Ainsworth Game Technology would probably like to go back and do its most recent fiscal year all over again. It had already announced that its second half wasn’t going to produce the numbers the Australian-based gaming company had expected to achieve, and has now confirmed that the entire fiscal year, which ended on June 30, was less than memorable. Profit for the year dropped 65.9% from the previous fiscal year, only reaching US$7.4 million.
Ainsworth handed over its latest financial results to the Australian Securities Exchange (ASX) yesterday, adding that its revenue had dropped, as well. It was down 11.8% year on year to around $157.87 million, and the company’s pre-tax profit plummeted 65.2% to a little more than $9.9 million. Topping it off, EBITDA (earnings before interest, taxes, depreciation and amortization) was 34.1% lower – $30.18 million – than it was a year earlier and adjusted EBITDA dropped 36.4% to just under $29 million.
As a result of the performance, Ainsworth’s board has decided to forego issuing both an interim and a final dividend, according to the company’s ASX filing. It is now going to take a closer look at its investments, particularly those in the research and development (R&D) area, as well as growth prospects to determine how to proceed, adding that the nonpayment of the dividend will help the company improve its financial position.
Most of the hit was felt back home in Australia, where a decline in sales forced revenue down 43.2% to $24.32 million. International operations remained virtually unchanged from the previous year, coming in at $133.53 million. Around 85% of the company’s total sales came from the international side of the house, with revenue in the Americas increasing by 1.2% to $125.79 million.
Lawrence Levy, Ainsworth’s CEO, added a personal note to the filing, stating, “While the fiscal-year 2019 results are relatively weak, Ainsworth is capable of delivering improved performance. We have a professional and motivated workforce, an excellent industry reputation and a well-established footprint across all our markets.”
Levy, who took the reins as the company’s CEO at the beginning of last month, added, “We have initiated a review to re-evaluate and focus our R&D investments to develop successful new… products to drive long-term growth.”
Ainsworth and Levy aren’t getting off to a great start in current fiscal year. Only days after it began, it was forced to respond to a lawsuit from rival Aristocrat Leisure that accuses it of intellectual property rights violations. Aristocrat alleges that Ainsworth stole technology that ended up in the latter’s Jackpot Strike slot machine.
