Q1 2021 Evolution Gaming Group AB (publ) Earnings Call
Okay.
[music].
Ladies and gentlemen, and welcome to the evolution gaming grip Q1 report trying to 'twenty one.
I'm pleased to present, CEO, Martin Carlson and CFO Jacob.
For the first part of this call all participants will be in a listen only mode and afterwards, there will be a question answer session.
He is speaking here moving.
Good morning, everybody.
Welcome to the presentation on resolutions three and reported for the first quarter on 2021.
My name is Monica Koehler zone in on that.
As CEO of evolution with me I also have our CFO Jacob kept on.
As usual I will start with some cold months on our performance in the quarter was on hand over to Jacob for a closer look at all of our financials on a per on round off on a presentation with an outlook on 2021 on them of course, we're happy to take questions.
Next slide please.
Yes.
Yeah.
This year started with a bang on I want to begin to talk about what we are really doing an evolution at the moment.
Its more important on the ACA.
<unk> figures that we are building on our future in quarter one on the on the twin peaks on Thursday on in terms with an exception of high pace of deliveries for evolution.
I can assure you that everyone in the company would agree with me on that it's important for me to explain that to create the figures you are about to see a lot has to happen.
Close enough strength integration posted on plan, maybe reorganization, we are about to launch in Michigan. We have started to notice a new studio constructions, where you're visiting the roadmap for both slots. That's why does live they're currently expanding on these existing studio.
Acquiring BCG Townsend COVID-19 in a total of 42 locations over the world and have one of the fastest recouped on spaces of new employees ever.
Let's say, we work hard we do when I say, we have high ambitions, we do when I say that we need to be better every day, we do have.
Evolution has great speed forward on this built on our 10000 plus crew on fantastic talent I want to thank everyone for their hard work and the end of 2020 on this first quarter.
Now, let's move to the coming slides and see the effect on numbers and products on all of our airports.
Operators operating in Mexico.
Okay.
Continue the momentum from 2000 times than I have seen a very strong start to 2021 of Jeff's team from the last slide there has been enormous extreme exceeded 11 from December 2020 on through the first quarter I'm, especially excited about the focus on products on future play experiences, but needless to say I'm also very happy to be.
But to state that you have to do the integration on restructure of NAFTA is dumb on delivering over expectations.
Well soon get back with some figures on that.
Let's look at the financials.
Revenue in the quarter is 235 million euros and increase of 105 per cent compared to Q1, 'twenty pumping that inclusive inclusive quietness on business for one.
On quarter.
Our live business shows fantastic organic growth of 60 per cent compared to Q1 'twenty pump. It. It's the highest growth rate that we have had in a single quarter since 2015 or even earlier.
Slots revenue grew 6% year on year, and it's comparing to net that's reported figures of 20th something which is in line with our expectations.
EBITDA increase is 150% to $160 million during the quarter on our EBITDA margin is 67, 9% for the same period.
Other highlights in according to its integration on that though just four months. After closing the deal we have established our new organizational structure and completed our cost synergy targets and close to one with the run rate saving of approximately 44 million euro.
Unfortunately, we were higher than the original targets on where also about nine months ahead of our communicate get on their communicate.
Communicate the timetable.
But this will not close to reporting on synergies moving forward and we will of course continue to work with our cost efficiency.
The rapid complete the completion of caution here supports a strong margin in the quarter. It has been exceptional hard work put in by all parts of our organization to share this or where they live at nine 2% on on 100 day plan, which I'm satisfied with.
But also just one week off the day after the quarter reported about the acquisition of Big time gaming.
It should be great additions evolution and our aim to become the number one in online casino in my opinion, it's the most innovative slots company in the world.
Great fit with our culture of evolution.
What's driving new gaming experience and play subsection.
It's very much look forward to welcoming the big get big time gaming crew to evolution.
Back to the acquisition on a net site.
Yeah.
