Intralot-integrated Lot Stock

Ladies and gentlemen, thank you for standing by. I am Gail, your Chorus Call operator. Welcome, and thank you for joining the Bally's Intralot Conference Call and live webcast to present and discuss the first half 2026 financial results. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Robeson Reeves, CEO of Bally's Intralot. Mr. Reeves, you may now proceed.

Thank you, and hello, everyone. I want to start with the 17th of August because two things happened in August that between them tell you where this company is going. On the 17th of August, evoke shareholders voted on our proposed acquisition. At the court meeting, 99.91% of the shares voted were voted in favor. At the general meeting, the special resolution passed with 99.63% in favor of the scheme.

I want to be precise about what that is and what it is not. It's not a formality. Shareholders in a business of that scale looked at the case we made, looked at the operating model we said we would bring and backed it almost unanimously. This is a significant milestone, but we're not at completion just yet. The transaction is proceeding through a scheme of arrangement. Our own shareholders meet in September, a number of the conditions relating to antitrust and regulatory approvals have now been satisfied and work on the remainder is progressing.

The court will hold the sanction hearing once every closing condition is satisfied or waived. And as we said on the 17th of August, we continue to expect the sanction hearing and the scheme becoming effective in the fourth quarter of 2026 or the first quarter of 2027. Until that point, evoke and Bally's Intralot remain two entirely separate, independent, and competing businesses, and we are running them that way.

So today, we will not -- we will not be further discussing integration, synergies beyond the approximately GBP 180 million of identified savings already announced, or anything about the combined business, as we must respect the ongoing process.

The second thing I want to put in front of you is simpler, and in some ways, it matters more. On the 1st of April, U.K. remote gaming duty went from 21% to 40% of gross gaming revenue, not of profit, of revenue.

I have spent the better part of the year telling this market that we will grow into that change rather than shrink into it, and that a business with our margin profile will come out of it stronger while others retreated. The second quarter of 2026 is the first full quarter under the new regime. So here is the test result.

U.K. online revenue grew 11.6% year-on-year on a constant currency basis in the second quarter. That is an acceleration from the 10.5% year-on-year growth achieved in the first quarter. For the half, U.K. online growth was 11.1%. Our U.K. business delivered an all-time high in net gaming revenue in the quarter in which its tax rate nearly doubled. I want to be very clear about what that actually means because it's easy to lose in a results release.

We did not hold the line, we accelerated. Year-on-year, player volumes held. We did not lose customers to competitors, and we did not lose them to the unregulated market. Spain also delivered an all-time high in the second quarter with online revenue up 15.1% year-on-year. Growth is the thing that matters most in this business because everything else -- mitigation, deleveraging, the transaction, the returns we can make -- is downstream of it. Cost programs are finite. You can only cut a business once. Growth compounds, and at a time where we were most likely to falter in the U.K., we showed strength.

Let me deal with the costs directly because you would have seen it in the numbers. The duty increase cost us approximately EUR 34 million in the second quarter alone. That is the gross unmitigated impact of a single line of fiscal policy on 1 quarter of this business, and I'm not going to dress it up. Against that, management actions and underlying trading absorbed close to 65% of the impact in the very first quarter of the new regime.

Revenue growth in core markets contributed approximately EUR 10.1 million, operating cost optimization and related adjustments contributed approximately EUR 11.3 million. We expect that cost benefit to be permanent, full year saving rather than a timing effect.

Now 2/3 is not all of it, which is what you would expect one quarter into a program of this size. Here is why I'm confident that we can close it though. Our mitigation was never a single action. It was 4 buckets, and they phase at different speeds. Generosity reductions only began to phase in during the second quarter. So we have carried a partial period benefit into a full period rate.

Marketing optimization has further to run, and it is the lever most within our own control. Cost optimization from business combinations and spend discipline continues to come through. And the top line is doing more of the work than we assumed it would. So the honest characterization is this. We mitigated roughly 2/3 of a very large number in one quarter from a standing start, while accelerating growth and the levers required to mitigate the remainder are identified and will be executed. That is a materially better position than absorbing a shock and hoping the market improves.

The one thing I would add, and I have said it before, is that this only works if the regulated market is policed. A 40% rate for operators inside the perimeter and nothing for those outside is not a sustainable structure. The commission has been progressive, and I would encourage it to stay vigilant on offshore activity so that the burden falls on a level playing field.

On the second half, let me give you the shape rather than a slogan. Growth in the first half has held up very well. And together with the cost containment measures we implemented, it allowed us to absorb around 65% of the tax impact in the first quarter of the new tax regime. Our original plan assumed a stronger contribution from market consolidation than we have seen so far, and that remains a scenario we're working towards.

Under that original consolidation scenario, together with the organic growth of 12%, we would expect Interactive's contribution to Adjusted EBITDA to reach approximately EUR 295 million. This includes further cost reductions in H2 while also absorbing additional costs relating to the Greek online project, which were not in the original guidance.

If market consolidation does not materialize over the next 6 months or comes through more slowly than we originally anticipated, then on the same 12% organic growth assumption, Interactive's contribution would be around EUR 280 million. The difference between those 2 figures is mainly the pace of market consolidation.

The legacy Intralot contribution, we expect to be in the range of EUR 112 million to EUR 120 million, reflecting the Turkish market risk already recorded in the second quarter and the seasonality of the United States jackpot business. Both estimates include the foreign exchange impact of sterling and dollar against the euro.

I would make one further observation on consolidation. It has been slower to arrive than we anticipated. Competitors have been more willing to absorb margin compression for longer than the arithmetic suggests they should. I'm not troubled by that for 2 reasons. First, our own growth momentum has more than covered the softer consolidation upside. We've achieved these results through sustained focus on our products, customers and execution, not by waiting for favorable market conditions.

Second, deferred is not canceled. A 20% to 25% margin business paying 40% of its revenue in duty does not have an indefinite runway, which brings me to the point I most want you to take from this call. This company has 2 engines. Our lottery and B2B business is a genuinely excellent asset, long contracts, high barriers, government counterparties, no U.K. duty exposure at all, and Chris will take you through it. It is the ballast in this business, and I would not be without it.

But B2C is the transformation. It is where the growth is. It is where the margin is, and it is where our operating model creates value that nobody can simply buy. In the first half, our legacy International Interactive business generated EUR 377.6 million of revenue at an Adjusted EBITDA margin of 35.2% in the half that included the duty increase. That is a margin most of this sector cannot reach in a good year, let alone in a year when its largest market's tax rate doubled.

That capability is the entire strategic logic of what we announced in June and what evoke shareholders endorsed in August. We are not diversifying. We're taking an operating model that has just proven itself under the hardest fiscal conditions this industry has faced in the U.K. and applying it at a significantly greater scale. The prize is a materially larger B2C business run to our standards, not a bigger version of the same thing. And I would ask you to read through the growth numbers I gave you earlier in that light. The case for scaling this model does not rest on a projection. It rests on what the model did last quarter.

On the balance sheet, I'll be straightforward, and Andreas will give you the detail. Adjusted net leverage was 4.05x on a pro forma basis at the end of June. That is elevated relative to where we intend to operate and the largest single reason is visible and deliberate. We paid EUR 85 million in the quarter for a 15-year monitoring license in Victoria, Australia. That is 15 years of contracted regulated cash flow bought in one payment. I would make that decision again.

Total liquidity at the end of June was EUR 287.3 million. Our commitment on financial policy has not changed and neither has the lens. We will protect the interest of our shareholders, our bondholders and our other stakeholders. And any transaction we pursue will be consistent with our stated financial policy within our perimeter. On the financing structure for the transaction, we'll say more when we're in a position to.

In summary, U.K. online revenue growth accelerated to 11.6% year-on-year in the quarter. Our largest market's duty rate nearly doubled. We didn't falter. Approximately 65% of the EUR 34 million quarterly duty impact was mitigated in the first quarter of the new regime and the levers to close the remainder are identified and within our control.

Group revenue for the half was EUR 544.2 million with adjusted EBITDA of EUR 184.8 million. Legacy International Interactive delivered a 35.2% adjusted EBITDA margin through the duty change, the capability that makes the evoke combination worth doing. Evoke shareholders approved the acquisition with 99.63% of general meeting votes in favor. We expect the scheme to become effective in Q4 2026 or Q1 2027.

Interactive is expected to contribute approximately EUR 295 million to adjusted EBITDA under our consolidation scenario and around EUR 280 million without it, with legacy Intralot in the range of EUR 112 million to EUR 120 million. Growth remains a priority because everything else follows from it.

I'll now hand over to Andreas to take you through the financials in detail.

Thank you, Robeson. Good morning, and good afternoon, everyone. I will take you through the first half in 4 parts: the Group results, the second quarter bridge, the segments and then the balance sheet and the cash flow. Moving directly to Page #3, where we have the consolidated financial results. On a reported basis, revenue for the first half of 2026 reached EUR 544.2 million compared to EUR 182 million in the first half of 2025. Bally's International Interactive contributed EUR 377.6 million of that total with Intralot legacy contributing EUR 166.5 million.

I would note that Bally's International Interactive is consolidated only from October 2025, so the comparative period comprises Intralot legacy alone and the Group movement is not a like-for-like comparison. At the legacy level, revenue of EUR 166.5 million compares with EUR 182 million, a decline of 8.5%. That decline is concentrated in the B2B and specifically in the U.S., our largest market, which was down by 11.7% on a constant currency basis on softer lottery activity and reduced equipment sales against a stronger prior year period, partially offset by organic growth across the rest of the legacy B2B portfolio.

Legacy B2C was broadly stable at EUR 38.5 million against EUR 39.5 million, with Argentina up 7.6% and Bilyoner down 5.5% on a reported basis, reflecting the amendment to its remuneration structure and the depreciation of the Turkish lira, even as amounts wagered grew 28.9% in local currency terms against a market up by 20.4%. At the Adjusted EBITDA level, the Group delivered EUR 184.8 million in the first half of 2026 against EUR 60.2 million in the comparative period, a margin of 34%, up 0.9 percentage points year-over-year.

Within that, Bally's International Interactive contributed EUR 132.8 million at a 35.2% margin and Intralot legacy EUR 52 million at a 31.2% margin, which compares with 33.1% in the first half of 2025. That 1.8 percentage point contraction reflects the same 2 drivers: softer U.S. B2B volumes and the Bilyoner remuneration amendment, which took effect at the end of the first quarter of 2025 and therefore, weighs on the whole of the current period.

Below Adjusted EBITDA, depreciation and amortization was EUR 85.6 million, reflecting the amortization of the acquired intangibles from Bally's International Interactive. Transaction fees were EUR 13.9 million and net interest expense, EUR 69.6 million, reflecting the group's new debt structure. After a tax charge of EUR 5.5 million, the first half of 2026 recorded a loss after tax of EUR 20.7 million.

On a pro forma 12-month basis to the 30th of June 2026, the combined Group delivered EUR 1.075 billion in revenue and approximately EUR 400 million in Adjusted EBITDA, representing a 37.2% margin. Moving to Slide #4 and focusing on the revenue mix. Across our 3 dimensions and taking the reported first half of 2026 first. By game type, iGaming and Sports Betting is the largest contributor to our top line at 74.9%, followed by lottery games at 20.3%. VLT Monitoring contributed 4.1% and Casino and Other Activities, 0.7%.

By geography, the U.K. is our largest region at 64.8% of group revenue with America 18.3%, Europe at 8.7% and the rest of the world at 8.1%. By activity line, B2C now represents 76.4% of the reported revenues with B2B at 23.6%. On a pro forma basis, the picture is very consistent. iGaming and Sports Betting at 74.3%, Lottery at 21%, the U.K. at 64.1%, America at 19.1%, and B2B at 75.6%. This confirms the Group's structural shift towards the U.K. digital consumer market, and that mix shift is the primary driver of the margin profile that we are delivering.

Moving to Slide #5. We have the revenue and adjusted EBITDA bridges from the first quarter to the second quarter of 2026, starting with the revenue. Group revenue increased by 3% quarter-on-quarter to EUR 276.1 million, up EUR 8 million from EUR 268.1 million in the first quarter. The B2C segment contributed EUR 6.3 million of that uplift and B2B EUR 1.7 million. Within B2C, the U.K. delivered an all-time high with online revenue up 5.3% quarter-on-quarter, an increase of EUR 9 million and up 11.6% year-on-year on a constant currency basis.

Spain set a new quarterly record with revenue up 9.7% quarter-on-quarter or EUR 1.1 million. Bilyoner declined by 21.8% quarter-on-quarter, EUR 3.6 million, reflecting market seasonality. The B2B segment grew by 2.6% quarter-on-quarter, delivering steady growth of EUR 1.6 million.

Turning to the adjusted EBITDA. The sequential movement from EUR 102 million in the first quarter to EUR 84.6 million in the second is the most important table in this release, so let me walk it. The Group delivered EUR 84.6 million in the second quarter, down EUR 15.6 million quarter-on-quarter with a margin at 30.7% against 37.4% in the first quarter. The B2C segment accounted for a EUR 16.6 million reduction, partially offset by a EUR 1.1 million contribution from the B2B.

The dominant driver in B2C is the U.K. gaming tax, which had a EUR 34 million impact in the second quarter following the increase from 21% to 40%. I would highlight that 65% of that tax increase was offset through management actions and underlying trading, including EUR 11.3 million from operating cost optimization and adjustments and EUR 10.1 million from top line growth in the U.K. and in Spain.

Bilyoner contributed a EUR 3.2 million adverse adjusted EBITDA impact following weaker market, but expected stronger in the second half. On the B2B side, the EUR 1 million contribution proved resilient against the absence of major U.S. jackpots in the period.

Moving to Slide #6. We have the key financial metrics dashboard. Revenue moved from EUR 268.1 million in the first quarter to EUR 276.1 million in the second quarter with a pro forma 12-month figure of EUR 1.075 billion. Adjusted EBITDA was EUR 102 million at 37.4% margin in the first quarter and EUR 84.6 million at 30.6% margin in the second quarter with a pro forma figure at EUR 399.9 million and a 37.2% margin.

Operating cash flow was EUR 84.4 million in the first quarter and EUR 49.2 million in the second quarter with a pro forma figure of EUR 354 million. Second quarter's figure includes a negative working capital movement of EUR 16 million, which is timing. Net CapEx was EUR 15.4 million in the first quarter and EUR 102 million in the second quarter, the step-up driven by the nonrecurring license fee for the Victoria monitoring license.

Adjusted net debt stood at EUR 1.6189 billion at the end of the second quarter against EUR 1,493.1 million at the end of March with a pro forma adjusted net leverage ratio at 4x. As mentioned, this is temporarily elevated with the largest reason being the payment of the EUR 85 million in the quarter for the 15-year monitoring license in Victoria, Australia.

Last but not least, moving to Slide #7, we have the cash movement and the net debt evolution, starting from the opening cash of EUR 242.2 million at the end of March. Normalized operating cash flow contributed EUR 59.4 million in this quarter against that CapEx of EUR 102 million, working capital outflow of EUR 16 million, investing in M&A activities of EUR 26.9 million and treasury share purchases of EUR 3 million for the period, while the net interest amount paid in the second quarter was EUR 44.9 million, a positive FX impact of EUR 3.4 million and the RCF drawdown of EUR 65 million bring us to the closing cash of EUR 177.1 million as at the end of June.

Two points on that. First, net interest paid of EUR 44.9 million in the second quarter compares with EUR 23.7 million in the first quarter and simply reflects the elevated debt interest payment profile that falls in the second and in the fourth quarter. Second, on CapEx, the increase is driven by the nonrecurring EUR 85 million license fee for the 15-year monitoring license in Victoria, Australia, partially funded by the RCF drawdown.

Still on this slide and turning to the net debt. Funded debt moved from EUR 1,692.1 million at the end of March to EUR 1.7613 billion at the end of June, following EUR 65 million drawdown of the RCF and an adverse FX effect on our GBP-denominated term loan. Adding lease liabilities of EUR 70 million and other debt items, total debt stood at EUR 1.8112 billion and unrestricted cash, as already mentioned, as of the 30th of June was EUR 177.1 million with restricted cash in a DSRA account for the retail bond of EUR 15.2 million, giving us a total cash of EUR 192.3 million.

With a EUR 95 million undrawn on the revolving credit facility, total liquidity was EUR 287.3 million. Adjusted net debt was EUR 1.6189 billion against EUR 1,493.1 million at the end of March against LTM pro forma adjusted EBITDA of EUR 399.9 million. That puts an adjusted leverage at 4x. The movement in the quarter is driven by nonrecurring outflows, which are the Victoria license, the working capital timing differences, investing in M&A activities and the share buyback program.

And with these final remarks, the first half of 2026 financial results presentation is ended, and I will now hand over to Chris for his remarks.

Thank you, Andreas. Hello, everyone, from me, and thank you for attending our second quarter earnings call. I will give you briefly the Lottery and B2B picture on the commercial side. The first half was one of the strongest periods of new contract activity. We announced a 15-year electronic gaming machine monitoring license in Victoria, Australia, the EUR 85 million investment Andreas and Robeson referred to and 15 years of contracted regulated cash flow.

An up to 12-year contract with the state lottery of Chile and an extension, a new contract with the Hellenic Lotteries in Greece, running for up to another 12 years. And most notably, we were selected as the lottery technology provider to OLG, the Ontario lottery for a 10-year contract. And that's a very important contract in a country that has increasing significance for our revenues, we are now serving -- we will be serving 2/3 of the Canadian market combined with BCLC, where we've had, as you know, a very positive experience.

We have a lag in our numbers in the U.S. and in Turkey. We expect H2 to be much better. It traditionally is, especially the fourth quarter. So we are having the U.S. seasonality and some market contraction in Turkey in the second quarter, which our teams have already worked on, and we are very optimistic about how the numbers will come in the end, and that gives sort of the upper end of the range we're giving in the updated guidance.

We are also working very hard on the renewals of our contracts in Arkansas, New Hampshire and Idaho. And all this puts together a rather expanded and increased CapEx profile for the year, which is totally within the boundaries we were expecting according to our business plan. Also in the United States, we are pursuing certain very large contracts. And obviously, that takes up a lot of effort and investment in these biddings, and that has impacted on the first half results.

So with these comments, I will now hand back to Robeson. Thank you.

Thank you, Chris. Let me close with where I think this half leaves us. For a year, I've been asked a single question in different forms. What happens to this business when the U.K. doubles its tax rate? We now have a quarter of evidence, right, rather than a quarter of argument. Our U.K. growth accelerated. We mitigated approximately 2/3 of the impact immediately, and we know which levers to close the rest.

Our Interactive margin stayed above 35% through it and our lottery business did exactly what a ballast is meant to do and kept us stable and balanced. I said that a less competitive market would benefit operators with our scale and margin profile. One full quarter into the new regime, I'm more confident in that view than I was when it was still a forecast. And in the same month, evoke shareholders voted almost unanimously to back the case for scaling our operating model.

There is real work still to do before that transaction completes, and we will do it properly and in the right order. But the direction is set, and it's set on the back of performance rather than a promise. For me and for this business, growth is what matters most. We have not faltered in the market where faltering was most likely. That's the half.

And now we'll open the floor for questions. Operator, please go ahead.

[Operator Instructions] The first question is from the line of Colin Mansfield with CBRE.

Maybe first, just wanted to touch a little bit on capital allocation as you guys think about the dividend from a go-forward basis. I know the EUR 30 million dividend will be -- was approved and already getting paid out, I believe, in July. But you previously mentioned the potential for a pre-dividend based on first half '26 performance.

And when you look at the levered free cash flow bridge that you provide, you compare it to where net income is trending year-to-date, it's 2 different stories. And I know the dividend policy, the recurring one is based off a ratio of net income. But just curious how you guys are thinking about the potential for that pre-dividend and maybe how we should think about the potential sizing of that and what we should be basing that off of?

Chris, do you want to take it?

Yes. Sure, Robeson. At this point, we are not ready to comment on a pre-dividend. We promised that this will come after the first half results, but please give us some more time on that. But I would like to comment that we are also making share buybacks, and that's another way to allocate capital. We made a large number of purchases directly around 23 million shares, about 1.23% of our share capital.

We bought back, and these are already treasury shares. And we also have a TRS swap agreement with Deutsche Bank. And weekly, we announce the purchases, which are happening at a steady pace by Deutsche Bank in the period of 10 months. And that we consider a return to the shareholders as well.

Great. I appreciate the color. And then maybe just one follow-up on the cost side, seeing a pretty big pullback in the personnel expense line item for the B2C segment. You guys gave a lot of good color on sort of the cost optimizations that you're enacting as a result of some of the tax changes. But is this a good level we can kind of expect from a run rate perspective? Is there maybe some seasonality or normalization that we should expect in that line item? Or is this sort of a good sort of run rate to think about on that segment specifically?

From a Q2 perspective, we're probably at run rate. We did make some changes in Q1 that are still annualizing, but the Q2 level should give you an indication of where we expect to trend.

[Operator Instructions] The next question is from the line of Alex Apostolidis with LGT.

Three questions for me, if I can ask them separately. The first one, just around the U.K. online business, obviously growing very nicely in Q2. Can you give any sort of early commentary for the months of July and August? Is this trend continuing?

Yes, I can answer. Yes, the trend is continuing. That's easy answer.

Super. And then the second question is just around the budget. We obviously have a new Prime Minister here in the U.K. Any early indications that this Labour government will target the sector again? You seem to be managing the impact overall well, and then I appreciate your point that the indefinite runway is not there for your competitors, but the doomsday scenario that everyone is painting up here as going out of business doesn't seem to be the case. So maybe that invites more measures. Is that something that is in discussion?

Well, I'd say many operators, we've -- including ourselves, right, have looked at reducing costs and reducing that further. I think the most recent announcements from the U.K. government, and we don't know what they're going to do, but they have talked about "aim to permit" and the high street -- so they have made comments around -- I think it's more directed towards adult gaming centers and slightly towards the actual betting shops.

But I do suspect they -- if they're going to look at anything, they might look at machine gaming duty. But it would be pretty crazy to come back and look at anything else in the online sector, given the degree of trauma that's already happened.

So overall, limited impact on the -- obviously, not on the Intralot side, nothing on the Bally's U.K. business, but potentially on the evoke business. Is that the way to think about it?

