Amortization of right of use asset     0.7       0.3       1.0     e Profit on sale of trade and asset     -       (0.9 )     (0.9 )   f Stock-based compensation expense     2.8       -       2.8       Contract Cost expense     -       (1.6 )     (1.6 )   a, b Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Non-cash interest expense relating to senior debt     0.4       -       0.4       Changes in assets and liabilities:                             Accounts receivable     (2.1 )     (0.1 )     (2.2 )   g Inventory     (11.9 )     0.3       (11.6 )   c, g Prepaid expenses and other assets     0.9       (0.9 )     -     g Corporate tax and other current taxes payable     (7.2 )     -       (7.2 )     Accounts payable     4.3       (0.1 )     4.2     g Deferred revenues and customer prepayment     (0.3 )     0.3       -     a, b, g Accrued expenses     7.1       -       7.1       Operating lease liabilities     (0.7 )     (0.3 )     (1.0 )   e Other long-term liabilities     (0.7 )     -       (0.7 )     Net cash provided by operating activities     5.1       (2.4 )     2.7                                     Cash flows from investing activities:                             Purchases of property and equipment     (5.2 )     (0.4 )     (5.6 )     Acquisition of subsidiary company assets     (0.6 )     -       (0.6 )     Disposal of trade and assets     -       1.3       1.3       Purchases of capital software     (5.1 )     1.2       (3.9 )     Net cash used in investing activities     (10.9 )     2.1       (8.8 )                                   Cash flows from financing activities:                             Repayments of finance leases     (0.1 )     -       (0.1 )     Net cash (used in) provided by financing activities     (0.1 )     -       (0.1 )                                   Effect of exchange rate changes on cash     (1.1 )     0.3       (0.8 )   g Net increase in cash     (7.0 )     -       (7.0 )     Cash, beginning of period     47.8       -       47.8       Cash, end of period   $ 40.8     $ -     $ 40.8                                     Supplemental cash flow disclosures                             Cash paid during the period for interest   $ 0.2     $ -     $ 0.2       Cash paid during the period for income taxes   $ -     $ -     $ -       Cash paid during the period for operating leases   $ 0.9     $ 0.8     $ 1.7                                     Supplemental disclosure of noncash investing and financing activities                             Property and equipment acquired through finance lease   $ -     $ -     $ -       Property and equipment transferred to inventory   $ 0.6     $ -          $ 0.6

v3.24.0.1

Acquisitions and Disposals	3 Months Ended
	Mar. 31, 2023
Business Combination and Asset Acquisition [Abstract]
Acquisitions and Disposals	3. Acquisitions and Disposals   In January 2022, the Company sold its Italian VLT business, including all terminal and other assets, staff costs and facilities and contracts to a non-connected party for total proceeds of €1.1 million ($1.3 million), recognizing a profit on disposal of €0.8 million ($0.9 million). The Company continues to serve these Italian markets in the form of the provision of platform and games.

v3.24.0.1

Allowance for Credit Losses, as restated	3 Months Ended
	Mar. 31, 2023
Receivables [Abstract]
Allowance for Credit Losses, as restated	4. Allowance for Credit Losses, as restated   Changes in the allowance for doubtful accounts are as follows: Schedule of Changes in Allowance for Doubtful accounts      March 31, 2023     December 31, 2022       (in millions)   Beginning balance   $ (1.4 )   $ (1.8 ) Additional provision for doubtful accounts     (0.1 )     (0.2 ) Recoveries     0.1       —   Write offs     —       0.4   Foreign currency translation adjustments     —       0.2   Ending balance   $ (1.4 )   $ (1.4 )

v3.24.0.1

Inventory, as restated	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Inventory, as restated	5. Inventory, as restated Schedule of Inventory      March 31, 2023     December 31, 2022       (in millions)   Component parts   $ 21.4     $ 20.7   Work in progress     2.9       3.6   Finished goods     10.3       6.0   Total inventories   $ 34.6     $ 30.3     Component parts include parts for gaming terminals. Our finished goods inventory primarily consists of gaming terminals which are ready for sale.

v3.24.0.1

Contract Liabilities and Other Disclosures, as restated	3 Months Ended
	Mar. 31, 2023
Contract Liabilities And Other Disclosures As Restated
Contract Liabilities and Other Disclosures, as restated	6. Contract Liabilities and Other Disclosures, as restated   The following table summarizes contract related balances: Schedule of Contract Related Balances     Accounts Receivable     Unbilled Accounts Receivable     Deferred Income     Customer Prepayments and Deposits       (in millions)   At March 31, 2023   $ 36.7     $ 15.4     $ (7.2 )   $ (2.6 ) At December 31, 2022   $ 44.6     $ 18.0     $ (7.4 )   $ (2.4 )   Revenue recognized that was included in the deferred income balance at the beginning of the period amounted to $1.2 million and $2.5 million for the three months ended March 31, 2023 and 2022, respectively.   For the periods ended March 31, 2023 and 2022 respectively, there was no significant amounts of revenue recognized as a result of changes in contract transaction price related to performance obligations that were satisfied in the respective prior periods.

v3.24.0.1

Stock-Based Compensation	3 Months Ended
	Mar. 31, 2023
Share-Based Payment Arrangement [Abstract]
Stock-Based Compensation	7. Stock-Based Compensation   A summary of the Company’s RSU activity during the three months ended March 31, 2023 is as follows:  Schedule of Restricted Stock Unit Activity     Number of Shares           Unvested Outstanding at January 1, 2023     1,647,544   Granted (1)     495,225   Forfeited     (6,266 ) Vested     (219,272 ) Unvested Outstanding at March 31, 2023     1,917,231     (1) The amount shown as granted in the table includes 219,213 performance-based target RSUs as to which the number that ultimately vests would range from 0% to 200% of the target amount of RSUs (a maximum of 438,426 RSUs based on attainment of Adjusted EBITDA targets for 2023).   The Company issued a total of 353,554 shares during the three months ended March 31, 2023 which included an aggregate of 332,227 shares issued in connection with the net settlement of RSUs that vested during the prior year (on December 30, 2022).

v3.24.0.1

Accumulated Other Comprehensive Loss (Income), as restated	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Accumulated Other Comprehensive Loss (Income), as restated	8. Accumulated Other Comprehensive Loss (Income), as restated   The accumulated balances for each classification of comprehensive loss (income) are presented below:  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 January 1, 2023     (84.2 )     0.3       33.1       (50.8 ) Change during the period     2.9       (0.2 )     (0.2 )     2.5   Balance at March 31, 2023   $ (81.3 )   $ 0.1     $ 32.9     $ (48.3 )       Foreign Currency Translation Adjustments     Change in Fair Value of Hedging Instrument     Unrecognized Pension Benefit Costs     Accumulated Other Comprehensive (Income)       (in millions)   Balance at January 1, 2022     (71.5 )     1.0       26.7       (43.8 ) Change during the period     (3.5 )     (0.2 )     (0.1 )     (3.8 ) Balance at March 31, 2022   $ (75.0 )   $ 0.8     $ 26.6     $ (47.6 )   In connection with the issuance of Senior Secured Notes and the entry into an RCF Agreement, on May 19, 2021, the Company terminated all of its interest rate swaps. Accordingly, hedge accounting is no longer applicable. The amounts previously recorded in Accumulated Other Comprehensive Income are amortized into Interest expense over the terms of the hedged forecasted interest payments. Losses reclassified from Accumulated Other Comprehensive Income into Interest expense in the Consolidated Statements of Operations and Income for the three months ended March 31, 2023 and March 31, 2022 amounted to $0.2 million and $0.2 million, respectively.

v3.24.0.1

Net Earnings (Loss) per Share, as restated	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Net Earnings (Loss) per Share, as restated	9. Net Earnings (Loss) per Share, as restated   Basic income/(loss) per share (“EPS”) is computed by dividing net income/(loss) attributable 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 RSUs, using the treasury stock method, and convertible debt or convertible preferred stock, using the if-converted method, unless the inclusion would be anti-dilutive.   The computation of diluted EPS excludes the common stock equivalents of the following potentially dilutive securities because they were either contingently issuable shares or because their inclusion would be anti-dilutive:  Schedule of Anti-dilutive Securities Excluded from Computation of Earnings per Share     2023     2022       Three Months Ended March 31,       2023     2022   RSUs   $ 1,917,231     $ 695,372     The following table reconciles the numerators and denominators of the basic and diluted EPS computations for the three months ended March 31, 2022. There were no reconciling items for the three months ended March 31, 2023. Schedule of Numerators and Denominators of the Basic and Diluted EPS Computations      Income (Numerator)     Shares (Denominator)     Per-Share Amount, Three Months Ended March 31, 2022       (in millions)               Basic EPS                         Income available to common stockholders   $ 1.5       28,437,052     $ 0.05   Effect of Dilutive Securities                         RSUs     —       925,330       —   Diluted EPS                                          Income available to common stockholders   $ 1.5     $ 29,362,382     $ 0.05     The calculation of Basic EPS includes the effects of 1,893,136 and 1,591,632 shares for the three months ended March 31 2023 and 2022, respectively, with respect to RSU awards that have vested but have not yet been issued.

v3.24.0.1

Other Finance Income (Expense)	3 Months Ended
	Mar. 31, 2023
Other Income and Expenses [Abstract]
Other Finance Income (Expense)	10. Other Finance Income (Expense)   Other finance income (expense) consisted of the following:  Schedule of Other Finance Income (expense)     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Pension interest cost   $ (0.8 )   $ (0.6 ) Expected return on pension plan assets     0.9       0.9   Other finance income (expense)   $ 0.1     $ 0.3

v3.24.0.1

Income Taxes, as restated	3 Months Ended
	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income Taxes, as restated	11. Income Taxes, as restated   The effective income tax rate for the three months ended March 31, 2023 and 2022 was 13.2% and 5.3%, as restated, respectively, resulting in a $0.2 million income tax benefit and $0.1 million income tax expense, respectively.   The effective tax rate reported in any given year will continue to be influenced by a variety of factors including the level of pre-tax income or loss, the income mix between jurisdictions, and any discrete items that may occur.   The Company recorded a valuation allowance against all of our deferred tax assets as of both March 31, 2023 and 2022. We intend to continue maintaining a full valuation allowance on our deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. However, given our current earnings and anticipated future earnings, we believe that there is a reasonable possibility that within the next 12 months, sufficient positive evidence may become available to allow us to reach a conclusion that a significant portion of the valuation allowance will no longer be needed. Release of the valuation allowance would result in the recognition of certain deferred tax assets and a decrease to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change on the basis of the level of profitability that we are able to actually achieve.