Well in all I'm very pleased to be able to percentage kept another very strong quarter for evolution. We are definitely one place will further strengthening our market share and continue to buy it on the graph to competitors, but as always we need to work hard on what comes out every single day.
Next slide please.
And so I think most of you know by now that sports is to be seen as day indicator of the activity and on our line up for it but this has not changed on only shows the nice part of the total evil network.
The positive trend with a strong increase of best sports that we have seen through 2020 continues on accelerated in the first quarter.
Number of basketball from the abuse of accounts to $17 2 billion compared to $8 7 billion on the same period last year, which is a growth by 9% to 7%.
In the quarter and we have invested in additional to the capacity both in North America and in other regions. However, due to the pandemic servers to just continue to operate with somewhat limited capacity.
Despite.
But we experienced a continued strong increase in volume quarter of the quarter.
Which is which I have the simple explanation.
The attraction of our products.
I believe that some of the toughest competition with face to our online casino product or of the force of online at the thing on increases in both in our volume is a pocket of course, we have been able to develop a totally new games that have attracted completely new groups of players.
For them to remember thank you next slide please.
Yeah.
Due to the pandemic and the related restrictions, we operated fewer tables sometime during 2000 tonnes a day.
Sometime it's still limits us in many ways, but were either sole expanding in all location as fast as we can.
That's the graph shows these past 10000 at least at the end of the quarter.
Ill break for more than 20 countries worldwide on a continuously expanding on complication as well as open up in new.
Just a few years ago, which was a big step for Russell on the new studio.
I just tried to make at this means to do the best for Advair, but student expansion is today on an integrated part of our operation and not a one off project.
We continue to see very high demand for paper and we will continue to grow with our customers. That's why I expect the number of employees to continue to grow all seen because he has to come.
Much of our success with evolution is due to the fact that we have managed to recruit the best talent in each market.
Also with acquisition on that something that I had the great talent evolution on the truly want to create a special place to work.
That at the moment, yes, but also a place where you can make a global impact where you can grow the people at evolution today create playing experience, but millions of players all over the world enjoy.
Hub of cutting edge technology, where you want to work if you will aim to be the best.
Next slide please.
[laughter].
But they are crying orange business and now have two legs to stand on.
Our R&D business down for about 22% of on total revenues in Q1 and lives downpour some capes on.
As I already said, our ninth casino business had the highest growth rate.
Never seen were recorded in the quarter.
60% debt.
So on G fast.
Some on jumbo amounted to 6% LNG growth is in line with our current expectations.
I'm very excited about the new games that we have in lineup for 2021 and also the work with with the road map for 2022, both in R&D as well as in life. We have revisited everything that goes on the road map that we will have a very interesting releases coming on.
South of the resistance and changes we will have more diseases in Q3, and Q4 that makes your two I'm also face a tougher comparable figures in Q2 for R&D. So nothing business saw a significant bump up in growth specifically in Q2 'twenty pumping is depend on the kit.
And then also on house are operating on all on existing markets, where we are focusing on reaching out with our full product portfolio.
During 2021, when these new games to the live game show segment as well as new takes on traditional non games on.
On top of Doctor very much before and adding big time gaming games to the folks enrolled him up on them.
This would be a product life very exciting day Air Force nature.
Exactly.
We lost the big time gaming deal earlier this month as you know.
As I stated on our long term ambition is to become the world's leading provider of online casino now would be to add an important piece to share that ambition. It did GE is one of the most interactive social graces BCG brings with him a very strong capital with great games that players love.
Page titles like Milan extra share name monopoly Mega ways, having what is all over the world simply great teams with great products.
In addition, based on game you know the creators Omega made major way it gave them a county, which is featured none of their own games, but all thing is licensed to over 200 games from many other providers, including our not sometimes on Tiger brands.
Therefore on a big time gaming development for a long time and I'm impressed with what they have achieved on a very excited to join forces and to continue our journey to create the global market leader in online casino.