Yes, potentially. Now please understand, I flagged this because within our synergy number, remember, we talked about the GBP 180 million. We deliberately didn't include retail in this. Evoke have already made structural changes there. So that potentially is upside, which could -- if there are any traumas, which come from a tax on machine gaming duty or anything like that, should be able to absorb the impact in that. So with respect to our scenario, I believe we're already shielded.

And then last question for me, just regarding the cost cutting, the cost mitigation. You had guided to EUR 50 million target for 2026. I think you did EUR 11 million just over in Q2. Do you still expect to hit this EUR 50 million in fiscal year '26? Or are we slightly behind on that target?

We definitely will continue to cut costs. We -- as we said, -- we can control the marketing lever. My balance that I need to strike is I believe that we need to maintain our growth rate and continue growing. I think if you stagnate your business, you always end up with a problem. So we will -- we do have room to cut. We will cut, but not with any impact on growth. So we feel good there. The biggest factor, which has meant that I gave the range of EUR 280 million to EUR 295 million is how quickly the market actually consolidates. So if people will leave the market, people haven't started to leave, they're just almost sweating the assets and seeing if they can extract anything. But if you sweat something and don't invest in it, it eventually dies anyway.

[Operator Instructions] Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Excuse me, I apologize. We have one more question from Russell Pointon with Edison Group.

A very quick question actually, and it will be for Andreas. Andreas, would you be able to isolate the impact on the U.S. decline in revenue between the state lotteries and the absence of the machine sales last year?

Russell, thank you for the question. So the impact of the merchandise sales last year, it was around EUR 6 million to EUR 7 million, which is not the case for this year.

Great. And is that a half year figure? Or is that -- do we need to annualize that for the full year, Andreas?

No, it's until now.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

Well, thank you all for joining us today. It's been an important second quarter for us. We believe that we're on the right path. We're delighted to see the confidence that evoke shareholders have put in us with respect to how they voted in favor of the scheme of arrangement. It should be a very exciting period for this business, and thank you for joining us again.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Hello, everyone, and thank you for joining us on what is a hugely exciting day as we outline the proposed acquisition of Evoke by Bally's Intralot. My name is Robeson Reeves, CEO of Bally's Intralot. I'm joined today by my colleagues, Chrysostomos Sfatos President of Lotteries and COO; and Katherine Gomaniouk, CFO of our B2C segment. For the Q&A, we'll also have the Evoke team with us, being joined by Per Widerstrom, CEO; Sean Wilkins, CFO; and James Finney, Investor Relations Director. You've heard me speak before about the opportunity with Evoke as we went through negotiations, and I'm delighted we could agree a deal.

As I've said before, we see a compelling opportunity to bring our operating model to a significantly larger business while transforming performance through synergies. This is exactly what we plan to do, and I truly believe both sets of shareholders stand to benefit from significant value creation over the coming years. I'll talk you through more of that detail over the following pages before opening up for questions.

Turning to Slide 3. I'll give you a quick overview of the key headlines of today's announcement and the transaction terms. There is a lot of detail in the announcement today, and we have outlined the headline points here. Starting with the key terms. It's an all-share offer for Evoke at 52p per share, with a cash alternative capped at 50% of consideration. The offer values Evoke at approximately GBP 243 million of equity value or around GBP 2.2 billion of enterprise value. To ensure funding certainty, we have secured a EUR 200 million bridge and GBP 157 million senior facility at the Bally's Intralot level, which will provide cash to fund any cash alternative take-up as well as settle the existing derivatives and cover transaction-related costs. The debt structures of Bally's Intralot and Evoke will remain separate for the near term.

This is to provide the most optimal structure for both sets of stakeholders. Bally's will provide the necessary cash injection into the Evoke Group to fund the transaction and refinancing costs. Within the Evoke credit structure, we have secured a commitment for an GBP 889 million denominated second lien facility, which will be used to refinance Evoke's existing 2028 maturities, materially derisking the near-term maturity profile of the combined group.

In addition, we have obtained required change of control consents across the remainder of the Evoke capital structure. This means the existing bonds due 2030 and 2031 remain in place on the same terms and the RCF also remains in place with a further agreement to upsize it to GBP 220 million, supporting improved liquidity. On a pro forma basis post-transaction, Bally's Intralot will have a consolidated net leverage of approximately 4.5x. We are not changing our existing stance towards leverage though, and we expect to delever over the medium term as we deliver significant synergies and benefit from the enhanced scale and attractive cash flow generation of the combined group.

Turning to synergies. We have identified at least EUR 210 million or GBP 180 million of cash synergies with GBP 12 million of these being CapEx related. We have a clear delivery plan across marketing spend, operations and technology that Katherine will touch on later. Importantly, we expect to capture a meaningful proportion of these within the first year following closing and the cash cost to achieve are expected to only be circa GBP 25 million, delivering a significant ROI.

The Board of Evoke have unanimously recommended the offer, and we're delighted that the founding family shareholder of Evoke has agreed to support the deal, and I look forward to them being a valued Bally's Intralot shareholder. The deal is subject to overall shareholder approval as well as further customary regulatory approvals, but we're confident in achieving these, and we're targeting completion towards the end of '26 or the start of '27. Turning to Slide 4. This shows a summary outlining the scale and diversification of the combined business. As I said at our financial year 2025 results call, our criteria for M&A was simple: regulated markets, strong brand positions, accretive economics and logical operational fit. Evoke ticks all of these boxes and the improved scale, diversification and financial profile of the combined entity provides a fantastic platform for future growth.

Evoke generates EUR 2.1 billion of revenue and EUR 416 million of EBITDA at a 20% margin. While Bally's Intralot contributes EUR 1.1 billion of revenue and EUR 431 million of EBITDA with a higher margin profile of 40%. On a combined basis, we are creating a EUR 3.2 billion revenue business, delivering EUR 856 million of adjusted EBITDA at a 27% margin.

This makes us one of the global leaders in online betting and gaming. Crucially, the group remains highly weighted towards locally regulated markets, underpinning the sustainability of revenue. We have a clear leading position in the U.K. and the group benefits from a more balanced geographic and product mix with strong underlying cash flow generation. Moving to Slide 6, which outlines the compelling strategic and financial rationale for the transaction and the benefits it will bring to both sets of stakeholders. First, this transaction is set to create a global gaming and lottery champion with significant scale and leading positions across some of the largest and most attractive markets in Europe.

Second, together, we will have significantly strengthened our position in the U.K. with the addition of Evoke's flagship brands, customer database and leading sportsbook as we look to capitalize on the evolving market conditions post duty changes. Third, we combine Evoke's iconic brands with Bally's Intralot's market-leading technology and data capabilities, which will enhance customer acquisition and optimize customer journeys. Fourth, the transaction unlocks clear and highly executable synergies, delivering significant value creation and significant earnings accretion in the future.

And finally, together, Evoke and Bally's Intralot will have an enhanced financial profile through increased scale and product diversification. Turning to Slide 7 and an overview of the scale and geographic breadth of the combined group across Europe. Post transaction, we would have leading positions and meaningful scale across 6 core markets being the U.K., Ireland, Italy, Spain, Romania and Denmark. These are all large, attractive and growing markets and in many cases, have structural tailwinds from online migration. And you can see on the slide the strong forecast growth rates outside of the U.K. In the U.K., the combined group would be the #2 overall operator and #2 in iGaming. We'll be #3 or #4 in other core markets.

But with the combination of brands and capabilities, we'll be better positioned to capture share. We also see an addressable TAM of EUR 36 billion once you include the other markets where Evoke has operations, representing significant runway for further growth in the coming years. With the trend in recent years towards local regulation and ever-increasing regulatory and compliance complexity, this makes the local and global scale ever more important. Turning to Slide 8 and the U.K.

Clearly, we see the U.K. consolidation as a key driver of value for this transaction. Not just in terms of synergy potential, but also the wider opportunity of taking market share following the recent duty changes. Both businesses are seeing strong performance in the U.K. so far in 2026. And with the combination of capabilities and brands, we see a massive opportunity to accelerate performance here and cement our leading position. The U.K. is still the largest locally regulated online market in the world if you count each state separately in the U.S. And we have proved that we have operating margins to still extract significant value from the U.K. I'm really excited about the future potential here with the powerful portfolio of leading brands and greater scale across all key verticals, particularly sports, enabling us to compete more effectively and capture a larger share of wallet.

I am also excited about the opportunity to see how we can better utilize the retail presence and create a compelling omnichannel offering for William Hill customers. Overall, this combination creates a stronger, more competitive and more diversified U.K. business. Turning to Slide 9. This slide shows the value creation opportunity from leveraging Bally's Intralot's data-driven operating capabilities.

Evoke has talked at length about its drive to improve customer life cycle management and personalization. By deploying our Vitruvian platform and advanced data capabilities, we can significantly improve customer segmentation, personalization and real-time decision-making for the Evoke brands, and we believe we can do this quickly. That translates directly into more efficient player acquisition and a better overall customer experience with personalized and curated journeys to remove friction and drive engagement and retention. In terms of marketing efficiency, you can see this in the headline numbers with Bally's Intralot U.K. B2C operating at around 11% marketing ratio, which is industry-leading compared to approximately 23% for Evoke in the U.K. So there is a clear and tangible opportunity to drive meaningful greater efficiency, leveraging our technology to reduce acquisition costs while maintaining growth.

Ultimately, this is about combining strong brands with best-in-class technology to improve unit economics and deliver more scalable, profitable growth. I'll now hand over to Katherine to touch on synergies.

Thanks, Robeson. As we've previously outlined, this transaction delivers a clear and highly executable synergy opportunity, which will unlock significant value creation and material earnings accretion. We have identified at least GBP 180 million of cost and CapEx synergies across 3 core areas: marketing spend optimization, operational efficiencies and IT infrastructure and tooling. We see significant opportunity to increase efficiency in marketing spend as we combine our data-led capabilities with Evoke's recognizable brands. In the U.K., especially, we see an opportunity to right-size the marketing mix and profile to align with the competitive dynamics following gaming tax changes, and we expect enhanced returns driven by improved capabilities.

On the operating cost side, simplification and accountability are key drivers. We see quick wins from streamlining processes and removing duplication across the two businesses, supported by our continued use of AI and automation. Within IT infrastructure, we also anticipate quick wins around overlapping services, tooling and data centers.

It should be noted that all of these synergies will land in the Evoke numbers from a credit silo perspective. We do see a longer-term opportunity around further technology integration and benefits from the Bally's Intralot side of the business, neither of which is currently factored into our synergy expectations, but we will be assessing these opportunities in more detail as we bring the businesses together. These savings represent actionable opportunities in the near term with our confidence in delivery underpinned by our track record of achievement of similar optimization within our business over the past 2 years. I'll now hand over to Chrys to touch on the combined financial profile.

Thanks, Katherine. Turning to Slide 11 and the financial profile of the combined business. This slide is presented on a pro forma basis for Bally's Intralot to reflect Bally's International acquisition and Evoke results have been converted to euros. We've also included a pro forma column that takes the 2025 numbers for both businesses and adjusts for the annualized impact of the new U.K. duties as well as our mitigation efforts on the Bally's side and the synergies on the Evoke side.

You can see that we are able to more than offset the impact of the new U.K. duties on a combined basis through this deal and the access to the scale and synergy opportunities. As you can see and as we have already outlined, -- the combination significantly increases the scale of the business with EUR 856 million of pro forma combined adjusted EBITDA adjusted for the impact of U.K. taxes and cost synergies. We can also see the consistent revenue and EBITDA growth profile and strong free cash flow conversion, which will enable a clear deleveraging trajectory. Within the Bally's Intralot business, the cash flow profile is also supported by long-term lottery contracts with a significant pipeline of stable revenues.

Overall, all of these points to the combination delivering a more robust and balanced financial profile with improved visibility of both cash generation and deleveraging. I will hand back to Robeson to conclude.

Thank you, Chris. Turning to the final slide and just to reiterate the key points again.

This transaction will create a diversified global gaming and lottery champion with leading positions across 6 core markets and a portfolio of 11 fantastic brands. In the U.K., the combination delivers a #2 position in iGaming and #4 in online sports betting, materially strengthening our competitive positioning. Combining the Evoke's brands with Bally's Intralot's leading technology and data capabilities will optimize player journeys and drive significantly improved marketing efficiency. We have also identified at least EUR 210 million or GBP 180 million of highly executable cost and CapEx synergies across marketing, operations and IT infrastructure. The enlarged group will have a significantly enhanced financial profile with over EUR 3.2 billion of combined revenue and an adjusted EBITDA margin of approximately 27%. All of this provides an exceptional platform for future profitable growth and value creation, and I'm excited about the potential for the combined group. With that, I'll close by reiterating our thanks for the continued support, and we are now happy to answer any questions.

[Operator Instructions]

Our first question comes from Karine at Barclays. What is the expecting regulatory timing for the transaction to be approved to close? When do you expect to repay '28?

I'll just take that on closing time. As we said earlier, we'll have to go through the usual regulatory approvals from the Gambling Commission from CMA, as you'd expect, and other regulatory bodies. So end of Q4, potentially early Q1, but we see it around those sorts of time lines. Chrys, do you want to talk about the '28?

Yes. As you have seen, we have secured the financing to repay the '28, and these should be done at around the time of the closing of the transaction.

Next question comes from Haley at Columbia Threadneedle Investments.

Can you clarify the capital structure of merged Bally's Intralot-Evoke? Will the two companies be merged? I appreciate you've got a change of control waiver on the 2030 and 2031 bonds and refinancing the 2028 bonds. But where will these bonds sit in relation to the GBP 889 million second lien facility? Thank you. Awesome transaction. Well done.

The new facility will sit on the Evoke silo and the Evoke silo will be nonrecourse to the Bally's Intralot silo.

Next question comes from Harry at Guggenheim Investments. Can you disclose any terms for and/or pricing on the second lien facility?

Should I take that one, Robeson?

Yes. Sure.

Yes. So it's a 5-year term. It's 11% cash paid, and there's a GBP 200 million mandatory prepayment in December 2027.

Next question comes from Julian at Penn Capital. How confident are you in your ability to integrate the two groups operationally while leaving the two restricted groups in place?

I guess this -- I'll take this. So this falls down to actually realization of synergies. Deliberately, I've focused on synergies whereby integration is less required. Most people when they think about synergy numbers, they automatically lean into tech consolidation and all of those sorts of things.

In all honesty, that's hard to do. And also, it's hard to predict how long it would take when you can't see it properly until you actually own it. The synergies that we described are very much focused on marketing spend. And therefore, this would be outside of classic regulation, right? So it's just where should you spend your money? Should you be spending your money on television or digitally and using appropriate tag management. So we see technology delivery, which will allow us to track that better. So there will be a degree of integration across marketing spend and how we do that. We will get into detail far closer to the time of what it means for further integration. So I don't want to go into too much color there, but I feel very good about the synergy realization. It should be relatively simple.

Next question is from Samik at [indiscernible]. Referring to a line on Page 30, agreed to support Evoke in connection with a GBP 200 million mandatory prepayment under the second lien term facility acquired by 31st December 2027. First question, this is separate from your EUR 200 million bridge facility for the cash consideration.

Is this going to be prefunded or based on a guarantee from Intralot? If I understand correctly, out of the GBP 889 million initial balance under the Second Lien, only GBP 689 million will be outstanding after December '27. Are there any further mandatory prepayments under the Second Lien facility prior to maturity in 2031?

Yes, Chrys.

This is correct. The GBP 200 million mandatory repayment at the end of 2027 is an obligation undertaken by Bally's Intralot, and it's not related to the bridge. This may be a good opportunity to explain that the whole proposal around the capital structure, the key element is the support that we have from financial institutions to refinance the 2028, which is right now the main issue that's weighing on an otherwise very valuable company.

So that GBP 200 million is part of our obligation, part of our skin in the game as buy side, and it's completely unrelated to the bridge. Given the runway, we will have the opportunity to generate a certain amount of cash, and we definitely have the liquidity instruments to finance that at the end of 2027.

A follow-up question from Samik. Do you foresee complications in terms of transferring databases and marketing tech to Evoke to ease the reduction in marketing as their IT systems and platforms may not be compatible?

With respect to the Martech platform, that sits outside of the classical player account management system, all of those other things. So you can actually -- you can spend marketing money without any form of integration at all between technology stacks. This is about giving more insights to how we're spending that money.

There will be a desire to have certain integration so we can understand better player lifetime value and so on. But this is relatively simple, and we've done it many times before. Our data platform is set across many different PAMs and different systems. It's meant to take in different data sources. It's very flexible. With respect to databases, our intention to do the database mixing. Every synergy we talk about sits within the Evoke silo.

Another one from Samik. What is the purpose of the secured commitments for a GBP 157 million senior facility from institutional investors to support the acquisition? In case of a restructuring under a bearish scenario, though a remote scenario given the expected synergies. Is there any acceleration clause under the second lien? Are we certain that the second lien acts as an equity cushion for the remaining senior secured '30s and '31s?

The second lien has the same security package, but subordinated to the first lien.

The purpose of the GBP 157 million facility is to fund other cash items of this transaction because Bally's Intralot intends to support wherever necessary, this -- the evolution of Evoke and the business plan that we have for Evoke.

Final one from Samik. How much of the GBP 180 million synergies will be derived from marketing cost savings? And would the marketing savings be entirely or mostly generated in the U.K.

I'm not going to break it down specifically. The largest bucket will be in the marketing. Then there's operational, you can see in our slides and then there's some tech. The majority of those savings will be in the U.K. Yes, that's it.

Next question is from Raman at Principal Asset Management. On the GBP 200 million amortization of the Evoke second lien facility, is it full recourse to Intralot?

In the Evoke silo, is the GBP 200 million contractually pari with regards to 2030s and 2031s in relation to the claim on collateral?

The GBP 200 million is a recourse on Intralot only.

Next question from Raman. How do you see Evoke's product and tech suite? Given recent underperformance in the U.K., do you believe there's a product or tech gap that requires investment to boost the Evoke's performance?

I guess I've described this in where I see the synergies. In our case, we're talking about cost reductions. So I'm talking about marketing spends being more precise. So I expect that we can reduce the cost per acquisition by being more targeted.

That's our key goal there. I would believe, as I said before, they're better at sports than us, right? There's no doubt that they're better at sports. So we're going to inherit that great capability. iGaming, as you can see from our numbers, our Q1, we grew by 10.5%, 11.5% in April and even greater in May, further accelerating to 16%. We believe we can do that via additional retention algorithms. Again, as I've said, all of these things sit outside of the classic regulatory stack. We'll just need to understand a little bit about customer profiles, what people are spending, their experiences, which we can analyze from data streams and then ideally boost customer retention.

So find a way that customers can spend in a very stable fashion, which gives you this core stability and core growth, which can last very long or forever is my hope. So I think that there is potential opportunity to grow and accelerate growth by augmenting gaming retention, not necessarily altering the product on site. I do believe that you can -- we will always want to improve the product on site. I haven't made any of those assumptions yet because I need to understand the technology stack and exactly how it works because there's one thing we're saying, I can -- I'll make it way better I need to really understand where the problems sit or where we see differences in performance across what I would expect metrics to look like.

The thing I'd add to that, Robeson, is that premising the question of underperformance in the U.K. Evoke is actually seeing pretty good momentum in Q1. The U.K. online business is growing at 5% within that gaming is growing at 8%. So the business is performing pretty well and we've got decent momentum as we go into this transaction.

Great. Next question comes from Alex. Regarding the second lien financing, could you please disclose what the interest rate on the second lien will be and whether there is a noncash pay component?

It's 11% cash paid. And Chris has already outlined pretty well all the terms around GBP 200 million prepayment in December '27.

Next question comes from Laura. What is the time frame to implement the synergies? At what level will the GBP 889 million second lien sit, and where does it rank versus existing SSNs, which remain in place and the existing term loan SSNs?

Katherine, do you want to take the synergy timing point?

Sure.

We expect about 75% of the synergies to be realized within the first 12 months following close and the remainder to be realized in the second year post- close.

Can you repeat the second part because my line was breaking up.

Regarding the second lien finance, you could disclose what the interest rate on the second lien will be and whether there's a noncash pay component?

No, that was the previous question.

Sorry.

In this question, there was a second part.

At what level will the the GBP 889 million second lien sit, and where does it rank versus existing SSNs, which remain in place and the existing term loan SSNs.

If I understand the question correctly, maybe Sean, maybe you can help me here. But as we said, it's a subordinated loan with the same security package.

Yes. So the capital structure of the silo is going to be that the RCF will become super senior. And then the second lien almost by definition, is subordinated to the remaining '30s and '31 senior secured notes.

Next question is from Russell. Post merger, you have a number of brands.

Can you talk about how much overlap there is between customers? Are all brands considered strategic over the long term? And do you anticipate revenue dissynergies? The announcement emphasizes cost synergies, but not revenue synergies, so can you give me some insight? You're obviously very confident about the opportunity. How do you anticipate the retail portfolio to evolve over the medium and long term?

There will be a degree of overlapping customer base across the two separate silos. You'll have to agree a program of how you look at single customer view in time with the regulator. I -- it's funny. So many people believe that when you implement a single customer view, it will have dissynergies on revenues. That will be the case if we still had a very large VIP industry within the regulated market. I think all of us operators will have seen, that has been diminished in time. I think that this single customer view will give us a far cleaner perspective on exactly how our customers are behaving.

You can almost view it as if someone goes into one store and they spend double the amount that they would spend in an alternative store, so say, going between Virgin Games or going between William Hill, you'll understand what product offerings almost like an A/B test are ideal to be served to every single customer. So I view it as a gaining of intelligence. We've viewed -- and as you can see, we have many brands. I've always believed in multi-brand because when you understand this, you know what product people prefer, you know what to serve them at the right time. So I view that as a revenue synergy. Some people believe it will be a dissynergy. I think there's another part of the question, I've forgotten that.

It was retail I could take that, if you like.

Go for it.

I mean we've gone through a retail transformation. It's been extremely successful. It's the key features were new [indiscernible], new SSBTs, store rationalization. And that's manifested itself in Q1 in a plus 3% like-for-like, which is well above -- really well above market. Expectation is that, that success continues and we continue to generate cash from the retail business into the medium term. The other thing to say is that obviously, there continues to be a great opportunity around omnichannel and the feedback loop between online and retail. So it's a key part of the product mix going forward.

