GGRAsia – Aristocrat 1H profit up 23pct, as revenue tops US$2bln

Aristocrat 1H profit up 23pct, as revenue tops US$2bln

May 18, 2023 Newsdesk Latest News, Top of the deck, World

Australia-listed slot machine maker and online gaming content provider Aristocrat Leisure Ltd reported revenue of AUD3.08 billion (US$2.05 billion) for its financial first half, up 12.2 percent from the prior-year period. The company posted an interim profit after tax and amortisation of AUD692.7 million, a 23.2-percent increase from a year ago.

The firm declared a dividend of AUD0.30 per ordinary fully-paid share for the six months to March 31, payable on July 3.

Earnings before interest, taxation, depreciation, and amortisation (EBITDA) on a normalised basis were up 5.7 percent year-on-year, to just below AUD1.03 billion.

Aristocrat said revenue growth in the period was driven by “outstanding performance” from gaming operations in the North American market and “global outright sales”. Such growth was also supported by a “resilient performance” from the group’s online social games segment – via its Pixel United division – “in a challenging environment,” it added.

“Aristocrat delivered a quality result over the period, demonstrating the ongoing resilience, competitiveness and diversification of our portfolio, as we navigated challenging market conditions and continued to invest fully behind our successful group growth strategy,” stated Aristocrat’s chief executive and managing director, Trevor Croker, in prepared remarks accompanying the results.

The group said that growth in its business for casino slot machines in its ‘international’ segment – referred to as ‘International Class III’ – was “driven by operating conditions in Europe, together with benefits from churn across Asia.”

Segment revenue at constant currency in International Class III was AUD84.0 million, up 31.3 percent year-on-year. The segment’s profit was AUD36.6 million, 22.4-percent higher from the prior-year period.

The international segment result was dwarfed by the AUD976.5 million revenue produced by Aristocrat during the period in the Americas casino market, a year-on-year gain of 17.2 percent. Segment profit for the Americas was AUD539.6 million, up 11.8 percent year-on-year, the firm said.

In North America, outright sales “delivered strong growth”, with unit sales and average selling price per unit increasing 27 percent and 21 percent respectively on the prior corresponding period.

The group’s Pixel United division generated AUD891.3 million in interim revenue, down 6.5 percent year-on-year. Profit from the segment fell by 15.5 percent, to AUD262.7 million.

The firm said it continued “accelerating implementation” of its “‘build and buy’ strategy” to scale in the online real money gaming (RMG) segment.

During the reporting period, Aristocrat’s online RMG business, Anaxi, signed content agreements with partners “representing over 55 percent of the U.S. iGaming market”.

“We are comfortably on course to exceed our target of penetrating at least 70 percent of regulated jurisdictions across North America over the next five years,” stated Mr Croker.

In February, the company completed the acquisition of Roxor Gaming Ltd, an online RMG supplier based in London, in the United Kingdom. Earlier this week, Aristocrat announced a deal to acquire online RMG provider NeoGames SA for a total consideration of AUD1.80 billion. The acquisition is to be funded with existing cash, said Aristocrat.

The firm said it had approximately AUD3.5 billion in available liquidity as of March 31, “to support committed and future investments”.