The data is planned to close during the second quarter.
Yeah.
Third piece that flow to the next slide.
Yeah.
This slide shows the breakdown of our revenue by geographic region and its an evidence that the demand growth is truly global.
We see very good growth in all our Joe geography.
And this quarter, we on the acquired business for the quarter. So the year on year increases in both comparable to previous quarters.
As the year goes on the comparison.
Over quarter will be more relevant so we will move towards a quarter by quarter comparison and stuff.
The Nordics makeup for about 7% on the total revenue nothing games are strongest redone and hasn't been on important contributed to the increase compared to 2020 were more than double our revenues from these income back to Q1 point per trumpet.
Uk's about 9% on the total revenues in Q1 also here not sometimes on Tiger games contributed significantly to the increase compared to Q4, but also live games have had a good development in the U K in the quarter.
The rest of Europe is about 44 pounds on filter so together with U K nordics about 60% of the revenues come from Europe.
Actually we have seen during the past year in Asia, and North America are growing very fast with a year on year growth amounting to 156 am 204% perspective it seems.
We see good potential in both these markets unexpected continued high growth there going forward, particularly as we see we are a small axa in Asia and with the recent regulatory movements on U S on becoming Michigan studio.
On their computer South America Africa, and remaining part of the road show good growth with 67%.
Revenues from regulated market price.
To support its on the revenues increasing their share of revenue from regulated markets, partly due to the NAV is having a greater percentage of revenue coming from regulated markets, but also to growth. The two the growth in the U S for life.
I will now pass to Jacob who will speak more about the financial lease. So next slide please thank.
Thank you Martin.
Good morning to everyone listening in.
Well now move on to a couple of sites with a closer look at our financials developed enough during the period.
I'm on the slide pack on the financials.
Interest and aside revenue amounts to $235 8 million euro in the first quarter. That's made up on $183 7 million in Europe related to our life casino products I'm $52 2 million in Europe from our oranges games.
The acquisition on that stuff was completed in December of last year. So not that of course included for the full quarter for the full quarter for the first time and in this quarter.
As Martin mentioned earlier it has been a great stops per year.
Our live casino business as organic growth of 60% year on year on the quarter.
We achieved almost 50% growth for the full year 'twenty 'twenty. So we did have a very good momentum coming into 2021 and the growth on this having said that the growth on this quarter I would say, it's on the high side compared to my own expectations from a few months ago and it's a combination of on many factors many of our operators have a good momentum in general with the life.
Product attract an increasing number of players we continuously building our product portfolio with new games and also depends on the cats, giving a boost to work force of online entertainment. So many many factors contributed to the high growth in the quarter.
Our LNG business is developing according to our expectations on stamps comparing to net reported numbers Q1, 'twenty 'twenty growth is about 6% in the quarter and the near term, we do come up against a tougher comparison figures on how to be a spike in volumes.
In the second quarter on the 20 <unk>.
But as Martin mentioned, we believe that they have a very strong lineup of new type of especially during the second half of FY 'twenty one.
I have no expectation on GDP growth in percentage terms in the second quarter.
Yeah.
EBITDA for the quarter amounted to 161 million Euro and then EBITDA margin of $67 nine in the quarter.
The good revenue development also affects the margin pulses to me of course also we have been able to complete our prep now on cost synergies ahead of plan or come back to the cost synergies on on the next slide.
So our guidance for full year 2021, what's left we would reach the fourth quarter on 20% level.
For EBITDA margin for the full year 2021, which as you can see on the slide would mean 65 per cent for full year 2021 were only a few months into the year now so we will not revise that statement.
I'm always thinking Oh on many things can go wrong, but with the good start of the year Didier on the completed close to and it is fair to say, but there's some upside to that guidance from a few months ago. So it.
For sure it would start to be on when it comes to margin.
So what's your main thing in the context of more jump is that our force probably worth at least the top line growth should we get the chance to expand more to capture more revenue, we will prioritize stuff even if it meant a hit on the margin on the short term. So that's a statement on it.
