Inspired Entertainment has received approval from Nasdaq for its proposed plan to regain compliance with the US stock exchange’s rules. The plan, which was submitted last month, outlines that Inspired will file a 10-Q form for Q3 2023 with Nasdaq by 28 February.
In addition to this, Inspired is also working to complete a 10-K/A for the year ended 31 December 2022, with restated financial statements. It aims to complete Forms 10-Q/A for Q1 and Q2 of 2023 by the same date. Nasdaq has accepted this plan, allowing Inspired to move forward and regain compliance.
Nasdaq first contacted Inspired in November regarding the late filing of its Q3 2023 results. This late filing placed Inspired in breach of Nasdaq’s rules, prompting the stock exchange to give Inspired until 22 January to submit a plan to regain compliance. Failure to do so would have resulted in the de-listing of its shares. Inspired missed the deadline by one day but formally filed its proposed plan on 23 January.
The late filing was attributed to accounting errors connected to accounting policies for capitalizing software development costs and compliance with US GAAP. Inspired identified “material weaknesses” in internal control over financial reporting and is working to address these issues. The company aims to ease investor concerns by assuring that the planned changes will not impact its cash position or business plan.
Inspired has not released any financial results since August 2023, and its Q2 and H1 figures revealed a 12.3% rise in Q2 revenue to $80.1m and a 11.0% higher H1 revenue at $146.4m. However, net profit saw declines in both periods due to higher spending. Adjusted EBITDA was up to $26.2m. These financial figures demonstrate the company’s growth despite the compliance challenges it faces.