v3.24.0.1

Related Parties	3 Months Ended
	Mar. 31, 2023
Related Party Transactions [Abstract]
Related Parties	12. Related Parties   Macquarie Corporate Holdings Pty Limited (UK Branch) (“Macquarie UK”), (an arranger and lending party under our RCF Agreement) is an affiliate of MIHI LLC, which beneficially owned approximately 11.51% of our common stock as of March 31, 2023. Macquarie UK did not hold any of the Company’s aggregate senior debt at March 31, 2023 or December 31, 2022. Interest expense payable to Macquarie UK for the three months ended March 31, 2023 and 2022 amounted to $0.0 million and $0.0 million, respectively. MIHI LLC is also a party to a stockholders agreement with the Company and other stockholders, dated December 23, 2016, pursuant to which, subject to certain conditions, MIHI LLC, jointly with Hydra Industries Sponsor LLC, are permitted to designate two directors to be nominated for election as directors of the Company at any annual or special meeting of stockholders at which directors are to be elected, until such time as MIHI LLC and Hydra Industries Sponsor LLC in the aggregate hold less than 5% of the outstanding shares of the Company.   On December 31, 2021, the Company entered into a consultancy agreement with Richard Weil, the brother of A. Lorne Weil, our Executive Chairman, under which he received a success fee in the amount of $0.1 million for services he provided in connection with our acquisition of Sportech Lotteries, LLC. The success fee was paid during the year ended December 31, 2022. Under the agreement, as extended in November 2022, he will provide consulting services relating to the lottery in the Dominican Republic through to June 30, 2023 at a rate of $10,000 per month and, with respect to such services, the aggregate amount incurred by the Company in consulting fees for each of the three months ended March 31, 2023 and March 31, 2022 was $30,000.

v3.24.0.1

Leases, as restated	3 Months Ended
	Mar. 31, 2023
Leases [Abstract]
Leases, as restated	13. Leases, as restated   Certain of our arrangements include leases for equipment installed at customer locations. As the lessor, we combine lease and non-lease components for all classes of underlying assets in arrangements that involve operating leases. The single combined component is accounted for under ASC 606, Revenue from Contracts with Customers based on the consideration that the non-lease components are the predominant items in the arrangements. If a component cannot be combined, the consideration is allocated between the lease component and the non-lease component based on relative standalone selling price. The lease component is accounted for under ASC 842, Leases and the non-lease component is accounted for under ASC 606.   Lease income from operating leases and from sales type leases is not material for any of the periods presented.

v3.24.0.1

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	14. Commitments and Contingencies   Employment Agreements   We are party to employment agreements with our executive officers and other employees of the Company and our subsidiaries which contain, among other terms, provisions relating to severance and notice requirements.   Arrangements with Daniel B. Silvers, former Executive Vice President and Chief Strategy Officer   Effective January 10, 2023, Mr. Silvers stepped down from his position as Executive Vice President and Chief Strategy Officer of the Company. Pursuant to Mr. Silvers’ employment agreement dated December 14, 2016, as amended, Mr. Silvers was entitled to receive a base salary at a rate of $385,000 per year, a target annual bonus of not less than 100% of his base salary and a maximum annual bonus of 200% of his base salary. He was also entitled to reimbursement for private medical insurance and to certain severance benefits.   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.

v3.24.0.1

Pension Plan, as restated	3 Months Ended
	Mar. 31, 2023
Retirement Benefits [Abstract]
Pension Plan, as restated	15. Pension Plan, as restated   We operate a defined contribution plan in the US, and both defined benefit and defined contribution pension schemes in the UK. The defined contribution scheme assets are held separately from those of the Company in independently administered funds.   Defined Benefit Pension Scheme   The defined benefit scheme has been closed to new entrants since April 1, 1999 and closed to future accruals for services rendered to the Company for the entire financial statement periods presented. The Actuarial Valuation of the scheme as at March 31, 2021, determined that the statutory funding objective was not met, i.e., there were insufficient assets to cover the scheme’s technical provisions and there was a funding shortfall.   In June 2022, a recovery plan was put in place to eliminate the funding shortfall. The plan expects the shortfall to be eliminated by October 31, 2026. Deficit reduction contributions of 1.1 million and expense contributions of $0.3 million will be payable during the year ending December 31, 2023.   The total amount of employer contributions paid during the three months ended March 31, 2023 amounted to $0.3 million.   The following table presents the components of our net periodic pension benefit:   Schedule of Defined Benefit Plans     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Components of net periodic pension benefit:             Interest cost   $ 0.8     $ 0.6   Expected return on plan assets     (0.9 )     (0.9 ) Amortization of net loss     0.2       0.1   Net periodic benefit   $ 0.1     $ (0.2 )   The following table sets forth the estimate of the combined funded status of the pension plans and their reconciliation to the related amounts recognized in our consolidated financial statements at the respective measurement dates: Schedule of Pension Plans and their Reconciliation      March 31, 2023     December 31, 2022       (in millions)   Change in benefit obligation:                 Benefit obligation at beginning of period   $ 71.2     $ 122.7   Interest cost     0.8       2.2   Actuarial loss (gain)     —       (39.0 ) Benefits paid     (0.7 )     (3.5 ) Foreign currency translation adjustments     1.9       (11.2 ) Benefit obligation at end of period   $ 73.2     $ 71.2   Change in plan assets:                 Fair value of plan assets at beginning of period   $ 69.1     $ 125.7   Actual gain (loss) on plan assets     0.9       (42.4 ) Employer contributions     0.3       1.4   Benefits paid     (0.7 )     (3.5 ) Foreign currency translation adjustments     1.8       (12.1 ) Fair value of assets at end of period   $ 71.4     $ 69.1   Amount recognized in the consolidated balance sheets:                 Unfunded status (non-current)   $ (1.8 )   $ (2.1 ) Net amount recognized   $ (1.8 )   $ (2.1 )

v3.24.0.1

Segment Reporting and Geographic Information, as restated	3 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
Segment Reporting and Geographic Information, as restated	16. Segment Reporting and Geographic Information, as restated   The Company operates its business along four operating segments, which are segregated on the basis of revenue stream: Gaming, Virtual Sports, Interactive and Leisure. 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), and total capital expenditures for the periods ended March 31, 2023 and March 31, 2022, 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, right of use assets, cash, prepaid expenses and property and equipment and software development costs relating to corporate/shared functions.   Segment Information  Schedule of Segment Reporting Information by Segment Three Months Ended March 31, 2023       Gaming     Virtual Sports     Interactive     Leisure     Corporate Functions     Total       (in millions)   Revenue:                                     Service   $ 20.2     $ 14.8     $ 5.9     $ 16.6     $ —     $ 57.5   Product sales     6.9       —       —       0.5       —       7.4   Total revenue     27.1       14.8       5.9       17.1       —       64.9   Cost of sales, excluding depreciation and amortization:                                                 Cost of service     (5.9 )     (0.4 )     (0.3 )     (8.4 )     —       (15.0 ) Cost of product sales     (5.8 )     —       —       (0.9 )     —       (6.7 ) Selling, general and administrative expenses     (5.7 )     (1.7 )     (2.5 )     (6.9 )     (9.5 )     (26.3 ) Stock-based compensation expense     (0.3 )     (0.2 )     (0.2 )     (0.1 )     (2.1 )     (2.9 ) Acquisition and integration related transaction expenses     —       —       —       —       —       —   Depreciation and amortization     (4.5 )     (0.8 )     (0.6 )     (3.1 )     (0.4 )     (9.4 ) Segment operating income (loss)     4.9       11.7       2.3       (2.3 )     (12.0 )     4.6                                                     Net operating income                                           $ 4.6                                                     Total capital expenditures for the three months ended March 31, 2023   $ 2.4     $ 0.4     $ 1.1     $ 5.2     $ 0.5     $ 9.6       Three Months Ended March 31, 2022       Gaming     Virtual Sports     Interactive     Leisure     Corporate Functions     Total       (in millions)   Revenue:                                     Service   $ 21.1     $ 11.3     $ 4.6     $ 19.0     $ —     $ 56.0   Product sales     3.7       —       —       0.6       —       4.3   Total revenue     24.8       11.3       4.6       19.6       —       60.3   Cost of sales, excluding depreciation and amortization:                                                 Cost of service     (6.0 )     (0.4 )     (0.3 )     (10.1 )     —       (16.8 ) Cost of product sales     (2.3 )     —       —       (0.2 )     —       (2.5 ) Selling, general and administrative expenses     (5.0 )     (1.7 )     (1.4 )     (6.6 )     (5.7 )     (20.4 ) Stock-based compensation expense     (0.3 )     (0.1 )     (0.1 )     (0.2 )     (2.1 )     (2.8 ) Acquisition and integration related transaction expenses     (0.1 )     —       —       —       (0.1 )     (0.2 ) Depreciation and amortization     (5.2 )     (0.8 )     (0.6 )     (3.6 )     (0.5 )     (10.7 ) Segment operating income (loss)     5.9       8.3       2.2       (1.1 )     (8.4 )     6.9                                                     Net operating income                                           $ 6.9                                                     Total capital expenditures for the three months ended March 31, 2022   $ 2.9     $ 0.5     $ 0.9     $ 4.0     $ 1.2     $ 9.5     Geographic Information   Geographic information for revenue is set forth below:  Schedule of Geographic Information     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Total revenue                 UK   $ 49.0     $ 45.9   Greece     5.6       5.6   Rest of world     10.3       8.8   Total   $ 64.9     $ 60.3   Total revenue   $ 64.9     $ 60.3     UK revenue includes revenue from customers headquartered in the UK, but whose revenue is generated globally.   Geographic information of our non-current assets excluding goodwill is set forth below:       March 31, 2023     December 31, 2022       (in millions)   UK   $ 87.5     $ 82.7   Greece     5.1       5.8   Rest of world     16.1       16.3   Total   $ 108.7     $ 104.8   Total non-current assets excluding goodwill   $ 108.7     $ 104.8     Software development costs are included as attributable to the market in which they are utilized.

v3.24.0.1

Customer Concentration	3 Months Ended
	Mar. 31, 2023
Risks and Uncertainties [Abstract]
Customer Concentration	17. Customer Concentration   During the three months ended March 31, 2023, there was one customer that represented at least 10% of the Company’s revenues, accounting for 15% of the Company’s revenues. This customer was served by the Virtual Sports and Interactive segments. During the three months ended March 31, 2022, there was one customer that represented at least 10% of the Company’s revenues, accounting for 12% of the Company’s revenues. This customer was served by the Virtual Sports and Interactive segments.   At March 31, 2023 no customers represented at least 10% of the Company’s accounts receivable. At December 31, 2022, there was one customer that represented at least 10% of the Company’s accounts receivable, accounting for 24% of the Company’s accounts receivable.

