Aristocrat Leisure Limited · ASX:ALL
Aristocrat Leisure — H1 2006 Earnings Presentation
16 slides from Aristocrat Leisure's earnings presentation, Aug 22, 2006
Slide 1: Results for the 6 months ended 30 June 2006
Aristocrat Leisure Limited Results for the 6 months ended 30 June 2006 Chief Executive Officer & Managing Director Paul Oneile Chief Financial Officer Simon Kelly Paul Oneile Chief Executive Officer and Managing Director
Slide 2: Summary of Results
Summary of Results + Profit After Tax $105 million — up 2.9% + Total Revenue $496 million — down 5.6% + International contribution ~ 77% of segment revenue + Strong underlying operating cash * 12 cps Interim dividend — up 20% + Investment in research and development ~ up 48% + Key strategic acquisit
Slide 3: Review of Financials
Review of Financials income Statement Hi 2006 H1 2005 Variance $m $m % Total Revenue 495.9 §25.3 -5.6% Gross Profit 279.1 277.8 0.5% GP% 56.3% 52.9% 3.4 Points Expenses (152.1) (140.0) 8.6% Share of Associate PAT 4.0 - nla EBIT 146.2 145.8 0.3% Profit Before Tax 146.2 150.0 -2.5% Income Tax Expense
Slide 4: H1 2006 vs H1 2005 EBIT
ESIT ASin 480 168] 466 448) 446) 438) +30 428] 429 418) a +$6.72m -$13.6m 4318.5m $2.9m i az $445.8m -$34.2m +$4.0m _-$0.2m -$2.1m — 4$17.0m: H1 2006 vs Hi 2005 EBIT +$4.3m $146.2m Key Drivers of EBIT + Global volume growth + Improved pricing + Cost efficiencies + Leverage of fixed cost structures O
Slide 5: Segment Revenue Split
Segment Revenue® Split 2006 Segment Revenue by region Australias NZ “Mature” 28% 2006 Segment Revenue by region ° Austrafial NZ “Mature” 25% Business Segmentation $m Revenue 400 Segment Profit Profit After Tax 350 HAA [are | 8% 30% O% 144% 144% O Australia/NZ & Growth markets I Japan| *Actual revenu
Slide 6: Management Cash Flow
Management Cash Flow H1 2006 H1 2005 $m $m Net cash - opening balance 183.7 121.5 EBIT 146.2 145.8 Share of Elektronéek Profit after Tax (4.0) - Depreciation and amortisation 15.1 19.3 Other non-cash adjustments 3.0 6.7 Net interest received 0.9 40 Net tax paid (100.0) (59.1) Change in operating ass
Slide 7: Operating Cash Flow and Working Capital
Operating Cash Flow 300 30% a 260 + 28% pmo + 20% 200 + 18% 150 $m + 10% 100 + + 5%, 50 + 0% Percentage of LIM Revenue + 8% -60 0% Jun Dec Jun Dec Jun Dec Jum Dec Jun Dec Jun o1 6010 02 2B BHCC mmm Operating Cash Flow «LIM Operating Cash Flow %LTM Revenue | Working Capital Net Working Capital -% of
Slide 8: Capital Management
Capital Management 2006 Interim Dividend ~ 12 cps fully franked vs 10 cps franked in prior year ~ Franking outlook remains positive ~ Dividend Reinvestment Plan to be reinitiated at full year On-market Share Buyback ~ $138 million of the total $200 million programs completed to date Employee Share B
Slide 9: Australia/New Zealand
Australia/New Zealand H1 2006 Ht 2005 Variance $m $m % Segment Revenue 129.6 132.7 {2.8)% Segment Contribution Profit 44.2 48.8 {8.4)% Segment Margin 34.3% 36.8% (2.5)pts + Challenging market conditions; smoking restrictions; licence renewals + Margin decline reflects product mix + Replacement cycle
Slide 10: North America
North America Hi 2606 Ht 2005 Variance $m $m % Segment Revenue 274.2 245.2 414.8% Segment Contribution Profit 123.4 94.7 +30.0% Segment Margin 44.9% 38.6% +6.3pts + Market slowdown ~ low in replacement cycle, no new jurisdictions + Margin improvement reflects pricing and leverage of fixed costs + Un
Slide 11: Japan
Japan H1 2006 Ht 2005 Variance $m $m % Segment Revenue 9.6 91.8 {88.5)% Segment Contribution Profit {9.6) 21.6 (144.4)% Segment Margin {100.0)% 23.8% {123.5}pts * Short term market uncertainties ~ Regulation 5 transition * Sales of 1,800 units vs 24,000 units * Inventory provision for surplus unique
Slide 12: Other Markets
Other Markets Hi 2606 Ht 2005 Variance $m $m % Segment Revenue 96.2 46.2 +106.1% Segment Contribution Profit 29.6 11.7 +153.0% Segment Margin 34.1% 25.3% +§.8pts * Strong growth in emerging markets: * Asia-Pacific (+100%), Europe excluding Russia (+59%), South America (+161%) + Leading position in M
Slide 13: ACE Interactive; Growth Framework Update
ACE Interactive + Acquired May 2006 + Next generation of interactive systems + Server based video lottery technology + Server based content delivery capability (downloadable games) + “Start up” business ALTOCEN wekdin wie atone Growth Framework — Update Global gaming market + Remains substantial gro
Slide 14: Growth Opportunities and Outlook
pportunities Growth O . Replacement cycle + Software model North America }. Replacement cycle . Stepper - Vdeofiow denom migration - New Markets (PA, CA, OK, FL, etc) }- Stepper and slant products: }. Wide area products: Conversions + Downtoadable Japan Regulation & + Ciass If casinos Russia Asta }-
Slide 15: Summary
Summary Solid result given difficult environment + Underlying growth in non-Japanese markets strong — up 27% + Business operating performance drivers: * Top line growth - pricing * Leverage of cost structures * Cash flow/asset leverage * Short term outlook sound, but difficult to predict 2007/2008 a
Slide 16: Results Segmentation
Results Segmentation Revenue Segment Profit Profit After Tax H1 2066 Hi 2005 =©Var H1 2006. H1 2005 = Var H1 2006 Hi 2005) = Var $m gin % $m $m % $m Sm % Australia/NZ 129.0 132.7 -2.8% 44.2 48.8 3.4% 30.9 34.2 9.4% Growth markets 369.4 294.4 26.8% 152.7 106.4 435% 1087.4 73.0 47.3% 498.4 424.1 47.8%