Aristocrat Leisure Limited operates across the globe. Below the Aussie brand’s financials show the company is financially stable. (Photo by Jeffrey Blum on Unsplash)
Aristocrat Leisure Limited (ALL) released its 12-month financial results last week and the stock has dropped despite having a strong balance sheet and strong earnings.
The Australian gambling giant has a robust growth strategy, that includes competitive product portfolios across key sectors, while deepening their business acumen through operational diversification and capability. While there are some uncertain conditions in the market going forward, ALL expects continued strong growth in profit and revenue in the coming fiscal year.
ALL is currently trading at $35.89 AUD and 5.3% decrease in share price since releasing their full year results last week. The profit of$1,099 million AUD is an increase of 27% when compared to the previous year. Revenues increased 18% to $5.6 billion AUD and is a highlight of ALL’s recovery post-Covid and their ability to generate strong performance through the diversification of their products.
Aristocrat has also launched an aggressive share buy-back program and increased the dividends to shareholders. Much of ALL’s revenue comes from overseas and currency fluctuations are another concern as are the increases in operations and acquisition costs
So… why is the stock not up???
With all of these positive results, it would seem that the Aristocrat stock price would be soaring but as all players in the iGaming industry, they are dealing with increasing inflation, salaries, expansion costs, energy prices and R&D costs. ALL has also had to deal with their Ukraine business because of the Russian invasion. The company has spent most of the year trying to relocate Ukrainian staff to safer locations within the Ukraine or abroad. This has caused severe operational disruptions but have been offset by opening new studios in Canada, Spain and Poland.
Another issue for ALL is that a major partner, Pixel United is suffering from supply chain issues-operational disruptions in the U.S. Although its Americas margin expanded 2.7% to 56.1%, Pixel’s online bookings have fallen drastically since Covid has subsided and this trend is expected to continue.
All this being said, most market analysts state that the ALL stock is a buy at the moment for the long-term investors. Other stocks in the industry are pushing down even more and do not have a strong balance sheet.
Aristocrat continues to gain market share, investing in R&D to bring innovative games to the industry and manage capital to maximise shareholder returns.
Aristocrat Year End Highlights
- Revenue – up 18% to 1.1 billion AUD
- EBITDA increased 20%
- Profit after tax -$1,099,300 AUD – up 27%
- Dividend per share $0.52 AUD – up $0.11 AUD from 2021
- Net Cash $564 million AUD
- Liquidity $3.8 billion AUD
Aristocrat Online Casino Games – Aristocrat Leisure Limited new Anaxi developer
The Aristocrat land-based business continues to release new and popular slot titles across the globe and into brick and mortar casinos as well as retail/high street video slot and gambling arcades. To separate its online game operations from the land-based side of operations, the company recently decided to rebrand the name it uses for the provision of online casino games. The new name is now Anaxi. You can read more about that news in our recent report – Australian Aristocrat iGaming Rebrands to Anaxi.
Anaxi operates under Aristocrat Leisure Limited. Under the new brand name, online casinos operating under the MGA, Curacao, and MGA iGaming frameworks will soon start to include famous slot titles Red Baron, Moon Festival, Buffalo, Choy Sun Doa, Silk Road and Queen of Nile, also found as land-based arcade slots.
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