v3.24.0.1

Subsequent Events	3 Months Ended
	Mar. 31, 2023
Subsequent Events [Abstract]
Subsequent Events	18. 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. Other than as described below, and except for the effects of the restatement as discussed in Note 2 to the consolidated financial statements, the Company did not identify subsequent events that would have required adjustment or disclosure in the consolidated financial statements.   On April 10, 2023, the Company’s Board of Directors adopted the 2023 Omnibus Incentive Plan (the “2023 Plan”), subject to the approval of our stockholders, which was obtained at the Company’s annual meeting of stockholders held on May 9, 2023. The 2023 Plan authorizes a total of 2,700,000 shares to be issued pursuant to awards and will also replace the Company’s predecessor plan (the 2021 Plan) such that shares available for grant under the 2021 Plan would instead be available for grant under the 2023 Plan. Upon approval of the 2023 Plan, the sign-on RSUs previously disclosed for Messrs. Weil and Pierce as part of amendments to their employment contracts in January 2023 were effective (comprising an aggregate of 250,000 performance-based RSUs and 125,000 stock price-based RSUs).

v3.24.0.1

Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated (Policies)	3 Months Ended
	Mar. 31, 2023
Accounting Policies [Abstract]
Company Description and Nature of Operations	Company Description and Nature of Operations   We are a global gaming technology company, supplying content, platform, gaming terminals and other products and services to online and land-based regulated lottery, betting and gaming operators worldwide through a broad range of distribution channels, predominantly on a business-to-business basis. We provide end-to-end digital gaming solutions (i) on our own proprietary and secure network, which accommodates a wide range of devices, including land-based gaming machine terminals, mobile devices and online computer applications and (ii) through third party networks. Our content and other products can be found through the consumer-facing portals of our interactive customers and, through our land-based customers, in licensed betting offices, adult gaming centers, pubs, bingo halls, airports, motorway service areas and leisure parks.
Management Liquidity Plans	Management Liquidity Plans   As of March 31, 2023, the Company’s cash on hand was $27.8 million, and the Company had working capital in addition to cash of $24.9 million. The Company recorded a net loss of $1.4 million and net income of $1.5 million for the three months ended March 31, 2023 and 2022, respectively. Net income/losses include non-cash stock-based compensation of $2.9 million and $2.8 million for the three months ended March 31, 2023 and 2022, respectively. 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. Cash flows provided by operations amounted to $11.6 million and $2.7 million for the three months ended March 31, 2023 and 2022, respectively. The change year on year was due primarily to improved working capital levels, with the three months ended March 31, 2023 benefitting from favorable receipts due to the timing of sales, and the three months ended March 31, 2022 showing significant inventory increases after the Company made the strategic decision to secure components and protect sales in a challenging global supply chain market. Working capital of $52.7 million includes a non-cash settled item of $4.9 million of deferred income. Management currently believes that, absent any long-term coronavirus (“COVID-19”) impact (see below), 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 May 2024.   There have been no COVID-19 restrictions in the United Kingdom since July 2021 and social distancing measures throughout Greece and Italy are no longer in force as of the second quarter of 2022. There have been no COVID-19 restrictions in the United States and social distancing measures are no longer in force. While states have varying requirements based on occupation, no mandates related to, or would prohibit, our normal business operations.
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.   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 years ended December 31, 2022 and 2021. The financial information as of December 31, 2022 is derived from the audited consolidated financial statements presented in the Company’s Annual Report on Form 10-K/A filed with the SEC on February 27, 2024. The interim results for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any future interim periods.
Newly Adopted Accounting Standards	Newly Adopted Accounting Standards   On January 1, 2023, the Company adopted Topic 326 Financial Instruments – Credit Losses (“ASC 326”). ASC 326 affects loans, debt securities, trade receivables, and any other financial assets that have the contractual right to receive cash. It requires an entity to recognize expected credit losses rather than incurred losses for financial assets and requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.   The adoption of ASC 326 did not have a material impact. Disclosures with respect to allowances for credit losses are given in footnote 4 to these financial statements.

v3.24.0.1

Restatement of Previously Issued Financial Statements (Tables)	3 Months Ended
	Mar. 31, 2023
Accounting Changes and Error Corrections [Abstract]
Schedule of Restatement Items to Prior Period Financial Statements	The following tables present the effect of the Restatement Items on the Company’s consolidated balance sheets for the periods indicated (in millions, except per share):  Schedule of Restatement Items to Prior Period Financial Statements                                   As of March 31, 2023 (unaudited)     As Previously     Previous     Restatement           Restatement     Reported     Revision     Adjustments     As Restated     References Assets                             Cash   $ 27.8     $ -     $ -     $ 27.8       Accounts receivable, net     33.0       -       (0.1 )     32.9     f Inventory, net     36.5       -       (1.9 )     34.6     c Prepaid expenses and other current assets     31.1       -       (0.4 )     30.7     f Total current assets     128.4       -       (2.4 )     126.0                                             Property and equipment, net     47.7       -       (0.3 )     47.4     b Software development costs, net     38.1       (1.0 )     (17.6 )     19.5     a Other acquired intangible assets subject to amortization, net     14.6       -       (0.3 )     14.3     d, f Goodwill     75.8       -       (18.8 )     57.0     d Operating lease right of use asset     8.1       -       7.6       15.7     e Cost of obtaining and fulfilling customer contracts, net     -       -       7.7       7.7     a, b Other assets     3.8       -       0.3       4.1     f Total assets   $ 316.5     $ (1.0 )   $ (23.8 )   $ 291.7                                             Liabilities and Stockholders’ Deficit                                     Current liabilities                                     Accounts payable     22.2       -       -       22.2       Accrued expenses     34.9       -       0.7       35.6     f Corporate tax and other current taxes payable     5.0       -       (1.6 )     3.4       Deferred revenue, current     5.1       -       (0.2 )     4.9     b Operating lease liabilities     2.8       -       1.2       4.0     e Other current liabilities     3.2       -       -       3.2       Total current liabilities     73.2       -       0.1       73.3                                             Long-term debt     285.5       -       -       285.5       Finance lease liabilities, net of current portion     1.2       -       -       1.2       Deferred revenue, net of current portion     3.2       -       (0.9 )     2.3     b Operating lease liabilities     5.6       -       6.3       11.9     e Other long-term liabilities     2.2       -       1.8       4.0     g Total liabilities   $ 370.9     $ -     $ 7.3     $ 378.2                                             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; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively     -       -       -       -       Additional paid in capital     381.2       -       -       381.2       Accumulated other comprehensive income     46.8       -       1.5       48.3       Accumulated deficit     (482.4 )     (1.0 )     (32.6 )     (516.0 )     Total stockholders’ deficit     (54.4 )     (1.0 )     (31.1 )     (86.5 )     Total liabilities and stockholders’ deficit   $ 316.5     $ (1.0 )   $ (23.8 )   $ 291.7           The following tables present the effect of the Restatement Items on the Company’s consolidated statement of operations for the periods indicated (in millions, except share and per share amounts):                               For Three Months Ended March 31, 2023 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Revenue:                       Service   $ 58.3     $ (0.8 )   $ 57.5     b, f Product sales     7.7       (0.3 )     7.4      b Total Revenue     66.0       (1.1 )     64.9                                     Cost of Sales                             Cost of service(1)     (10.9 )     (4.1 )     (15.0 )   b, f Cost of product sales     (5.8 )     (0.9 )     (6.7 )   b, c Selling, general and administrative expenses     (34.3 )     5.1       (29.2 )   a, f Acquisition and integration related transaction expenses     -       -       -       Depreciation and amortization     (8.9 )     (0.5 )     (9.4 )   a, b Net operating income (loss)     6.1       (1.5 )     4.6                     -               Other expense                             Interest expense, net     (6.3 )     -       (6.3 )     Gain on disposal of business     -       -       -       Other finance income (expense)     0.1       -       0.1                                     Total other expense, net     (6.2 )     -       (6.2 )                   -               Net loss before income taxes     (0.1 )     (1.5 )     (1.6 )     Income tax (expense) benefit     (0.1 )     0.3       0.2       Net loss     (0.2 )     (1.2 )     (1.4 )                                   Other comprehensive income (loss)                             Foreign currency translation gain (loss)     (1.7 )     (1.2 )     (2.9 )     Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Actuarial gains (losses) on pension plan     2.0       (1.8 )     0.2     g Other comprehensive income (loss)     0.5       (3.0 )     (2.5 )                                   Comprehensive income (loss)   $ 0.3     $ (4.2 )   $ (3.9 )                                   Net income (loss) per common share - basic   $ (0.01 )   $ (0.04 )   $ (0.05 )     Net income (loss) per common share - diluted   $ (0.01 )   $ (0.04 )   $ (0.05 )                                   Weighted average number of shares outstanding during the year - basic     26,155,346       1,818,836       27,974,182     h Weighted average number of shares outstanding during the year - diluted     26,155,346       1,818,836       27,974,182       Stock-based compensation included in:                             Selling, general, and administrative expenses   $ (2.9 )           $ (2.9 )       (1) Excluding depreciation and amortization                                       For Three Months Ended March 31, 2022 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Revenue:                             Service   $ 57.0     $ (1.0 )   $ 56.0     b Product Sales     3.6       0.7       4.3      b Total Revenue     60.6       (0.3 )     60.3                                     Cost of Sales                             Cost of Service     (11.8 )     (5.0 )     (16.8 )   b, f Cost of Product sales     (2.1 )     (0.4 )     (2.5 )   b, c Selling, general and administrative expenses     (29.6 )     6.4       (23.2 )   a, f Acquisition and integration related transaction expenses     (0.1 )     (0.1 )     (0.2 )     Depreciation and amortization     (10.1 )     (0.6 )     (10.7 )   a, b, d Net operating income (loss)     6.9       -     6.9                                     Other expense                             Interest expense, net     (6.5 )     -       (6.5 )     Gain on disposal of business     0.9       -       0.9       Other finance income (expense)     0.3       -       0.3                                     Total other expense, net     (5.3 )     -       (5.3 )                                   Net income before income taxes     1.6       -       1.6       Income tax expense     (0.1 )     -       (0.1 )     Net income     1.5       -       1.5                                     Other comprehensive income:                             Foreign currency translation (loss) gain     2.4       1.1       3.5       Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Actuarial gains (losses) on pension plan     0.7       (0.6 )     0.1     g Other comprehensive income     3.3       0.5       3.8                                     Comprehensive income   $ 4.8     $ 0.5     $ 5.3                                     Net income (loss) per common share - basic   $ 0.06     $ (0.01 )   $ 0.05       Net income (loss) per common share - diluted   $ 0.05     $ -     $ 0.05                                     Weighted average number of shares outstanding during the year - basic     26,850,326       1,586,726       28,437,052     h Weighted average number of shares outstanding during the year - diluted     29,294,973       67,409       29,362,382           The following tables present the effect of the Restatement Items on the Company’s consolidated statements of stockholders’ equity (deficit) for the periods indicated (in millions, except per share amounts):                                                                   Accumulated                                   Additional     other           Total           Common Stock     paid in     comprehensive     Accumulated     stockholders’     Restatement     Shares     Amount     capital     income     deficit     deficit     References                                                       Balance as of March 31, 2023 (As Previously Reported)     26,263,070       -       381.2       46.8       (482.4 )     (54.4 )     Previous Revision     -       -       -       -       (1.0 )     (1.0 )     Restatement Items     -       -       -       1.5       (32.6 )     (31.1 )     Balance as of March 31, 2023 (As Restated) (Unaudited)     26,263,070     $    -     $ 381.2     $        48.3     $ (516.0 )   $      (86.5 )                                                                       Accumulated                                   Additional     other           Total           Common Stock     paid in     comprehensive     Accumulated     stockholders’     Restatement     Shares     Amount     capital     income     deficit     deficit     References                                                       Balance as of March 31, 2022 (As Previously Reported)     26,880,622       -       375.0       47.1       (492.6 )     (70.5 )     Balance     26,880,622       -       375.0       47.1       (492.6 )     (70.5 )     Restatement Items     -              -       -                0.5       (30.7 )     (30.2 )     Balance as of March 31, 2022 (As Restated) (Unaudited)     26,880,622     $ -     $ 375.0     $ 47.6     $ (523.3 )   $ (100.7 )     Balance     26,880,622     $ -     $ 375.0     $ 47.6     $ (523.3 )   $ (100.7 )         The following tables present the effect of the Restatement Items on the Company’s consolidated statements of cashflows for the periods indicated (in millions):                                             Three Months Ended March 31, 2023 (unaudited)     As Previously     Previous     Restatement           Restatement     Reported     Revision     Adjustments     As Restated     References Cash flows from operating activities:                                     Net income (loss)   $ (0.2 )   $ -     $ (1.2 )   $ (1.4 )   a, b, c, f Adjustments to reconcile net income (loss) to net cash provided by operating activities:             -                       Depreciation and amortization     8.9       -       0.5       9.4     a, b, d Amortization of right of use asset     0.5       -       0.3       0.8     e Profit on sale of trade and asset                                     Stock-based compensation expense     2.9       -       -       2.9       Contract cost expense     -       -       (2.6 )     (2.6 )   a, b Reclassification of loss on hedging instrument to comprehensive income     0.2       -       -       0.2       Non-cash interest expense relating to senior debt     0.3       -       -       0.3       Changes in assets and liabilities:             -                       Accounts receivable     8.5       -       (0.2 )     8.3     g Inventory     (4.6 )     -       1.1       (3.5 )   c, g Prepaid expenses and other assets     1.6       -       (0.6 )     1.0     f, g Corporate tax and other current taxes payable     (3.8 )     -       (2.4 )     (6.2 )   g Accounts payable     (4.1 )     -       2.0       (2.1 )   g Deferred revenues and customer prepayment     (0.3 )     -       0.1       (0.2 )   g Accrued expenses     5.5       -       0.1       5.6     f, g Other lease liabilities     (0.6 )     -       (0.3 )     (0.9 )   g Other long-term liabilities     -       -       -       -       Net cash provided by operating activities     14.8       -       (3.2 )     11.6                                             Cash flows from investing activities:                                     Purchases of property and equipment     (6.1 )     -       0.6       (5.5 )   g Acquisition of subsidiary company assets     -       -               -       Acquisition of third-party company trade and assets     (0.6 )     -       -       (0.6 )     Disposal of trade and assets                                     Purchases of capital software     (4.8 )     -       2.0       (2.8 )   a, g Net cash used in investing activities     (11.5 )     -       2.6       (8.9 )                                           Cash flows from financing activities:                                     Repayments of finance leases     (0.5 )     -       -       (0.5 )     Net cash used in financing activities     (0.5 )     -       -       (0.5 )                                           Effect of exchange rate changes on cash     -       -       0.6       0.6     g Net increase (decrease) in cash     2.8       -       -       2.8       Cash, beginning of period     25.0       -       0       25.0       Cash, end of period   $ 27.8       -       0       27.8                                             Supplemental cash flow disclosures                                     Cash paid during the period for interest   $ 0.1     $ -     $ -     $ 0.1       Cash paid during the period for income taxes   $ 0.1     $ -     $ -     $ 0.1       Cash paid during the period for operating leases   $ 1.2     $ -     $ 0.9     $ 2.1                                             Supplemental disclosure of noncash investing and financing activities                                     Lease liabilities arising from obtaining right of use assets   $ (0.1 )   $                    $                   $ (0.1 )     Property and equipment acquired through finance lease                                     Property and equipment transferred to inventory                                             Reported     Adjustments     As Restated     References     Three Months Ended March 31, 2022 (unaudited)     As Previously     Restatement           Restatement     Reported     Adjustments     As Restated     References Cash flows from operating activities:                             Net income (loss)   $ 1.5     $ -     $ 1.5     a, b, c, d, f Adjustments to reconcile net income (loss) to net cash provided by operating activities:                             Depreciation and amortization     10.1       0.6       10.7     a, b, d Amortization of right of use asset     0.7       0.3       1.0     e Profit on sale of trade and asset     -       (0.9 )     (0.9 )   f Stock-based compensation expense     2.8       -       2.8       Contract Cost expense     -       (1.6 )     (1.6 )   a, b Reclassification of loss on hedging instrument to comprehensive income     0.2       -       0.2       Non-cash interest expense relating to senior debt     0.4       -       0.4       Changes in assets and liabilities:                             Accounts receivable     (2.1 )     (0.1 )     (2.2 )   g Inventory     (11.9 )     0.3       (11.6 )   c, g Prepaid expenses and other assets     0.9       (0.9 )     -     g Corporate tax and other current taxes payable     (7.2 )     -       (7.2 )     Accounts payable     4.3       (0.1 )     4.2     g Deferred revenues and customer prepayment     (0.3 )     0.3       -     a, b, g Accrued expenses     7.1       -       7.1       Operating lease liabilities     (0.7 )     (0.3 )     (1.0 )   e Other long-term liabilities     (0.7 )     -       (0.7 )     Net cash provided by operating activities     5.1       (2.4 )     2.7                                     Cash flows from investing activities:                             Purchases of property and equipment     (5.2 )     (0.4 )     (5.6 )     Acquisition of subsidiary company assets     (0.6 )     -       (0.6 )     Disposal of trade and assets     -       1.3       1.3       Purchases of capital software     (5.1 )     1.2       (3.9 )     Net cash used in investing activities     (10.9 )     2.1       (8.8 )                                   Cash flows from financing activities:                             Repayments of finance leases     (0.1 )     -       (0.1 )     Net cash (used in) provided by financing activities     (0.1 )     -       (0.1 )                                   Effect of exchange rate changes on cash     (1.1 )     0.3       (0.8 )   g Net increase in cash     (7.0 )     -       (7.0 )     Cash, beginning of period     47.8       -       47.8       Cash, end of period   $ 40.8     $ -     $ 40.8                                     Supplemental cash flow disclosures                             Cash paid during the period for interest   $ 0.2     $ -     $ 0.2       Cash paid during the period for income taxes   $ -     $ -     $ -       Cash paid during the period for operating leases   $ 0.9     $ 0.8     $ 1.7                                     Supplemental disclosure of noncash investing and financing activities                             Property and equipment acquired through finance lease   $ -     $ -     $ -       Property and equipment transferred to inventory   $ 0.6     $ -          $ 0.6