Okay, operator, let's go to the next like this.
So.
A few more words about cost synergies are our original statement on announcing dose per semester. Unfortunately, with the chips 30 million euro in annual cost synergies compared to the Q1 'twenty cost base, which was the latest reported figures at the time of announcement.
That's what's shown to the left in the slide a total of $78 4 million euros for the combined group were on 27 four was reported by net dumped on the remainder was evolution cost base at the time.
This included about 50 million Euro of previously announced savings by net dumping in connection with the acquisition of Red Tiger earlier in 2019.
So on reporting the Q4 figures in February we increased the targets too on your.
Run rate of 40 million Euro and that level has now been achieved even a bit above that.
The $10 9 million euro or reduction in the quarter.
It's around rates close to 40 44 million euro on dinner.
Thank you.
During the year. We have of course also have increase that's not related to the acquisition of our life business has expanded we've added pay both new studios on so on and on the $8 2 million Euro increase in that part of the business can be compared to the organic increase between the first COVID-19 in the first quarter 'twenty four evolution, which once.
About $7 6 million euro so relatively normal increase if we look historically.
Altogether that brings us to the reported operating expenses, excluding depreciation this quarter on $75 seven mm mid digit growth.
So as Martin mentioned, we will definitely not stop our efforts for cost efficiency. When it comes to the integrated business stuck with enough track synergies separately it would be part of our normal operations.
Alright, operator, let's go to the next slide please.
So this shows our P&L on a bit more detail on that.
Just walking through the table from from the top with the live revenue almost a 194 million euro a bunch of them and that's comparable to the 150 million Euro we'd reported in the first quarter on a 2020, so 60% increase on.
Angie revenue amounts to 52 million euro and when we compare our year on year on growth in Orange during 2021 it will be against the reported net debt figures.
During 2020, so what you see on this slide is not the pro forma where we include net debt for 2012 adjusted paired off that but you don't get to see that emphasize.
Total revenue moving on its $235 8 million Euro a increase of 120 million euro compared to the same period previous year.
Moving down to expenses also here the comparison to 2020 of course include stay quiet net business in this quarter, but not in the January to March 'twenty kind of free period.
As I stated earlier, our intention was always to integrate the two companies and so why do we do report revenue by product line, we will not attempt to separate the cost base into live on Orangey, So that would be one.
Yeah, that's one on one segment.
Okay moving through the expense lines their personnel expenses amount to $48 8 million of Euro that's an increase of $10 2 million compared to the same period last year.
<unk> interest in itself both in operations, that's where continuous day I think tables and also in our engineering and also administrative functions. Both include additional stuff from net though not owing to that for the full quarter.
Finishing reinsurance amounts to $18 5 million Euro that includes $8 9 million in amortization of intangibles related to the south acquisition.
Next time other operating expenses include items, such as consumable equipment communication costs consult on ROI emphasis line amounts to $26 9 million in the first quarter. So summing all that up the total operating expenses on a $94 two.
On the operating profit sums up to 100 on 47 million Euro.
Tax is up $8 7 million during the quarter, a tax rate of six 2% and.
All of this equals appropriate for the three month period on 100 on 32 million euro debt equals.
Earnings per share of 60 yourself per share for the first quarter on a fully diluted basis, and that's an increase of 100 per south compared to first quarter I'll try to kind of thing for the rolling 12 month period $1 83 per share.
Alright, let's go to the next slide.
Before I hand back to Martin and look at the cash flow on financial position, so starting to the left in the slide.
The chart shows developmental capital expenditure the great part of the Board's Strep a sound investment in tangible assets. This is our studio construction, mainly it's just under 7 million Euro $6 9 million euro in the quarter I should say.
I said earlier, we maintain a very high pace and our expansion on both current studio send also new studios for the remainder of 2021 I expect at least this level of investment being studios, possibly increasing some during the year.
