Ainsworth stock tanks on profit warning

Shares in Ainsworth Game Technology Limited tanked 37 percent on Friday after the company warned profit for H2 will be less than half of its prior estimate.

The company said it now expects profit before tax to be about $20 million. In February, the company gave guidance of $42.2 million for the period. For H1 profit was $16.2 million.

Profit before tax for the full year FY18 is now expected to be approximately $36 million compared to the $57.4 million in FY17, assuming its Churchill Downs machine order is completed this financial year.

“We are clearly very disappointed by the rebasing of our profit expectations for 2HFY18. We operate in competitive markets and our execution this time has not met the high standards our shareholders correctly deserve,” said CEO Danny Gladstone. “We are moving decisively to improve our profit outlook and are continuing to progress new product developments and marketing initiatives, which we confidently expect to improve our performance in FY19.”

The company said its sales expectations have been adversely affected by a range of factors, including competitive activity, regulatory approval delays in product submissions and further product development changes which have deferred the approval and release of previously scheduled key game titles until H1FY19.