Aristocrat Leisure: 1H23 result - Eyes on the prize

About the author:

Alexander Mees
Author name:
By Alexander Mees
Job title:
Co-Head of Research and Senior Analyst
Date posted:
19 May 2023, 7:00 AM
Sectors Covered:
Gaming and Retail

  • With FX tailwinds at its back, Aristocrat Leisure (ASX:ALL) delivered a 14% increase in 1H23 NPATA, operating cash flow and dividends coming along for the ride. Strip out the effect of a strong USD, however, and the result was a little more muted, with constant currency growth in NPATA of 4%. On top of that, the result was a tale of two businesses, with the land-based gaming business in the Americas growing rapidly and taking share of a buoyant market, while the digital gaming business Pixel United saw earnings decline in a softening global market for mobile games.
  • We believe Pixel United is likely to experience challenging conditions and deliver softer growth for the next 12-18 months, though its profits should at least show signs of improvement in 2H23. We have lowered our group net profit estimates by 1.5% in FY23 and 1.7% in FY24. As ALL continues to dominate the US land-based gaming market, there’s still a lot of growth to come near-term. Stay positive.

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