Import Restrictions Weigh on Ainsworth as Acquisition Vote Looms
Ainsworth Game Technology forecasts a stable profit before tax of around $14 million for H1CY25, buoyed by Australian market gains and steady North American revenue despite challenges in Latam/Europe. The company also backs a major acquisition proposal by Novomatic AG.
- Profit before tax expected at $14 million, stable versus prior period
- 6% revenue growth driven by Australian market and Raptor cabinet launch
- North American revenue steady; Latam/Europe down 14% due to import restrictions
- R&D investment maintained at approximately 17% of revenue
- Independent Board committee recommends shareholder approval of Novomatic acquisition scheme
Steady Profit Amid Market Challenges
Ainsworth Game Technology Limited (ASX: AGI) has provided a trading update for the six months ending 30 June 2025, forecasting a profit before tax of approximately $14 million. This figure is largely unchanged from the $14.3 million reported in the previous corresponding period, signaling a steady financial footing despite a mixed market environment.
The company’s revenue is expected to grow by about 6% compared to the prior six months, primarily driven by improved performance in the Australian market. This uplift follows the February 2025 launch of the new Raptor cabinet, which has bolstered local sales and contributed to stronger operating leverage.
Regional Performance Diverges
While Australia shows promising growth, Ainsworth’s key North American market is expected to deliver revenue broadly consistent with the previous half-year period when adjusted for currency fluctuations. This stability is notable given ongoing global economic uncertainties.
Conversely, the Latam/Europe region faces headwinds, with revenue anticipated to decline by approximately 14%. The company attributes this drop to persistent import restrictions in Mexico, which have constrained market access despite increased recurring revenue from gaming units already in operation.
Maintaining Investment and Margins
Segment margins are forecast to remain consistent overall, with gains in Australia offsetting margin pressures in Latam/Europe. North American margins are expected to hold steady. Importantly, Ainsworth continues to invest heavily in research and development, allocating around 17% of total revenue to innovation, slightly up from 16.6% in the prior half.
Chairman Danny Gladstone emphasized that the results align with management’s expectations and reflect strategic initiatives to grow Australian revenues while managing international challenges and an increased cost base.
Acquisition Scheme Gains Board Support
In a significant corporate development, the Independent Board committee has recommended shareholders vote in favor of the scheme proposal by majority shareholder Novomatic AG to acquire all remaining shares in Ainsworth. This endorsement is contingent on the absence of a superior proposal and confirmation from an independent expert that the deal serves shareholders’ best interests.
This acquisition could mark a pivotal moment for Ainsworth, potentially reshaping its strategic direction and market positioning.
Bottom Line?
Ainsworth’s steady performance and strategic moves set the stage for a critical shareholder vote that could redefine its future.
Questions in the middle?
- Will the Novomatic acquisition scheme secure shareholder approval without competing bids?
- How will Ainsworth navigate ongoing import restrictions impacting Latam/Europe revenue?
- Can the Raptor cabinet sustain momentum to drive further growth in Australia?