Next question is from [indiscernible] out of the GBP 180 million expected synergies, how much is expected to end up in the Evoke silo? Could you please confirm the expected cost of achieving GBP 180 million synergies is GBP 25 million? And please elaborate on what the restructuring costs will be? Could you also please split GBP 180 million synergies into marketing, corporate and IT and how much is going into each bucket?

Do you want to take that Katherine?

Sure. So we've covered -- we won't really disclose the exact amount, but as Robeson mentioned before, it was -- the bulk of the synergies is going to come from marketing, followed by operational efficiencies and closed out by IT infrastructure and tooling. The cost to achieve are, as you say, GBP 25 million, and these would essentially be restructuring costs. And what was the third part of the question?

If they realized all in the Evoke silo.

Yes, and they will be realized in the Evoke silo. We'll make sure that we keep them exactly where they belong.

Next question comes from Alex at LGT. Regarding the cost savings, if the transaction closes in Q1 '27, do you expect to realize most of the GBP 180 million cost savings by Q1 '28?

Yes. So we will be working in a 12-month cycle. So 75%, as I mentioned, will -- is expected to be realized in the first 12 months following close and the remainder in the second 12 months following close. So Q1 to Q1 sounds about right.

It might be worth adding to that, that there isn't a hiatus until the end of this year. Current management team is working on getting more efficient marketing, getting more efficient bonusing, retail rationalization, operating model efficiencies, supplier cost efficiencies. I guess the point is that once the deal is done, we can accelerate that, particularly once we get access to the Vitruvian platform.

Next question comes from [indiscernible]. What does the silo structure mean for future refinancing plans? Which entity do you expect to use as the main issuing entity going forward? Or do you envisage the two entities to repay on a stand-alone basis? Also on the second lien, is there a structure at all?

Yes, very good question. Obviously, we intend -- as I said, the key element here in the financing is to remove the maturity wall of 2028 and give the company the runway to achieve the synergies. As I'm sure you're aware, this is a highly cash-generative business, and that is the great advantage that we bring by securing this runway.

Clearly, at some point, the consolidated balance sheet makes more sense to look at for a more comprehensive refinancing. So we believe that once we are able to demonstrate that we can deliver these synergies after the first year or second year, we cannot determine right now exactly when, but we will be looking for a comprehensive refinancing across the capital structure.

The next question comes from Richard at Deutsche Bank. Could you please describe your plans for Evoke's retail estate, i.e., how core is this? Could you provide color on your strategy for online markets outside the U.K., in particular, in Italy, Spain and Romania? And also, how quickly would you expect leverage to return towards 2.5x steady state target?

So with respect to the retail estate, as Sean has already said, the Evoke management team have been rationalizing that footprint and it's performing well.

For us, our focus is going to be on realizing those synergies, which predominantly lives across really U.K. online because that's where we've got deep, deep strength of expertise. So retail, keep on doing what it's doing, and it looks like the team have done a fantastic job already rationalizing and getting the growth. International online, as I said a few times, that makes us still very attractive. We want that to keep on its pathway of growth, very positive there. So it's almost really leave retail, leave international for a period and focus on the U.K.

Next question is from Charlie at BNP. Do you expect marketing optimization to result in holding or gaining market share or focusing on a smaller number of more profitable players?

I think you can grow market share by being more precise with exactly who you advertise towards. My preference in marketing is to make sure that I spend money only showing adverts to people who may want to engage with my products rather than spending money on advertising, which can be presented in front of people who may have zero desire to engage with me. So I guess.

I'm hoping that we can apply what we've done for years and make sure we are very targeted, very precise with how we advertise and that delivers growth. You can see it in our numbers.

We're starting to see a structural shift in the market post the tax changes as well. Like we always thought that we'd see the long tail consolidating down and see the market share transferring from the long tail into the major operators. And I think that the incredibly strong or the very strong growth that we've seen in Q1, both in Bally's Intralot and Evoke is an indicator that, that's already started to happen. That can only gain momentum, right? The impact of this new tax will fall very heavily on the long tail, and we'll continue to do so and continue to take the fuel out of their marketing opportunities.

Next question comes from Alex, LGT. Could you please guide on a CapEx figure as a percentage of revenue for the combined businesses?

Catherine, do you want to take that?

Maybe Sean on the other side...

I can take it. I mean we won't be providing guidance on CapEx for the kind of combined entity at this point, but there's a slide in the presentation where you can work out current CapEx kind of 5% to 6% for both groups. So that's where we currently sit.

Next question comes from [indiscernible]. Is the second lien tender 5 years from today or 5 years from completion date?

Is that the maturity that you're asking? The second lien maturity 5 years from completion. If that's the question, then yes, it's 5 years from completion.

The next question comes from Raman at Principal Asset Management. How will the RCF at Evoke dealt with?

So the RCF is partially drawn currently. That partial draw will roll over into the new silo and will be upsized to GBP 220 million. The current capacity is GBP 200 million, it will upsize to GBP 220 million. The other thing about it is that it's been -- it's ranked alongside the other debt at the moment.

And one of the reasons for that is the terms within the term loan B, we're refining the term loan B. And as a result of that, the RCF can become super senior.

Next question comes from [indiscernible]. Given material deleveraging through the SSNs 3031s, have you had any conversations with the rating agencies regarding an upgrade and/or rating differentiation between 1L and 2L?

So we started conversations with the ratings agencies. The way they work is they're not about to make quick judgments on these things. They want to see the full detail. They want to see the full documentation. And once they've seen that, they'll update their models and only then will they start to give us changes in the ratings. But you're absolutely right. The '30 and '31 SSNs, the leverage at that level drops enormously. It drops from 5, 5.2 down to 2.2.

And as a result of that, a lot less risky, and therefore, we do expect to see some improvement in the ratings of those particular instruments.

Next question comes from Pravin at Barclays. What proportion of expected synergies come from supplier negotiations on online side of the business? And do you see potential for more savings with future negotiations with your content suppliers?

So as it stands now, we expect spend optimization, not necessarily savings from contract renegotiations as we come together as a combined business and we better understand the terms and look at economies of scale, this is where potential additional upside can come into play as it comes to renegotiations.

Next question comes from Ivor at Peel Hunt. What does the strong growth in FY '26 from both companies tell us about market revenue leakage to offshore operators? Is that leakage no longer a threat?

I would say the leakage is always a threat. If regulations create displacement, people have to go somewhere. So that's always a threat. As Sean said earlier, the growth that we're seeing, I think a lot of it is driven by the long tail. I've been pointing to the fact that as soon as the tax announcement arrived, the same marketing spend was acquiring in excess of an extra 60% increased volume in first-time depositors to our brands. We're starting to receive the benefits of all of these things. So we've got some great lead indicators, which end up converting into cash further down the line.

But that is really saying that where we're spending, we're getting cheaper inventory for the same -- like in the same place. So I see there's risk of the offshore, but actually bigger operators are gaining the benefit from market consolidation.

Question from Pravin at Barclays. On U.K. retail, do you plan to leverage Evoke retail networks to cross-sell Bally's brand in the U.K. in due course? Does initial guidance include retail shop closures beyond what Evoke has already announced so far? If not, would you consider further retail estate review and thereby see scope for further cost savings?

Retail optimization is currently not part of the GBP 180 million of synergies. So whatever actions Evoke has taken to date on that is not part of that figure and will be incremental.

And we also don't have any intention to utilize the Bally's Intralot brand in the retail estate. I believe there's strong power with the William Hill brand. I value that brand massively. I think it is a genuine piece of heritage for the U.K. and internationally.

Next question from [indiscernible] Capital. Do you intend to retain all Evoke international operations? Or would you consider selling some of them?

We wanted the whole group. We have no intention to sell any assets. As I've said a few times, I find the international assets almost the most attractive because it creates a diversification for our combined group and really does give us a pan-European presence. So no intention. But if things arrive, which makes sense, we'll always consider, but absolutely no intention. We like the business that Evoke has. We believe together, we can be stronger and truly grow this business and have significant scale.

Next question from Meggy at PGIM. Will there be cash pooling or cash transferability between the two silos?

No.

No, we plan to keep the treasury separate. It will be an unrestricted group, and it will be serving its own debt. And the Bally's Intralot side will be supporting when necessary.

Next question from Ben, HPS. Do you foresee any issues securing the requisite antitrust and regulatory approvals from the U.K. CMA and Gambling Commission?

No, I don't see any risks there. You can -- my example, I look at something like Flutter, which has created its scale entirely inorganically. Normally, there's challenges when it comes to retail footprint, but we don't have it. So I don't see any risks there.

Perfect.

There are no further questions from the webcast. So I'll hand over to you.

I think if I may address a question that we kind of left unanswered earlier about the CapEx, Alex's question. Just to give you some color because a lot of the CapEx relates to the legacy Intralot side. I think that we will be looking at 4% of revenue for the whole group. So you're looking into a number around GBP 100 million to GBP 120 million. This may be important for your modeling. So I thought we should just give you some kind of color around here.

Well, thank you. I guess my closing words would really be saying that this is a true statement that we believe in regulated gaming and lotteries and to respect the public terms of licensure for responsible and safe gaming. We're acquiring Evoke and we become a dominant profitable international online gaming operator in Europe. And we do it in one move, right? So you do it in one quick go. We essentially go to podium positions in 6 markets and become #2 in the U.K. Just to remind you, Evoke generates GBP 2 billion in net gaming revenue across 3 equal segments, roughly equal segments.

Retail, U.K. online and international. I know everyone thinks that we're buying the U.K., but Bally's Intralot's strategy has always been to diversify beyond the U.K., and this is what's happening. We're buying international scale across Italy, Spain, Romania, Denmark and beyond. The U.K. comes with it. And the U.K., we believe we can improve as we've described through this presentation. Our business really does allow this opportunity. We spend 11% of net gaming revenue on marketing, and we grow double digits. So we improve the U.K. and we gain international and we save ourselves about 7 years to get to this place.

So our business is a platform for growth, both organic and through smart acquisitions. So what acquiring Evoke makes us the business we really always wanted to become. We want to become international. We want to become a champion across Europe and the globe. So with that, I really do look forward to speaking to you all again soon. I hope you're as excited about this transaction as we all are. Yes, it should be a great journey, and I'm very excited. Thank you. Thank you all for joining us.

Ladies and gentlemen, thank you for standing by. I'm Constantinos, your Chorus Call operator. Welcome, and thank you for joining the Bally's Intralot Conference Call and live webcast to present and discuss the first quarter 2026 financial results. [Operator Instructions] The conference is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Robeson Reeves, CEO of Bally's Intralot. Mr. Reeves, you may now proceed.

Thank you, operator. Good afternoon to everyone joining us today. I'm pleased to be presenting our first quarter 2026 results, which marked a strong start to the year for Bally's Intralot and demonstrate the growing earnings power of our platform.

Before I take you through the numbers, I want to address the broader strategic context. As we announced, Bally's Intralot is exploring an emerging opportunity tied to evoke, which we are actively pursuing and we shall be able to provide more color on this in the coming days. I will not deviate from what is already in public domain, but I would ask you to read this alongside what we're about to tell you about our margins, our platform, our operational track record and our cash generation. The strategic rationale is not difficult to follow.

Now let me turn to the results. Q1 2026 marks a strong start to the year. Group revenue reached EUR 268.1 million with adjusted EBITDA of EUR 100.2 million at a 37.4% margin, a meaningful improvement of 5.8 percentage points year-on-year. This reflects the first full quarter of consolidation of Bally's International Interactive, which is performing exactly as expected. On a pro forma 12-month basis, the combined organization delivered EUR 1.06 billion in revenue and EUR 427 million in adjusted EBITDA at a 40.2% margin, fully in line with the projections and guidance previously provided. I'm extremely proud of that delivery.

Let me address what I know many of you will want to hear about the U.K., the tax change and where we stand. Our U.K. online business continued its strong momentum in Q1, growing 10.5% on a constant currency basis. Preliminary April revenues were up a further 11.5% year-on-year. The U.K. remote gaming duty rate doubled from 21% to 40% on the 1st of April 2026. And we entered that change from a position of strength, not retreat. Active players are up year-on-year. Our brands are very robust. Our product is competitive, and our player base is growing. We are generating more efficient revenue from a larger player base. This is precisely the environment we said we would benefit operators with our scale and margin profile, and that is exactly what is happening. On 2026 guidance, we reaffirm our adjusted EBITDA target of approximately EUR 422 million. The early trading data gives us continued confidence in delivering it.

On capital allocation, our approach has not changed. We continue our share buyback program, and the Board has recommended a pre-dividend subject to shareholder approval during the shareholders' meeting that will take place tomorrow, reflecting our confidence in the cash generation of this business. Liquidity remains robust at EUR 417.3 million as of the 31st of March 2026.

I'll now hand over to Andreas to take you through the financials in detail.

Thank you, Robeson. Good afternoon, everyone. I will take you through the financial performance for the 3 months ended on the 31st of March 2026, using the figures that have been released this morning.

Moving directly to Page #3. On the revenue bridge, group revenue increased by EUR 172.5 million compared to the first quarter of 2025 reaching EUR 268.1 million in the first quarter of 2026. This increase was driven predominantly by the B2C segment, which contributed a revenue uplift of EUR 179.6 million, primarily reflecting the full consolidation of Bally's International Interactive, which started EUR 183.6 million in the quarter.

Within our legacy B2C operations, which comprise Argentina and Turkey, revenue declined by EUR 4 million or 15.9% on a reported basis with no FX impact. In Turkey, reported revenue declined by 19.2% year-over-year to EUR 16.6 million, largely due to the amendment to Bilyoner's remuneration structure. Nevertheless, Bilyoner continued to gain market share, outpacing the Turkish online sports betting market, which expanded approximately 35% in local currency terms, while Bilyoner grew by 45% year-over-year. Only in the last quarter, Bilyoner's market share grew by 1% versus 2025 year-end.

Argentina held broadly flat at EUR 4.5 million, down by 1.3%. The B2B segment saw revenue decline by EUR 7.1 million to EUR 63.5 million, which represents a decline of 10% on a reported basis and 3.9% on a constant currency basis, excluding BII. This reflects a foreign exchange headwind of approximately EUR 4.6 million, almost entirely USD related. The U.S., the group's largest market, recorded a 6.2% revenue decline on a constant currency basis, driven mainly by softer Lottery activity. The remainder of the legacy B2B business remained broadly stable, underscoring the segment's resilience.

Turning to adjusted EBITDA. The group delivered EUR 100.2 million in the first quarter of 2026 compared to EUR 30.2 million in the first quarter of 2025, more than a threefold increase. BII contributed EUR 72.7 million in its first full quarter of consolidation at a 39.5% adjusted EBITDA margin, which clearly demonstrates the quality of the digital B2C business being integrated. Excluding BII, legacy adjusted EBITDA stood at EUR 27.5 million with a decline limited to 2.8% on a constant currency basis.

At the segment level, the B2C legacy adjusted EBITDA reached EUR 7.1 million, with margin improving to 34% from 33.1% in the first quarter of 2025, supported by cost efficiency initiatives that partially offset the impact of the amendment to Bilyoner's remuneration structure. The B2B segment delivered adjusted EBITDA of EUR 20.4 million, down by 7.1% on a reported basis, but up 1.3% on a constant currency basis, with the U.S. remaining the largest profit contributor. Group adjusted EBITDA margin expanded by 5.8 percentage points year-on-year to 37.4%.

Moving to Slide #4 and focusing on the revenue mix. Across our 3 dimensions, first of all, by game type, the iGaming and Sports Betting emerged as the largest contributor to our top line, accounting for 74.8% in the first quarter of 2026 group revenue, followed by Lottery Games at 20.4%. VAT Monitoring contributed 4%, while Casino and Other Activities represented 0.8%. This is a significant shift from the first quarter of 2025 when Lottery Games represented 63.9% and iGaming just 24.7%, reflecting the transformative impact of BII's full consolidation.

By geography, the U.K. is now our largest region at 64% of group revenue in the first quarter of 2026, with America at 18%, Europe at 9% and the rest of the world also at 9%. On a pro forma full year basis, the U.K. [ weighting ] represented approximately 64%, confirming the group's significant shift towards the U.K. digital consumer market. By activity line, B2C now represents 76.3% of reported revenues with B2B 23.7% in the first quarter of 2026, a big transformation from the first quarter of 2025 when B2B accounted for 73.8% and B2C just 26.2%. This mix shift is the primary driver of the margin expansion that we are delivering.

Moving to Slide #5. We have the detailed P&L. So on a reported basis, the first quarter of 2026 revenue of EUR 268.1 million compares to EUR 95.6 million in the first quarter of 2025. The BII contribution was EUR 183.9 million with EUR 72.7 million at the EBITDA level, representing a 39.5% margin. Intralot Legacy contributed EUR 27.5 million at a 32.7% adjusted EBITDA margin. The combined Q1 2026 adjusted EBITDA of EUR 100.2 million gives us a margin of 37.4%.

On a pro forma 12-month basis, the combined group delivered EUR 1.0629 billion in revenue and EUR 427.2 million in adjusted EBITDA, representing a 40.2% margin. This is fully in line with our guidance. Below adjusted EBITDA, depreciation and amortization was EUR 43.2 million in the first quarter of 2026, reflecting the amortization of acquired intangibles from BII as well as purchase price allocation adjustments. Net finance expense was EUR 34.8 million, reflecting the group's new debt structure. After the tax charge of EUR 9.8 million, the first quarter of 2026 profit after tax was EUR 7 million compared to the EUR 2.1 million in the first quarter of the previous year.

Moving to Slide #6. We have the key financial metrics dashboard. Revenue grew from EUR 96 million in the first quarter of 2025 to EUR 268 million in the first quarter of 2026 with a pro forma 12-month figure of EUR 1.063 billion. Adjusted EBITDA grew from EUR 30 million at a 31.6% margin in the first quarter of 2025 to EUR 100 million at a 37.4% margin in the first quarter of 2026, with a pro forma figure reaching EUR 427 million at a 40.2% margin. Operating cash flow nearly doubled year-over-year to EUR 84.4 million, underpinned by the strong cash generation profile of BII, which contributed EUR 78.4 million in its first quarter of consolidation.

Net CapEx in the first quarter of 2026 came at EUR 15.4 million, EUR 9.8 million above the first quarter of 2025, primarily reflecting BII's contribution of EUR 7.9 million, coupled with higher investments in the U.S. projects. Adjusted net debt at the end of the first quarter of 2026 remained broadly stable at EUR 1.4931 billion, in line with year-end 2025. On a pro forma basis, the adjusted net leverage ratio stands at 3.5x, reflecting our consistent funded debt structure of the group.

Looking at the net debt bridge for the first quarter of 2026. So starting from the EUR 1.4939 billion at December 2025, the group generated solid free cash flow of EUR 59.1 million during this quarter. This supported EUR 22.6 million in net interest payments, EUR 17.8 million in purchases of own shares and EUR 8.1 million in reorganization and refinancing-related outflows coming from the previous year.

Other debt movements amounted to EUR 9.8 million, primarily comprising EUR 7.7 million of accrued interest, EUR 2.6 million of amortized loan costs and EUR 1.4 million adverse FX impact on the GBP-denominated loans, partially offset by EUR 1.8 million decrease in lease liabilities. This brings adjusted net debt to EUR 1.4931 billion at the 31st of March 2026, essentially flat quarter-on-quarter, which we view as an important proof point of group's cash conversion capability. And with these final remarks, the Q1 2026 financial results presentation is ended, and I will now hand over to Robeson.

Thank you, Andreas. Before we open for questions, let me leave you with a few things. The first is delivery. On a pro forma 12-month basis, the combined group generated over EUR 1 billion in revenue and over EUR 427 million in adjusted EBITDA and a 40.2% margin, exactly in line with what we guided.

The second is resilience. The U.K. remote gaming duty change is the most significant regulatory shift in our market in years. We have been telling you for several calls that we had a plan, that we have the margins to absorb it and that a less competitive market would favor operators with our scale. The Q1 data and early April trading confirms that thesis. U.K. online revenue in Q1 grew 10.5% on a constant currency basis. Preliminary April NGR was up 11.5% year-on-year.

Now for May. May is also showing double-digit year-on-year growth, accelerating from Q1 and April, in line with our expectations. The plan is working.

The third is momentum. We are not standing still. We are returning capital to shareholders. We're managing leverage carefully. We have a total liquidity of EUR 417.3 million, including an undrawn revolving credit facility of EUR 160 million. And we are evaluating growth opportunities from a position of genuine strength. 2026 guidance of approximately EUR 422 million in adjusted EBITDA is reaffirmed. We are tracking in line and the number is EUR 422 million. It was EUR 422 million in January. The difference is I now have Q1 and April behind me.

We will now open the floor for questions. Operator, please go ahead.

[Operator Instructions]

The first question comes from the line of Ricardo Chinchilla with Deutsche Bank.

I wanted to start with the U.K. In terms of the revenue increase, it seems very strong. Has this -- have you noted any change in player behavior that you can share just to see -- is it because you are gaining players, players are spending less or more time on device. Anything -- any color that would help us understand what the current dynamics for the second quarter would be very helpful?

Thank you, Ricardo. Robeson here. So yes, our growth is nice. The great lead indicators that we're seeing are that our acquisition volumes of new customers has increased significantly. I think I've said before, of the same spend, if you do like-for-like comparisons, we're seeing in excess of 60% increase in new customer volumes coming through, which actually, when you step back and think about that, the same marketing money is proving much more effective. That is highlighting a reduction in competition. And hence, we are also seeing improved player ARPUs.

So as I said before, the small operators are pulling away. That means that the cost of acquisition is declining, but it also means that you're not competing for the same customer's wallet. People are also pulling back from their incentives, their promotions and so on. So we're definitely seeing the start of consolidation.

