Ainsworth Game Technology has announced it is expecting a 29.2 percent year-on-year decrease in profit for the first half of FY19, due to “highly competitive conditions in the Australian market.”
The company noted that revenues and profit before tax for the Australian segment are expected to be materially lower in FY19H1.
“Overall industry demand has fallen by around 10 percent. Furthermore, timing issues around the approval of more complex new products, and the strategic decision to defer product launches into FY19H2 to maximize market impact and total returns have affected short-term financial results.
On the other hand, AGT said it expects revenue and PBT for its North American businesses to be ahead of the prior corresponding period in the half year.
The company also expects to report an increase in R&D investments in the half year, and on an ongoing basis, as well as a “modestly adverse” impact from the adoption of new account standards which requires a higher level of provisioning for receivables credit risk.
Looking ahead, AGT said it has a positive outlook for performance and financial results in domestic markets in FY19H2, as it expects the new products to gain traction with customers and generate higher returns on investment then.
AGT said it expects to report profit before tax of approximately A$8 million (US$5.8 million) for FY18H1, down from $11.3 million in the prior year period.