GGRAsia – Ainsworth to review dividend policy as recovers says chair

Ainsworth to review dividend policy as recovers says chair

Nov 29, 2022 Newsdesk Latest News, Top of the deck, World

Casino slot machine maker Ainsworth Game Technology Ltd is committed to reviewing a return to a dividend policy, once trading conditions “stabilise” in the post-pandemic environment, says its non-executive chairman Danny Gladstone (pictured in a file photo).

His commentary came in prepared remarks for the annual general meeting on Tuesday of the Australia-listed firm.

His colleague, group chief executive Harald Neumann, mentioned Ainsworth had started its current financial year commencing July 1, with “good momentum”.

“Based on current forecasts we expect to achieve approximately AUD18 million [US$12.0 million] in profit before tax, pre-currency [adjustments] and one-offs for the six months ending 31 December 2022,” added Mr Neumann.

The CEO also noted that the previously-announced change planned for 2023, to shift the firm’s financial year to match the calendar year, would “achieve better alignment to industry business cycles” and “improve efficiencies” of the company’s “year-end processes and audit”.

Mr Neumann additionally mentioned that the group was in the “strongest financial position” it had experienced for “many years”, with net cash of more than AUD50 million, more than AUD300 million of net assets, and “effectively no debt”.

Mr Gladstone said a “strong balance sheet” would help the group fund its “growth strategy and product investments”.

He stated: “Given the current economic uncertainties combined with supply chain challenges, an increased level of working capital is initially considered necessary to ensure continuity in production to fulfil expected sales volumes in calendar year 2023.”

The chairman added: “Once these conditions stabilise and operational requirements can be reliably determined, the board is committed to review the recommencing [of] the payment of dividends to shareholders.”

In August 2020, the company had noted in its preliminary annual results for the financial year to June 30, 2020, that it had suspended such payouts.

In August this year, Ainsworth reported an after-tax profit of AUD11.8 million for the 12 months ended June 30, versus an after-tax loss of AUD53.4 million for the “pandemic-impacted” prior corresponding period.

The group had mentioned in its report for the 12 months to June 30, that the “Asia market remains challenging as this region was impacted by border closures and travel restrictions throughout most the year”.