Inspired Gaming Group plc
14 March 2008
14 March 2008
Inspired Gaming Group PLC ('the Company')
Pubs Division Update
At the time of the announcement of the preliminary results for the year ended 30
September 2007 on 25 January 2008, the Directors indicated that trading in the
Pubs Division was weak and that conditions would be monitored very carefully.
The Directors confirmed that they would take any further actions deemed
necessary to protect the profits of the Group. The Directors are currently
conducting a thorough review of the Pubs Division and are considering a number
of strategic options. The aim of the strategic review is to focus the Company's
capital allocation and management resources on the faster growing Gaming and
Leisure sectors in the UK and international markets.
The Directors expect to announce the conclusions of the review of the Pubs
Division in the near future and in any event by June 2008 when the Company is
due to report its interim results to 12 April 2008.
Despite the tougher trading environment anticipated as a result of the smoking
ban the Directors had expected the Pubs Division to be marginally profitable at
the EBITdA* level for the current financial year as a result of cost savings.
The most recent financial information shows that trading in the Pubs Division
has deteriorated since the announcement of the preliminary results due to a
reduced level of revenues on those machines where the Company has a revenue
share and a reduction in the number of machines in pubs as a result of recent
pub closures. If this trend were to continue, the Board do not believe that this
recent deterioration in trading in the Pubs Division could be offset by gains in
other areas of the business. Pending the outcome of the strategic review, the
Directors are planning further cost cutting measures to help mitigate the
impact.
The activity levels in all of the Company's other Divisions (UK Gaming, UK LBO,
UK Leisure and International), where almost all of the Group's expected EBITdA
for the current financial year is generated, remain positive. Machine incomes
across all product categories are performing well, which is leading to strong
demand from existing and new customers. The UK Divisions benefit from long term
contracts, recurring revenues and strong cash flows while the growth potential
of the International Division is significant given the expected rate of adoption
of SBG technologies.
ENQUIRIES
Andy Berry Fishburn Hedges +44 (0) 20 7544 3044
+44 (0) 7767 374 421
Morgan Bone Fishburn Hedges +44 (0) 20 7544 3053
+44 (0) 7767 622 967
Evolution Securities as Nominated Adviser to the Company:
Stuart Andrews +44 (0) 20 7071 4300
* EBITdA represents Earnings before Interest, Taxation, Non-Machine
depreciation, Amortisation, Exceptional Items and Share Based Payments.
This information is provided by RNS
The company news service from the London Stock Exchange
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