Now the thing also to bear in mind is when you spend your marketing money, you don't break even on that instantly, right? So when I was saying lead indicators, if you're getting these new customers through the door today, that has significant benefits when you roll the clock forward a year. So I feel very good about what we're seeing. I also believe that if we think about normal life, only when you start to pay the bills fully, you start to change your behaviors. Even if you know the bill is coming, we saw a change happen when the tax was announced on the 26th of November. We're definitely going to see more changes happen over the coming months as people have to start paying these bills to the tax man essentially with the increase in remote gaming duty.

Got it. If I may follow up, could you please provide us some details on the economics of the new contracts that you guys won recently in terms of what's kind of like the expected revenue or expected EBITDA and expected CapEx related to these new contract wins on the lottery side?

Which contract are you referring to now, the Hellenic Lotteries?

Both, the Hellenic Lotteries and the one from Australia.

Sure. Hellenic Lotteries -- I mean, both contracts are contracts that we currently have. The impact of the Australian contract will be significant on our CapEx, but it's something that's all been in our budget, the numbers that we have shown. And it will be an increase over the existing EBITDA compared to the past. We expect around EUR 15 million EBITDA from the Australian contract going forward on average. The Hellenic Lotteries contract is a smaller contract. It's mainly technology contract. It's about EUR 1.5 million per year.

Got it. Last one for me. Can you please remind us the realized cost savings that are showing already on your financials? And if you could give us a sense of the cadence where the full length of the cost savings will be fully reflected on your EBITDA line?

Thank you, Ricardo. So as we said before, we're making changes to generosity, right, marketing spend and then there's people reductions. The people reductions, those changes occurred really in Q1. So that won't be reflected. You'll see a greater reflection of that leading into Q2 and onwards.

With respect to the marketing spend, I took a position to hold our marketing spend because I didn't want to create too many variables by adjusting all of your marketing spend down right away. We'll see that happen going into Q2. As I was kind of signaling when people have to pay the tax bills, you'll see the greatest adjustment there. So we expect, and we're starting to see it now that we will be able to reduce our marketing spend, but still see that significant increase in customer volumes. So I guess, in summary, not particularly reflected within Q1.

The next question comes from the line of Russell Pointon with Edison Group.

It's a question on the B2B, so perhaps more for Chrys or Andreas. So there's been 2 relatively weak consecutive quarters in B2B now, mostly driven by the U.S. And I think the revenue is tracking lower than the guidance you had when you announced the business combination last year of low to mid-single-digit revenue growth. So could you just give some indication of whether you're expecting a better performance in the rest of the year to get to that midterm guidance for the revenue? And perhaps can you give some more detail on what's happening in some of those other markets at the moment?

Yes, Russell, we are -- we have experienced the first quarter without any jackpot. As you know, that's the key element in the seasonality variation in revenue and its EBITDA impact. And statistically, these do happen, 2 or 3 every year. So we just had one quarter without one. We continue to have some pressure from the currency. The dollar-euro relation is still not in the euro favor if you're comparing with Q1 last year. And first quarter is never our stronger quarter. It's -- fourth quarter is the strongest quarter, as you very well know. So these are the 2 comments about the first quarter.

And let me add here that -- I want to remind you that the first quarter of 2025 included also revenues from the iLottery in the New Hampshire, which is now -- which was ended during the summer of 2025. So the revenues of this year compared to last year is also affected by this. However, in terms of EBITDA, it's more or less the same. So we have had some good mitigation measures in order to recover the revenue from the iLottery of New Hampshire in addition also to the nonexistence of the jackpot as said by Chrys.

Perfect. And just outside the U.S., could you just give a bit more granularity on the key markets? What did well in the first quarter?

Outside the U.S., I think I mentioned during the presentation, more or less stable. So we had more or less the same results as last year in terms of revenues and also EBITDA. Primarily the impact, if not all of it, comes from the U.S.

So all the regions were stable. There were no -- there were number...

Yes, exactly. Apart from Bilyoner, which was lower, again, we said it due to the remuneration scheme change. Again, very effective handling of the cost, in large balancing the deficit on the revenues in the EBITDA line.

The next question comes from the line of Raman Narula with Principal Asset Management.

Congratulations on a good start to the year. I have a couple of questions, please. The first, focusing back to the U.K. Just curious, with the sort of growth in volumes you're seeing, is there any feedback you track from new players of what's particularly driving them to the platform? Is it generosity and sort of the yield that they note? Or is it more so around the game catalog?

It's a good question. We -- you acquire gamblers. Gamblers are always transitioning between different gambling websites and they sometimes have a break, right? So what we do, all of us have got very similar content. Where you differentiate is working out what to communicate to a customer and when they are ready to transition to you.

So I would say that what we're seeing is pullback. That's why things are cheaper, and that's why we're getting enhanced volumes. But we're also -- our technology is proving the point that when a customer is ready to move, we're able to catch them. So we look at where, call it, traffic are passing through different placements across the Internet and make sure that we're serving the right volume of advertising. Not too much, not too little, just to make sure that we have the most efficient spends possible. Hopefully, that explains it because virtually all of us have got the same content libraries. What you have to do is manage your regulations very well and work out how to appropriately spend marketing to retain customers and acquire customers.

No, that makes sense. And just as a follow-up to that, I mean, you mentioned you sort of decided to keep marketing spend where it was in Q1. I'm just curious, was a similar decision taken with regards to generosity in the U.K.?

No, actually, generosity, so the gap between gross gaming yield and net gaming revenue has narrowed. That isn't due to us saying we're not going to give you the same rewards if you have the same experiences. Our customers are having much more call it, less disruptive experiences from their gaming habits. Some of this is triggered by stake limits. Some of this is triggered by how -- what products we're getting our customers to engage with. So less volatile content means that people don't necessarily lose as quickly and hence, the cost of maintaining a relationship with a player is cheaper.

So it isn't necessarily -- people are basically having a better time, so you don't actually have to pay them as much to return to you. That's what's narrowed the gap rather than reducing generosity as such. Yes, rewards are lower, but that's because we've managed the customer experience better.

Understood. I guess the next one, just curious. I mean, you mentioned obviously smaller players pulling back from the market and that's driving a lot of the volume growth. But just curious as to what you've observed from some of your larger competitors, whether they've sort of followed suit with regards to what you guys are doing or whether they've taken a different approach?

A lot of operators, the large boys, they have maintained consistent digital spend. Many of them have reduced their marketing spend on above-the-line activity. You'll be able to see that yourself if you look at the Nielsen report. So you'll see that some of them have pulled back there. So digital is relatively stable from the big operators. Above-the-line spend, especially in TV has been reduced by some of the bigger operators.

Understood. And last one for me. Just curious if there's any update you can give us regards your talks with the regulator and with the government regarding measures that can be taken to stop any leakage to the black market. Any updates you can give would be much appreciated?

Well, there has been -- so the government did announce funding to help prevent the growth of the black market. Often, people look at the U.K. market in the same way as other territories such as, say, the Netherlands, which had a rapid rise in channelization. There's a big difference here, though. The U.K. over the past 5 years has essentially made for a much more affordable spending climate for mass market.

So in reality, the VIPs, the massive players, they've already been displaced. So when it comes to the black market, they are policing it. I just wouldn't expect as much change in market size from high-value customers because high-value customers have already been displaced to the black market. But yes, [indiscernible] monitoring the sites which don't have like Gamstop applied and so on. Bear in mind, if someone's got a problem gambling, they're very likely to not have that much funding.

The next question comes from the line of Richard Stuber with Deutsche Bank.

Just a couple left from me, please. The first is I've been sort of reading more reports about affordability measures, again, being introduced by the sort of the Gambling Commission potentially in the U.K. Can I just check where we are with that? And presumably, your customers are more lower spending, so it's going to be less relevant for you possibly these measures? And the second question is, could you just kind of reiterate your strategy to sports betting essentially? So what are you -- how important is sports betting to your portfolio? And what part of the sort of stack are you sort of increasingly interested in having?

Thank you, Richard. With respect to affordability, yes, they're looking at other measures to ensure that customers can spend what they afford -- they can afford, sorry. Our entire platform has been built on this basis anyway because ultimately, if people can afford to spend, they can afford to spend forever. So yes, I might not have the highest, call it, annual spend of players.

But when you actually look at our retention and you look at the stable growth, we're getting that growth because you're basically just throwing new customers on top and people become more and more loyal and concentrate their wallet with us. So affordability measures, I don't see as a significant risk to us because our players are much more stable and consistent.

Now how they implement these could create trauma and friction for even genuine good customers. I think that the Gambling Commission, I think that the Department of Culture, Media and Sport will want to make sure that customers stay within the regulated market. These are the sort of frictions which can create displacement and make for unsafe gambling for customers. So there is definitely this lens. As we said earlier, they have funded the black market protection of a GBP 25 million fund and so I'm not concerned about affordability, especially with our player base.

With respect to sports betting, we have definitely seen a good influx of sports betting customers via acquisition driven by Bally Bet in the U.K. For us, sports betting has definitely been a funnel to drive customers into our offering, then they end up drifting to iGaming. Sports betting is more important in other European territories to help capture audiences more because of the demographics are certainly different in the likes of Spain and other territories where there's fewer -- a smaller percentage of the population of gamblers are female than they are in other markets.

The next question comes from the line of Colin Mansfield with CBRE.

Most have been asked, but just one from our side. I want to touch base on the liquidity color that you guys provided. So EUR 417 million of total liquidity. I guess, how do you guys think about any sort of minimum level that you want to maintain, whether that's maintaining the undrawn revolver or the cash balances? Do you guys kind of think about having a minimum liquidity level that you're comfortable with? Or is there no explicit target really?

Yes. Broadly speaking, around EUR 50 million to EUR 60 million is going to be super sufficient in terms of the main business that we currently have.

Great and appreciate the color on April and May in the U.K. as well.

The next question comes from the line of [Alex Apostolidis with LGT ].

I have 3 questions. The first, just going back to April and May. You specifically stated April NGR net gaming revenue up just over 11% and then May double digits. And then I think you separately stated that people will start to pay the bills. I just want to make sure I fully understood it. Does this suggest you expect net gaming revenue growth to taper off in the following months? That's the first question.

The second, just regarding the World Cup historically, in periods in summers or winters, I guess, where we've had it, have customers traded out of online casino and into sports betting. And so that's just a negative mix effect we should be aware of? And then my last question is on the potential transaction with evoke. I know you don't want to comment, but regarding June 8, you have an extension. Is there a final, final date beyond which you can extend? Or can you just keep extending it if need be?

So okay, let's talk about April, where it's at 11.5% growth and that's accelerating in May. What I meant by pay the bills, I wasn't talking about players. I was talking about operators paying the increased remote gaming duty tax, saying that people's behavior or operators' behavior we would expect to substantially change when -- if you think about these other iGaming operators, this is a 19% change. The majority of these operators have got a profit margin sub 19%. So that will substantially change their behavior. They won't have any money for marketing. So I expect operators' behaviors to change, not actually players. I think that the growth that we're seeing, it will remain. I'm optimistic that it can accelerate as we're seeing.

With respect to the World Cup, I'm probably the greatest naysayer around the World Cup. This World Cup is even worse, right? So this World Cup has been extended to be the largest World Cup. It means the grading of the games, call it, are less equal. They're less interesting. People like to see genuine contests. And actually, the volume of fixtures is still low, right, versus a normal weekend of football across Europe where you've got games across Greece, the U.K., you've got Spanish football, you've got Italian football, you've got German football. They're going to have games between like Cape Verde and like other teams. It's just not going to be as interesting.

What we tend to see happen with the World Cup is a lot of sports-led operators advertise like crazy to attract customers in, but there isn't actually that much volume for people to bet on. So my hope is that people spend very aggressively during the World Cup, spend all their marketing money and then we can go and acquire those customers very, very cheaply straight after it. I don't intend to spend a lot of money during the World Cup. We will make sure that we acquire efficiently and make sure that the customers have an offering that they can bet on. And that's a great thing about gaming. It's always on. It's 24/7. Chrys, do you want to take the evoke question?

Yes. Look, we're making announcements as required by the regulator in the U.K. for a U.K. listed company and the extension of this original deadline was agreed with the sell side. So I don't want to make any comment that can be interpreted one way or the other beyond what we've already announced. We are progressing on all the work streams as we have planned. There's a number of work streams that need to progress in order for us to be able to submit a binding offer, a firm offer and for the sell side to be able to recommend or make a decision on whether they recommend or not our proposal. We are satisfied with the progress, and we will make the next announcement in due course.

Mr. [ Apostolidis ], have you finished with your questions?

Yes.

The next question comes from the line of Aminah Baagil with Arini Capital Management.

I just have 2. So first of all, would you be able to elaborate on the Bilyoner remuneration structure change? And then secondly, if you could just give an update in terms of the tax and regulations. Are you seeing any upcoming change being discussed in the geographies where you have presence, which may impact your operations going forward?

Can you repeat the second part of your question because your line was not very clear.

Excuse me, Ms. Baagil, can you hear us?

Sorry about that. Yes. So if you could just elaborate on the tax and regulations in the geographies where you have presence in terms of what is being discussed at the moment, if there are any changes being considered?

So in the second question, there's nothing we can discuss at this moment. There's no particular change other than what is already known. On the first question, on the fee of the Bilyoner, we have not disclosed these details, but what we can certainly say is that in Turkey, the growth of the market has always been such that allows us to catch up with whatever changes. More or less, these changes reflect the growth of the market. And also, we have been able to manage expenses and mitigate whatever changes we've been facing, including, of course, the general macro situation in the country. So we have consistently been able to deliver growth in hard currency on the Bilyoner contract, and that will remain the case.

Sorry, can you just confirm that this change is just related to Bilyoner instead of perhaps a wider Turkish regulatory change?

No, it's not just for us. It's a change in the fee structure imposed by the state to all companies. There's no particular reason why it should apply to one supplier.

Got it. So it's -- so all operators in Turkey are affected by this remuneration structure change.

We are not -- just to clarify, we're not an operator. We are an electronic agent. So we're not organizing the game. We just get a commission on the sales that we perform.

Got it. But in impacting these operators, you, as a result, are also exposed. Is that the right way to think about it?

These changes are particular for electronic agents, not for the operator. The operator is subject to different set of rules.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments.

Thank you for joining us all today. I hope that you can see that Bally's Intralot is a company with an ambitious vision. but we definitely do not chase blindly. We're very deliberate, diligent and focused. We'll always take the right logical steps to reach our goals and deliver value for all of our stakeholders. So I look forward to speaking to you all very soon. Thank you, and I hope you have a good rest of your day.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Ladies and gentlemen, thank you for standing by. I'm Constantinos, your Chorus Call operator. Welcome, and thank you for joining the Bally's Intralot conference call and live webcast to present and discuss the full year 2025 financial results. [Operator Instructions] The conference is being recorded.

[Operator Instructions] At this time, I would like to turn the conference over to Mr. Robeson Reeves, CEO of Bally's Intralot. Mr. Reeves, you may now proceed.

Thank you, operator. Hello to everyone joining us today. Before I take you through the results, I want to address what you've already seen this morning. Evoke plc has published an announcement confirming that Bally's Intralot is in discussions with them regarding a possible offer for their entire share capital, an all-share combination with a partial cash alternative. We have until the 18th of May 2026 to confirm our position, firm offer or no offer. There is no certainty that an offer will be made.

I said publicly today and I'll say it again here, we have built a business with a margin profile that stands out in this industry. Evoke has the scale. We see a compelling opportunity to bring our operating model to a significantly larger business and the potential to transform its financial performance through synergies we are uniquely positioned to deliver. This is an opportunity we're pursuing with conviction. I'm not going to go further than the announcement. That's what the process requires, and I will not deviate from it.

What I will do is take you through a set of results that show exactly why this business has earned the right to be on the front foot. The numbers speak for themselves. One point I will address head on before we go further is leverage. I know the question will come. Our commitment is straightforward. We'll protect the interests of our shareholders, our bondholders and our other stakeholders. That is not a throwaway line. It is a lens through which we're evaluating every aspect of this. I will say more in the capital allocation section. Now the results.

The financial year 2025 was the most consequential in Bally's Intralot's history. In October, we completed the acquisition of Bally's International Interactive, a transaction that created one of the largest listed iGaming and lottery platforms in the world and one of the largest listed entities on the Athens Stock Exchange.

On a reported basis, group revenue for FY 2025 was EUR 518 million, up 34.8% year-on-year. Adjusted EBITDA was EUR 183.5 million, up 40.4% with a margin of 35.4%. The BII business contributed EUR 167.1 million in revenue and EUR 67 million of adjusted EBITDA at a 40.1% margin in just under 3 months of consolidation. That margin tells you everything about the quality of what was acquired.

On a pro forma 12-month basis, the combined group generated revenue of EUR 1.086 billion and adjusted EBITDA of EUR 430.8 million at a 39.7% margin, in line with guidance. I am really proud of that delivery. We're now 6 months into the integration of Bally's International Interactive. I will not overclaim on synergies at this stage, but I will say clearly, the teams have come together well as one leadership team, one strategy and one set of priorities. We are tracking in line with the EUR 15 million synergy target I committed to on the Q3 call, and I have no reason to revise that.

The cultural integration matters as much as the financial one. We have 5 values that define how we work at Bally's Intralot: win as one, powered by curiosity, fun with purpose, embrace the possibility and guard the game. Those values are not aspirational posters on the wall. They are the operating system of how we run this company, and they are what allows an organization of this scale and complexity to move at speed.

Let me now address what I know everyone on this call wants to hear about, the U.K., the tax change and what April looks like. U.K. B2C NGR for Q1 2026 delivered approximately GBP 147.9 million, up approximately 10.5% year-on-year. Every month of Q1 delivered year-on-year growth. U.K. online revenue in January and February was GBP 95.7 million, 11.1% growth year-on-year, and March continued that with double-digit growth. We entered the tax change from a position of strength, not retreat.

Now I can add April. The U.K. remote gaming duty rate doubled from 21% to 40% on the first of April '26. 19 days in, here is what our unaudited results look like. First, U.K. net gaming revenue is up double digit year-on-year. Our player volumes and total wager have held. We have not lost customers to competitors, and we have not lost them to the unregulated market. Our brands are robust. Our product is competitive and our player base is growing. So active players are up 7% year-on-year. Whilst some competitors have been reducing marketing, we have been gaining players. The market share thesis I articulated on previous calls is not theoretical, it's happening.

Next, NGR is sitting at GBP 32.2 million for the first 19 days and is ahead of March on the same-day basis. Wager per player is lower year-on-year. That is intentional. We tightened generosity as part of our mitigation program. We are generating more efficient revenue from a larger player base. That is good business. I said on previous calls that a less competitive market would benefit operators with our scale and margin profile. 19 days into the new tax regime, I am more confident in that view than ever.

So the 2026 guidance. We guided to an adjusted EBITDA of approximately EUR 422 million, which we reaffirm today. I'm not changing that number. The early April data gives me even greater confidence in delivering it. So if we go from the beginning and remember where we were in financial year '25 pro forma adjusted EBITDA, which is our base, is EUR 431 million. Then we have the direct U.K. remote gaming duty impact where it goes from 21% to 40%, that's a EUR 95 million hit. We then add back our generosity reductions and marketing and cost savings, adding EUR 35 million and our planned transaction synergies another EUR 15 million, plus our organic growth across all markets adds EUR 34 million. That gives us our 2026 adjusted EBITDA guidance of EUR 422 million.

We have been really clear and consistent on capital allocation and our actions have followed our words. We have executed approximately EUR 20 million of share buybacks since receiving shareholder authorization. I believe our shares represent excellent value and I intend to continue this program in a disciplined manner.

The Board is recommending a pre-dividend of approximately EUR 30 million, subject to shareholder approval. This reflects our confidence in the cash generation of this business.

Operating cash flow in FY '25 was EUR 158.5 million. We have significant free cash flow headroom. On leverage, adjusted net debt at year-end was EUR 1.4939 million, (sic) [ EUR 1.4939 billion ] giving us a net leverage ratio of 3.46x on a pro forma basis. Our stated financial policy is to reduce net leverage over the medium term and our cash generation gives us a clear path to do so.

On the Evoke discussions and what they mean for our financial position, I know that this is the question in the room. I'll say this, our commitment to our stakeholders does not change. We will protect the interests of our shareholders, our bondholders and our other stakeholders. Any transaction we pursue will be consistent with our stated financial policy goals within our perimeter. That is a firm commitment, and it shapes every decision we're making in this process. Our existing capital structure will be protected, but at this point, it's very early to provide any further insight.

We're working very hard with our financing providers and advisers to agree the best possible financing structure that fully protects our perimeter. These discussions are happening live. And until we conclude the details, we cannot say more. We're fully aware of the landscape, and we've -- and we have the following 4 weeks to work on a structure that will be meaningful and that will create value for all. We need to respect the rules in discussions with investors and we'll cleanse information when required.

The strategic context for M&A has strengthened since our last call. The remote gaming duty change has created a more differentiated competitive landscape. Operators with thin margins and limited scale are under real pressure. I have said on previous calls that we're actively evaluating opportunities and that we will not miss a genuinely compelling one. This morning's announcement is consistent with that posture.

I will not add to what is already in the public announcement. The process does not allow it. So I would ask you to read it alongside everything we have just told you about our margins, our platform, our operational track record and our cash generation. The strategic rationale for why a business like ours would look at a business like Evoke is not difficult to follow. Beyond Evoke, we continue to monitor the broader M&A landscape. Our criteria have not changed, regulated markets, strong brand positions, accretive economics and logical operational fit. Our EUR 160 million undrawn revolving credit facility provides genuine financial flexibility for the right opportunity.

So just to summarize, financial year 2025 delivered over EUR 1 billion in pro forma revenue. EUR 430.8 million in adjusted EBITDA at a 39.7% margin, which is in line with our guidance. Our integration is on track. Synergies are being delivered. We have one team and one strategy. The U.K. Q1 2026 has been strong with approximately GBP 147.9 million of NGR, up approximately 10.5% year-on-year. April NGR is up double digit year-on-year. 2026 adjusted EBITDA guidance of EUR 422 million has been reaffirmed and we're tracking in line. We've executed EUR 20 million of buybacks, and we have a EUR 30 million pre-dividend recommended.

Commitment to our stakeholders is unchanged. Any transaction will be consistent with our stated financial policy goals. So we are on the offensive. The competitive landscape is really shifting in our favor.

