Author Topic: INLOT.AT - Intralot  (Read 139116 times)

Packer16

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Re: INLOT.AT - Intralot
« Reply #20 on: December 28, 2013, 05:26:41 PM »
You are correct, however, for the only sub we have data on (Americas segment) the EBITDA is reduced by $3 million and in all the analysts reports and the Bloomberg consensus don't appear to have a materially lower EBITDA number from the consolidated number that has been reported by the company.  I will send IR a question about this and see what the response is.  Thanks.

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Sportgamma

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Re: INLOT.AT - Intralot
« Reply #21 on: December 28, 2013, 07:13:52 PM »
Its a very interesting idea.

I like the fact that its founders have a big stake in the company as well as being directors.

However, I´m having trouble fathoming how they record revenue and more importantly COGS. I guess tracking cash flows would be a better way of valuing the operations.

prevalou

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Re: INLOT.AT - Intralot
« Reply #22 on: December 29, 2013, 12:50:24 AM »
I have two questions:
1) what is the cost of gaining/renewing a long term contract ?
2) what is the impact of gaming liberalization on "monopoly revenue and margins" ?

leftcoast

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Re: INLOT.AT - Intralot
« Reply #23 on: December 29, 2013, 10:47:47 AM »
I've been invested in GTECH (previously known as Lottomatica) for quite some time and I rode OPAP along throughout 2013. For all those interested in the lottery space, here is what the typical value chain looks like:
...
My preference for GTECH stems from the fact that they are this fully vertically integrated full service lottery group (I know, a lot of words) which I think will be increasingly important as a lot of goverments/states are counting on gambling tax revenues to decrease their deficits. For instance, the potential in the US, where states are opening their state lotteries to players like GTECH ( who have the expertise to increase the revenues significantly) is quite significant and it is my belief that these states/governments have a preference for those players that can provide the entire "package" (and which have a good track record in doing so).
In comparison to GTech I think the capabilities are comparable at least from Intralot's corporate presentation on their website.  They appear to do system implementation and support, have gaming modules and develop interactive gaming.   They also operate lotteries.  There EBITDA margins (adjusted for net vs. gross payout - see presentation) are comparable to GTech's.

Thanks for sharing the GTech slide and info. Further to Packer's point, here's the info from Intralot's investor presentation that breaks down how much of their revenue and EBITDA come from each segment of the value chain. (See attached for the source slide.)

   Revenue %   EBITDA %
Technology (Infrastructure Dev + Software Dev + System Installation & Support)   16%37%
Management Contracts (Content Dev & Market Research)10%23%
Licensed Operations (Gaming Operations)74%40%

This definitely doesn't jive with GTech's presentation, which shows Intralot relegated to the "bottom" of the value chain (i.e. technology development). Do you know when that slide GTech was created? Perhaps it's out of date with respect to Intralot?

Edward

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Re: INLOT.AT - Intralot
« Reply #24 on: December 30, 2013, 03:16:20 AM »
I might be mistaken, but isn't it that they use full consolidation for quite a few of their not fully owned businesses? In that case, shouldn't we adjust the EBITDA numbers down?
First, I would like to thank Packer for the idea. We held OPAP in the past, and I find the whole gambling industry interesting.

As Swedish mentioned, there is an issue with EBITDA not being wholly owned by shareholders of the parent. Going over Annual reports through 2007-2012, It was interesting to discover that a large part of annual net profit is attributed to minority interest.

A summary of consolidated results:

2007 - Net profit 164M, of which 52M is attributable to minority interest.
2008 - Net profit 104M, of which 54M is attributable to minority interest.
2009 - Net profit 77M, of which 27M is attributable to minority interest.
2010 - Net profit 54M, of which 18M is attributable to minority interest.
2011 - Net profit 35M, of which 17M is attributable to minority interest.
2012 - Net profit 33M, of which 26M is attributable to minority interest.
2013 9M - Net profit 19M, of which 19M is attributable to minority interest.

Does the EBITDA calculation take into account that a significant portion of the consolidated business seems not to be owned by shareholders?