v3.24.0.1

Allowance for Credit Losses, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Receivables [Abstract]
Schedule of Changes in Allowance for Doubtful accounts	Changes in the allowance for doubtful accounts are as follows: Schedule of Changes in Allowance for Doubtful accounts      March 31, 2023     December 31, 2022       (in millions)   Beginning balance   $ (1.4 )   $ (1.8 ) Additional provision for doubtful accounts     (0.1 )     (0.2 ) Recoveries     0.1       —   Write offs     —       0.4   Foreign currency translation adjustments     —       0.2   Ending balance   $ (1.4 )   $ (1.4 )

v3.24.0.1

Inventory, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Inventory Disclosure [Abstract]
Schedule of Inventory	Schedule of Inventory      March 31, 2023     December 31, 2022       (in millions)   Component parts   $ 21.4     $ 20.7   Work in progress     2.9       3.6   Finished goods     10.3       6.0   Total inventories   $ 34.6     $ 30.3

v3.24.0.1

Contract Liabilities and Other Disclosures, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Contract Liabilities And Other Disclosures As Restated
Schedule of Contract Related Balances	The following table summarizes contract related balances: Schedule of Contract Related Balances     Accounts Receivable     Unbilled Accounts Receivable     Deferred Income     Customer Prepayments and Deposits       (in millions)   At March 31, 2023   $ 36.7     $ 15.4     $ (7.2 )   $ (2.6 ) At December 31, 2022   $ 44.6     $ 18.0     $ (7.4 )   $ (2.4 )

v3.24.0.1

Stock-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2023
Share-Based Payment Arrangement [Abstract]
Schedule of Restricted Stock Unit Activity	A summary of the Company’s RSU activity during the three months ended March 31, 2023 is as follows:  Schedule of Restricted Stock Unit Activity     Number of Shares           Unvested Outstanding at January 1, 2023     1,647,544   Granted (1)     495,225   Forfeited     (6,266 ) Vested     (219,272 ) Unvested Outstanding at March 31, 2023     1,917,231     (1) The amount shown as granted in the table includes 219,213 performance-based target RSUs as to which the number that ultimately vests would range from 0% to 200% of the target amount of RSUs (a maximum of 438,426 RSUs based on attainment of Adjusted EBITDA targets for 2023).

v3.24.0.1

Accumulated Other Comprehensive Loss (Income), as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Equity [Abstract]
Schedule of Accumulated Other Comprehensive Loss (Income)	The accumulated balances for each classification of comprehensive loss (income) are presented below:  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 January 1, 2023     (84.2 )     0.3       33.1       (50.8 ) Change during the period     2.9       (0.2 )     (0.2 )     2.5   Balance at March 31, 2023   $ (81.3 )   $ 0.1     $ 32.9     $ (48.3 )       Foreign Currency Translation Adjustments     Change in Fair Value of Hedging Instrument     Unrecognized Pension Benefit Costs     Accumulated Other Comprehensive (Income)       (in millions)   Balance at January 1, 2022     (71.5 )     1.0       26.7       (43.8 ) Change during the period     (3.5 )     (0.2 )     (0.1 )     (3.8 ) Balance at March 31, 2022   $ (75.0 )   $ 0.8     $ 26.6     $ (47.6 )

v3.24.0.1

Net Earnings (Loss) per Share, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Earnings Per Share [Abstract]
Schedule of Anti-dilutive Securities Excluded from Computation of Earnings per Share	The computation of diluted EPS excludes the common stock equivalents of the following potentially dilutive securities because they were either contingently issuable shares or because their inclusion would be anti-dilutive:  Schedule of Anti-dilutive Securities Excluded from Computation of Earnings per Share     2023     2022       Three Months Ended March 31,       2023     2022   RSUs   $ 1,917,231     $ 695,372
Schedule of Numerators and Denominators of the Basic and Diluted EPS Computations	The following table reconciles the numerators and denominators of the basic and diluted EPS computations for the three months ended March 31, 2022. There were no reconciling items for the three months ended March 31, 2023. Schedule of Numerators and Denominators of the Basic and Diluted EPS Computations      Income (Numerator)     Shares (Denominator)     Per-Share Amount, Three Months Ended March 31, 2022       (in millions)               Basic EPS                         Income available to common stockholders   $ 1.5       28,437,052     $ 0.05   Effect of Dilutive Securities                         RSUs     —       925,330       —   Diluted EPS                                          Income available to common stockholders   $ 1.5     $ 29,362,382     $ 0.05     The calculation of Basic EPS includes the effects of 1,893,136 and 1,591,632 shares for the three months ended March 31 2023 and 2022, respectively, with respect to RSU awards that have vested but have not yet been issued.

