Ainsworth Game Technology Limited · ASX:AGI
Ainsworth Game Technology — H1 FY2017 Earnings Presentation
38 slides from Ainsworth Game Technology's earnings presentation, Feb 21, 2017
Slide 1: 1HFY17 Results Announcement
For personal use only 1HFY17 Results Announcement Ainsworth Game Technology Limited 21st February, 2017 Danny Gladstone CEO Mark Ludski CFO
Slide 2: Disclaimer
Disclaimer For personal use only IMPORTANT NOTICE This presentation has been prepared by Ainsworth Game Technology Limited ACN 068 516 665 (AGT) in good faith.No express or implied warranty is given as to the accuracy or completeness of the information in this document or the accompanying presentati
Slide 3: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 3
Slide 4: Continued execution of a clear strategy
Continued execution of a clear strategy: building a stronger, more diversified Ainsworth with greater presences in the key international markets complemented by higher quality recurring earnings. For personal use only 4
Slide 5: 1HFY17 Results Summary
1HFY17 Results Summary - Continued execution of a clear strategy: building a stronger, more diversified Ainsworth with greater For personal use only presences in the key international markets complemented by higher quality recurring earnings. • Total sales revenue of $122.7m, a decrease of 14% on PC
Slide 6: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 6
Slide 7: Group Profit & Loss Summary
Group Profit & Loss Summary For personal use only ̶ 1HFY17 Profit before tax consistent with 6 months to 6 months to Change guidance provided on 26th October 2016. A$m Change (%) 31-Dec-2016 31-Dec-2015 (%) ̶ International markets represent 67% of total revenue, (+2% v PCP). Domestic revenue 41.0 50
Slide 8: Results Adjusted for Currency Gains
Results Adjusted for Currency Gains 6 months to 6 months to A$m Movement Change (%) For personal use only 31-Dec-2016 31-Dec-2015 PBT 20.0 44.8 ▼ (55%) Currency gains (before tax) (4.8) (9.8) ▼ (51%) Adjusted PBT 15.2 35.0 ▼ (57%) NPAT 20.6 33.1 ▼ (38%) Currency gains (after tax)(1) (4.8) (6.8) ▼ (2
Slide 9: Results adjusted for currency gains and significant items
Results adjusted for currency gains and significant items outside ordinary business activities For personal use only 6 months to 6 months to Variance A$m 31-Dec-2016 31-Dec-2015 % Reconciliation: Profit before tax 20.0 44.8 (55%) Net interest (1.4) (1.0) (40%) Depreciation and amortisation 13.3 10.0
Slide 10: Operating Costs
Operating Costs H1FY17 H1FY16 Variance Sales, service and marketing 27.3 25.0 9% R&D 18.4 13.8 33% For personal use only Administration 12.7 10.7 19% Total Operating costs 58.4 49.5 18% • Increase in Sales, service and marketing expenses primarily due to: - Establishment of Nova Technology (Class II
Slide 11: Segment Overview
Segment Overview 6 months to 6 months to Variance Variance In millions of AUD 31-Dec-2016 31-Dec-2015 % For personal use only Segment revenue Australia 41.0 50.3 (9.3) (18%) Americas 70.3 79.9 (9.6) (12%) Rest of World 11.4 11.7 (0.3) (3%) Total segment revenue 122.7 141.9 (19.2) (14%) Segment resul
Slide 12: Net Profit Bridge
Net Profit Bridge For personal use only • $5.0m decrease in forex represents a decrease in foreign exchange gains in 1HFY17 of $4.8m (v $9.8m PCP). • $2.3m increase in D&A charge reflects rise in number of machines under participation and deprecation of LV facility. • $12.3m decrease in tax expense
Slide 13: Ainsworth at a Glance
Ainsworth at a Glance For personal use only 13
Slide 14: Balance Sheet
Balance Sheet For personal use only 6 months to 6 months to A$m ̶ Strong balance sheet position with capital 31-Dec-2016 30-Jun-2016 to fund growth and innovation. Cash 27.4 26.4 ̶ Receivables totalled to $148.9m Receivables 114.0 118.7 (FY16:$156.6m) – a decrease of 5% due Other Current Assets 79.0
Slide 15: Cash Flow Statement
Cash Flow Statement • Decrease in Net Cash from Operations 6 months to 6 months to For personal use only to $7.0m due to a reduction in domestic A$m Change 31-Dec-2016 31-Dec-2015 and international receivables and increase in working capital investment in Net Cash from Operating Activities 7.0 17.0
Slide 16: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook 16
Slide 17: Segment Results - Australia
Segment Results - Australia ̶ Challenging period for volume and revenue For personal use only growth given highly competitive domestic 6 months to 6 months to Change A$m Change (%) 31-Dec-2016 31-Dec-2015 (%) market conditions and: • Reduced activity with Corporate Revenue 41.0 50.3 ▼ (18%) Accounts