The blue part of the bar is investments in intangible assets and its related to development of new games and features to the platform. It totaled $6 2 million during the quarter. This is up from previous quarters looking at 'twenty 'twenty, but of course now also includes the net development on new games.
Total capex for the full year 2020 watts.
Around 37 million Euro for Q1, 'twenty, one day totaling 13 million Euro let's assume this item, we will increase I'm doing deals on estimated capex for the full year 2021 until but there's approximately 60 million in Europe right now.
In the middle of the slide moving on to the next chart.
We show operating cash flow cash conversion at a good level nearly 80% and to the far right then decided to look at the balance sheet no major changes since year end the dividend for 2020 over hundred and 45 million Euro will would it be takes a day actually so that shouldn't be in progress as we fix it.
All right I'll stop there how about your marketing for some closing remarks, I will take questions off the debt okay.
Okay. So operator next slide last slide outlook for 2021 I think.
Thank you Jacob.
And then it takes a computer and a very strong quarter looking ahead and I feel very excited about the new games doesn't have a lineup for 2021 at the end of the second quarter. We released the first game coming up out of the cross functional caught up on a collaboration between life and non G. Provide anixter go on so stretched at home. They look forward to that in addition to product.
We continue to invest for the future inform on new studios a state than it was during the second quarter to open our new Michigan studio and we as we all are to see that.
Good development to elaborate on G games in Michigan, adding lives will be very exciting.
For the year with a good momentum on equates to the extent that product portfolio on talent. Following the completion of the nascent acquisition and they come in completion on BTG.
With enthusiasm to the rest of the year income.
Senior to push boundaries and creates the best games with the highest player entertainment value from future features spire on current that's why on a future plays by new Fantastic games as simple as that evolution score is based on share decided to win and to collectively constantly push ourselves to the next time it as paranoid as I've learned we've always wanted to do.
Baxter an increase to GAAP the competition with that I want to thank you for taking your time to listen and now let's move to questions. So the last slide please.
Thank you, ladies and gentlemen, if you do wish to ask a question Keith pricing and that kind of price.
On one on you kind of think he pack once again to register for a question.
Right.
On your pet parents.
Our first question comes from Andrew Young from Morgan Stanley. Please go ahead your line of thinking.
Good morning, Thank you for taking my questions on.
Obviously, it's very it's obviously, a very strong quarter.
Sort of thing that speaks for itself in some regards I'll like to us three slightly longer term questions. If that's okay. So on on the first on the net time roadmap can you talk a little bit more about the change it seems like a relative to recent decision sort of you're just coming on the last four to five months away on the business that required on a sort of a change in direction on what did you say to describe that change.
Is quality over quantity.
We aim to do the best Slops into markets.
We have that they ended up ambition and and looking at the slots I think that there are a number of things that we can do better there we'd not something there's been some limitations on maybe a little bit more look into the volume rather than on the quality and now we've changed nothing is based on adding the right things to make the best slot.
We often talked about like.
Okay, we want to make when we released the salt that should look like okay. This can be top five in the world 2021 and that's sort of where we're aiming it always going to do always on a succeed without of course on every time, but we have that ambitious on the changes are in line with that.
Yeah.
Okay, and then technical on I'll start with <unk>.
And Blake the only thing we don't.
Comments.
Traditional teaching what they used to be about innovation about everything else, but having said that do you believe there was any kind of tension between.
Oh ambition to become the biggest and best online casinos supplier on.
Operating expenses not to people holding 21 supply I E. What you considered requiring more stops companies on would at some point that would be the synergies from doing that and if that would how should we think about M&A targets. If you continue to grow your cash ball.
That's that's actually more than one question I would say that the first the first out.
It's just like it sounds like it's the same but.
I want us to be the best company in the World.
It's not an arrogant statement, that's done with Greg I want to be humble, but I cannot understand why we can't be that and its ambition. Its ambition, that's where we'll go on included in that day that we want to work with our operators we won't do it.