v3.24.0.1

Other Finance Income (Expense) (Tables)	3 Months Ended
	Mar. 31, 2023
Other Income and Expenses [Abstract]
Schedule of Other Finance Income (expense)	Other finance income (expense) consisted of the following:  Schedule of Other Finance Income (expense)     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Pension interest cost   $ (0.8 )   $ (0.6 ) Expected return on pension plan assets     0.9       0.9   Other finance income (expense)   $ 0.1     $ 0.3

v3.24.0.1

Pension Plan, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Retirement Benefits [Abstract]
Schedule of Defined Benefit Plans	The following table presents the components of our net periodic pension benefit:   Schedule of Defined Benefit Plans     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Components of net periodic pension benefit:             Interest cost   $ 0.8     $ 0.6   Expected return on plan assets     (0.9 )     (0.9 ) Amortization of net loss     0.2       0.1   Net periodic benefit   $ 0.1     $ (0.2 )
Schedule of Pension Plans and their Reconciliation	The following table sets forth the estimate of the combined funded status of the pension plans and their reconciliation to the related amounts recognized in our consolidated financial statements at the respective measurement dates: Schedule of Pension Plans and their Reconciliation      March 31, 2023     December 31, 2022       (in millions)   Change in benefit obligation:                 Benefit obligation at beginning of period   $ 71.2     $ 122.7   Interest cost     0.8       2.2   Actuarial loss (gain)     —       (39.0 ) Benefits paid     (0.7 )     (3.5 ) Foreign currency translation adjustments     1.9       (11.2 ) Benefit obligation at end of period   $ 73.2     $ 71.2   Change in plan assets:                 Fair value of plan assets at beginning of period   $ 69.1     $ 125.7   Actual gain (loss) on plan assets     0.9       (42.4 ) Employer contributions     0.3       1.4   Benefits paid     (0.7 )     (3.5 ) Foreign currency translation adjustments     1.8       (12.1 ) Fair value of assets at end of period   $ 71.4     $ 69.1   Amount recognized in the consolidated balance sheets:                 Unfunded status (non-current)   $ (1.8 )   $ (2.1 ) Net amount recognized   $ (1.8 )   $ (2.1 )

v3.24.0.1

Segment Reporting and Geographic Information, as restated (Tables)	3 Months Ended
	Mar. 31, 2023
Segment Reporting [Abstract]
Schedule of Segment Reporting Information by Segment	Segment Information  Schedule of Segment Reporting Information by Segment Three Months Ended March 31, 2023       Gaming     Virtual Sports     Interactive     Leisure     Corporate Functions     Total       (in millions)   Revenue:                                     Service   $ 20.2     $ 14.8     $ 5.9     $ 16.6     $ —     $ 57.5   Product sales     6.9       —       —       0.5       —       7.4   Total revenue     27.1       14.8       5.9       17.1       —       64.9   Cost of sales, excluding depreciation and amortization:                                                 Cost of service     (5.9 )     (0.4 )     (0.3 )     (8.4 )     —       (15.0 ) Cost of product sales     (5.8 )     —       —       (0.9 )     —       (6.7 ) Selling, general and administrative expenses     (5.7 )     (1.7 )     (2.5 )     (6.9 )     (9.5 )     (26.3 ) Stock-based compensation expense     (0.3 )     (0.2 )     (0.2 )     (0.1 )     (2.1 )     (2.9 ) Acquisition and integration related transaction expenses     —       —       —       —       —       —   Depreciation and amortization     (4.5 )     (0.8 )     (0.6 )     (3.1 )     (0.4 )     (9.4 ) Segment operating income (loss)     4.9       11.7       2.3       (2.3 )     (12.0 )     4.6                                                     Net operating income                                           $ 4.6                                                     Total capital expenditures for the three months ended March 31, 2023   $ 2.4     $ 0.4     $ 1.1     $ 5.2     $ 0.5     $ 9.6       Three Months Ended March 31, 2022       Gaming     Virtual Sports     Interactive     Leisure     Corporate Functions     Total       (in millions)   Revenue:                                     Service   $ 21.1     $ 11.3     $ 4.6     $ 19.0     $ —     $ 56.0   Product sales     3.7       —       —       0.6       —       4.3   Total revenue     24.8       11.3       4.6       19.6       —       60.3   Cost of sales, excluding depreciation and amortization:                                                 Cost of service     (6.0 )     (0.4 )     (0.3 )     (10.1 )     —       (16.8 ) Cost of product sales     (2.3 )     —       —       (0.2 )     —       (2.5 ) Selling, general and administrative expenses     (5.0 )     (1.7 )     (1.4 )     (6.6 )     (5.7 )     (20.4 ) Stock-based compensation expense     (0.3 )     (0.1 )     (0.1 )     (0.2 )     (2.1 )     (2.8 ) Acquisition and integration related transaction expenses     (0.1 )     —       —       —       (0.1 )     (0.2 ) Depreciation and amortization     (5.2 )     (0.8 )     (0.6 )     (3.6 )     (0.5 )     (10.7 ) Segment operating income (loss)     5.9       8.3       2.2       (1.1 )     (8.4 )     6.9                                                     Net operating income                                           $ 6.9                                                     Total capital expenditures for the three months ended March 31, 2022   $ 2.9     $ 0.5     $ 0.9     $ 4.0     $ 1.2     $ 9.5
Schedule of Geographic Information	Geographic information for revenue is set forth below:  Schedule of Geographic Information     2023     2022       Three Months Ended March 31,       2023     2022       (in millions)   Total revenue                 UK   $ 49.0     $ 45.9   Greece     5.6       5.6   Rest of world     10.3       8.8   Total   $ 64.9     $ 60.3   Total revenue   $ 64.9     $ 60.3   Geographic information of our non-current assets excluding goodwill is set forth below:       March 31, 2023     December 31, 2022       (in millions)   UK   $ 87.5     $ 82.7   Greece     5.1       5.8   Rest of world     16.1       16.3   Total   $ 108.7     $ 104.8   Total non-current assets excluding goodwill   $ 108.7     $ 104.8

v3.24.0.1

Nature of Operations, Management’s Plans and Summary of Significant Accounting Policies, as restated (Details Narrative) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Accounting Policies [Abstract]
Cash on hand	$ 27.8		$ 25.0
Additional working capital	24.9
Net loss	1.4
Net income	(1.4)	$ 1.5
Share based compensation, expense	2.9	2.8
Cash flows provided by operations amount	11.6	$ 2.7
Working capital non-cash settled item	52.7
Deferred income	$ 4.9

v3.24.0.1

Schedule of Restatement Items on Consolidated Balance Sheets (Unaudited) (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022	Dec. 31, 2021
Assets
Cash	$ 27.8	$ 25.0
Accounts receivable, net	32.9	40.4
Inventory, net	34.6	30.3
Prepaid expenses and other current assets	30.7	31.2
Total current assets	126.0	126.9
Property and equipment, net	47.4	45.1
Software development costs, net	19.5	18.3
Other acquired intangible assets subject to amortization, net	14.3	14.6
Goodwill	57.0	55.5
Operating lease right of use asset	15.7	16.0
Cost of obtaining and fulfilling customer contracts, net	7.7	7.0
Other assets	4.1	3.8
Total assets	291.7	287.2
Current liabilities
Accounts payable	22.2	23.7
Accrued expenses	35.6	29.0
Corporate tax and other current taxes payable	3.4	10.1
Deferred revenue, current	4.9	4.6
Operating lease liabilities	4.0	3.9
Other current liabilities	3.2	3.6
Total current liabilities	73.3	74.9
Long-term debt	285.5	277.6
Finance lease liabilities, net of current portion	1.2	1.2
Deferred revenue, net of current portion	2.3	2.8
Operating lease liabilities	11.9	12.3
Other long-term liabilities	4.0	4.0
Total liabilities	378.2	372.8
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; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively
Additional paid in capital	381.2	378.2
Accumulated other comprehensive income	48.3	50.8	$ 47.6	$ 43.8
Accumulated deficit	(516.0)	(514.6)
Total stockholders’ deficit	(86.5)	(85.6)	(100.7)	$ (108.7)
Total liabilities and stockholders’ deficit	291.7	$ 287.2
Previously Reported [Member]
Assets
Cash	27.8
Accounts receivable, net	33.0
Inventory, net	36.5
Prepaid expenses and other current assets	31.1
Total current assets	128.4
Property and equipment, net	47.7
Software development costs, net	38.1
Other acquired intangible assets subject to amortization, net	14.6
Goodwill	75.8
Operating lease right of use asset	8.1
Cost of obtaining and fulfilling customer contracts, net
Other assets	3.8
Total assets	316.5
Current liabilities
Accounts payable	22.2
Accrued expenses	34.9
Corporate tax and other current taxes payable	5.0
Deferred revenue, current	5.1
Operating lease liabilities	2.8
Other current liabilities	3.2
Total current liabilities	73.2
Long-term debt	285.5
Finance lease liabilities, net of current portion	1.2
Deferred revenue, net of current portion	3.2
Operating lease liabilities	5.6
Other long-term liabilities	2.2
Total liabilities	370.9
Stockholders’ deficit
Preferred stock; $0.0001 par value; 1,000,000 shares authorized
Common stock; $0.0001 par value; 49,000,000 shares authorized; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively
Additional paid in capital	381.2
Accumulated other comprehensive income	46.8
Accumulated deficit	(482.4)
Total stockholders’ deficit	(54.4)		(70.5)
Total liabilities and stockholders’ deficit	316.5
Previous Revision [Member]
Assets
Cash
Accounts receivable, net
Inventory, net
Prepaid expenses and other current assets
Total current assets
Property and equipment, net
Software development costs, net	(1.0)
Other acquired intangible assets subject to amortization, net
Goodwill
Operating lease right of use asset
Cost of obtaining and fulfilling customer contracts, net
Other assets
Total assets	(1.0)
Current liabilities
Accounts payable
Accrued expenses
Corporate tax and other current taxes payable
Deferred revenue, current
Operating lease liabilities
Other current liabilities
Total current liabilities
Long-term debt
Finance lease liabilities, net of current portion
Deferred revenue, net of current portion
Operating lease liabilities
Other long-term liabilities
Total liabilities
Stockholders’ deficit
Preferred stock; $0.0001 par value; 1,000,000 shares authorized
Common stock; $0.0001 par value; 49,000,000 shares authorized; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively
Additional paid in capital
Accumulated other comprehensive income
Accumulated deficit	(1.0)
Total stockholders’ deficit	(1.0)
Total liabilities and stockholders’ deficit	(1.0)
Revision of Prior Period, Reclassification, Adjustment [Member]
Assets
Cash
Accounts receivable, net	(0.1)
Inventory, net	(1.9)
Prepaid expenses and other current assets	(0.4)
Total current assets	(2.4)
Property and equipment, net	(0.3)
Software development costs, net	(17.6)
Other acquired intangible assets subject to amortization, net	(0.3)
Goodwill	(18.8)
Operating lease right of use asset	7.6
Cost of obtaining and fulfilling customer contracts, net	7.7
Other assets	0.3
Total assets	(23.8)
Current liabilities
Accounts payable
Accrued expenses	0.7
Corporate tax and other current taxes payable	(1.6)
Deferred revenue, current	(0.2)
Operating lease liabilities	1.2
Other current liabilities
Total current liabilities	0.1
Long-term debt
Finance lease liabilities, net of current portion
Deferred revenue, net of current portion	(0.9)
Operating lease liabilities	6.3
Other long-term liabilities	1.8
Total liabilities	7.3
Stockholders’ deficit
Preferred stock; $0.0001 par value; 1,000,000 shares authorized
Common stock; $0.0001 par value; 49,000,000 shares authorized; 25,909,516 shares and 26,433,562 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively
Additional paid in capital
Accumulated other comprehensive income	1.5
Accumulated deficit	(32.6)
Total stockholders’ deficit	(31.1)		$ (30.2)
Total liabilities and stockholders’ deficit	$ (23.8)