Now I'm going to hand over to Andreas to take you through the financials in detail.

Thank you, Robeson. Good morning and good afternoon, everyone. I will now take you through the financial performance for the 12 months ended 31st of December 2025, both on a reported and pro forma basis using the final audited figures released this morning.

Going straight to Slide #3. Here, we present the year-on-year bridge for both revenue and adjusted EBITDA [ decomposed ] by B2C and B2B segment contributions. The revenue increased from EUR 384.3 million in 2024 to EUR 518 million in 2025, is driven predominantly by B2C with the B2B segment acting as a modest drag. The B2C segment contributed EUR 150.1 million, largely reflecting the consolidation of Bally's International Interactive from October 8, 2025, which added this segment EUR 166.3 million to the revenue.

Within the legacy B2C portfolio, Tecno Acción in Argentina delivered modest growth of 2.5%, while Bilyoner in Turkey saw the underlying market expand approximately 50% in local currency, but reported revenue declined 21.8% due to changes in the remuneration structure within the value chain and the impact of euro to Turkish lira translation.

The B2B segment contributed minus EUR 16.4 million, primarily driven by FX headwinds. In the U.S., approximately EUR 8.1 million of the decline is attributable to foreign exchange movements and lower merchandise sales. Australia delivered 4% growth in constant currency terms, while Croatia grew by 13.2% year-on-year and Argentina's B2B operations also showed strong performance, providing a partial offset for the softer performance in rest of the world markets.

Regarding the adjusted EBITDA bridge from EUR 130.7 million to EUR 183.5 million, tells an equally important story. The B2C segment contributed EUR 62.3 million, driven by Bally's International Interactive's EUR 63 million, adjusted EBITDA contribution at a 40.1% margin, partly offset by the FX-driven decline in Turkey, which, however, has been largely mitigated by operational cost reductions.

The B2B segment contributed minus EUR 9.6 million year-over-year, tracking the revenue softness above the FX and the lower merchandise and implementation sales, with the U.S. remaining the largest profit contributor. The fourth quarter of 2025 adjusted EBITDA of EUR 93.4 million is the clearest illustration of BII's earnings accretion, accounting for the large majority of the full year uplift.

Turning to Slide #4, which presents our revenue mix across 3 dimensions on a reported full year '25 basis, but also on a pro forma full year basis. So the first pie, which is by game type, The lottery games remain the largest contributor at 46.2% of total revenue, a reflection of Intralot's established B2B lottery platform. iGaming primarily and sports betting follows closely at 45.2%, driven by BII's B2C digital operation consolidated in the fourth quarter. VLT monitoring accounts for 2.1%. And casino and other activities, 0.5%.

The near parity between lottery and iGaming on a reported basis already signals the transformation underway. On a pro forma full year basis, iGaming and sports betting with iGaming being the clear majority contributor.

In terms of geography. America, primarily Intralot U.S. and Argentina operations is the largest region at 42.6% of reported revenues, followed by the U.K. at 30%. The U.K. [ weighting ], reflecting BII's games operation from October onwards. Europe accounts for 10.6% and rest of the world represents 16.8%. Here, we include Australia, New Zealand, Turkey and Morocco. On a pro forma basis, the U.K. weighting increases further to 61.5%, America 20.3% and Europe and Rest of the World, 18.2% combined.

Lastly, by activity line, on a reported full year '25 basis, B2B accounts for 53.2% of revenues and B2C 46.8%, already a significant structural shift from Intralot's historically, B2B-dominant profile. On a pro forma basis, B2C rises to approximately 73% and B2B falls to 27%, reflecting BII's predominantly consumer-facing digital business model. This mix shift is primarily the driver of the margin expansion we are delivering.

Moving on to Slide #5, which presents our most detailed P&L view with 5 columns: pro forma, full year; BII, stand-alone contribution; Intralot legacy; reported full year 2025; and full year 2024. This split is important because it isolates the financial profile of each business and shows clearly where the margin uplift originates. Reported full year '25 revenue of EUR 518 million represents a 34.8% growth over 2024. Intralot's legacy operations contributed EUR 350.9 million with a decline from 2024's EUR 384.3 million, reflecting the FX and merchandise headwinds described in the bridge section above. BII contributed in total EUR 167.1 million from the acquisition date. On a pro forma full year basis, combined revenue was 1.8 -- EUR 1.085 billion approximately.

In terms of adjusted EBITDA, here is the most important insight from this 5 column presentation, which is the margin differential between BII and Intralot legacy. BII's high-margin B2C digital model is structurally accretive to group margins and its full year pro forma weight drives the combined margin to 39.7%, approximately 570 basis points above the Intralot's stand-alone full year 2024 level. Intralot's legacy adjusted EBITDA of EUR 116.5 million on the EUR 350.9 million of revenues represents a 33.2% margin, modestly below the 34% achieved on the full year 2024, consistent with the FX and revenue headwinds already discussed.

BII's [ EUR 67 million ] adjusted EBITDA on EUR 167.1 million of revenue at 40.1% demonstrates the quality of the digital B2C business being integrated. On the other hand, the resilient and visible operational profit contribution of the B2B lottery business is what legacy Intralot brings on this combined business platform. Below EBITDA, D&A of EUR 92.4 million on a reported basis reflect the amortization of acquired intangibles of BII for the period October 8 to December 31, 2025, as well as purchase price allocation adjustments following recognition of BII's intangibles.

Transaction fees of EUR 20.2 million are entirely attributed to the Intralot legacy column as this relates to M&A advisory and financing fees incurred during the acquisition. Net finance expense of EUR 85.3 million, mainly impacted by the increased interest and related expenses due to the accrued interest of the new debt structure for the period, coupled also with the one-off commitment fee of the bridge financing related to the transaction.

Here, I would like also to reaffirm the guidance we have given for 2026. And as Robeson stated already, we can reaffirm the adjusted EBITDA guidance of approximately EUR 422 million on a constant currency basis. The early April trading data and the continued progress on our cost mitigation program support this guidance. We are not revising this number. We are affirming it with greater confidence.

Moving to Slide #6, where we consolidate 4 key metrics across the reporting periods and on a pro forma basis. So the first 2 have already been analyzed in detail, so no need for further analysis here. Regarding the net leverage, the reported net leverage of 8.1x reflects the full acquisition of the debt against only a partial year BII adjusted EBITDA contribution. On a pro forma basis, leverage is 3.46x, a level we view as appropriate given the cash generative nature of the combined business. We are committed to a disciplined deleveraging trajectory over the medium term, supported by strong operating free cash flow generation.

Reported operating cash flow of EUR 158.5 million in full year 2025 grew by 45.8% from [ EUR 108.7 million ] in 2024, comprising of EUR 113.6 million from Intralot -- legacy Intralot and EUR 44.9 million from BII. On a pro forma basis, operating cash flow is approximately EUR 388 million, reflecting the inherently cash generative nature of the combined platform. Net CapEx of EUR 40.3 million, remains disciplined with the uplift driven by BII's technology investment and increased Croatia and U.S. project expenditure.

Lastly, moving to Slide #7, which represents the movement in adjusted net debt from [ EUR 334.2 million ] in December 2024 to EUR 1,493.9 million at December 2025. The significant increase primarily reflects the transformation of the group's capital structure to support the strategic acquisition of Bally's International Interactive. The transaction-related net cash consideration totaled EUR 1,534.7 million, while net proceeds from the share capital increase reached EUR 399.9 million. Reorganization and refinancing related expenses reached EUR 108.9 million.

The group's strong financial performance is demonstrated by the generation of EUR 93.4 million in free cash flow. Net interest paid amounted to EUR 23 million only, entirely related to pre-acquisition debt. Other debt movements are noncash and include a positive impact from the favorable foreign exchange effects, primarily related to our U.S. dollar-denominated debt counterbalanced by increased accrued interest and lease liabilities recognition related to the acquisition.

And at this point, I would like to hand over to Chrysostomos.

Thank you, Andreas. I will be very brief regarding the lottery section. As most have already been said by both Robeson and Andreas and addressed in our previous calls. Just to summarize that the lottery segment remains one of the most distinctive and valuable pillars of Bally's Intralot, offering stability and predictability in our P&L.

The lottery segment contributed to the adjusted EBITDA of 2025 of EUR 125 million to the combined group. However, performance was impacted by the U.S. dollar and euro exchange rates given our significant exposure in the U.S. Also, our other big market, Turkey, we had an impact from the change of the fee on the top line. However, efficient marketing spend resulted in higher market share. We acquired significant market share, both in 2025 and 2024, resulting now in a market share of the online sports betting market in the country, exceeding 20%, and that corrected the top line losses in terms of profitability. The lottery business is not impacted by the U.K. remote gaming duty increase and provides, obviously, a meaningful counterbalance as we navigate the evolving U.K. tax environment.

Now in the past year, we secured expansions in key U.S. states, including Arkansas and New Hampshire. While recently, we extended our services to the British Columbia Lottery Corporation, BCLC, with a new contract on services that will provide and enhance the basis of our local presence in Canada. Actually, we started a new company, Intralot Canada, which will be the center for consolidating the opportunities in this very promising market.

Now our lottery operations span 39 countries. No other listed operator has this combination of online gaming scale and lottery. Our pipeline of tenders and renewals is very healthy. I believe that in the coming weeks, maybe days, we will be in a position to share news on critical updates on tenders in which we participated. In addition, the New York State Lottery RFP is out, and we intend to participate. Texas is another large-scale opportunity. The combination with Bally's Interactive has given us the balance sheet capacity to pursue U.S. opportunities previously unthinkable as a stand-alone Intralot group.

So with this brief comment on the lotteries section, I will now hand back to Robeson.

Thank you, Andreas, and Chrys. But before we open for questions, let me leave you with 3 things. The first is delivery. We said we'll close a EUR 2.7 billion transaction, integrate it and deliver over EUR 1 billion in pro forma revenue at nearly 40% EBITDA margin. We did exactly that. I said the words and then we followed it with the numbers. The second is resilience. The U.K. remote gaming duty change is the most significant regulatory shift in our market in years. I have been telling you for 3 calls that we had a plan and that we had margins to absorb it and that a less competitive market would favor operators with our scale.

The third is momentum. We're not going to stand still. I don't think we'll ever stand still. We are returning capital to shareholders. We're managing leverage carefully. We are evaluating M&A from a position of genuine strength, not desperation, not financial engineering, absolute strength. The announcement this morning reflects that. This business has a very strong medium-term trajectory. I am confident in it. And today's results and April's data gives me more reasons to be.

We'll now open the floor for questions. Operator, please go ahead.

[Operator Instructions] The first question comes from the line of Chinchilla, Ricardo with Deutsche Bank.

The numbers that you shared are very encouraging for April, and we appreciate that you share this information. I was a little bit curious if you could share a little bit more on your plan on generosity. How was the introduction of the generosity measures or cutting the generosity in gaming has been introduced? Has this been a process that started a little bit prior to the tax change? Or is it something that you introduced and has slowly been changing as April has progressed? And have you seen any changes in terms of engagement, recycling of proceeds or basically time that your players are spending in your games change as a result of the changes in generosity?

Yes. Okay. Thank you, Ricardo, and thanks for the question. So when we talk about generosity, it's a combination of customer rewards and customer wins. What's really important to understand, we have introduced many of these changes in advance of April is that what we have been doing is concentrating rewards to ensure that more people end up with winning experiences. But they don't end up with extraordinary winning experiences. So this essentially means that people don't really win walk away money. They end up winning enough to give them more session time, so playing for longer. So they're getting better value for money, but it also means that they're much more likely to increase the recycling of winnings, which is all about the balancing act of, call it, reinvestment and extraction from the system. Hopefully, I've answered your question.

Also, as you can imagine, if people engage for longer, and they have better experiences, and that doesn't mean like you win life-changing sums, it means that you actually get better value for money, you retain better, and that's why you'll see our active player base is growing. That isn't all driven by new customers coming through the door. Our loyal player base are stickier than ever before.

Got it. In terms of -- you mentioned that you have a position of strength and that you're monitoring every opportunity. Have you guys been engaging in perhaps the acquisition of databases or brands or anything from the smaller players that probably are not going to be able to compete in the new tax environment?

We are looking at all different types of avenues. So yes, there are models such as looking at databases or competitors essentially getting a royalty rate by giving us all of their customers because we can offer them a higher margin return to them than they would be experiencing today and absorb that in our normal cost profile. As you would have seen before in many of our decks, essentially, we spent 11% of our net gaming revenue on marketing. If I offer some of these small operators the same number, they earn more than their earnings today, but it would run through our business in the same margin, if not higher, because we're already at scale and you get it immediately, so you don't have to wait for it.

Got it. Last one for me. With regards to your cash balance, is that net out of customer deposits or does that include any liabilities for player deposits? And what's your minimum operating cash for this business?

Okay. Let me take this one. It includes some amounts that are netted off with [ loss ] in the U.S. was around EUR 22 million. And also cash amounts in Turkey, smaller, around EUR 4 million. These are detailed in the relevant note of the financial statements, you can find all the details in there.

Mr. Chinchilla, have you finished with your questions?

Yes, I appreciate the questions. Thank you.

The next question comes from the line of Stuart, Richard with Deutsche Bank.

Just a couple for me, please. I think you've been very clearly -- you've clearly articulated the opportunity you can see on a lower-margin U.K. online operators. Could you also just clarify where your stance is on the retail side within the U.K. and potentially sort of online businesses in Europe? Do you see a similar opportunity there?

And my second question is really regarding the lotteries business. You talk a lot about renewals and tenders for this year. Could you just remind us what sort of CapEx do you expect for this year? And are there any particular sort of tenders and renewals you want to just call out within that?

I'll take the first on retail and, call it, Europe and other operators. What's important to think about with -- I'll pick up online first. If you look at an example of, say, Evoke, interesting business, large presence in the U.K. online, almost 1/3, 1/3, 1/3, right, because you've got the high street bookmakers being 1/3, you've got the U.K. online being 1/3, and then you've got their international business. What's excellent about the mixes that you see in these companies, and I won't shy away from saying that we understand the U.K. exceptionally well. We don't necessarily understand some of these other markets as well as I would like. So we're being fortunate in the fact that you can look at M&A with a single lens on actually essentially applying your business model just to the U.K. market, and you can pick up other territories free. So you almost end up with diversification coming as a byproduct of being very efficient in what I consider the best regulated market in the world because it's got wonderful barriers, wonderful frictions, but we're very good at navigating that.

With respect to retail, as you would have seen, I'll use the bookmaker lens, over time due to things such as FOBT stake limits such as COVID, other things like that, the actual number of bookmakers on the high street has massively reduced over time. I think it's important to have presence in retail. I think it's a good business. It needs to work very much hand-in-hand with online. So you need to make sure that your customers, if possible, can be fluid between both online and retail as best as possible, but everything we're looking at, we're being honest with ourselves and saying, we know U.K. online very well. So that will be our leaning. There's other factors which come into play where you get some other assets to diversify, that is an added benefit.

But can I hand over to Chrys on the lottery CapEx question?

Yes. Thank you, Robeson. CapEx, last year's CapEx was around EUR 65 million pro forma, I mean both businesses. This year, the Intralot side is going to be a little bit higher because of the renewals in the U.S. So let's say, EUR 80 million. And to that, we need -- we cannot comment any more because we don't know the outcome of the tender for the Victoria license in Australia. Once that comes in, we'll be able to have a more accurate estimate of our CapEx this year.

That being said, it was always clear that '26 and '27 would be abnormally high CapEx years, but following the combination with Bally's Interactive, we clearly have the balance sheet and the cash flow to handle all these opportunities and still fulfill our financial policy goals.

The next question comes from the line of Apostolidis Alex with LGT.

A few questions. Just firstly, on April. I believe you mentioned that active players are up about 7% year-on-year. What's the market growth rate overall for April, please? The second question, just on the B2B legacy business down about 6%, excluding Bally's. Can you provide that revenue figure at constant FX, so just excluding the U.S. to euro movements that you cited earlier? And then I have 2 follow-up questions after that, if that's okay.

Well, I can't tell you what the market growth rate is. What I can say is if you look at all of our competitors -- because it's just not ours, right? What I can say is if you look at all of the competitors and especially the Big 5 in the U.K. in Q1, we grew faster than the others in the market. So I guess that would say that our growth rate, which I'm talking about double-digit revenues, the market is growing at a slower rate than that.

B2B, Chrys will pick that.

I suppose you are not referring to April, because April is not available.

Yes. Exactly. I'm referring to Q1. That's why I talked about Q1 because April will not be available, obviously.

So how about the second question on the legacy business, can you repeat what exactly the question was, Alex?

Yes. Yes. No, just to clarify. So on the B2B side, this is for Q4, but it was down about 6%, excluding Bally's. I think the figure is 5.8%, 5.9%. What that figure looks like at constant FX?

On an annual basis or just the fourth quarter?

For the quarter, I think it's the 5.9%, so for the quarter Q4 ending December 31.

Okay. Okay. Please continue. We'll get back on this shortly.

And then just the other two questions. If you can comment on Montana. I think Australia, you mentioned something briefly. Ohio, Illinois. I mean these are licenses coming up in '26 or '27, I think. Any early guidance you can give on those, the progress you're seeing, positive, negative? And then the last question, just to clarify, I believe on the call you held a few months ago, you stated no intention to expand into retail. And has something changed, I guess, in light of that comment versus the press release this morning from your perspective on retail specifically?

So when we talked about retail, we are referring to really casinos in the retail space. These are -- if you know the U.K., well, the majority of large operators have high street bookmakers almost as their free advertising voice on every street in the country. It's almost an asset you inherit, but it does generate good cash. So this is much more aligned to have the origin of all the sports betting arrived into the U.K. high street bookies, then online arrived later. You look at anyone, you look at Entain, they have high street betting shops. You look at Flutter, high street betting shops. So that's the byproduct of what we're assessing with respect to Evoke.

I'm getting back on the question, on a constant currency basis, the delta is 2.4% instead of 6% for the fourth quarter.

Okay. And you had -- your other question was about the new contracts. Ohio, Ohio is a contract that we have lost. So we will be out in 2027, the lottery contract. On Montana, we have renewed and this -- the new system will launch in July this year. We're expecting the outcome of the tender for the VLT monitoring business in Victoria this month as well as Chile and tender for a new project we participated in Ontario, Canada.

And just a brief follow-up. The -- about 3.5% decline on the B2B business at constant FX. What exactly is driving that then?

On constant currency, you mean?

Yes.

Okay. There were some merchandise last year, which was not the case in 2025. So primarily, this is in the U.S. So primarily, there is where the deficit comes from.

The next question comes from the line of Mansfield, Colin with CBRE.

I understand you can't obviously speak about the potential acquisition, but maybe asked in a different way. I guess, how does the potential for any M&A transaction impact the quantum of how you guys are thinking about the pre-dividend you alluded to in your preliminary results that you would pay after the first half results? So I understand you're paying the EUR 30 million after these results. But the ones that you intend to pay later this year, I guess, how does that kind of impact the quantum of how you're thinking about that?

Robeson, do you want me to take this one?

Yes. Go for it, Chrys.

Again, this is at the core of our financial policy goals and we promised to the investors to return on profits. This particular EUR 30 million that we are going to recommend to the Shareholders Meeting, the Annual Shareholders' Meeting coming up next month, is actually distribution of profits from previous years that were not possible due to previous losses. So that's one.

We've also said that we will examine a pre-dividend following our 6-month results. Obviously, this is -- the amount is something we will evaluate given all our cash flow at that time. But these amounts definitely fit within the whole cash flow capabilities that we have.

Just to remind you, last year's pro forma cash flow generation was EUR 170 million -- EUR 173 million. So we definitely have the capacity. Given that the mitigation plan proceeds, as Robeson has explained on this call and previously, we will be able to honor these promises to the investors.

Great. Yes. No, I agree there's plenty of capacity here. Just trying to gauge how high up you guys would be able to take the distribution. Maybe one quick follow-up. The color on share repurchases to date is very helpful. I guess what factors [Technical Difficulty] and repurchases? Anything there would be helpful.

Sorry. Sorry, your line was breaking up. Can you repeat the question, please?

Yes. Just how do you guys balance capital allocation decisions between dividends and repurchases?

I mean, we repurchased EUR 21 million in shares, and the -- as I mentioned, we had capacity from previously undistributed profits which would be available. So that was the starting point for determining the dividends that we're going to recommend, the previously undistributed dividend. And from that, then the remaining cash that we considered available for the shareholders' benefit was the remaining EUR 21 million that we've already allocated in the purchase of own shares.

The next question comes from the line of Narula, Raman with Principal Asset Management.

First, just a quick follow-up on the CapEx point. So you said on the Intralot side, it will be higher, and you gave a figure of circa EUR 80 million. Is that EUR 80 million incremental on top of like the run rate, call it, EUR 60 million, EUR 65 million? Or is that the total?

No, no, no. The incremental is EUR 20 million to EUR 25 million.

Got it. Okay. So the incremental is EUR 20 million to EUR 25 million, taking it to like EUR 80 million and a bit then, right?

Yes, yes.

Got it. Okay. Perfect. And then I guess the one question I had is, I appreciate giving and reaffirming the guidance. I remember back in Q3, when you outlined the mitigation plan, you sort of gave us some numbers of how you're thinking about the next year by segment and you have U.K., Spain and legacy Intralot. I mean given you sort of reaffirmed guidance several times, are you able to give us that split of how you expect performance to turn out by these respective segments?

Yes, sure. So essentially, if you go back to when we gave our initial mitigation plan, we've actually said exactly the same thing the entire way through. So we've essentially given growth for Intralot at almost inflationary. We've got some of our international markets the same growth rate we've seen historically. And then when we talk about all of our mitigations, we're very focused that, that sits within that U.K. segment. So it's exactly the same. We're on track for the same plan that we gave to, I guess, 1 day following the tax announcement change in November. So that's available. We can make sure we add that to the quarter.

Understood. There's just -- I mean, at the time, you mentioned that like given the speed at which you put together that slide that it's a bit of a conservative guidance. And then obviously, given the run rate performance throughout the balance of this year, I'm just wondering if there's any scope where you see -- you would think it's prudent to sort of revise that a bit upwards the organic growth rates or you're comfortable sort of as is at the moment?