<unk> found the market I'm doing good things, so I want our operators to see also support and they're doing good things and having good relation with them. So we don't that that is important and that's a little bit the complement to the to the to the size on the power that we have and so on so that that stay on.
Stood up.
Yeah.
The buy beat the Gs about the intimates in it.
Power on the team and the great people that work there on what they have created and debt.
We were peaking we looked at BCG for long time.
I wouldn't even.
Well, it's a harmless I'll say that we know them a little bit by now and we will take it when we choose them. So that takes the way we look at mergers and acquisitions on what we are doing we were discounting the market.
Now the focus is to take care of what we have and sheets that works out well.
I'm sorry, I'm on my final one just obviously talk regularly about the importance of extending the captive competition upon to cause some of your competitors, they're not just sort of copying seems all concepts some of that guidance.
Just you do have someone like dream to use somebody interfaces are copied almost exactly you sometimes have.
Defending IP well all you're doing on what can you do to ensure that the innovation you altering gets the best return on on the kind of capped competition is maximized.
Yeah.
Stealing is never good with states it up before it.
The net to answer did that just that we want to does not look we want to be in the let's say we want to move the boundless further on we want to be part of digital I see the online casino market and on.
And I think that we need to get the industry to understand that that is called on the load that we have together I'm, taking on coke thing from each other's not pushing that boundary we need to be in a let's say add them on in each pot. So so I would I would rather look at it in that perspective in law suits and other.
Okay. Thanks.
Yeah.
Thank you. Our next question comes from Marciano from Dnb markets. Please go ahead your line of thinking.
Good morning, guys.
Just wondering what's going on out.
I I want to start off with a question on the organic growth acceleration I'm here you'd been at 50% for a while.
And now Youre up six stemming what what's changed here just in order to try to understand the higher rates in Q1.
And we continue to see the global demand as we've talked about on the.
And that comes out in Q1, and a very good quarter, and we see everything moving in that direction, because with the growth in all markets and we're expanding in all students at the moment and it all comes down to that system is rather.
A lot of things happening at the same time, then to single out one single thing.
Okay.
I mean are there any regions or markets that you want to single out that's S are especially important possible acceleration in the growth.
I wouldn't do that I would say that Europe is growing.
Trying to trim their livelihoods are Asian, and North America is doing fantastically well.
We also don't see like we're now engaging a little bit more focus in our South America and Africa, and that's only on the days, but what's interesting is.
And on the market when you look into the stock on the new quarter Q2, I mean.
Would you say you had a good start on.
And on that.
They snap on is sustainable on the iron ore, you're more expecting coming back to some level.
He has to earn interest state anything about Q2, and I think that we should say the 60% growth on the size of yours is there like a good quarter in Q1.
Okay and on the.
On the upcoming reopening and in many of your markets.
How would you expect that to impact your growth I understand the comments on R&D.
And was boosted in Q2 last year, but I'm thinking mainly on the life side.
We're working hard with expansion right now to say the least to seek to debt we'd get to get back I mean, we lost time when will depend on me, but non activity level increased on the states that they still valid that we made in 2020 that okay activity level increase hamper the or operating capabilities in evolution.
And it came out neutral or a little bit posted so force going back into other day should we expect the same.
Yep.
On capacity.
Utilization in the studios for the dedicated paint booths, where are you now compact with Q1 last year before the pandemic.
I would say where we are.
Yeah, as we said on that in Q4, we're back with the same number of tables. There on US we had pretty comes out. It comes on we've included something about so I would say compared to sleep on that make where it's a more or less back I would say, even even a little debt Uh huh Exxon does have us up so what kind of.
They were in that regard, where we're not so much comparing to pre pandemic anymore. It's more kind of from how we take it from here.
And at the same time, you've increased the net.
Studios capacity doing this band right.
