With its headquarters in Sydney, Aristocrat Leisure is the largest manufacturer of gambling machines in Australia, and one of the largest in the world.
“Aristocrat Leisure (ALL) delivered an impressive first half of 2024 result, surpassing both our expectations and that of the market. Net profit after tax (excluding tax-effected amortisation of acquired intangibles) in the first half was $764 million and up 16% year-on-year,” Raymond explained.
“This was 13% above our forecast, 10% above consensus and up 13% on a constant currency basis. Operating profit (EBITA) was up 15% to $1,027 million, 12% higher than our estimate.
“North America revenue (excluding Latin America or LATAM) achieved 6% growth, approx. 4% above forecast.
“ALL’s digital gaming division, Pixel United, delivered impressive 17% growth in profit, 6% above our forecasts.
“Earnings per share before amortisation (EPSA) was up 19% to 118.5 cents, 12% above our estimate.
“Dividend per share (DPS) was up 20% to 36 cents.
“A $350 million extension to ongoing buyback program was also announced.
“Consequently, our estimates of EPSA on a fully diluted basis increase by 9% in both financial year 2024 and financial year 2025.
“We upgrade ALL from a Hold to Add recommendation, with a 12-month target price of $50.
“We forecast free cash flow (FCF) and dividend yield of 5% and 2% respectively for financial year 2024,” Raymond said.
GRAPH FOR Aristocrat Leisure (ALL)
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