I believe it's sensible to sit on it as is. Obviously, we're seeing certain changes happening in the marketplace. We've said we're even more confident with our guidance. We're 19, 20 days into a significant change in tax. I've always ended up believing that people make their final decision when they actually have to pay their first tax bill, not before then. So there's a bit more unknowns in there.

Having said that, everything that we're seeing today means that we're in line. If we -- if there's potential upside for more trauma in the market, then there's more benefit for us together. So you can interpret that how you would like, but we're keeping guidance as it is and we are just more confident in that.

On the split of the 2 businesses that you've asked, roughly, you should anticipate on the Bally's Interactive side, roughly EUR 300 million in the EBITDA plus or minus and the legacy Intralot roughly EUR 120 million plus or minus. That's the split of the EUR 422 million.

The next question comes from the line of Elias, Karine with Barclays.

Appreciate you can only give limited details on the announcement this morning on Evoke. But just broadly speaking, when you're referring to the transaction being aligned with your stated financial policy goals, in relation to, obviously, leverage, which is at 3.46x. And you mentioned that ultimately, medium term, you wanted to reduce that to 2.5x. What is the sort of like maximum leverage you're comfortable operating with would be helpful? And any comments in terms of your ICR also would be quite helpful as well to the extent that you can?

Chrys, do you want to take that?

Yes. Look, we are always -- if we move ahead with Evoke, we're looking into a different capital structure moving forward. And as we said, we will refrain at this moment of making and giving any further insights of how we think about it. On our traditional business, we've mentioned many times that our idea about the impact of the new gaming duty in the U.K. is that it will delay our plan by 1 year. So that's all the impact we anticipate because we see the opportunity to grow as other people either disappear or shrink taking advantage of our superior margin in this business.

So just delayed by 1 year on track for the trajectory to EUR 500 million EBITDA, which was our ambition when we put together the combination of the 2 businesses.

The next question comes from the line of Branshtein, Yuliya with Tresidor Investment Management.

Just a question on the U.K., please. So my understanding is that the big operators have been experiencing somewhat of a tailwind since the second half due to voluntary affordability checks becoming compulsory for the rest of the market, while I understand that you guys have already implemented them before. So could you help me quantify that tailwind? How much of the double-digit growth in April is driven by it? Is it like a low single-digit impact? Or is it higher?

Could you explain your question again just so I get it right, please?

Sure. So my understanding is that there were voluntary affordability checks in the market, which all of the big operators had complied with previously. And so they saw a bit of a headwind in the market because the rest of the market didn't have to comply with them. And then from the second half of '25, as those became compulsory for the rest of the market, so benefiting, therefore, the bigger operators. So I'm just wondering how much of your growth is driven by that tailwind, if at all, because I heard from some of your competitors that there's some tailwind associated with that?

Yes, there is an element, but it's just worth understanding that the majority of revenue uplift we're seeing from our existing players, it takes a long time -- not a long time, it takes time for new customers to significantly contribute. It's like build layers on a cake, and it takes a significant time for that. So some of these people who are moving because we are acquiring at a more efficient rate, higher volumes of players more than we actually ever used to achieve, but the majority of the revenue uplift we're seeing from our existing players, and that is caused not by big VIP spends and not actually by people fundamentally spending more as I said earlier, it's all caused by fewer winners winning significant sums of money. So it's just much more balanced ecosystem.

Understood. And just to build on that. So that -- should we think of it just sort of a change in kind of your product proposition? Or should we think that -- sort of how should we think about marketing in the meantime? Did you increase marketing in time to get to double-digit growth? Or is it just all on the back of the way you've sort of readjusted your product?

Good question. We have essentially just changed the configuration of our product. And then, as always, very careful around where we spend our acquisition marketing money to essentially minimize competition when we actually spend. It isn't always about like some people think that you have to be the loudest to win. We are just very clear with our message to find the right customers. So no, we're not spending more on acquisition marketing. That's one of the questions. But we definitely just tweak the configuration of our products to boost the experience of what you would consider your mid-value customer. I think it's helpful.

The next question comes from the line of Pointon, Russell with Edison Group.

I have two questions. First one to Robeson, I think. On previous calls, I think you've said you've been interested in entering a number of new markets per year on the B2C side. But I just wondered how far up your radar the markets that Evoke is in were how attractive they were to you before Evoke became available? I appreciate you have to be opportunistic on these things.

And my second question, probably for Chrys or Andreas, is in Turkey, you had the change in the revenue mechanism. I think it was in Q4. So how much of a revenue headwind does that present into financial year '26 on an underlying basis, please?

I'll quickly just pick off the territories where Evoke is present that were very appealing to us. Obviously, Italy is an appealing market, hard to get entry, and they are scaled there, nice market. Wouldn't have necessarily been top of the list due to the challenges of actually entering. Romania is an attractive market and was on the list. There's also a kind of layering aspect, whereby a decent player in Spain, and we already have presence in Spain. So there is some logic there.

So the -- with any of these M&A opportunities, you have to look at everything in and around. We have to take all the appropriate prudent steps, but I kind of view some of these as ways to accelerate time to have the international footprint that they have would take many years to have on that scale. So we will review all opportunities anyway. But yes, it's a good -- it's a sensible fit again with them.

You had the second question, that's -- I can't remember...

Okay. I can take this one, Robeson. So Russell, regarding Turkey, you asked about the change in the value chain, the remuneration fees, what was the impact. So the impact from the change in the remuneration was around EUR 26 million. However, we said that there was a very healthy organic growth there. So this was counterbalanced by EUR 17 million organic growth. So the net impact on the revenue line was around EUR 9 million in 2025 compared to 2024. And of course, with a very efficient cost handling, the EBITDA was mitigated. It was slightly lower year-over-year.

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

Okay. Well, thank you all for joining. Clearly, we're very interesting at the moment due to the volume of questions we got. There are very exciting times ahead, and I wish you all the very best until we speak to you again shortly. So thank you for joining today.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling. Have a good afternoon.

Ladies and gentlemen, thank you for standing by. I am [ Gaily ], your Chorus Call operator. Welcome, and thank you for joining the Bally's Intralot conference call and live webcast to present and discuss the Bally's Intralot trading update. [Operator Instructions] The conference is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Robeson Reeves, CEO of Bally's Intralot. Mr. Reeves, you may now proceed.

Good morning, everyone, and thank you for joining. As a standard reminder, this call may contain forward-looking statements. Please refer to our 17th March full year results announcement for the full disclaimer detailing FY 2025 [Technical Difficulty].

Mr. Reeves, if I apologize, this is the operator. Can you hear me. Mr. Reeves, I apologize. This is the operator. Can you hear me?

Yes.

I'm sorry. Your line is very bad. I cannot hear -- we cannot you very well.

Okay. I'll try again. Apologies.

No problem.

Good morning, everyone, and thank you for joining. As a standard reminder, this call may contain forward-looking statements. Please refer to our 17th March full year results announcement for the full disclaimer and detailed FY 2025 financials.

Today, I want to do 3 things. First, briefly recap the key numbers we published on the 17th of March '26, so we're all working from the same base. Second, reaffirm our 2026 adjusted EBITDA guidance, and I want to be clear that reaffirmation is exactly what it is. And third, give you the Q1 2026 trading data, which I'm providing because it directly supports the confidence behind that reaffirmation. Let me get straight into it.

On the 17th of March, we published our full year 2025 results. I'm treating that filing as read and want to reconfirm the headline numbers disclosed previously remain unchanged. A few points worth reiterating. The 39.7% adjusted EBITDA margin reflects the structural quality of this business. A U.K. operator running at that margin has a different risk profile to any operator running at 20% to 25%. That matters particularly now as we enter the period of U.K. gaming duty change.

EUR 172.7 million of levered free cash flow gives us clear capacity to service debt, return capital and pursue M&A simultaneously if the right opportunity arises. The EUR 50 million of capital returns represents less than 30% of annual free cash flow. And we continue with our plan on deleveraging the balance sheet towards our 2.5x target. That is the base.

Now let me tell you where we stand on '26. Our 2026 adjusted EBITDA guidance of approximately EUR 422 million is reaffirmed. From today, the 1st of April, U.K. remote gaming duty moves from 21% to 40% of gross gaming revenue. We have been preparing for this since Q4 last year. So we have a mitigation bridge. If I go to the start point, that's approximately EUR 431 million. That's our 2025 pro forma adjusted EBITDA. So we get this gross tax impact of EUR 95 million, the direct cost of the duty increase on our U.K. gross gaming revenue.

With our first mitigation, that's our generosity reductions and marketing optimization, we add EUR 25 million. That's already in motion, phased in Q1 and in the run rate now. Our second mitigation are the cost savings, headcount and operating expenditure adding EUR 10 million. That's been actioned in Q1. Mitigation 3, that's the transaction synergies, adding EUR 15 million, which tracks to be in line with the commitment we made at the time of acquisition.

The final mitigation is just our organic growth across all markets, including our Lottery division with 0 U.K. gaming duty exposure, adding EUR 34 million. The net result of that is approximately EUR 422 million. That's a 2% impact on the 2025 pro forma. That is what I told you this cost would be, and that's where we remain.

On leverage, we're at 3.46x. We are entering this tax change with approximately EUR 173 million of levered free cash flow. The mitigations are operational levers within our control. And as the Q1 data I'm about to give you will confirm, we are entering this change with stronger underlying trading momentum than at any recent point in our history. On margin, our B2C adjusted EBITDA margin was approximately 40% in Q4 2025. Most comparable operators are running below 25%. When Gaming Duty nearly doubles on gross gaming revenue, not profit, a 20% to 25% margin compresses to near 0. A 40% margin does not. That asymmetry is why our guidance is reaffirmed with confidence.

Now on to trading. The reason I'm giving you Q1 data today is straightforward. Q1 trading is strong, and I want you to have that as context when evaluating our guidance reaffirmation. This is not a separate story. It is the evidence base. Please note that these numbers are unaudited and could change slightly as we close our Q1 accounts. So now I want to touch on sequential quarter-to-quarter performance. So Q4 to Q1.

Q4 is always the biggest quarter, our biggest quarter. It's always that every time. October, November, December has the autumn sporting calendar, the Christmas build, peak promotional intensity across the entire market. So in Q4 '25, U.K. net gaming revenue was GBP 148.8 million. Q1 '26 was approximately GBP 147.9 million. That's essentially flat quarter-on-quarter against Q4, right? Q4 is always the biggest. So flat is exceptional performance. So that is the first thing to hold.

Q1 2026, when we look at that for the quarter in full, U.K. B2C NGR for the quarter, as I said, GBP 147.9 million, up approximately 10.5% year-on-year. Every single month of Q1 delivered year-on-year growth. B2B performed in line with our expectations across the quarter. The B2B division is a core part of the business, and it's stable with a strong contracted revenue base, which provides additional resilience to the group during this tax transition period.

Touching on some other customer metrics in Q1. Active players were flat quarter-on-quarter, so against a really strong Q4 base. This reflects sustained momentum in both acquisition and retention as well as efficient welcome offers. First-time depositors were up 10.8% quarter-on-quarter and 59.4% year-over-year. The customer pipeline is expanding into the tax change, not contracting. B2B is stable. It's operating within our expected parameters, and there's no material surprises.

Noncore international markets are also stable. There are modest FX translation headwinds in certain markets and some market-specific dynamics we flagged at the FY '25 results. That picture has not materially changed. The group margin is carried by UK iGaming and our Lottery division. Both of those are performing. Noncore stability means they are not a drag. That's the message. This is the trading base on which we reaffirm our EUR 422 million of adjusted EBITDA guidance for 2026.

Now on to capital allocation. So I'll start with buybacks. Approximately EUR 20 million has been executed since the EGM authorization. I believe our shares represent outstanding value. I intend to continue utilizing related TRS products of international banks that do not immediately impact our cash on balance sheet and give flexibility to execute buybacks when we determine that timing is right.

On to dividends. The Board is recommending approximately EUR 30 million to the Annual General Meeting, leaving EUR 173 million of levered free cash flow, EUR 50 million returned, well within our capacity while deleveraging. On leverage, net leverage at year-end was 3.46x pro forma. The medium target remains at 2.5x, and we have a clear line of sight. On M&A, the tax environment is creating very motivated sellers, and we have the platform, the margin headroom and the management team to act on the right opportunities. So we are active.

My closing remarks, I'll just give you a nice summary. FY 2025 published on the 17th of March, pro forma revenue of EUR 1.0858 billion, adjusted EBITDA EUR 430.8 million, margin of 39.7%, leverage 3.46x and free cash flow, EUR 172.7 million. 2026 adjusted EBITDA guidance of approximately EUR 422 million is reaffirmed and our mitigation program is in execution with all 4 levers active.

Q1 U.K. B2C NGR of approximately GBP 147.9 million, flat on the seasonal peak of Q4, up approximately 10.5% year-on-year. Active players flat Q-on-Q, but up 8.7% year-on-year. First-time depositors up 10.8% quarter-on-quarter and 59.4% up year-on-year. The customer pipeline is expanding into the tax change.

B2B is performing in line with expectations and noncore international markets are stable. EUR 20 million of buybacks have been executed and a EUR 30 million dividend recommended. Deleveraging is on track to 2.5x. I said this before that the strong don't only survive, but they do get stronger, and I believe that we are getting stronger. We'll now take your questions.

[Operator Instructions]

The first question is from the line of Chinchilla Ricardo with Deutsche Bank.

I wanted to start on the M&A front. As you mentioned that there is opportunities and that the press has recently mentioned that you are active. While respecting the company's confidentiality regarding specific targets, I would appreciate an assessment of the company's M&A appetite. This assessment could encompass suitable target profiles. Are you looking at B2C operators, technology stacks and a specific company within a market? And also, can you please also provide us with an evaluation of the maximum leverage that the company can sustain or that you will be willing to elevate just to move fast in an environment and consume something strategic for the business?

Robeson, shall I take this one?

Go for it, Chrys. Go for it.

Yes. Thank you for your question. We have said many times that we are on the lookout for any opportunity that will contribute towards either organic or inorganic growth. We're clearly on a growth path from this point on. So inorganic growth would cover -- our appetite for M&A is there. But on condition that we will be able to fulfill our financial policy goals as stated, which includes, first and foremost, our path to delever and the distribution to shareholders. So both goals, I think, on distributions, we've already covered enough on this call and through our announcement.

On the path to delever, it remains our goal. We have disclosed what is the pro forma free cash flow generation. And with that, as you probably know, we have an amortization schedule with regard to our bank loans in our capital structure. And so we intend to make significant repayments and reduce the gross debt in the next 2, 3 years. So we are committed to deleverage. We will do whatever M&A is necessary by adding EBITDA by considering anything that's meaningful in terms of very, very substantial synergies that we feel comfortable we can deliver or cost reductions on the target. And at the moment, this is our message to the market.

Got it. If I may do a follow-up. The company recently opened that casino in Newcastle and you had mentioned in the past that they wanted to expand into sports betting. Can you provide your thoughts on additional casino footprint in the U.K. And if you rather acquire a sports business or build it yourself from the ground up?

I'll take this one. For us, the retail casino in Newcastle is much more of an R&D piece. It's very, very small part of the actual footprint. There's no intention to expand into retail within Bally's Intralot. The retail presence we'll have will remain in the lotteries.

With respect to Sports Betting product, we currently have an agreement with Kambi, who provides really a back-end sports betting solution. We're very happy with them. If we were to look at any opportunities out there, as we said, the U.K. market has become more attractive more because of the trauma, which has been created by this tax change. We would only consider things if we could see substantial cost-cutting opportunities as well as synergies.

I would not underestimate how strong our margin profile is versus peers in this space. As long as we can bring things into our platform, and I mean our platform, how we manage things, how we operate things that gives us this margin improvement over others, then it can become very attractive. But we'll be very diligent and ensure that we protect our capital structure in whatever we do.

If I could squeeze one last one. In the past, the company mentioned articulated growth opportunities contingent upon the integration of the [ Merck ] technology stacks. I was hoping if you could give us an update on these potential opportunities that at the time you mentioned that you would disclose once the merger was completed and you get permission. So any update would be very helpful?

So as we discussed previously, Ricardo, our intention is to launch into 2 B2C markets per year, utilizing the Intralot footprint and their relationships. These things are progressing. We will disclose those closer to the time. If we end up looking at other opportunities inorganically, that may change that plan if it accelerates expansion, but we're still on track for 2 new B2C markets being launched this year.

The next question is from the line of Narula Raman with Principal Asset Management.

Just a couple from me, please. The first, just curious if you can disclose what percentage of your full year '25 U.K. revenue was Sports Betting and maybe the same for Q1 as well? And just if you could give a sense of how that's been growing, that would be appreciated.

Cool. Katherine, do you want to take this?

Sure, Robeson. Thank you. Sports Betting still constitutes a fairly small percentage of our revenue, but we have seen healthy growth in that space as is demonstrated by the growth in our FTD numbers, which were in part driven by some sports events that happened in Q1. So we continue using sports as a funnel to acquire gaming customers, and that strategy seems to have been working as would have been demonstrated in our Q1 numbers.

And just to layer on top of that -- so thank you, Katherine. Just to layer on top of that, when we look at Sports Betting and iGaming, what you would have seen from many of our peers' recent releases around Q1 performance that there was a decline in Sports Betting and there was an increase in iGaming.

Now if you've got the balance right between your product sets, so people might win on sports and they reinvest into iGaming and so on, then you would -- the net position would always be better, whereas actually, a lot of the peers are showing down by 5% or so in Sports Betting and up in iGaming by 5%. So they're not even really seeing any growth.

What we've been very careful to do with our Sports Betting offering is ensure that it fits with all of the regulations which sit in the U.K. market, such as stake limits on slot machines. So you need to balance exactly the scale of bets that you would take alongside people's ability to reinvest. Sports betting just, call it, [ GBP 1 million ] or so per month is what we're seeing in the U.K. So small, but that's where a huge opportunity lies.

Understood. That's very helpful. And I guess as a segue into the next question, obviously, this year, huge sports calendar along with the World Cup. Just curious, maybe in a similarly stacked sports year like '24 with the Euros, I mean, what kind of effect did you see on your sort of core iGaming business during those months, those summer months when you had those big football tournaments ongoing?

We didn't see any -- if you're asking, is there any negative impact by having -- you have to understand, you've got the euros, you got the World Cup. How many of those matches are competitive and how many fixtures do they have in terms of volume. They are good acquisition drivers, but they're not necessarily big revenue drivers, right? You're going to have fixtures between Curacao and other matches, which are heavily one-sided.

When it comes to soccer, you prefer fixtures, which are a bit more balanced or you have sufficient volume. The World Cup actually is, call it, a low period or the Euros is a low period in fixture volumes for actual revenues, but it does bring new customers to the market. So for us, this would aid the funnel for acquisition, and it's almost like a perfect storm in lots of ways because there's not enough matches for people to be betting on to constantly be active. If you think about normal Saturday, there's lots of fixtures for revenue to flow there. But actually, this will get the right prestige and coverage to acquire and then there's no matches, then people can play iGaming products and so on.

Makes sense. And then lastly, I just wanted to touch on dividend policy. Obviously, in the preliminary results, you stated that it's the intention to recommend a pre-dividend sort of along with the publication of H1 results. If you could just give us a sense of like the potential quantum? Is that going to be a percentage of the pro forma adjusted EBITDA? Or is that still a percentage of adjusted net income? Just if you could give -- remind us of your dividend policy, that would be really helpful.

Chrys, do you want to take it?

Sure. At this point, we cannot give you an estimate about the pre-dividend. I think the combination of buybacks and the dividend that we will distribute the EUR 30 million, which is what we already have available for previously undistributed profits in the past, which we could not distribute at the time due to losses that we're now covering. That's the only specific thing that we would like to share at the moment. We don't want to preempt what the results are going to be. We will evaluate the entire situation, our cash flows at the time, and we will make the decision once the results are available.

Understood. And could you just clarify the medium-term target of 2.5x. Do you expect to sort of be there around mid of '27? Or what are you targeting?

That will be in line with our amortization schedules. Yes. By the time we get basically to 2029 when we have the retail bond maturing, the EUR 130 million retail bond, the unsecured portion of our debt maturing in February 2029, we intend to repay that. And we intend to repay through amortizations, as I said, and eventually on maturity at the end of 2029, the Greek bank loan. Well, these 2 tranches together is EUR 330 million of gross debt, which we intend to reduce in the coming period.

Of course, it will all depend on the cash generation, on our CapEx requirements and all of this. So in this period, we think that it's achievable if we manage to deliver our growth targets. What we said is that basically the imposition of a new tax regime in the U.K. will have, as a result, the delay of our plan by 1 year because we will be able to capture market share from a market which we believe is going to change fundamentally in the next year.

The next question is from the line of [indiscernible] with Credit Suisse.

As part of the bond offering last year, the company included the helpful KPIs. You mentioned the impressive growth, 8.7% increase year-over-year in the first quarter. Is that going to be included in the annual report that -- in upcoming presentations?

I think you're referring to the U.K. market or to the combined growth.

Yes. Maybe the active online players, revenue per active players, that type of disclosure was helpful and it was including the bond offering, and you mentioned it again today. I guess it was more of a request to include it as part of your presentations.

Yes. I think going forward, we'll share the most relevant KPIs, which can indicate the future pathway as best as we can guide. But that's why we showed new player volumes. New player volumes will build on your base and actually drive future revenues. So we're trying to be as -- we believe that transparency is always a good thing. So we'll be as transparent as is sensible without giving away too much competitor information, let's say. So we -- yes, we'll try and be as transparent as possible in every quarter going forward.

And what is driving the impressive growth in the first quarter?

Well, with respect to the revenues, as we said, we've made some slight adjustments to our products, so some of the configurations with regards to ensuring that players basically lose at a very sustainable rate. So our objective has actually been to manage player spend almost down slightly on a visit frequency, which means that people retain better longer term. But we've seen really good numbers coming from, call it, marketing performance from acquisition spend.

As I've said to all of you, the day following the tax announcement in the U.K., we saw improved performance from the same marketing spend amounts because there was reduced competition. For me, that's a pretty amazing sign that the statement of tax coming caused a reaction. So from this day, we'll see what performance looks like given now this is the first time that people with suppressed margins will have to start footing a bill with the increased gaming taxes.