Yes for sure I mean Abbott Studiosus, so yes, absolutely thanks Ed.
And on just on the on the margin discussion for the phone on the air.
Are you you mentioned that sits on a few month into the year. So you didnt want to revise that statement and you said that they're staying on many things that standard.
It can go wrong, what could this be in and you're on one.
It's it's it's hard to paint the picture of what's going wrong, but.
And if he can help them that's what I stated now we'd see an upside on the are there any items. That's that's where we are right now.
Okay.
It does.
Before Saturday I mean, when we have a very good quarter on revenue that also comes to on on margin. So that stuff's, a little bit of exception I would say to them.
Awesome.
Thanks margin up so I wouldn't yeah.
It of course, it looks compared to where they were a couple of months ago on we somehow 65 for some idea for the year I mean, there's an upside to that.
The net number.
Okay. Thank you. Thank you for confirming knock on final question I have it's on.
On your U S expansion can you comment a little based on how's it going in New Jersey, and Pennsylvania with the upgrade of the product.
And also Michigan on the house construction going when do you expect to launch there and finally, how about your preparations for Formula stage. Thank you.
It's a big deal that we're doing fine in U S. We're expanding and wants to do deals and we expect to go live in Michigan moving to.
Two.
Okay. Thank you.
Thank you very much on funding.
Thank you on next question comes from Oscar unexpected from Carnegie. Please go ahead. Your line is open.
Thank you good morning, guys a lot of questions have been already bought a few for me.
First of all starting with the net debt.
Could you discuss a little bit nothing marketshare in Michigan compared to Pennsylvania, and New Jersey are also hugs he smoked and live competition developing in the U S. They have a little it would be interesting to hear your take on that B E.
U S expansion. Thank you.
And then the market share from that sense in all of the states is a very good I I don't have the figures exactly what market share out there on actually a public soon.
I don't have them in front of me so I can't comment on it right now, but it's a very good market channel one and of course, the strange thing on position with the BTG acquisition and you us having one of the strongest games political news as well.
Going forward do you us I mean, it's a it's an open market and you need to deliver the best games to attract a players.
And we believe we have that so so we have a rather good market outlook for R&D starts to U S M and <unk> have a big market share in each state operating right now.
Bought it on the regarding the further sort of state by state rollout in the U S anything new to share there any new markets that you see.
And over the next one to two years okay.
It's always a big guests in gaming from everyone because no one really knows but the day. The states that are sort of in the in the discussion that would be Indiana, Illinois on Connecticut.
And then I would say that.
They are running a little bit side by side, sometimes on these things are happening and right now Connecticut.
On the phone on their end.
Is it some on would expect it to get our debt would regulate some wait time for 'twenty, one 'twenty constitute but that's my guess and told to this as good as anyone else.
Understood and then.
A question on on the margin side I suppose.
We went through the synergies from that which seems to be over he head on before Canadian pace, but do you see further potential there in coming quarters on where Q1 and stuff, but food full run rate or have you done stuff in the courtroom swap.
But I can answer it.
We've completed the.
The planned synergy initiatives are completed then of course that same any business. You know we continue to look to do things more efficiently and improve them on them.
On the Doctor So that we will continue to strive for that comes as you know there there's things going on but in terms of synergies that we're kind of closing that project us on though.
Yeah.
Yeah.
I'll leave it that the formalities. Thank you.
Thank you very much.
Thank you the next question.
Pump Marlin panic from price cost.
Securities. Please go ahead your line is nice day.
Hi, good morning, and first of all that I mean, one bump for that Q1 guidance here.
Hum.
And uptime performance questions kind of on three questions well I mean, if you can just comment briefly.
The year on my market performance during the quarter and life Kraft's U S launch 90 on so on that day.
Send growth drivers are in a quarter or something like that the U S. That's one is Asia.
Uh huh.
Germany is.
We don't have any further information on of course everything is sort of the.
