Aristocrat post 220% revenue growth on digital growth

Aristocrat, the largest pokies manufacturer in Australia, has amassed $55m million revenue – a 220% increase – on the wings of an unprecedented digital growth.

The company has traditionally been the business of supplying electronic gaming machines for casinos, pubs and clubs. But it has recently focused more on online gaming market, by acquiring two digital gaming companies: digital gaming companies, the US-based Big Fish Games and Israel’s Plarium.

The acquisitions seem to be paying off, as revenues from digital front are soaring, as its digital earnings grew more than $84 million.

The $18 billion company’s overall after-tax profit rose 2.8 per cent to $256.5 million, the company said, weighed down by one-off legal, consulting and restructuring expenses related to its recent acquisitions.

Trevor Croker, Aristocrat’s chief executive, partly attributed the company’s performance to growth in North America, and the strength of its digital gaming division, where online daily active users have increased almost sixfold to 8.3 million.

“Aristocrat will continue to push for growth by increasing our strategic investment in design and development in order to protect and extend market leading positions,” he said.

“The group expects further growth in its social casino and social games business, with increased investment in user acquisition associated with the launch of new apps across all business units.”

Following the results on Thursday morning, Aristocrat’s share price soared more than 8 per cent, or $2.23, to end the day trading at $30.04.

Aristocrat in January completed a $1.3 billion takeover of the US-based online gaming business Big Fish to become the world’s second-largest provider of online casino games.

Seattle’s Big Fish Games is the creator of several hugely popular mobile and desktop games played by more than 12.4 million active users every month. Among its catalogue of gaming titles are Big Fish Casino, Gummy Drop! and Fairway Solitaire.

Mr Croker said Aristocrat’s half-year results reflected the “soundness of our strategy whilst highlighting our broadening ambition as we make substantial progress in expanding our addressable market across both digital and land-based segments.” He said Aristocrat anticipated investing more in designing and developing new land-based and digital gaming products in the coming year, in order to “defend and grow” the company’s leadership positions.

Baillieu Holst analyst Nick Caley on Thursday said Aristocrat’s digital division had “clearly assumed the mantle” as the company’s growth driver.

Aristocrat declared a fully franked dividend of 19¢ to be paid on July 3.

Source: smh.com.au