It was probably a co-incidence yesterday, but as Aristocrat (ALL) shares were basking in the glow of a higher dividend and solid rebound in 2015 earnings, its smaller local rival was seeing its shares battered after the surprise retirement of a key executive.
Ainsworth Game Technology (AGI) shares hit a new year low of $2.26 in trading and closed down 11% at $2.35 after telling the market that its head of strategy and development had resigned suddenly.
Brokers said the news cast doubt over the company’s roster of new games under development, which will be vital as it tried to recover market share in the local market lost to the recovering Aristocrat.
The executive in question, Scott Clarebrough, was widely seen as the driving force behind many of Ainsworth’s most successful poker games in recent years.
AGI 1Y – Ainsworth loses pokies guru
Ainsworth CEO, Danny Gladstone said the market had over-reacted to the retirement, noting Mr Clarebrough would stay with the Sydney-based company for a further 12 months and may also be used in an advisory role following his official departure.
But the company failed to address another important concern – that something happened in the past 8 days to trigger the retirement. Ainsworth held its annual meeting November 17 and there was no sign of any move to leave by Mr Clareborough, so something has happened in the intervening period. The fact that he won’t leave for 12 months indicates it is not a retirement as we know the term.
The 12 month period is a form of non-compete arrangement to prevent him going to a rival, as is the talk of an ‘advisory’ role.