Moving down there for the time being and so that's that's the comment on when he gets back as soon as we know a little bit more on what would knock on wood revenues another and so we as everyone else took it.
The heat or whatever you call it spot on.
Asia continues to grow our debt that we are still a small player much because they get to know.
We continue to see great potential in that market.
I'm not supposed to what must admit there's question I really like our crops are launched in the U S. Working on that that's just that's a regulatory aspect.
And we don't have any dates for that yet.
On the crops.
On the question on some big time gaming I mean, I understand you will continue to provide a companion mega weighted send me a cluster of mechanics.
Any change and be different strategies here and then once you mentioned looking to price and I'll kind of at a inhouse that's a competitive advantage.
No we won't change the business strategy when it comes to Mega ways.
Changes to be provided to all those folks as well. So yes. So we would be provided to other sports companies are on the on the backbone of that and we think that is a good business model and it will work.
Washington D G growth driving the parent Houston for next one to two years I mean for example are brought on to use it and they got enough just compared to make out with.
I wouldn't go into the potential in America as competitive takeaways, but.
There's also a good game mechanics of course on we'll hope to do even more like that.
Of course, we see it put down on shelf.
To take BTG into our network, which is big geared them on the current distribution channel stuff did you have a loan.
Oh, Okay, Oh pardon me now thank you.
Thank you very much expense.
Thank you. It's another reminder to register for a question. Please pass it on I kind of like the one on yet.
The next question comes from Karen <unk> from Bank of America on our niche. Please go ahead. Your line is open.
Hey morning guidance I'm, just wondering on me.
<unk>.
You spoke about the EBIT margin target and you're likely to see upside on your guidance are you also considering D. T. G. When you've mentioned battle He's got another bolt on to that figure.
No no debt.
Oh, sorry go ahead.
And then continue on.
Yeah, that's what I say, but no it doesn't consider because you I mean, the day that has not.
So it's Jeff So we will wait for that to close on something they kind of incorporate stopped him and canola.
Gotcha.
That's for us.
We are today.
Perfect. The other one is on new studios.
Could you maybe talk a little bit more about that needs to do to come on are you targeting any specific region or that it is I know in deposits that maybe the agent photo studio and I know you're bolting on and all the day to move off of is there any sort of Q4 that in terms of what you'll be offering.
In terms of the U S. This is a question.
<unk> often talked about how blackjack instead, most popular game in the U S. I think any sort of successful cross selling to your other games on a more scalable.
And what's the sort of trajectory for more game show gaming thing about India.
Okay.
As I stated we are building on two more students like not only expanding in actually average student warehouse. So so we are we're on a roof to.
Increase our supply to seat so that we can fulfill the demand that we see and I stated earlier during the call on that we're expanding in one day and day, one suite of Europe, I'm really wants to be in North America on but to be clear on that is that the studio North America used to supply.
On the demand and it's not the new states.
It's a it supplying demand that we see.
Yeah, it's a constant struggle right now COVID-19 is stable here, it's still difficult to both recruit and manage accounts for our M. P's of course goes first as social distancing and a lot of things. So we need to see it. So that we can demand on top of that of course, we're also seeing cause them not to of course to this where we can have redundancy and be more of a city on too.
Other situations like the ones that we have right now with COVID-19 learning from that so that is also.
What's important to see when it comes to more product in U S. We're constantly working with the regulators, but that's a new area for them. So it's a it's a bit of a.
It's always a bit on the not the soundness, it's more like a bit of work to get it down on them. We were on to that just so that we can launch the products, we want to launch in U S. A.
I hope to be able to tell soon when when we launch it won't but that's a constant work that we do.
Okay perfect. Thank you very much.
Thank you very much.
Thank you never appear to be no further questions on the turn the conference back to you.
Okay. Thank you very much for listening and taking your time and.
So you're on a quarter bye bye bye.
Thank you. This does conclude today's conference call. Thank you all for attending you may now disconnect your lines.
Yeah.
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