Aristocrat home on the range

The top line

Revenue for the six months to March fell 1% to A$2.23bn but on a constant currency basis it rose 11%. EBITDA rose 6% to A$750.3m with EBITDA margin rising 230bps to 33.7%. Net profit after tax (NPAT) rose 18.4% to A$362.2m

Revenues derived from gaming represented 46% of total group revenue while digital revenue stood at 54%. In gaming, 78% of revenue came from the Americas, 20% ANZ and 2% ROW. For digital, 49% of revenue came from social casino, 34% from strategy and RPG and 17% from social casino gaming.

At March end 93% of class II install base was operational and around 80% of the class III install base.

Net debt decreased by 40% to A$1.33bn with the net debt/EBITDA ratio shrinking to 1.2x. Liquidity at the end of March was over A$2bn.

Buffalo wings: Gaming revenue fell 14.2%, however in local currency it rose 2%. The fee per day across the total install base rose 8.9% to A$54.69. CEO Trevor Croker noted that 17 of the top 25 games on the Eilers & Krejcik premium title list were Aristocrat titles, which Croker said demonstrated the group’s “exceptional portfolio strength.” Croker also noted the release of Buffalo Link in the US in the last fortnight, which he said was the most anticipated game in the industry. The game was developed in conjunction with HRG Studios.

I can see for miles: While Croker noted that many of the company’s operator clients “aren’t necessarily into releasing capital for games right now”, he was still hopeful for the rest of this year. “We’re still confident that we will see an install base increase,” Croker added. “Good quality games will drive foot traffic and we think we will benefit from that.” On iGaming in the US, Croker said the company continues to monitor the market. “The growth in digital is phenomenal and we believe there is a lot of growth there and in the gaming business.

We’re well-positioned and the key is to continue to grow the core businesses and iGaming is just one of those adjacencies that we continue to monitor and I should say it is still very early in its lifecycle in the US.”

Merge mania: Revenues for digital rose to US$899m (all digital revenues in USD), up 28.9%. Croker noted that consumer demand for digital games remained undimmed and “elevated” on pre-Covid levels, albeit moderated slightly on company’s second half 2020. Among the highlights is the growth of EverMerge, which brought in US$136m in H1. DAU numbers decreased 8.2% on the prior year period, but revenue per active user rose to US$0.72 from US$0.50. “You’re seeing some growth rates moderating,” Croker told the analysts. Talking about EverMerge, Mike Lang, CEO of digital, said the game was “by far the most successful launch we have had with Big Fish since we bought the company.”

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