Aristocrat Leisure: 1H23 result - Eyes on the prize

About the author:

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.

Find out more

If you would like more information, please contact your adviser or nearest Morgans office. 

Disclaimer: The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents (“Morgans”) do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.