I'm very hopeful that if I think about my history in this sector, when I started working here, there was no tax on revenues, no gaming duty on revenues. Then it went to 15% tax of net gaming revenue, then flipped across on to gross gaming revenue, then became 21% and this is the next tax change. In every single period of this, it's led to consolidation. And actually, through this cycle, our EBITDA margin has grown because we're very, very good at, call it, flying through a storm and operators who don't see there's a storm there, even if it might be a clear blue sky, they just don't see opportunities because you can continuously improve and continuously improve your margins and improve your growth. So I'm quite excited about this next period. This is opportunity.

The next question is from the line of Gondhale Pravin with Barclays.

Firstly, on U.K. sort of growth outlook for 2025 and 2026, what's your assessment on that given the tax changes? And then within that, are you seeing any changes in channelization of online gaming? I realize it's just day 1 of the new taxes, but what's your outlook for that as well?

Yes. Okay. So you're talking about the overall U.K. market, right? Just for clarity.

Yes, please. Yes, yes.

Yes. So the U.K. market, as I was indicating when I spoke about some of the peers who haven't been able to see reinvestment of winnings from sports betting go back into casino, there will be a degree of channelization coming from that. So people -- because the reason why people can't reinvest is due to limits on what they're able to spend. This can do multiple things.

People could move to the black market slightly. But bear in mind, the U.K. Gambling Commission are investing substantially in trying to police this. I don't see the market growing by that much, if growing at all this year because of these changes to stake limits. Having said that, I believe it's a significant period of consolidation. So I'd expect all the big operators to gain share in this. There are many operators out there who are willing to hand over databases for royalty fees and so on. They're willing to exit. And that will just mean that we can soak up that revenue. So I don't see the market really growing. It will be minimal, a couple of, like, call it, low single digit if growth, right? But there will be consolidation into the big guys.

[Operator Instructions]

The next question is from the line of Katsios Nestoras with Optima Bank.

Just a question from my side. Can you please repeat your free cash flow guidance because I missed that part.

We have not given the guidance for 2026. We have published the pro forma free cash flow for the combined entity at EUR 171 million -- EUR 172.7 million for last year. So that was on the background of an EBITDA of EUR 230.8 million -- EUR 430.8 million, sorry. So based on the guidance on EBITDA -- and it will depend a little bit on our CapEx requirements this year. Last year, the CapEx we published was around EUR 60 million. This year, it will be a bit higher because of certain renewals in the United States. And we are still waiting to hear from our bid for the Victoria Monitoring License in Australia. So we can't reveal the sensitivities on our CapEx. So it will depend on that alone.

[Operator Instructions]

Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

Thank you. Thanks, everyone, for joining us today. I'm sorry that we're interrupting your Easter break. I hope you all get a bit of time off. But we wanted to give you the most up-to-date summary of Q1, and I look forward to speaking to you again soon. Feel free to reach out to the company if you've got any further questions. So thank you for joining us. Goodbye.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Ladies and gentlemen, thank you for standing by. I am Mena, your Chorus Call operator. Welcome, and thank you for joining the Intralot conference call and live webcast to present and discuss the third quarter 2025 financial results. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Robeson Reeves, CEO of Intralot. Mr. Reeves, you may now proceed.

Thank you, operator, and thank you all for joining us today for the Q3 results of Intralot. The transaction completed in October 2025 to bring together Bally's International Interactive and Intralot. As you will have seen, Intralot has delivered strong third quarter results despite FX headwinds. Bally's International Interactive has delivered around EUR 548 million in revenue with a hefty 43% adjusted EBITDA margin for Q3, which is on track with our stated guidance. Full year 2025 pro forma of the 2 entities annualized is more than EUR 1 billion in revenues and EUR 435 million in adjusted EBITDA with a combined margin of 40.65%, which is in line with previously stated full year guidance. As you are aware, yesterday, the U.K. government revised gaming taxes by increasing remote gaming duty from 21% to 40% beginning in April '26.

This was higher than anticipated, but we are going to follow the aggressive mitigation scenarios. We still intend to deliver growth in wages accepted, which combined with generosity reductions, marketing reductions and accelerated synergies will limit the tax impact. However, this will delay our growth plan by 1 year and impact our total EBITDA by 4% versus 2025 guidance.

I'll ask you all to refer to Page 4 of the presentation as I want to walk you through the bridge. So if you look at 2025 EBITDA, I will highlight our mitigations for '26. So I start with EUR 435 million as we've provided that already in our guidance. 315 million of EBITDA is from the Bally's International Interactive segment. The U.K. online EBITDA contributes GBP 275 million with revenue of GBP 660 million. The remote gaming duty increase from 21% to 40% has a direct impact of GBP 95 million when applied to 2025. That gives us a starting point of GBP 180 million of EBITDA from the U.K. before mitigation. I want to break down the mitigations. As I said, we will look at generosity reductions, marketing reductions such as advertising and cost cutting, which amounts to GBP 35 million.

In addition, there will be GBP 15 million from the transaction synergies, which will deliver a total of GBP 50 million. Our forecast organic growth is expected to be GBP 34 million from all markets, including Intralot. In summary, mitigations are GBP 35 million, which is 28% of full year tax impact, plus the GBP 15 million of transaction synergies and growth of GBP 34 million.

We end up with GBP 435 million, minus GBP 95 million for tax, which equals GBP 340 million. We have GBP 34 million for growth and GBP 35 million in mitigations, plus GBP 15 million for the transaction synergies, leaving GBP 424 million, which is a 4% impact versus 2025. Another way to look at it is GBP 810 million of turnover from Bally's International Interactive with an EBITDA margin of circa 30% is GBP 245 million, plus GBP 35 million of mitigation, GBP 15 million of synergies and GBP 125 million from Intralot gives GBP 420 million. We believe these estimates are conservative. A significant market consolidation is possible. The full year tax impact will be higher by GBP 30 million as this GBP 90 million is a 9-month impact. We will also realize GBP 25 million more in '27 in committed intra-lot synergies, and we believe that generosity and marketing will have further flex.

Our growth in sports, expansion into new markets and the full realization of synergies will alleviate tax rate pressures in the U.K. from a full year of tax increase in '27. In 2027, increased tax for online sports betting will be introduced and drive further consolidation. Such tax increases have happened periodically in our markets and historically have highlighted vulnerability for others, leading to market consolidation and market share growth for companies like Bally's, who have higher margins than other peers.

We achieved in Q3 a 43% EBITDA margin, whilst most others are below 25%. Hence, there will be other operators that cannot adapt to this change due to lower margins and lack of scale. This will result in fewer players, and I welcome a less competitive environment. The point of the combined Bally's International Interactive and Intralot was to create a platform for both organic opportunities and accretive acquisitions. We believe this improves our prospects. I do understand that the U.K. government has a need for revenue. My message is I will continue to embrace public-private partnership and regulations, but that the UKGC will have to be extra vigilant to police offshore gambling given that the incentive to do so has increased.

The UKGC has been progressive with consideration to grow into areas such as crypto and prediction markets to lead and expand the market rather than zero-sum reallocation. I love our business, and we have been through such experiences over the years and will continue to adapt. I know that we will be very strong in the medium term. I intend to make a recommendation to the EGM, obviously, subject to Board approval to allow the company to make share buybacks. Now I'll hand over to Andreas to walk you through Q3.

Thank you, Robeson. Good afternoon, ladies and gentlemen. On October 8, Intralot completed the acquisition of the Interactive International segment of Bally's for a total transaction value of EUR 2.7 billion, EUR 1.53 billion in cash and EUR 1.136 billion in newly issued shares of Intralot. With this transaction, Bally's Corporation became the largest shareholder of Intralot with a 58% participation. The closing followed the successful completion of Intralot's comprehensive acquisition financing and satisfaction of required shareholder, regulatory and other customary closing conditions. Moving on to the Slide #5 of the presentation.

On the left-hand side, we see the pro forma capitalization table post closing, including Intralot's financing package comprising of EUR 900 million aggregate principal amount of senior secured notes due 2031, EUR 600 million fixed rate notes and EUR 300 million floating rate notes. Secondly, a GBP 400 million, EUR 460 equivalent, a 6-year senior secured term loan with institutional lenders and a EUR 200 million 4-year amortizing term loan provided by a consortium of Greek banks.

To finance the transaction, Intralot also raised EUR 429 million through the issuance of 390 million new ordinary shares at a price per share of EUR 1.1. Total funds raised were used to pay the consideration to repay all the outstanding debt of Intralot, except for the retail bond of EUR 130 million, which survived the transaction plus the transaction fees. Following all these financing activities, the pro forma net debt -- funded net debt stands at around EUR 1.5 billion and the total enterprise value at around EUR 3.2 billion. The new combined entity on the right side of the slide, on a pro forma basis for the 9-month period would have a total revenue of EUR 790 million, an adjusted EBITDA of EUR 320 million and a robust EBITDA margin of around 41% and a healthy EBITDA minus CapEx metric of around EUR 280 million. Now moving to the 9 months of 2025 financial results of Intralot and turning to Page #6.

We see the revenue analysis. Highlights here is the contribution of the Americas of around 60% and the B2B, B2G having the majority of the Intralot business with more than 95%. Turning to the next page, #7, where we focus more on the revenue line. The key takeaway is that the group showed a stable underlying performance in constant currency terms with FX headwinds, however, in all markets, which is functional currency is different than the euro, leading to an overall reported deficit of 2.9x or EUR 7.3 million, with the majority of the impact coming from the markets of the United States and Turkey. If we move on to Page #8, we have the overall P&L performance for the first 9 months of 2025 compared to the previous year and for the third quarter. Revenue is lower by 2.9% for the year-to-date period and 11.8% for the third quarter, with negative FX being the major contributor for this variance, accompanied by a slower growth in Turkey and Argentina in the third quarter. Same picture for the gross profit line. However, through efficient cost management, the group has managed to present an almost stable EBITDA performance for the 9-month period by maintaining the EBITDA margin at around 37%.

Net interest was substantially lower this year due to the scheduled repayments of the bank loans in Greece, the United States and Turkey of around EUR 25 million and lower interest rates due to both Euribor and SOFR lower levels compared to the 2024 respective period. Net income variance is attributed entirely to an accounting treatment in relation to the hyperinflation adjustments in Turkey, which had a positive effect in 2024 and a negative in 2025. Turning to Page #9.

The upper 2 graphs have been analyzed in the previous slide. And on the bottom left graph, we see the operating cash flow, which was higher by EUR 4 million as a result of favorable working capital movement and the lower tax payments. CapEx in the 9 months of 2025 was lower by EUR 4.3 million compared to the respective period of last year, mostly due to the nonrecurring license renewal payment in Turkey back in 2024, partially offset by higher U.S. investment needs in the current period. On the bottom right, we see that the net debt and leverage ratio adjusted for the restricted cash referring to debt servicing and repayments was EUR 299 million and 2.3x, respectively, for the third quarter of 2025, better by EUR 57 million and 0.4x compared to 2024 year-end.

Turning to Page #10 and focusing on the adjusted net debt movement bridge from December 2024 through September 2025, we see that the contributors to the EUR 57 million reduction have been the solid financial performance in the 9-month period as evidenced by the generation of EUR 48.1 million in free cash flow, accompanied by a positive movement in debt, primarily due to favorable foreign exchange effect in our U.S.-denominated debt, while the net interest payments stood at EUR 21.9 million.

Lastly, on Page #11, we see the contributions per region and to our revenues and EBITDA. Revenue was almost stable in all jurisdictions, apart from Turkey presented in the rest of the world. performing, however, better in terms of EBITDA in this region as well due to efficient cost management, counterbalancing the top line deficit. EBITDA in all other jurisdictions at almost equal levels year-over-year with North America performing better. And at this stage, the presentation of the results for the 9 months of 2025 is finished, and I hand over to Robeson for his closing statement.

So thank you all for joining us today. This tax change is higher than anticipated, but we will aggressively deliver our mitigation scenarios, as I've already described to you. And I've said that these changes lead to opportunities. The way I look at it is the strong don't only survive this. They get much stronger. So I'd like to hand back to the operator so we can open the line for Q&A.

[Operator Instructions] First question is from the line of Tzioukalia Fani with Euroxx Securities.

Just 2 questions on our end. First of all, you mentioned the launch of the share buyback program. I was wondering, is there any indication that the major shareholder would be looking to increase their stake in the company? And the second question is, you provided the outlook for 2026 and 2027, how you would be looking for the medium term? Would you expect that at some point in 2028, we would see the numbers that we were initially expecting as an EBITDA outlook?

I'll take that. Thank you very much for your question. With respect to share buyback, your question relates to, do you expect the majority shareholder to increase their stake in Intralot?

Yes. I mean separate [indiscernible]. Yes.

As I've said, I believe in this company and Bally's Corporation will no doubt be looking to increase its stake in the company. If we see it as value, which we do. I've already described that today, we will be increasing our stake in the company. With respect to your next question, as I said, this essentially delays our plan by a year, so I still expect the same growth prospects for us.

We just have to play catch up against what has happened to us with the U.K. tax changes. I do think this means that in the long term, you end up with a much more consolidated market in the U.K. So that is protected. You make these mitigations, you're protected, but our growth pathway is still there.

So yes, it just changes the year by 1. So it's just the latest slightly. So thank you for your question.

The next question is from the line of Raman Narula with Principal Asset Management.

Just a couple from my side. On the mitigations, just wondering, I mean, if you could touch a bit more, I mean, how much you're looking to flex sort of marketing and generosity spend? I mean, is it your expectation that your competitors, given they're at lower margin, will sort of be forced to flex a lot more than you and do you expect to be able to acquire a lot more customers by way of that? How are you guys thinking about that?

The way I look at it, so as we've already said, we've got synergies, which we had already been planning for and already starting to execute for '26 anyway. So that leaves us with the remaining EUR 35 million. I view it as the generosity piece being essentially half and then marketing being half again.

We have already, and it tells you that this is a significant shock to the industry, seen people pull back from marketing. So we will judge it if we're going to chase more growth, which would always be my preference if we're getting the right returns, but we can see already that there is substantial flex that we won't have to spend the same amount of marketing money to get the same growth. If we see greater opportunity there, we'll make sure we accelerate the growth and increase our EBITDA margins once again. But just understand that the majority of operators have an EBITDA margin in the U.K. sub-25% and many are sub-20% and in the teens. So this change wipes out all profitability and makes some loss-making.

That makes sense. And just as a segue into that, I mean, you've said that consolidation will be a direct consequence of this. I mean, other than the share buyback, will you be looking to opportunistically do any bolt-on acquisitions to further consolidate your share? Or is the sort of focus solely on deleveraging in the medium to near term and delivering synergies as planned?

I think we'll have to be opportunistic and see what opportunities arise in the market. This is obviously day 1. We do want to delever in the medium term and continue that delevering pathway. But if there are great opportunities, which in itself are delevering by an operator essentially is loss-making and we can absorb that revenue. It depends what price we would have to pay. So we're looking at everything. I do already sense that consolidation is here and growth will be driven by a few operators rather than many on the go forward.

Perfect. My next one, just on sports betting. Just would be helpful to get a sense on how that's performing relative to the core sort of iCasino. And if you could give sort of growth rate at which that's been growing and what your assumption is going forward, that would be helpful.

Sports betting is a small percentage of our revenue in the U.K., very, very small. So we actually have most of our revenue is in iGaming. We are seeing acceleration there due to our sponsorship of Notting & Forest. We expect our sports revenue to triple in the next year. That was prior to these changes. So we may be reviewing our product mix further anyway, obviously, because of the tax differential between iGaming and sports in the year of 2026. So I think there's quite a few levers to pull, but we are small in sports. We can -- I guess the narrative is we're small in sports today, we'll grow it. We can mitigate this tax rate even though we are heavily concentrated to the highest tax burden, but that's -- we can mitigate it better than others because our EBITDA margins are sitting already in excess of 10 to 15 percentage points higher than others.

Understood. And just as a last one for me, maybe on -- just to help on modeling. I mean, is there some sort of scale-up assumption that you can disclose in order to get from NGR to sort of GGR? And if you're unable to disclose, maybe it would be helpful if you can comment on like how the intensity of sort of bonuses and free spins that you guys give out to your consumers relative to sort of other competitors in the market, that would be helpful.

I guess you can do the proxy based on our revenue sitting at EUR 660 million in '25 and understand the tax impact over 9 months would be EUR 95 million. So you can use that as a reverse proxy if you want to do it that way.

The next question is from the line of [indiscernible] with LGT.

I have 3 questions. I'll ask them in order. The first one, just going off my colleague's question on Slide 4. So $229 million is the new EBITDA you present for fiscal year '26, and this is prior to any growth. But my question is, what gives you confidence that volumes will remain stable, let alone grow? And correct me if I'm wrong, but in the Netherlands, we saw similar increases and the impact there was volume pressure. So the first question is why will volumes remain stable and not decline given the move to the black market potentially?

Good question. The key things which drive growth in the black market, yes, one of the key factors is tax. The other factor is regulation. Now if you roll back and say, before yesterday, we had our existing tax rate and displacement to the black market wasn't happening. We can see that there's such a large long tail of operators in the U.K. market, there's approximately 1,000, right, who have substantially lower margins. We believe that our current numbers and everything still points to the fact that we will continue our marketing spend. There is a reduction there, but we're seeing people already pulling back from auctions and advertising that we believe our growth will continue. The regulatory balance with tax is on the edge. I won't deny that. And as you heard in my comments, I want to ensure that the UKGC focus on preventing the black market. Having said that, in all of the numbers we're seeing already, our growth comes from, yes, new player acquisition, but also our existing players becoming more loyal.

In historic presentations, you would have seen that over time, our player spends grow. Now if you think there's fewer players in the market and people spread their spend across multiple operators, this will accelerate as well. So we think that we'll gain more players because fewer people are bidding for the same traffic, but also we see further upside, which I haven't accounted for here in increased player spend because their spend is more concentrated amongst fewer operators than would have been previous.

But just to confirm -- very helpful. But just to confirm, in the Netherlands, what was the impact on volumes there on the legal market? Because my understanding is we did see volume pressure and quite significant margin -- volume pressure, excuse me.

Yes. So in the Netherlands, if you look at the data, you'll see that the majority of players, the counter players are within the regulated market. The pressures that came, and we've already had these pressures, by the way, on limiting spend of individuals. So individual player spend, so VIP spend, call it, gets displaced. That has already occurred in the U.K., very limited VIP spend. It's much more about the regular recreational player, which is exactly what we're built on.

We have a high-volume, lower spend audience. So black market in Netherlands, over 50% of revenue. 90-plus percent are playing in the regulated market. It's about the VIP displacement. This has already occurred in the U.K. And we are actually -- when you look at the regulated market in the U.K., we don't see further displacement from recreationals. And our business model is based on recreationals. We already hold a stake limit of maximum GBP 5 on a slot machine, GBP 2 for under 25 on slots. So our spending profile is much, much lower with an average stake of 63p a spin on a slot machine.

Very clear. And if I can just ask the other 2 questions together. In terms of CapEx guidance, you've given that to be low to mid-double digits for fiscal year '26 and 2027. But is it possible to provide a bit more disclosure on the exact level, which leads me to the last question, which is you renewed Arkansas, so congratulations. And then on Illinois, Ohio, Australia, when do you expect decisions on those expectations still to renew and importantly, at similar or perhaps lower margins given competitive intensity in the U.S.

I'm going to hand over to Nikolaos to address.

Andreas, let me take the second part and you talk about the numbers of CapEx. So we do have a pipeline that for -- which is going to materialize, I mean the customers are going to take decisions rather soon. It has to do with the Ontario lottery, the Maryland that still is an active process, and we are waiting to see how the next step -- the next step is going to be. Minnesota and also the VLT monitoring in OPAP that we are expecting a decision really soon, plus the VLT monitoring in Illinois that the submission date has moved to January 5. There is still also Texas that is going to issue an RFP in the first quarter. most probably of next year and some other smaller projects in Latin America and the rest of the world.

On the 3 projects that you mentioned, first of all, Ohio, it is something that we have announced a year before that Scientific Games won. So this is something that is going to run until 2027, mid-'27 for us. On Australia and Victoria, we are in a bidding process, in the middle of the bidding process for the licensing. And on Illinois, both the PMA and the technology contract that we do have expires in -- both expire in 2027. Still, there is no movement on issuing any RFP either for one or for the other.

I understand based on what I hear from the legislation and what we read in the news that there is a debate what is going to happen with the PMA, if the PMA is going to be continuous as it is, if legislation is going to change. Still, we are waiting to see what will happen there. And my view is that according to what the decision the state is going to take for the PMA, then we're going to decide when they are going to issue the RFP for the technology provider. Andreas, can you please take the numbers for the CapEx numbers for next year?

Yes. Let me take this one. It's Chrys here. As we've mentioned, we have on average, both companies combined, we estimate about EUR 60 million of CapEx per annum average for renewals and normal course of business. On top of that, there may be spike years and '26, '27 is one of those spike years because our projects, especially in the United States, as you know, they spread over 10 years.

They have the CapEx in the beginning and then the revenue share model. So there's a first cycle of the project where you don't -- where you're trying to recover your investment in 3, 4 years. And then in the second half, of the project, you are generating all the cash. And if you have an extension, which is typically the case because these contracts extend to 15 years, that's even more cash generative. Now '26 and '27 are years where we expect big spending in certain projects, as Nico was mentioning. So the additional spending will be between EUR 50 million and EUR 80 million because we are spreading these investments over time.

Of course, this will depend on the overall situation because these contracts may delay, the time line may slide a little bit. But the '26 and '27 will be exceptional years. But we think we are in a very good situation to cover whatever CapEx we need.

And just to make sure I heard the number, so it's EUR 60 million for maintenance, normal course of business CapEx on top of...

Maintenance [indiscernible] on average. Like, for example, the extension in Arkansas is part of the renewals, which is a much lighter CapEx case than if you win a tender from scratch. So on average, that's a EUR 60 million. And then you have the spike years.

The next question comes from the line of Osman Memisoglu with Ambrosia Capital.

