The Aristocrat Leisure Limited (ASX: ALL) share price has dropped 3% after the poker machine and digital game ASX share revealed its HY23 result.
Aristocrat Leisure says that it offers a “diverse range of products and services including electronic gaming machines, casino management systems and free to play mobile games. Its regulated gaming products are available in more than 100 countries.
Aristocrat Leisure HY23 result
Here are some of the highlights from the first six months of its 2023 financial year compared to the first six months of FY22:
- Operating revenue increased 12.2% to $3.08 billion
- Normalised EBITDA (EBITDA explained) grew 5.7% to $1.03 billion
- Normalised underlying net profit (NPATA) grew 13.6% to $658.8 million
- Reported net profit rose 27.3% to $653 million
- Operating cashflow up 22% to $613.1 million
- Interim dividend per share up 15.4% to $0.30
The company said this result reflected a strong performance in its Gaming Americas business, and resilience in Pixel United despite “challenging market conditions” – it’s benefiting from a growing market share in the ‘social casino’.
The ASX share also benefited from interest income benefits and “effective strategic investment in talent and technology.”
Arisocrat Leisure also said that its newest operating business, Anaxi, delivered on its initial market entry commitments and established “sound foundations for growth”. It has signed content agreements with partners representing over 55% of the iGaming market in the US. It’s “comfortably on course” to reach its target of at least 70% of its regulated jurisdictions across North America over the next five years.
Management said that a lot of the cashflow that it’s generating has been used to fund further growth, with surplus being paid to shareholders through dividends and share buybacks.
Outlook for the Aristocrat Leisure share price
The ASX share is expecting to deliver underlying profit (NPATA) growth over the full year to 30 September 2o23.
In the second half it’s expecting continued strong revenue growth and profit growth from its poker machines business, thanks to “market-leading positions and recurring revenue drivers”.
Meanwhile, the FY23 second half is expected to show a profit improvement from Pixel United compared to the first half, however it is expected to be “moderately below” FY23.
In the medium term, the business wants to continue to gain market share, deliver profitable growth, keep investing to improve competitiveness and breadth of product and diversification, and manage capital to deliver growth and maximise shareholder returns.
A business involved with gambling is not the first I’d have on my watchlist, but the company has done very well over the long-term. I think it’s one of the most successful ASX businesses, and it could keep growing. But, I don’t know what a good price is to buy at.
