Poker machine group, Aristocrat confirmed earlier guidance of an operating profit and a loss after one off items for the December 31 2009 financial year.
The company told the market yesterday earnings at the operating level, pre-abnormals after tax and minority interest, amounted to $116.4 million, on revenue of $908.6 million for the 12 month period ended 31 December 2009.
But the loss after tax and abnormals was $157.8 million, largely due to impairment charges announced at the half year and a post-tax provision of $187.3 million made in relation to a potential damages liability associated with the US Convertible Bonds litigation.
That has also cost shareholders any dividend, the company told the ASX yesterday.
The news, although revealed in an update a few weeks ago, came as investors took a breather from Monday’s bullishness.
So Aristocrat shares were sold down, losing more than 5% at one stage.
They ended off 4.2% at $4.27, a fall of 19c on the day.
The shares steadied in afternoon trading.
That was despite some cautious optimism about this year and next, tempered by a warning that 2010 will still be "tough".
CEO, Jamie Odell, said in the statement that “While we are still in the early stages of our 3-5 year turnaround, we are making important and steady progress across the breadth of our strategic change agenda.
"We have clear performance benchmarks in place at all levels of the organisation and are progressing to plan.
“Our higher ship share results in North America and Australia are particularly encouraging, and demonstrate that the improvements we are making in our product portfolio and go to market strategies have gained early traction with customers.
“However, 2010 is going to be another tough year and we have a lot of work ahead to embed the improvements we’re making across the business and turn them into sustainable top line momentum.
“2010 is going to be a year of accelerating the implementation of our strategy, amid tough and turbulent market conditions across the world.
"Our operational performance will continue to impacted by these macro factors.
"We will, however, maintain our focus on the things within our control: improving our fundamentals and positioning Aristocrat to take full advantage of opportunities as they arise and as conditions improve” Mr Odell concluded.
The company said that in 2009 it "faced adverse conditions across all major markets, with operators highly cautious about capital expenditure and limited new venue openings in North America and other markets".
But it described the "underlying performance was ahead of market consensus, closing the year with positive momentum on the back of strengthening product traction, particularly in North America and Australia".
"Aristocrat continues to take a prudent approach to balance sheet management.
"Following a $236.7 million capital raising last April, debt coverage ratios and net debt have been maintained at conservative levels and well within those expected for companies with a BBB- investment grade credit rating.
"In light of the Company’s reported loss for 2009, and any resulting cash outflow from the Convertible Bond litigation, the Board has determined that no final dividend will be paid for the 2009 year.
"The Group is committed to providing shareholder returns through paying dividends and, subject to Board review at the appropriate times, will revert to its annual earnings payout ratio target of 50%- 70% in 2010."
The company said that its markets in North America and Japan shrank by around 30% compared to the prior year while the Australian market remained flat overall.
"In North America, increased ship share and growth in gaming operations installed base was more than offset by significantly lower demand, including in the systems market.
"Revenue declined 13.8% to $405.6 million and profit fell 18.8% to $152.3 million," the company said.
In Australia, improved revenues and ship share reflected stronger game releases, a higher average selling price and there was a steady customer uptake of the new 3-year licences.
"The result also reflected the recognition of an upfront licence fee from a key Australian customer. Revenue increased 12.1% to $207.8 million and profit grew 21.6% to $63.1 million."
The smaller market in Japan was exacerbated by the delivery of only one key licensed game title during the year, which limited total sales volumes.
Aristocrat said full year revenue in that market fell 50.5% to $106.1 million and profit fell 68.6% to $16.4 million.
And it said "generally weak economic conditions across most other jurisdictions drove a 9.9% fall in revenue and a 22.2% fall in profit in the Rest of World region in 2009.
"However, Aristocrat generally held share across this segment."