« Last Edit: December 30, 2013, 04:28:06 AM by Edward »

xtreeq

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Re: INLOT.AT - Intralot
« Reply #25 on: December 30, 2013, 04:09:57 AM »
Thanks for the idea Packer,

Started reading the 2012 annual and on p.17 it says
Recently, INTRALOT USA launched in the US market its new internet product - "DeepStack Casino™", which offers the possibility in the US players to participate in casino style games by receiving costfree chip bonuses. This new website offers interactive and social gaming content and expands the Company‘s portfolio beyond the traditional lottery products for which the Company is well known in the US. Legislation permitting, INTRALOT USA will also offer the platform as a B2B product to clients who want to introduce a real-money site within their regulated US jurisdictions, such as the lotteries.

The relevant press release http://www.intralot.com/content/2697/intralot-usa-launches-freeplay-deepstack-casino
Commenting on the occasion, Mr. Tom Little, President & CEO of INTRALOT USA, stated: “We are delighted to present to the US market our new, freeplay website DeepStack Casino™ that we have developed with a focus on the expectations and the actual habits of real-money players. We are confident that our new gaming offering will be embraced by players in the US jurisdictions.”

This is the website: https://www.deepstackcasino.net/

I would be embarrassed to show this site to a potential client.
Homepage is blank.
This page is just weird: https://www.deepstackcasino.net/mttwinners.asp#.UsAkaPQW3T8
It says “Top 20 MTT Winners” but it shows 21 winners. My guess is that most of the users are fake but I don’t have a way to verify this.

This is the facebook page https://www.facebook.com/pages/DeepStack-Casino/331492023553862
Only 65 likes.
Zero activity.
« Last Edit: December 30, 2013, 04:16:22 AM by xtreeq »

Packer16

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Re: INLOT.AT - Intralot
« Reply #26 on: December 30, 2013, 04:46:38 AM »
I think a good part or most of the minority interest income comes from "mark-to-market" gains associated with the minority interest when less than 100% of the entity is purchased.  So if Intralot buys 80% of a company for $100 million, then the minority interest is put on the balance sheet at $20 million and "mark-to-market" gain is flowed through the income statement.  This would explain the lumpy MI income over time.   If you look at the % ownership from the AR the largest unit with a MI is Intralot USA (with a 90% ownership).  This equates to about $3 m of EBITDA.  If you can provide more insight that would be great.

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finetrader

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Re: INLOT.AT - Intralot
« Reply #27 on: December 30, 2013, 05:01:09 AM »
Quote
2007 - Net profit 164M, of which 52M is attributable to minority interest.
2008 - Net profit 104M, of which 54M is attributable to minority interest.
2009 - Net profit 77M, of which 27M is attributable to minority interest.
2010 - Net profit 54M, of which 18M is attributable to minority interest.
2011 - Net profit 35M, of which 17M is attributable to minority interest.
2012 - Net profit 33M, of which 26M is attributable to minority interest.
2013 9M - Net profit 19M, of which 19M is attributable to minority interest.

Man, talk about growth!
Live to invest, invest to live

yadayada

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Re: INLOT.AT - Intralot
« Reply #28 on: December 30, 2013, 06:18:15 AM »
https://www.intralot.it/poker
this also is kinda weird. DOnt they provide software? Here they are essentially running the ongame software. A skin for a dying pokersite with horrible software basicly.  It also said they entered some kind of agreement with partygaming. I would like to see some of their  websites that are doing well.

It seems the machines part of the business, and the lotteries provide the big money here. But 40% of ebitda is not under contract.

Another thing that i dont get is their receivables. Its been building up to around 170 million euros in the last 4 years if i look at the cash flow statement. and 260 million if you count in 2008. Yet i dont see it increase on the balance sheet? total receivables went from 320 million to 300 million. What is going on here? I mean im not yet v experienced in reading financial statements so i might just be overlooking something. But if it goes up a net 260 million, shouldnt receivables on the balance sheet be increased by 260 million?

racemize

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Re: INLOT.AT - Intralot
« Reply #29 on: December 30, 2013, 12:42:44 PM »
I'm still reading on this one; however, it doesn't seem particularly easy to trade this.  It looks like I'd need to pay a fair amount of Euros/month in IB to see the data, and Google/Fidelity data doesn't seem to go back very far.  I guess there's the ADS, but it seems fairly illiquid.  Any advice out there?