Slide 18: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 18
Slide 19: Segment Results - Americas: North America
Segment Results - Americas North America For personal use only North America 6 months to 6 months to Change A$m Change (%) ̶ Greater presence and profile in local 31-Dec-2016 31-Dec-2015 (%) market. Revenue 37.2 43.0 ▼ (13%) ̶ Strong momentum following temporary Segment Profit 14.3 18.0 ▼ (21%) dela
Slide 20: North America Market Penetration by Total Placements
North America Market Penetration by Total Placements For personal use only 20
Slide 21: Top Performing Brands in North America
Continued development of Top Performing Brands In North America Top Performing Brands For personal use only • All brands listed are performing at an average index of 1 to 2.2 of house average. 21
Slide 22: Segment Results - Americas: Latin America
Segment Results - Americas Latin America For personal use only Latin America 6 months to 6 months to Change A$m Change (%) ̶ Continued strong market positions 31-Dec-2016 31-Dec-2015 (%) across the region. Revenue 33.1 36.9 ▼ (10%) ̶ New product transition in H1 with the launch of A600 series of cab
Slide 23: Latin America installations
Dominican Republic 380 u. Mexico 8,000 units Peru 1,405 u. ‘NSWORTH 23 EXPERIENCE COUNTS
Slide 24: Top Performing Brands in Latin America
Continued development of Top Performing Brands In Latin America Top Performing Brands For personal use only • All brands listed are performing at an average index of 2.1 to 3.0 of house average. 24
Slide 25: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 25
Slide 26: Segment Results – Rest of the World
Segment Results – Rest of the World For personal use only ̶ Strong performance in Asia and Europe 6 months to 6 months to Change offset by weak results in New Zealand. A$m Change (%) 31-Dec-2016 31-Dec-2015 (%) ̶ Slight fall in revenue, -3% versus PCP due to a large sale in PCP to Sky City Revenue 1
Slide 27: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 27
Slide 28: Gaming Products
For personal use only 28 Gaming Products 28
Slide 29: Product Review: Australia and North America
Product Review Australia • Executed plan to create combined QCOM games submissions. • For personal use only Effectively reducing submission costs and increasing product offerings to Queensland, Victoria and Tasmanian markets. • Strengthened the legacy product offering into New South Wales and QCOM m
Slide 30: Product Review: Latin America and Rest of the World
Product Review Latin America • Continue the steady release of legacy content such as Quad Shot™ on A600™ & A640™ platforms. For personal use only • Released Latin America specific Link product based on proven math models such as Dream Strike™ on A600™ platform. • Developed another powerful legacy li
Slide 31: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 31
Slide 32: Regulatory Update
Regulatory Update Continuing strategy to deliver new jurisdictions based on detailed market assessment of For personal use only commercial opportunities. From 1 July 2016 to current, the AGT group has secured the following new gaming licenses: Colorado New York (Commercial gaming) Kansas (permanent
Slide 33: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 33
Slide 34: Online and Social
Online and Social Ainsworth’s online focus is aimed at offering a multichannel distribution strategy to enable AGT product contents to be available in all digital channels including social casinos and regulated real money gambling For personal use only partners throughout UK, Europe, Australasia and
Slide 35: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 35
Slide 36: Novomatic Update
Novomatic Update For personal use only ̶ Regulatory approval process continues. Expected completion in September 2017 quarter; ̶ Revenue in current period of A$2.9 million. Significant revenue as previously detailed planned in 2HFY17; ̶ The progress in game development on 6 Novomatic game assets is
Slide 37: Agenda
For personal use only 1.Results 2.Consolidated Results 3.Segment Results - Australia 4.Segment Results - Americas 5.Segment Results - Rest of the World 6.Gaming Products 7.Regulatory Update 8.Online and Social 9.Novomatic Update 10.Outlook and Questions 37
Slide 38: Outlook
Outlook Continued execution of a clear strategy: building a stronger, more diversified Ainsworth with greater presences in the key international markets complemented by higher quality recurring earnings For personal use only FY17 Profit guidance – PBT, excluding foreign exchange rate movements, expe
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