Inspired Entertainment, Inc. · NASDAQ:INSE
Inspired Entertainment — Hydra Industries Acquisition — SPAC Merger (July 2016)
22 slides from Inspired Entertainment's SPAC merger presentation, Jul 19, 2016
Slide 1: Investor Presentation – Inspired Entertainment, Inc. (INSE) July 2016
Investor Presentation – Inspired Entertainment, Inc. (INSE) July 2016 July 2016 Investor Presentation – Inspired Entertainment, Inc. (INSE) This image cannot currently be displayed.
Slide 2: Forward-Looking Statements
PAGE 1 Forward - Looking Statements This presentation includes forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . These forward - looking statements include, among others, statements regarding the estimated valuations of DMWSL 633 Limited (“Insp
Slide 3: Presenters
PAGE 2 Presenters Lorne Weil ● Current CEO and Chairman of Hydra Industries Acquisition Corp. ● To be Executive Chairman of the Board of Inspired Entertainment, Inc. Luke Alvarez ● Founder and Current CEO of Inspired Gaming Group ● To be President, CEO and Board Member of Inspired Entertainment, Inc
Slide 4: The Opportunity
PAGE 3 Revenue and EBITDA growth poised to accelerate in 2017 and beyond 8 The Opportunity Leadership in fast - growing Virtual Sports (95% of global installs and over $10 billion of handle) positions the company to introduce its digital products to new jurisdictions 3 Stable, contracted recurring r
Slide 5: Historical and Projected EBITDA
PAGE 4 $25 $25 $34 $36 $38 $48 $62 FY13A FY14A FY15A LTM H1 '16 FY16E FY17E FY18E EBITDA is projected to grow at ~24% CAGR supported by a recurring revenue base representing more than 96% of total sales Note: Figures presented based on US GAAP and constant 1.32 USD / £ exchange rate as of July 13, 2
Slide 6: Inspired overview: Server Based Gaming and Virtual Sports
PAGE 5 ; Leading provider of Server Based Gaming (”SBG”) systems and terminals ; Currently has 25,000 SBG terminals live and more than 5,000 contracted ; E - Table gaming platforms including “Sabre” multi - win roulette and casino Storm terminals ; Leader in the UK with ~50% of machine volume and #3
Slide 7: Recurring Revenue From Long-Term Customers
PAGE 6 Server Based Gaming Virtual Sports Customer Relationship (in years) Customer Relationship (in years) UK William Hill >10 Ladbrokes >10 Betfred >10 William Hill >10 Paddy Power >10 Coral >10 Playnation >10 Betfred >10 Gala Coral Group >10 Paddy Power >10 Genting Casino 7 Skybet 10 Grosvenor Ca
Slide 8: History of Inspired
PAGE 7 Since its founding in 2002, Inspired has grown into a leading provider of digital entertainment History of Inspired 2002 Inspired launched as mobile entertainment technology startup with 10 people in central London 2002 to 2006 Inspired acquired Virtual Sports graphics specialist and integrat
Slide 9: Worldwide Gaming Revenue and Digital Growth
PAGE 8 $ 14bn $ 43bn 2005E 2016E Global Digital / Online Gaming and Lottery Net Win or Net Sales $ 269bn $ 397bn 2005E 2016E Global Gaming and Lottery Net Win or Net Sales Inspired’s platform is well positioned to take advantage of high - growth in Digital / Online gaming Source: H2 Gambling Capital
Slide 10: Influencers of Digital Adoption
PAGE 9 United Kingdom Betting Shop Influencers of Digital Adoption ; Governments: Opening of new gaming territories – Italy, Greece, Spain, Philippines and China ; Distributed Gaming Revenues: Expansion of regulated gaming away from relatively few large resort casinos into many more distributed venu
Slide 11: Our Competitive Focus
PAGE 10 Our Competitive Focus ; Leader in UK with 50% of market ; Top 2 - 3 provider in Italy, Greece and internationally ; 25,000 Server Based Gaming terminals live — More than 5,000 additional machines contracted ; 100+ games integrated on open platform ; Unitary platform approved across multiple
