GGRAsia – Casino supplier Ainsworth loses US$32mln, sheds 107 posts

Casino supplier Ainsworth loses US$32mln, sheds 107 posts

Aug 27, 2020 Newsdesk Latest News, Top of the deck, World

Australia-based slot machine maker Ainsworth Game Technology Ltd reported on Thursday a 12-month loss amounting to AUD43.4 million (US$31.5 million), compared to a prior-year profit of AUD10.9 million. The firm also said it cut 107 posts during the reporting period.

The result for the fiscal year to June 30 was on group revenue that declined 36.2 percent year-on-year, to AUD149.4 million, from AUD234.3 million.

Ainsworth Game noted it has suspended dividends.

“These results were severely impacted by Covid-19, primarily in quarter four, traditionally the strongest period for the group. Customers across all of our major markets suspended their operations from mid-March,” stated the firm, in commentary separately filed to the Australian Securities Exchange.

Reported earnings before interest, taxation, depreciation and amortisation (EBITDA) were negative by AUD9.0 million in the year to June 30, compared to a positive EBITDA performance of AUD44.8 million in the prior year.

The company said nonetheless regarding its prospects for the next reporting period: “Encouragingly, some [casino-operator] customers’ facilities have started to reopen, although the majority of venues have indicated initial reductions in capital expenditure due to travel restrictions imposed and resultant impact” on visitor volumes, which were “well below pre-pandemic levels”.

Lawrence Levy, Ainsworth Game’s chief executive, noted: “While the Covid-19 pandemic hit our industry hard, we moved quickly to protect Ainsworth.”

The group said that, in addition to voluntary reductions in salaries and other overhead reductions, it had reduced employee numbers by “eliminating 107 roles” at an annual cost saving of approximately AUD10 million, which it added was “expected to carry forward into fiscal year 2021”.

The firm’s “rationalised” costs base and its new “AStar” range of cabinets – which the company said offered newly-developed game brands - allowed Ainsworth Game to be “well positioned as customers progressively resume more typical business levels”.

In its ‘Asia’ business segment, Ainsworth Game reported annual revenue for sales and servicing of gaming machines amounting to AUD598,000, although the segment result showed a loss of nearly AUD2.0 million.

In fiscal-year ending June 30, 2019, revenue from Asia sales and servicing of gaming machines had been just over AUD2.5 million, with a segment result positive by nearly AUD1.3 million.

The firm said that group wide, Australia and ‘rest of the world’ revenue was AUD35.3 million in the fiscal year to June 30, compared to AUD47.6 million in the prior corresponding period, a decline of 25.8 percent.