v3.24.0.1

Schedule of Restatement Items on Consolidated Balance Sheets (Unaudited) (Details) (Parenthetical) - $ / shares	Mar. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Accounting Changes and Error Corrections [Abstract]
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	1,000,000	1,000,000
Common stock, par value	$ 0.0001	$ 0.0001	$ 0.0001
Common stock, shares authorized	49,000,000	49,000,000	49,000,000
Common stock, shares issued	26,263,070	25,909,516	26,433,562
Common stock, shares outstanding	26,263,070	25,909,516	26,433,562

v3.24.0.1

Schedule of Restatement Items on Consolidated Statement of Operations (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended
		Mar. 31, 2023		Mar. 31, 2022
Revenue:
Total Revenue		$ 64.9		$ 60.3
Cost of Sales
Cost of Service	[1]	(15.0)		(16.8)
Cost of Product sales		(6.7)		(2.5)
Selling, general and administrative expenses		(29.2)		(23.2)
Acquisition and integration related transaction expenses				(0.2)
Depreciation and amortization		(9.4)		(10.7)
Net operating income		4.6		6.9
Other expense
Interest expense, net		(6.3)		(6.5)
Gain on disposal of business				0.9
Other finance income (expense)		0.1		0.3
Total other expense, net		(6.2)		(5.3)
Net income before income taxes		(1.6)		1.6
Income tax expense		0.2		(0.1)
Net (loss) income		(1.4)		1.5
Other comprehensive income:
Foreign currency translation (loss) gain		(2.9)		3.5
Reclassification of loss on hedging instrument to comprehensive income		0.2		0.2
Actuarial gains (losses) on pension plan		0.2		0.1
Other comprehensive income		(2.5)		3.8
Comprehensive (loss) income		$ (3.9)		$ 5.3
Net income (loss) per common share - basic		$ (0.05)		$ 0.05
Net income (loss) per common share - diluted		$ (0.05)		$ 0.05
Weighted average number of shares outstanding during the year - basic		27,974,182		28,437,052
Weighted average number of shares outstanding during the year - diluted		27,974,182		29,362,382
Stock-based compensation included in:
Selling, general, and administrative expenses		$ (2.9)		$ (2.8)
Service [Member]
Revenue:
Total Revenue		57.5		56.0
Product Sales [Member]
Revenue:
Total Revenue		7.4		4.3
Previously Reported [Member]
Revenue:
Total Revenue		66.0		60.6
Cost of Sales
Cost of Service		(10.9)	[2]	(11.8)
Cost of Product sales		(5.8)		(2.1)
Selling, general and administrative expenses		(34.3)		(29.6)
Acquisition and integration related transaction expenses				(0.1)
Depreciation and amortization		(8.9)		(10.1)
Net operating income		6.1		6.9
Other expense
Interest expense, net		(6.3)		(6.5)
Gain on disposal of business				0.9
Other finance income (expense)		0.1		0.3
Total other expense, net		(6.2)		(5.3)
Net income before income taxes		(0.1)		1.6
Income tax expense		(0.1)		(0.1)
Net (loss) income		(0.2)		1.5
Other comprehensive income:
Foreign currency translation (loss) gain		(1.7)		2.4
Reclassification of loss on hedging instrument to comprehensive income		0.2		0.2
Actuarial gains (losses) on pension plan		2.0		0.7
Other comprehensive income		0.5		3.3
Comprehensive (loss) income		$ 0.3		$ 4.8
Net income (loss) per common share - basic		$ (0.01)		$ 0.06
Net income (loss) per common share - diluted		$ (0.01)		$ 0.05
Weighted average number of shares outstanding during the year - basic		26,155,346		26,850,326
Weighted average number of shares outstanding during the year - diluted		26,155,346		29,294,973
Stock-based compensation included in:
Selling, general, and administrative expenses		$ (2.9)
Previously Reported [Member] | Service [Member]
Revenue:
Total Revenue		58.3		$ 57.0
Previously Reported [Member] | Product Sales [Member]
Revenue:
Total Revenue		7.7		3.6
Revision of Prior Period, Reclassification, Adjustment [Member]
Revenue:
Total Revenue		(1.1)		(0.3)
Cost of Sales
Cost of Service		(4.1)	[2]	(5.0)
Cost of Product sales		(0.9)		(0.4)
Selling, general and administrative expenses		5.1		6.4
Acquisition and integration related transaction expenses				(0.1)
Depreciation and amortization		(0.5)		(0.6)
Net operating income		(1.5)
Other expense
Interest expense, net
Gain on disposal of business
Other finance income (expense)
Total other expense, net
Net income before income taxes		(1.5)
Income tax expense		0.3
Net (loss) income		(1.2)
Other comprehensive income:
Foreign currency translation (loss) gain		(1.2)		1.1
Reclassification of loss on hedging instrument to comprehensive income
Actuarial gains (losses) on pension plan		(1.8)		(0.6)
Other comprehensive income		(3.0)		0.5
Comprehensive (loss) income		$ (4.2)		$ 0.5
Net income (loss) per common share - basic		$ (0.04)		$ (0.01)
Net income (loss) per common share - diluted		$ (0.04)
Weighted average number of shares outstanding during the year - basic		1,818,836		1,586,726
Weighted average number of shares outstanding during the year - diluted		1,818,836		67,409
Revision of Prior Period, Reclassification, Adjustment [Member] | Service [Member]
Revenue:
Total Revenue		$ (0.8)		$ (1.0)
Revision of Prior Period, Reclassification, Adjustment [Member] | Product Sales [Member]
Revenue:
Total Revenue		$ (0.3)		$ 0.7
[1] Excluding depreciation and amortization [2] Excluding depreciation and amortization

v3.24.0.1

Schedule of Restatement Items on Consolidated Statements of Stockholders' Equity (Deficit) (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022	Mar. 31, 2022	Dec. 31, 2021
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	$ (86.5)	$ (85.6)	$ (100.7)	$ (108.7)
Common Stock [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Shares, Outstanding	26,263,070	25,909,516	26,880,622	26,433,562
Additional Paid-in Capital [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	$ 381.2	$ 378.2	$ 375.0	$ 372.3
AOCI Attributable to Parent [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	48.3	50.8	47.6	43.8
Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(516.0)	$ (514.6)	(523.3)	$ (524.8)
Previously Reported [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(54.4)		(70.5)
Previously Reported [Member] | Common Stock [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Shares, Outstanding	26,263,070		26,880,622
Previously Reported [Member] | Additional Paid-in Capital [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	$ 381.2		$ 375.0
Previously Reported [Member] | AOCI Attributable to Parent [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	46.8		47.1
Previously Reported [Member] | Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(482.4)		(492.6)
Previous Revision [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(1.0)
Previous Revision [Member] | Common Stock [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Previous Revision [Member] | Additional Paid-in Capital [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Previous Revision [Member] | AOCI Attributable to Parent [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Previous Revision [Member] | Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(1.0)
Revision of Prior Period, Reclassification, Adjustment [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	(31.1)		(30.2)
Revision of Prior Period, Reclassification, Adjustment [Member] | Common Stock [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Revision of Prior Period, Reclassification, Adjustment [Member] | Additional Paid-in Capital [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance
Revision of Prior Period, Reclassification, Adjustment [Member] | AOCI Attributable to Parent [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	1.5		0.5
Revision of Prior Period, Reclassification, Adjustment [Member] | Retained Earnings [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Balance	$ (32.6)		$ (30.7)

