Supplier News

Australia – Aristocrat secures fifth period of double-digit NPAT

By Phil - 27 November 2013

Less sales into Japan dented revenue at Aristocrat Leisure who reported a strong NPAT result of $107.2m representing a 16.9 per cent increase over the prior corresponding period for the full year ended 30 September 2013.

A 3.5 per cent decrease in revenue largely reflected fewer scheduled game releases in the Japan market. Excluding the variability driven by the Japanese game release schedule, revenue increased 4.3 per cent and EBIT increased 18.4 per cent.

This result represents the group’s fifth consecutive reporting period of double-digit NPAT growth as it continued to make progress in line with its product-led growth strategy.

The directors have authorised a final dividend in respect of the reporting period of 7.5 cents per share ($41.4m). Total dividends for the 2013 year amount to 14.5 cents per share and represent a payout ratio of 75 per cent of normalised earnings, at the upper end of the group’s recently increased target payout range and a142 per cent uplift in dividends.

The group undertook two acquisitions and funded dividends over the course of 2013, with net debt only marginally higher than the 2012 result and gearing levels maintained. A reduction in interest expense was also achieved compared to the prior corresponding period.

Operating cash flow fell 40.6 per cent, driven mainly by the timing of revenues, influenced by the second game in Japan, and growth in the September quarter in the Americas and Australia driven by new product releases.

Chief Executive Officer and Managing Director, Jamie Odell, said: “Aristocrat has reported another year of strong performance over the twelve months to 30 September 2013. This builds on our medium term record of double-digit NPAT growth, with better quality games and products sustaining robust operational performance despite increased competition in many key markets. Aristocrat has refreshed our growth strategy, and put in place its foundations – including measured and strategic acquisitions, industry leading creative and technical talent pools, a step-change in enabling technology, better processes, insights and a high performance organisational culture.

The group made significant investments in industry-leading creative and technical talent and better technology, consistent with its plans to take share in priority segments across key markets. Over the 12 months to September 2013, the group also bedded down online and social gaming acquisitions, giving it a cost-effective and strategically sound foothold in these fast-growing, emerging value streams.

Mr. Odell explained: “Our online and digital businesses are growing quickly and represent an exciting and expanding value stream that we are prioritising in line with our strategy.”

Operational highlights include outstanding performance across the Americas business, with almost 12 per cent growth in our gaming operations footprint, an incremental lift in outright sales share in a highly competitive market and a 5.4 per cent increase in average selling price compared to the prior period. Aristocrat also maintained its leading position in the Asia Pacific region, made significant progress aligning its Australian game portfolio with its strategic priorities and began deploying and monetising premium Aristocrat content, while steadily building distribution reach, in its online business.

Mr. Odell added: “Improvements have not been even across markets in 2013, and there is much more to be done as we work to fill product pipelines with compelling new product. Nevertheless, it’s already clear that our product-led, share-taking strategy is reaping rewards and we are absolutely focused on accelerating the implementation process over the coming months. While conditions will remain competitive across major markets, we expect continued strong NPAT growth over the 2014 full year, driven by improvement in operational performance across our key markets, partly offset by a significant uplift in D&D investment as we build for the future consistent with our strategy,” Mr. Odell concluded.