Slide 12: Omni-Channel Digital Distribution
PAGE 11 Omni - Channel Digital Distribution
Slide 13: Organic Growth Opportunities: Four Core Products, One Common Platform
PAGE 12 Organic Growth Opportunities Four Core Products, One Common Platform Retail Virtual Sports Mobile Virtual Sports Virtual Sports ; Existing Virtuals Customers – Income growth from key UK and Italian contracts plus cross sell of new products ; New Virtuals Customers – Continue track record of
Slide 14: Building a Digital Distributor of Content
PAGE 13 Building a Digital Distributor of Content USA / Canada x UK / EU x x x China x x Rest of World x x Sports Betting Poker Social Virtual Sports x x x Gaming Terminals x x x Slots x x Lottery x Table Games x Bingo x Products Geographies Retail x x x Online x x Mobile x x x Channels Omni - Chann
Slide 15: Management team
PAGE 14 Lorne Weil Executive Chairman ● Mr. Weil will be Executive Chairman of the Board of Inspired Entertainment, Inc. ● Mr. Weil founded Hydra Industries Acquisition Corp. (NASDAQ: HDRA) in 2014 and currently serves as its Chairman and CEO ● Prior to founding Hydra Industries, Mr. Weil served as
Slide 16: Macquarie and Vitruvian will continue to support Inspired as major shareholders
PAGE 15 Macquarie and Vitruvian will continue to support Inspired as major shareholders post closing Sponsorship Aligned with Shareholders Vitruvian Partners Macquarie Capital ; Macquarie Capital represents Macquarie Group’s (ASX:MQG) corporate advisory, equity, debt and private capital markets busi
Slide 17: Historical & Projected Financial Performance
PAGE 16 $112 $105 $110 $134 $180 FY14A FY15A FY16A FY17A FY18A $25 $34 $38 $48 $62 FY14A FY15A FY16A FY17A FY18A $20 $23 $33 $48 $59 FY14A FY15A FY16A FY17A FY18A $92 $82 $77 $86 $121 FY14A FY15A FY16A FY17A FY18A (US$ in millions, Fiscal Year End September) Figures presented based on US GAAP and co
Slide 18: Transaction Overview
PAGE 17 Note: Exchange rate of 1.32 USD / £ as of July 13, 2016; Assumes 100% SPAC participation. Overview ● Hydra Industries Acquisition Corp. (“Hydra”) to acquire 100% of the equity of Inspired Gaming (“Inspired”) from Vitruvian Partners and certain other minority shareholders (the “Sellers”) in e
Slide 19: Implied valuation, ownership, sources and uses
PAGE 18 ($ in millions, except share price) Sellers' Rollover Equity $73.3 (÷) Issue Price of Hydra Shares $10.00 Estimated Sellers Rollover Shares (mm) 7.3 (+) Hydra Management 1.6 (+) Hydra Board 0.1 (+) Macquarie Capital 3.0 (+) SPAC Shareholders 8.8 Fully Diluted Shares Outstanding (mm) (4) 20.8
Slide 20: Illustrative Trading Comparables
PAGE 19 5.6x 13.0x 6.2x 6.3x 8.2x 7.9x 5.8x 11.3x 6.3x 7.9x 7.5x Gaming Equipment EV / 2017E Median: 7.1x EV / 2018E Median: 7.5x Illustrative Trading Comparables Source: Public company filings, broker research consensus estimates and CapitalIQ. Note: Financials and trading prices converted to USD a
Slide 21: Anticipated Transaction Timeline
PAGE 20 Anticipated Transaction Timeline Date Event July 14 th ; Transaction announced Late July ; File preliminary proxy materials with SEC August ; Se t record date for shareholder vote September ; Mail final proxy materials to shareholders October ; Hold shareholder vote and close transaction Not
Slide 22: Compelling Opportunity
PAGE 21 Revenue and EBITDA growth poised to accelerate in 2017 and beyond 8 Compelling Opportunity Leadership in fast - growing Virtual Sports (95% of global installs and over $10 billion of handle) positions the company to introduce its digital products to new jurisdictions 3 Stable, contracted rec
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