v3.24.0.1

Schedule of Restatement Items on Consolidated Statements of Cashflows (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash flows from operating activities:
Net income (loss)	$ (1.4)	$ 1.5
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	9.4	10.7
Amortization of right of use asset	0.8	1.0
Profit on sale of trade and asset		(0.9)
Stock-based compensation expense	2.9	2.8
Contract Cost expense	(2.6)	(1.6)
Reclassification of loss on hedging instrument to comprehensive income	0.2	0.2
Non-cash interest expense relating to senior debt	0.3	0.4
Changes in assets and liabilities:
Accounts receivable	8.3	(2.2)
Inventory	(3.5)	(11.6)
Prepaid expenses and other assets	1.0
Corporate tax and other current taxes payable	(6.2)	(7.2)
Accounts payable	(2.1)	4.2
Deferred revenues and customer prepayment	(0.2)
Accrued expenses	5.6	7.1
Operating lease liabilities	(0.9)	(1.0)
Other long-term liabilities		(0.7)
Net cash provided by operating activities	11.6	2.7
Cash flows from investing activities:
Purchases of property and equipment	(5.5)	(5.6)
Acquisition of subsidiary company assets		(0.6)
Acquisition of third-party company trade and assets	(0.6)
Disposal of trade and assets		1.3
Purchases of capital software	(2.8)	(3.9)
Net cash used in investing activities	(8.9)	(8.8)
Cash flows from financing activities:
Repayments of finance leases	(0.5)	(0.1)
Net cash used in financing activities	(0.5)	(0.1)
Effect of exchange rate changes on cash	0.6	(0.8)
Net increase (decrease) in cash	2.8	(7.0)
Cash, beginning of period	25.0	47.8
Cash, end of period	27.8	40.8
Supplemental cash flow disclosures
Cash paid during the period for interest	0.1	0.2
Cash paid during the period for income taxes	0.1
Cash paid during the period for operating leases	2.1	1.7
Supplemental disclosure of noncash investing and financing activities
Lease liabilities arising from obtaining right of use assets	(0.1)
Property and equipment acquired through finance lease
Property and equipment transferred to inventory		0.6
Previously Reported [Member]
Cash flows from operating activities:
Net income (loss)	(0.2)	1.5
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	8.9	10.1
Previously Reported [Member] | Accounting Standards Update [Member]
Cash flows from operating activities:
Net income (loss)	(0.2)	1.5
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	8.9	10.1
Amortization of right of use asset	0.5	0.7
Profit on sale of trade and asset
Stock-based compensation expense	2.9	2.8
Contract Cost expense
Reclassification of loss on hedging instrument to comprehensive income	0.2	0.2
Non-cash interest expense relating to senior debt	0.3	0.4
Changes in assets and liabilities:
Accounts receivable	8.5	(2.1)
Inventory	(4.6)	(11.9)
Prepaid expenses and other assets	1.6	0.9
Corporate tax and other current taxes payable	(3.8)	(7.2)
Accounts payable	(4.1)	4.3
Deferred revenues and customer prepayment	(0.3)	(0.3)
Accrued expenses	5.5	7.1
Operating lease liabilities	(0.6)	(0.7)
Other long-term liabilities		(0.7)
Net cash provided by operating activities	14.8	5.1
Cash flows from investing activities:
Purchases of property and equipment	(6.1)	(5.2)
Acquisition of subsidiary company assets		(0.6)
Acquisition of third-party company trade and assets	(0.6)
Disposal of trade and assets
Purchases of capital software	(4.8)	(5.1)
Net cash used in investing activities	(11.5)	(10.9)
Cash flows from financing activities:
Repayments of finance leases	(0.5)	(0.1)
Net cash used in financing activities	(0.5)	(0.1)
Effect of exchange rate changes on cash		(1.1)
Net increase (decrease) in cash	2.8	(7.0)
Cash, beginning of period	25.0	47.8
Cash, end of period	27.8	40.8
Supplemental cash flow disclosures
Cash paid during the period for interest	0.1	0.2
Cash paid during the period for income taxes	0.1
Cash paid during the period for operating leases	1.2	0.9
Supplemental disclosure of noncash investing and financing activities
Lease liabilities arising from obtaining right of use assets	(0.1)
Property and equipment acquired through finance lease
Property and equipment transferred to inventory		0.6
Previous Revision [Member] | Accounting Standards Update [Member]
Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization
Amortization of right of use asset
Stock-based compensation expense
Contract Cost expense
Reclassification of loss on hedging instrument to comprehensive income
Non-cash interest expense relating to senior debt
Changes in assets and liabilities:
Accounts receivable
Inventory
Prepaid expenses and other assets
Corporate tax and other current taxes payable
Accounts payable
Deferred revenues and customer prepayment
Accrued expenses
Operating lease liabilities
Other long-term liabilities
Net cash provided by operating activities
Cash flows from investing activities:
Purchases of property and equipment
Acquisition of subsidiary company assets
Acquisition of third-party company trade and assets
Purchases of capital software
Net cash used in investing activities
Cash flows from financing activities:
Repayments of finance leases
Net cash used in financing activities
Effect of exchange rate changes on cash
Net increase (decrease) in cash
Cash, beginning of period
Cash, end of period
Supplemental cash flow disclosures
Cash paid during the period for interest
Cash paid during the period for income taxes
Cash paid during the period for operating leases
Revision of Prior Period, Reclassification, Adjustment [Member]
Cash flows from operating activities:
Net income (loss)	(1.2)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	0.5	0.6
Revision of Prior Period, Reclassification, Adjustment [Member] | Accounting Standards Update [Member]
Cash flows from operating activities:
Net income (loss)	(1.2)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	0.5	0.6
Amortization of right of use asset	0.3	0.3
Profit on sale of trade and asset		(0.9)
Stock-based compensation expense
Contract Cost expense	(2.6)	(1.6)
Reclassification of loss on hedging instrument to comprehensive income
Non-cash interest expense relating to senior debt
Changes in assets and liabilities:
Accounts receivable	(0.2)	(0.1)
Inventory	1.1	0.3
Prepaid expenses and other assets	(0.6)	(0.9)
Corporate tax and other current taxes payable	(2.4)
Accounts payable	2.0	(0.1)
Deferred revenues and customer prepayment	0.1	0.3
Accrued expenses	0.1
Operating lease liabilities	(0.3)	(0.3)
Other long-term liabilities
Net cash provided by operating activities	(3.2)	(2.4)
Cash flows from investing activities:
Purchases of property and equipment	0.6	(0.4)
Acquisition of subsidiary company assets
Acquisition of third-party company trade and assets
Disposal of trade and assets		1.3
Purchases of capital software	2.0	1.2
Net cash used in investing activities	2.6	2.1
Cash flows from financing activities:
Repayments of finance leases
Net cash used in financing activities
Effect of exchange rate changes on cash	0.6	0.3
Net increase (decrease) in cash
Cash, beginning of period	0.0
Cash, end of period	0.0
Supplemental cash flow disclosures
Cash paid during the period for interest
Cash paid during the period for income taxes
Cash paid during the period for operating leases	$ 0.9	0.8
Supplemental disclosure of noncash investing and financing activities
Property and equipment acquired through finance lease
Property and equipment transferred to inventory

v3.24.0.1

Restatement of Previously Issued Financial Statements (Details Narrative) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2023		Mar. 31, 2022	Dec. 31, 2022
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Selling, general and administrative expenses		$ 26.3		$ 20.4
Depreciation and amortization		9.4		10.7
Revenue		64.9		60.3
Customer contract cost		7.7			$ 7.0
Cost of service	[1]	15.0		16.8
Inventory		1.9
Other acquired intangible assets		14.3			14.6
Operating lease right of use asset		15.7			16.0
Current operating lease liabilities		4.0			3.9
Long-term operating lease liabilities		11.9			12.3
Pension amount		(1.8)			$ (2.1)
Service [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		57.5		56.0
Product Sales [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		7.4		4.3
Revision of Prior Period, Adjustment [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Depreciation and amortization		1.6		1.4
Revenue		0.3
Decrease in deferred revenue, current		0.2
Decrease in deferred revenue, current		0.9
Customer contract cost		0.8
Cost of service		2.3		1.9
Cost of product sales				0.2
Cost of product sales				0.5
Revision of Prior Period, Adjustment [Member] | Service [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		0.7		1.0
Revision of Prior Period, Adjustment [Member] | Product Sales [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		0.3		0.7
Revision of Prior Period, Adjustment [Member] | Short-Term Contract with Customer [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Reseach and development expenses		7.2
Revision of Prior Period, Adjustment [Member] | Software Development [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Reseach and development expenses		17.6
Revision of Prior Period, Adjustment [Member] | Capitalized Software [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Selling, general and administrative expenses		1.1		0.5
Depreciation and amortization		1.1		0.7
Previous Revision [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Customer contract cost
Other acquired intangible assets
Operating lease right of use asset
Current operating lease liabilities
Long-term operating lease liabilities
Previous Revision [Member] | Software Development [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Reseach and development expenses		1.0
Revision of Prior Period, Accounting Standards Update, Adjustment [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Depreciation and amortization				0.1
Other acquired intangible assets		1.2
Revision of Prior Period, Reclassification, Adjustment [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Depreciation and amortization		0.5		0.6
Revenue		(1.1)		(0.3)
Customer contract cost		7.7
Cost of service		4.1	[2]	5.0
Other acquired intangible assets		(0.3)
Operating lease right of use asset		7.6
Current operating lease liabilities		1.2
Long-term operating lease liabilities		6.3
Revision of Prior Period, Reclassification, Adjustment [Member] | AOCI Attributable to Parent [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Pension amount		1.8
Revision of Prior Period, Reclassification, Adjustment [Member] | Other Noncurrent Liabilities [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Pension amount		1.8
Revision of Prior Period, Reclassification, Adjustment [Member] | Service [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		(0.8)		(1.0)
Revision of Prior Period, Reclassification, Adjustment [Member] | Product Sales [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue		$ (0.3)		$ 0.7
[1] Excluding depreciation and amortization [2] Excluding depreciation and amortization

v3.24.0.1

Acquisitions and Disposals (Details Narrative) - 1 months ended Jan. 31, 2022 € in Millions, $ in Millions	USD ($)	EUR (€)
Business Combination and Asset Acquisition [Abstract]
Total proceeds	$ 1.3	€ 1.1
Profit on disposal	$ 0.9	€ 0.8

v3.24.0.1

Schedule of Changes in Allowance for Doubtful accounts (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Receivables [Abstract]
Beginning balance	$ (1.4)	$ (1.8)
Additional provision for doubtful accounts	(0.1)	(0.2)
Recoveries	0.1
Write offs		0.4
Foreign currency translation adjustments		0.2
Ending balance	$ (1.4)	$ (1.4)

v3.24.0.1

Schedule of Inventory (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Component parts	$ 21.4	$ 20.7
Work in progress	2.9	3.6
Finished goods	10.3	6.0
Total inventories	$ 34.6	$ 30.3

v3.24.0.1

Schedule of Contract Related Balances (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Contract Liabilities And Other Disclosures As Restated
Accounts receivable	$ 36.7	$ 44.6
Unbilled accounts receivable	15.4	18.0
Deferred income	(7.2)	(7.4)
Customer prepayments and deposits	$ (2.6)	$ (2.4)

v3.24.0.1

Contract Liabilities and Other Disclosures, as restated (Details Narrative) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Contract Liabilities And Other Disclosures As Restated
Revenue recognized in deferred income	$ 1.2	$ 2.5

v3.24.0.1

Schedule of Restricted Stock Unit Activity (Details) - Incentive Plan [Member] - Restricted Stock Units (RSUs) [Member]	3 Months Ended
	Mar. 31, 2023 shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of Shares, Unvested Outstanding	1,647,544
Number of Shares, Granted	495,225	[1]
Number of Shares, Forfeited	(6,266)
Number of Shares, Vested	(219,272)
Number of Shares, Unvested Outstanding	1,917,231
[1] The amount shown as granted in the table includes 219,213 performance-based target RSUs as to which the number that ultimately vests would range from 0% to 200% of the target amount of RSUs (a maximum of 438,426 RSUs based on attainment of Adjusted EBITDA targets for 2023).

