Slots and systems giant Aristocrat Leisure posted a 6.9% increase in revenues to A$870.3 million for the year ended 30th September on strong sales in North America and its home market of Australia.
Normalized net profit, excluding a significant write-down of its Japanese pachislot business, was up 10.2% year on year to A$118.1 million—20.7 cents per diluted share—on an 11.5% increase in EBITDA to $209.8 million.
ASX-listed Aristocrat (ALL) wrote off $78 million of the underperforming Japan operation and also recorded a $43 million loss from the sale of its non-core Lotteries business, moves which Chief Executive Jamie Odell said “reduce risk and management distraction going forward”.
The company also recorded costs of $13.1 million related to its US$1.3 billion acquisition earlier this year of Video Gaming Technologies, a leading manufacturer of machine games for the North American tribal markets.
The combined charges resulted in a statutory net loss of A$16.4 million.
“Over the course of the year, the business continued to methodically close portfolio gaps while also lifting front-end effectiveness and sales execution,” Mr Odell said. “Aristocrat’s product-led, share-taking strategy delivered outstanding operational performance across core market and segments in 2014—particularly in the critical US gaming operations segment, which remains our single most compelling strategic opportunity.”
The company grew its North America installed base by 20% and average fee per day by 10.5%, and Mr Odell characterized the VGT purchase as a “bold step” that will contribute to making 2015 a “transformative year”.
“We expect to see a significant lift in the percentage of total revenues that are recurring in nature, as we integrate VGT and continue to grow recurring revenues in our Class III and Digital businesses over the course of 2015.”
Share gains in New South Wales and Queensland were “significant,” the company said, with ship share improving by 10 percentage points.
“Aristocrat also held its leading share position across Asia Pacific markets,” the company said, although combined revenues from the business segments outside North America, Australia and Latin America fell 18.4%, “primarily driven by reduced expansion activity across the Asia Pacific region and poor economic conditions in Europe, partially offset by increased ship share in South Africa”.
Digital revenues from the company’s Product Madness platform were up 300% on an average of 625,597 active users per day.
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