Just going back to the top line for U.K. from '25, EUR 660 million to EUR 720 million, that does include market share gain, but the upside is from higher spend per customer. Did I understand that correctly? And also coming back to the black market, is it fair to say BII will be less impacted by leakage to the black market given the profile of the customers?

That's my first question. And then coming back to the share buyback comment, when -- what is the time line on that? When will the AGM could be held? When could the share buybacks, if approved, could start? And finally, related to that, the dividend consideration, the 35% out of 2026 results, is that still the case? Or are there any potential changes there?

Okay. I'll take...

Robeson, let me take the [indiscernible]. There are a couple of issues post transaction that we were planning to hold the AGM. So the intention is to hold an AGM within the month of December, which may include the issue of the share buybacks. And the dividend forecast, the percentage we have quoted is still the intention.

Okay. And I will pick up the other questions. So part of the growth that we're expecting is in ARPU increase, but we're still expecting natural growth that we see from our marketing acquisition because we'll still be spending in the marketplace. I don't think our reduction in marketing will be as substantial as our peers.

Also, as I was trying to emphasize before, player spends grow over time. So growth comes from actually your retained audience, not only adding new players on top. And you -- and we get that because our players are lower spending. So they actually spend very little at the beginning, and they continue to build over time. That means for a more sustainable business. But also, to your exact point, we're less exposed to the black market because we don't have high-end customers. We haven't got those big VIPs who get displaced by regulation and they go over to the black market, so they can still get their big bets away.

The next question is from the line of [indiscernible] with Optima Bank.

So coming back to Slide #4 and your projections on EBITDA for 2026 and 2027, I can see that there's almost flat assumption for Intralot. I guess you haven't taken into account any potential new contracts. Is that correct?

Nikolaos, do you want to take it?

Yes, can you please repeat the year, 2026, you mean?

Yes. And 2027. I can see almost flattish EBITDA for Intralot. So...

I think the slight increase in 2026. If I'm not mistaken, significant EUR 5 million, if I'm mistaken.

In the table, we have published, we have not taken into account new projects like the one.

This is probably -- let me tell you something. First of all, this is mainly on Robeson 's comment that this buildup and the bridge that we have here is really conservative. What I can tell you for next year is that we are going to start 2 new projects in British Columbia. The first is going to be the iLottery, which it's going to start either on April or May. And I'm not talking about contract wins because this is already there. I'm talking about implementation. So this is the first one. And the second one, we have not announced yet, but we're going to announce a contract with Managed Services, which is going to we're going to sign in the next weeks. It is already approved by British Columbia Board. And we are going practical to outsource a significant part of the operation of the system to us.

We are also going to have growth in markets that we're going to deploy the Vitruvian platform, as we have said repeatedly. And the main one is in Croatia, where we are going to start the UAT in January, and we believe that by the end of the first quarter, we are going to be live and operational. We are expecting, obviously, the organic growth that we have every year, but especially in the U.S., give or take, follows the inflation.

And last but not least, we do believe that we are going to have growth by adding some significant states that I cannot disclose guessing what we are saying. So this game is going to really take off. So all in all, there are prospects that some of those we have already secured. We are cautious because of the situation, especially in the States, if there's going to be any recession, if there's going to be still a flat line, especially with the scrap card, the instance that represents, give or take, 65% of the market. But as I said in the beginning and Robeson in his initial statement, this is a conservative forecast. And it is not incorporate any new contract.

Keep in mind that apart from the renewals, the contract that we are going to win, even if we win contract today a new contract, we're not going to realize any revenue in 2026. So we are not projecting any revenue there because the experience that we have in the U.S. is in the last couple of years that there is significant delays both in legislation in iLottery, but also in the evaluation and in the awarding of contracts.

If I may add something to this, the table that we presented on Slide 4 was intending to just explain the mitigation part on the U.K. tax, and that's why these estimates are conservative. As you may have noticed, the general range given by Robeson's court is between EUR 420 million and EUR 440 million. So in the optimistic scenario, it may include Intralot incremental revenue and EBITDA, which is not on this table.

That's why we end up in the lower side of the spectrum that we said in our renewed guidance. And of course, this is even more for 2027. That's further out. We have not calculated any of that incremental potential here. This was just the exercise to present the mitigation plan, and that's why the numbers that we come in the end are on the lower end of the spectrum.

Okay. And because I missed the previous question, you said about the dividend, you are sticking to your intention to distribute from the next year.

35% of net profits, yes.

The next question is from the line of Pointon Russell with Edison Group.

Two questions. First one, I suspect is for Robeson. On Slide 4, the generosity marketing savings are broadly equally split. I note your answer earlier about you will be flexible. Does that mean the revenue elasticity of cutting marketing versus Generosity is on a like-for-like basis, very similar?

I deliberately broadened the definition of saying generosity. Generosity means a few different things. It's however you can give returns to your customer. So it can be across the space of odds, can be across the space of reward and so on. I think we have to be flexible there. We can easily cut more marketing, to be clear, but I don't intend to. So there's much more flex.

We chose a balance because we have to watch what happens in the marketplace. And that's why we've said 50-50. In reality, I suspect that there is potentially more revenue elasticity, which comes from concentration of wallet share of existing players because of the pressures that are coming to other operators who, as I've said, this entire tax rate removes all profitability. But we have flex in our marketing. That's for sure. We are already observing and as I've said, I was a little bit shocked that I saw this on day 1, that we don't have to spend the marketing in the same places to have the same volume of traffic. So people have already -- and it isn't like you might assume everyone will reduce. Many operators have removed fully, right? So you could easily make assumptions on what it means for the overall required marketing spend to capture the entire marketplace.

But we believe it's sensible that it's 50% -- call it, we've put it into buckets of maybe $15 million for generosity and $15 million for marketing, but I'm not going to hold myself to that. We have to adapt in times of change, and that's what we've shown we're good at doing over the last 20 years.

Great. And my second question, I think the answer is I already know to this, but I just want to make sure with the now lower profitability expected for the group in the coming year or so, that doesn't frustrate any aspirations the group might have had in terms of new contract wins elsewhere across the globe.

On the contrary, as Chrys, I think, mentioned before, we are not shy of the necessary CapEx, either on the lottery side or on launching B2C operations. The plan remains the same. And as I mentioned before, especially on the lottery stuff, we are moving on going after the contracts that we have in our pipeline. And the same goes also on the launches that we have planned on the B2C space.

The next question is from the line of [indiscernible] with Arini Capital Management.

I understand on a year-to-date basis, your performance is stable with some impact of FX. But if we look at just the quarterly performance, the decline is part announced at double digit. Would you be able to just explain this?

Okay. Let me take this one. The variance in the third quarter compared to last year, again, is attributed to the FX, but also accompanied, as I said during my analysis on a slower pace in relation to the growth of markets in Argentina and Turkey. So the market had a slower growth compared to last year.

And this is why the FX hit was higher, although normally, the market catches up with the devaluation. In this case, in this quarter, this was at a slower pace. So this is the variance compared to the full year effect. And of course, it's not only the Argentina and Turkey. I mean we saw the same effect even in the U.S. So overall, the FX was negative.

Sorry, just to clarify. So in use the year-on-year set within the Americas. There's around EUR 10 million decline in the revenue. Is it driven by 1 particular region? Or is it across the different geographies within the U.S?

It is across different geographies.

And can you confirm that there wasn't anything different last year, perhaps higher marketing spend or any project behind this? This one.

No, no. It was just the FX.

Next question is a follow-up question from Raman Narula with Principal Asset Management.

A quick follow-up for me. Sorry, I didn't quite catch what you said earlier about the share buyback. So is that going to be from Bally's Corp. in the U.S. increasing their stake? Or will the combined sort of Intralot Bally's Group look to buy back shares from the exchange?

I can take that. So with respect to Bally's Corporation, Bally's Corporation will purchase shares and not buybacks, but purchase shares and increase its stake. Taking a recommendation though, they're obviously dependent on approvals to -- as Bally's Ir-lot to make share buybacks as well because this company is strong for the medium and long term.

And for Bally's Intralot, is there any sort of -- are you able to give any sort of quantum like Max Quantum, which you'll be looking to buy back assuming your approvals are given or...

I think we will just review that as a Board plus. We still have a focus on delevering. We want to make sure that we grow appropriately since leasing together. We want to do all of these things in...

Ladies and gentlemen, there are no further questions at this time. I will now hand over the conference to management for any closing comments.

Thank you for joining us today. This company is very strong for the medium term, and I'm very proud of being part of it and delighted that we have the combined Bally's International Interactive and Intralot together. I look forward to speaking to you again very soon, and all the best for the festive season.

Ladies and gentlemen, the conference has now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.

Ladies and gentlemen, thank you for standing by. I am Geli, your Chorus Call operator. Welcome, and thank you for joining the Intralot conference call and live webcast to present and discuss the 6 months 2025 financial results. [Operator Instructions] The conference is being recorded. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Nikolaos Nikolakopoulos, Group CEO of Intralot. Mr. Nikolakopoulos, you may now proceed.

Thank you. Good evening or good morning, everyone. Thank you for joining our first half conference call for the first half -- the results of the first half of 2025. I will start with a brief introduction, and then I will give the floor to our CFO, Andreas Chrysos, to walk you through in detail with the numbers and the operational performance.

On the first half, we experienced a stable performance with a slight increase in revenues and EBITDA despite the absence of a significant -- any significant jackpot activity in the U.S. I think it's worth noted here that August in the U.S. seems to be a good month in terms of top line performance for the industry. In general the Powerball jackpot has already accumulated in USD 950 million, which is, if I'm not mistaken, among the top 10 jackpot in the history of Powerball and we really hope that this trend is going to continue next week also.

Again, on the first half, we experienced a significant operating cash flow generation that practically help us to move our net leverage ratio close to a multiple of 2.3. On new projects, we're going live in Nebraska previous month in July, where we had an implementation on time and I should say, on a record time frame. We managed to renew Idaho and Montana in the 2 contracts in the U.S. And we have ended with OPAP in a binding MOU to provide technology for the next tender of Hellenic Lotteries continues the strong partnership that we have with the Greek operator.

I'm sure you all know that last month, we announced the acquisition of the international division of Bally’s Interactive and transaction that we believe that is going to be transformative for the industry and obviously for the group. The new entity will remain in the Athens Stock Exchange. The main business, the majority of the business is going to be on the digital part -- digital services, more than 73% of the total revenues are going to come from digital and B2C. And that transaction is expected to close in Q4 this year. And it is noted here also that the integration of the technology stack that we have started a few months ago is almost concluded. We believe that we are going to have a unified technology stack within October.

With that brief introduction, let me ask Andreas, as I said, to walk you through the operational performance and the results. Thank you.

Thank you, Nikolaos. Good afternoon, good morning to all of you. The operational performance of the first half of the year as also Nikolaos stated, was pretty stable, and this was detected in the P&L metrics versus a year ago. At the same time, this was also characterized by a strong operating, but also free cash flow generation supported to a large extent from a strong reportive working capital. The operating cash flow for the period was approximately $72 million, almost $27 million higher versus the expected period of last year. The cash balance at the end of the quarter stood at EUR 67 million, almost EUR 2.4 million higher versus the year-end of 2024, while at the same period, the group repaid approximately EUR 20 million in loan amortization in the U.S. term loan and the Greek syndicated loan.

During the same period, Intralot satisfied one of its obligations to restrict additional amounts for coupon payments of EUR 6.4 million as per retail bond requirements. Adjusting the free cash flow generation for these 2 elements, it stood at around EUR 29 million. Summarizing all the above, adjusted net debt for the first half landed at EUR 303 million improved by around EUR 53 million versus year-end of 2024 reflected also on the improved adjusted net leverage ratio, as also Nikolaos mentioned, it's 2.3x versus year-end.

So we are now moving to the first half of 2025 presentation. So going directly to Page #5. We see the revenue analysis per business activity. Our technology activity line was higher by EUR 2.9 million, mainly driven by the better performance in our U.S. business. Although the service revenue for the first half of the year was negatively affected by the lower jackpots compared to the respective period of 2024. This was offset by increased equipment sales versus the first half of 2024, better performance in our Croatian business as well as a solid performance in our Argentinian technology line activities also supported the revenue performance of each activity line.

License operation in Argentina was higher by EUR 2 million year-over-year with improved macroeconomic conditions supporting market growth. In local currency terms, the results for the current period posted an increase of 91.4% compared to the same period of last year.

The game management activity line was lower for the first half of 2025 by EUR 2.2 million. Despite the continued growth of the local online sports betting market in Turkey, the revenue performance was impacted by adverse accounting effects related to the hyperinflation in the Turkish economy, which contrasted with a positive effect in the same period of last year. In addition, higher investment in player and acquisition -- in player acquisition and retention activities calculated in the revenue line, also affected the revenue performance negatively, but resulted in an increased market share at the end of the first half of 2025 versus previous quarter by around 1%.

Turning to Page #6. We have the overall P&L performance for the first half of 2025 compared to 2024, which, as already stated, it was pretty stable. Revenue was slightly higher in the first half and around 5% lower in the second quarter versus the respective quarter of last year, affected primarily by negative FX movements.

Gross profit was lower by 12%, mainly due to the higher cost of sales coming from the U.S. due to the increased merchandise sale activity that supported the revenue line but came with increased cost of sales. EBITDA up almost equal levels year-over-year due to the prudent cost handling in the OpEx line, mainly in the U.S. and in Turkey, managing to fully counterbalancing -- to fully counterbalance the negative impacts on the gross profit line. EBITDA margin stable at around 36%. Earnings before tax in the first half of 2025 amounted to EUR 9.8 million compared to EUR 6.1 million in the first half of 2024. The reduction of debt has led to lower interest expense for the period, which was also positively affected by lower reorganization costs in the first half of 2025 resulting to a much better EBITDA performance in current versus a year ago.

Turning to Page #7. The other 2 graphs have been analyzed already in the previous slides in detail. On the bottom left graph, the operating cash flow was higher by EUR 27 million mainly due to the strongly positive working capital movement. CapEx was slightly higher at slightly higher levels compared to the last year period primarily due to increased CapEx spending in the U.S. On the bottom right, we see the net debt and the leverage ratio adjusted for the restricted cash referring to debt servicing and repayments was EUR 303 million and 2.3x, respectively, for the first quarter better by EUR 35 million and 0.6x, respectively.

Turning to Page #8. We see that the adjusted net debt movement bridge from December 2024 through June 2025, stood, as already stated, at EUR 303 million, reflecting a reduction of EUR 52.7 million, while adjusted net leverage ratio improved to 2.3x from 2.7x at year-end underscoring the company's enhanced credit profile. The solid financial performance in the first half is evidenced by the generation of EUR 43.5 million in free cash flow.

During this period, principal repayments of funded debt totaled around EUR 20 million, while net interest payments amounted to EUR 14.6 million. Furthermore, other movements amounted to EUR 24.1 million, driven by favorable foreign exchange effects on the U.S. dollar-denominated debt. Lastly, on Page #9. We see the contributions by region to our revenue and EBITDA. North and South America revenue performance, namely USA and Argentina, counterbalanced fully the deficit in the rest of the world. while EBITDA contributions were either stable or better year-over-year in all jurisdictions.

And at this stage, the presentation of the results for the first half of 2025 is finished and the Intralot executive team is at your disposal for any questions you may have. Thank you so much.

[Operator Instructions] The first question is from the line of Pointon Russell with Edison Group.

I have a few questions, please. Can I just start off in Turkey. Could you just talk about the actual constant currency revenue growth in Turkey in Q2 and the first half. Apologies if I've missed it because management operations revenue is down by over 30% in Q2 and the currency depreciated by quite a bit, but that indicates underlying declines. And you mentioned a number of things there in terms of investment in player acquisition and retention and that's affected revenue, but also your number of active customers has increased year-on-year quite nicely. So could you just unpick some of those parts, please, and their effects on the revenue.

Thank you, Russell, for the question. So the underlying growth in Turkey of the 6-month period versus last year were around 6%.

Okay. And all of those other -- you talked about investment in player activity and whatever, how much of an impact were they on the growth?

It was around EUR 2 million.

Sorry, it's Nikolaos. It is difficult to now to practically calculate the impact on the growth that the investment is happening because practically, especially all the promotions and the marketing that we are spending. We are expected to have an impact also long term and not realized on the same necessarily quarter. This is the first thing that I think you should take into consideration, if I understood the question.

Yes. I didn't know you had a good increase in customers year-on-year. So it's showing that you're gaining share. So okay. Can I just move on to Croatia. I mean you've had a good performance there. I'm just interested in the growth there has been quite volatile over the last 18 months. Could you just talk about why it is so volatile? Is that inflation? Is it other factors?

Russell, can you please repeat the question because...

What as the volatility.

Volatility on what.

Just in terms of -- if you look at the growth rates between the halves over the last 18 months or so in Croatia it's been quite volatile. So could you just give some indication of why that is? Is it -- are there macro issues? Is it inflation?

No, no, no. In Croatia, we are providing technology and operational services to the state lottery. And on the same time, we are managing multiple verticals there. So it is lottery, retail and iLottery. It is also the casino, the iGaming, I mean online casino and the sports book. So in order to get in every period, the specific, we need to go across verticals because especially sports betting, but also lottery betting, the jackpots. They have volatile volatility in the performance. All in all, what we experienced is a stable and the very decent double-digit growth as we are moving forward. I think this is the key message there.

Okay. And just moving across to the U.S., you've obviously had a great first half in terms of contract renewal extensions. There is quite a lot of detail in the results released about Maryland and your legal proceedings. Could you -- do you have any idea when that may resolve itself?

The short answer is no. Why? Because it does not depend on us. What I can tell you in Maryland, and I think you should appreciate that this is an active procurement. So I will refrain for any other judgments or predictions. What is public. It is that we submitted the proposal along with other companies. Initially, we were awarded through the evaluation committee and the gaming commission, the contract. Then through a decision, which is -- was really surprising -- the evaluation committee decided to revert the proposal. And what we -- where we stand now is that there is a proposal from the evaluation committee for the second bidder to get awarded contract.

Obviously, we have done what legally we were allowed to follow. We are following this process. For us it is an important contract. But for the time being, I really don't know how and when this practical process is going to be resolved one way or the other.

The next question is from the line of Mansfield Colin with CBRE.

Maybe first on the operations in the U.S. You called out a little bit of the headwinds in the multistate jackpots. And understand that it's an inherently volatile business. I know some of your peers have also experienced similar trends. But I'm just curious -- are there any trends in the U.S. to call out for the second half of this year as it relates to what you're seeing in terms of volume, demand? Or just in general, how the casual play is looking on that front?

What we've experienced in the U.S., I think it's the same trends like in half 1, which is in terms, especially on electronic instance, it is practically steady state and nice electronic -- sorry, scratch cards, physical instance because this is, give or take, 65% of the market there.

And in my point of view, this is also practically demonstrate the trends. What is different, I think now, as I said in the beginning, is that in August, there is a ramp-up in jackpot on Powerball, which I believe is growing practically to make the results of the industry, not only Intralot much better because this year was the only year in the last 3, 4 years, that practically until now, we had very, very thin performance in terms of jackpot -- but other than that, it is a stable market.

There is no obvious growth from the normal business. And we do still believe that the growth in the U.S. is going to come with the digitalization, especially in the lottery of -- the iLottery, where the legislators in each state decides to include this type of activity in the specific states.

Great. That's really helpful color. And then just 1 more for me. As it relates to, I think, the financing you guys have communicated, I think September roughly is what's been communicated about the Bally’'s transaction, both on the equity and the debt side. Any update you can provide there would be helpful. And then also, just any initial thoughts you can share on what sort of the pro forma capital structure may look like? Are you planning to take out pretty much all of the existing legacy debt with this new debt that you're raising? And do you think it will be more euro-based or dollar based?

Yes. Thank you for the question. What we have announced is that -- we already have a bridge financing of EUR 1.6 billion by a consortium of international banks, and this will be taken out by a mix of term loans and high-yield bonds. So we're currently contemplating a Term Loan B in sterling, which is the currency were a large part of the future revenue will be generated in GDP from the U.K. operation of Bally’'s Interactive and a Eurobond. Also, we have a syndication of Greek banks, which will come in to refinance part of the maturing legacy debt -- and our plan is to make necessary amendments to the retail bond that Intralot currently has, the EUR 130 million, so that this remains in place until its maturity. So the future capital structure will be EUR 1.6 billion of total debt and it will be all that maturing at much longer periods.

Great. That is excellent color. I appreciate it.

The entire transaction will be funded by the combination of this new debt, new shares that will be issued for an in-kind payment of part of the consideration for the acquisition. And roughly EUR 400 million of new equity that will be raised in cash. Yesterday, we had the AGM that gave authorization to the management to establish and propose the terms of this transaction, and you should expect more announcements probably later in September.

[Operator Instructions] The next question is from the line of Memisoglu Osman with Ambrosia Capital.

Congrats on particularly the improvement on operating cash flow, linking that and looking forward, can you comment on the outlook for the combined entity post the transaction in terms of cash flow and particularly dividend prospects. How should we think about that?

Yes. Thank you, Osman. As has been cleared from previous presentations and in case that people on this call have not reviewed the presentations on our website, we are uploading a lot of materials there and the tab of this transaction. So the part of the business from Bally’'s International Interactive that's coming into the perimeter of the transaction is a very strongly cash-generating business.

The way we presented currently in our presentations as free cash flow generation of EBITDA minus maintenance CapEx has a 90% to 95% conversion rate, which is very high. And it will be a completely different profile going forward compared to Intralot as analysts and investors used to look at it until now. So it will be a very strong cash-generating business that will allow us to quickly come down to a net leverage ratio of 2.5x. This is the target that we will be reaching in 2 years' time.

And also, I think you asked about dividend. We have established that the financial -- in the financial policy, the leverage, we said it will be 2.5x and the dividend will be 35% of net profits.

[Operator Instructions] Ladies and gentlemen, there are no further questions at this time. I will now turn the conference over to management for any closing comments. Thank you.

For once more, thank you very much for your interest and your attendance, and we wish you to have a great weekend. Thank you.

Ladies and gentlemen, the conference is now concluded, and you may disconnect your telephone. Thank you for calling, and have a good afternoon.