v3.24.0.1

Schedule of Restricted Stock Unit Activity (Details) (Parenthetical)	3 Months Ended
	Mar. 31, 2023 shares
Performance Shares [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock shares granted	219,213
Performance Shares [Member] | Minimum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting percentage	0.00%
Performance Shares [Member] | Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting percentage	200.00%
Restricted Stock Units (RSUs) [Member] | Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock shares granted	438,426

v3.24.0.1

Stock-Based Compensation (Details Narrative) - Restricted Stock Units (RSUs) [Member] - Share-Based Payment Arrangement, Tranche Three [Member] - shares	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 30, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-based payment award, shares issued in period	353,554
Number of shares issued RUSs		332,227

v3.24.0.1

Schedule of Accumulated Other Comprehensive Loss (Income) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Equity [Abstract]
Foreign Currency Translation Adjustments, Balance	$ (84.2)	$ (71.5)
Change in Fair Value of Hedging Instrument, Balance	0.3	1.0
Unrecognized Pension Benefit Costs, Balance	33.1	26.7
Accumulated Other Comprehensive (Income), Balance	(50.8)	(43.8)
Foreign Currency Translation Adjustments, Change during the period	2.9	(3.5)
Change in Fair Value of Hedging Instrument, Change during the period	(0.2)	(0.2)
Unrecognized Pension Benefit Costs, Change during the period	(0.2)	(0.1)
Accumulated Other Comprehensive (Income), Change during the period	2.5	(3.8)
Foreign Currency Translation Adjustments, Balance	(81.3)	(75.0)
Change in Fair Value of Hedging Instrument, Balance	0.1	0.8
Unrecognized Pension Benefit Costs, Balance	32.9	26.6
Accumulated Other Comprehensive (Income), Balance	$ (48.3)	$ (47.6)

v3.24.0.1

Accumulated Other Comprehensive Loss (Income), as restated (Details Narrative) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Equity [Abstract]
Interest expenses	$ 0.2	$ 0.2

v3.24.0.1

Schedule of Anti-dilutive Securities Excluded from Computation of Earnings per Share (Details) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
RSUs	1,917,231	695,372

v3.24.0.1

Schedule of Numerators and Denominators of the Basic and Diluted EPS Computations (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
Net income loss basic		$ 1.5
Weighted average, shares	27,974,182	28,437,052
Earnings per share basic	$ (0.05)	$ 0.05
Restricted stock units
Restricted stock units		925,330
RSU, per share amount
Net income loss diluted		$ 1.5
Weighted average, shares	27,974,182	29,362,382
Earnings per share diluted	$ (0.05)	$ 0.05

v3.24.0.1

Net Earnings (Loss) per Share, as restated (Details Narrative) - shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Restricted stock awards not yet issued	1,893,136	1,591,632

v3.24.0.1

Schedule of Other Finance Income (expense) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Other Income and Expenses [Abstract]
Pension interest cost	$ (0.8)	$ (0.6)
Expected return on pension plan assets	0.9	0.9
Other finance income (expense)	$ 0.1	$ 0.3

v3.24.0.1

Income Taxes, as restated (Details Narrative) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Income Tax Disclosure [Abstract]
Effective income tax rate	13.20%	5.30%
Income tax expense	$ 0.2
Income tax benefit	$ (0.2)	$ 0.1

v3.24.0.1

Related Parties (Details Narrative) - USD ($)			3 Months Ended
	Jun. 30, 2023	Dec. 31, 2021	Mar. 31, 2023	Mar. 31, 2022
Consultancy Agreement [Member]
Related Party Transaction [Line Items]
Consulting fees			$ 30,000	$ 30,000
Consultancy Agreement [Member] | Richard Weil [Member]
Related Party Transaction [Line Items]
Consulting fees		$ 100,000
Consultancy Agreement [Member] | Richard Weil [Member] | Subsequent Event [Member]
Related Party Transaction [Line Items]
Consulting fees	$ 10,000
Macquarie Corporate Holdings Pty Limited [Member]
Related Party Transaction [Line Items]
Related party beneficially owneed			11.51%
Interest and debt expense			$ 0.0	$ 0.0
Outstanding shares percentage			5.00%

v3.24.0.1

Commitments and Contingencies (Details Narrative) - Amended Employment Agreement [Member] - Former Executive Vice President And Chief Strategy Officer [Member]	Jan. 10, 2023 USD ($)
Loss Contingencies [Line Items]
Base salary	$ 385,000
Minimum [Member]
Loss Contingencies [Line Items]
Target annual bonus	100.00%
Maximum [Member]
Loss Contingencies [Line Items]
Target annual bonus	200.00%

v3.24.0.1

Schedule of Defined Benefit Plans (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Retirement Benefits [Abstract]
Interest cost	$ 0.8	$ 0.6
Expected return on plan assets	(0.9)	(0.9)
Amortization of net loss	0.2	0.1
Net periodic benefit	$ 0.1	$ (0.2)

v3.24.0.1

Schedule of Pension Plans and their Reconciliation (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Retirement Benefits [Abstract]
Benefit obligation at beginning of period	$ 71.2	$ 122.7
Interest cost	0.8	2.2
Actuarial loss (gain)		(39.0)
Benefits paid	(0.7)	(3.5)
Foreign currency translation adjustments	1.9	(11.2)
Benefit obligation at end of period	73.2	71.2
Fair value of plan assets at beginning of period	69.1	125.7
Actual gain (loss) on plan assets	0.9	(42.4)
Employer contributions	0.3	1.4
Benefits paid	(0.7)	(3.5)
Foreign currency translation adjustments	1.8	(12.1)
Fair value of assets at end of period	71.4	69.1
Overfunded status (non-current)	(1.8)	(2.1)
Net amount recognized	$ (1.8)	$ (2.1)

v3.24.0.1

Pension Plan, as restated (Details Narrative) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022	Dec. 31, 2023
Subsequent Event [Line Items]
Employer contributions	$ 0.3	$ 1.4
Subsequent Event [Member]
Subsequent Event [Line Items]
Contingent contributions			$ 1.1
Expense contributions			$ 0.3

v3.24.0.1

Schedule of Segment Reporting Information by Segment (Details) - USD ($) $ in Millions		3 Months Ended
		Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Total revenue		$ 64.9	$ 60.3
Cost of service	[1]	(15.0)	(16.8)
Cost of product sales		(6.7)	(2.5)
Selling, general and administrative expenses		(26.3)	(20.4)
Stock-based compensation expense		(2.9)	(2.8)
Acquisition and integration related transaction expenses			(0.2)
Depreciation and amortization		(9.4)	(10.7)
Segment operating income (loss)		4.6	6.9
Net operating income		4.6	6.9
Total capital expenditures		9.6	9.5
Service [Member]
Segment Reporting Information [Line Items]
Total revenue		57.5	56.0
Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue		7.4	4.3
Gaming [Member]
Segment Reporting Information [Line Items]
Total revenue		27.1	24.8
Cost of service		(5.9)	(6.0)
Cost of product sales		(5.8)	(2.3)
Selling, general and administrative expenses		(5.7)	(5.0)
Stock-based compensation expense		(0.3)	(0.3)
Acquisition and integration related transaction expenses			(0.1)
Depreciation and amortization		(4.5)	(5.2)
Segment operating income (loss)		4.9	5.9
Total capital expenditures		2.4	2.9
Gaming [Member] | Service [Member]
Segment Reporting Information [Line Items]
Total revenue		20.2	21.1
Gaming [Member] | Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue		6.9	3.7
Virtual Sports [Member]
Segment Reporting Information [Line Items]
Total revenue		14.8	11.3
Cost of service		(0.4)	(0.4)
Cost of product sales
Selling, general and administrative expenses		(1.7)	(1.7)
Stock-based compensation expense		(0.2)	(0.1)
Acquisition and integration related transaction expenses
Depreciation and amortization		(0.8)	(0.8)
Segment operating income (loss)		11.7	8.3
Total capital expenditures		0.4	0.5
Virtual Sports [Member] | Service [Member]
Segment Reporting Information [Line Items]
Total revenue		14.8	11.3
Virtual Sports [Member] | Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue
Interactive [Member]
Segment Reporting Information [Line Items]
Total revenue		5.9	4.6
Cost of service		(0.3)	(0.3)
Cost of product sales
Selling, general and administrative expenses		(2.5)	(1.4)
Stock-based compensation expense		(0.2)	(0.1)
Acquisition and integration related transaction expenses
Depreciation and amortization		(0.6)	(0.6)
Segment operating income (loss)		2.3	2.2
Total capital expenditures		1.1	0.9
Interactive [Member] | Service [Member]
Segment Reporting Information [Line Items]
Total revenue		5.9	4.6
Interactive [Member] | Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue
Leisure [Member]
Segment Reporting Information [Line Items]
Total revenue		17.1	19.6
Cost of service		(8.4)	(10.1)
Cost of product sales		(0.9)	(0.2)
Selling, general and administrative expenses		(6.9)	(6.6)
Stock-based compensation expense		(0.1)	(0.2)
Acquisition and integration related transaction expenses
Depreciation and amortization		(3.1)	(3.6)
Segment operating income (loss)		(2.3)	(1.1)
Total capital expenditures		5.2	4.0
Leisure [Member] | Service [Member]
Segment Reporting Information [Line Items]
Total revenue		16.6	19.0
Leisure [Member] | Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue		0.5	0.6
Corporate Functions [Member]
Segment Reporting Information [Line Items]
Total revenue
Cost of service
Cost of product sales
Selling, general and administrative expenses		(9.5)	(5.7)
Stock-based compensation expense		(2.1)	(2.1)
Acquisition and integration related transaction expenses			(0.1)
Depreciation and amortization		(0.4)	(0.5)
Segment operating income (loss)		(12.0)	(8.4)
Total capital expenditures		0.5	1.2
Corporate Functions [Member] | Service [Member]
Segment Reporting Information [Line Items]
Total revenue
Corporate Functions [Member] | Product Sales [Member]
Segment Reporting Information [Line Items]
Total revenue
[1] Excluding depreciation and amortization

v3.24.0.1

Schedule of Geographic Information (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 64.9	$ 60.3
Total non-current assets excluding goodwill	108.7		$ 104.8
UNITED KINGDOM
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	49.0	45.9
Total non-current assets excluding goodwill	87.5		82.7
GREECE
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	5.6	5.6
Total non-current assets excluding goodwill	5.1		5.8
Rest of World [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	10.3	$ 8.8
Total non-current assets excluding goodwill	$ 16.1		$ 16.3

v3.24.0.1

Customer Concentration (Details Narrative) - Customer Concentration Risk [Member]	3 Months Ended		12 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Revenue Benchmark [Member] | Customer One [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	15.00%	12.00%
Accounts Receivable [Member] | Customer One [Member]
Concentration Risk [Line Items]
Concentration risk, percentage			24.00%
Accounts Receivable [Member] | No Customer [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%

v3.24.0.1

Subsequent Events (Details Narrative) - 2023 Plan [Member] - shares	Apr. 10, 2023	Jan. 31, 2023
Performance Shares [Member] | Amendment to Employment Contract of Weil and Pierce [Member]
Subsequent Event [Line Items]
Aggregate shares		250,000
Stock Price Based RSUs [Member] | Amendment to Employment Contract of Weil and Pierce [Member]
Subsequent Event [Line Items]
Aggregate shares		125,000
Subsequent Event [Member]
Subsequent Event [Line Items]
Share based compensation arrangement,number of shares authorized to be issued	2,700,000

---