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Ainsworth profit falls 21 per cent

AAP logoAAP 23/08/2016 Trevor Chappell

Ainsworth Game Technology's annual profit has been hit by currency fluctuations and a drop in revenue from Australia but the poker machine supplier says its financial results for 2015/16 were solid.

Ainsworth on Tuesday booked a 21 per cent fall in statutory net profit for the 12 months to June 30 to $55.7 million.

Excluding currency fluctuations, profit after tax was $52.4 million, in line with the prior year's profit of $52.5 million and in line with guidance, the company said.

"Excluding the effect of foreign exchange gains, the FY16 (fiscal 2016) results were solid," Ainsworth chief executive Danny Gladstone said.

Mr Gladstone said Ainsworth's $US38 million acquisition of US-based poker machine supplier Nova Technologies had given Ainsworth greater access to new markets in the Americas.

The Americas market generated 68 per cent of Ainsworth's profits.

Ainsworth acquired Nova in January 2016. The acquisition doubled the number of poker machines that Ainsworth had in North America at the time to more than 2,600.

Ainsworth said Nova had made a pleasing contribution to the 2016 results.

"Since completion the business has been fully integrated and continues to deliver strong growth," Ainsworth said.

"There is scope to expand into new territories both in the US and beyond."

Ainsworth said its margins remained strong in international markets but margins in the domestic market fell because of changes in the product mix, fluctuations in the Australian dollar, and competition.

Domestic revenue, which accounts for 29 per cent of total revenue, fell 12 per cent to $81.5 million out of total revenue of $285.5 million.

International revenue of $204 million was up 38 per cent on the previous year.

Ainsworth said it was cutting costs, and higher sales volumes, production efficiencies and more premium progressive games were expected to go some way to offsetting the pressure on margins.

Meanwhile, Ainsworth is awaiting regulatory approvals to complete the sale of 172 million shares owned by major shareholder Len Ainsworth to international gaming company Novomatic.

Mr Gladstone said significant benefits could flow from the relationship with Novomatic. It would help diversify the group's game technology, and improve growth and profitability in international markets.

Ainsworth released its 2016 full-year financial results after the share market had closed on Tuesday.

Ainsworth shares were steady at $2.39.

CURRENCY, DOMESTIC MARKET CRIMPS AINSWORTH PROFIT

* Full-year net profit down 21pct to $55.7m

* Revenue up 19pct to $285.5m

* Final dividend of five cents per share, unchanged. Full year dividend 10 cents, unchanged

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