Shares in gaming machine maker Aristocrat Leisure (ALL) surged 11% yesterday after the company produced a surprisingly strong upgrade to its first half earnings.
The company told the ASX in a trading update that it now expects its first-half net profit to be up 66% to $183 million from the first half of 2014-15.
The shares jumped 13% to $11.92 at one stage, and ended up 10.5% at $11.59.
ALL 1Y – Aristocrat “well ahead” of market expectations.
Aristocrat, which releases its first half results in two weeks (on May 26), said in the update that normalised net profit after tax and before amortisation of acquired intangibles of $183 million will be “well ahead” of market expectations.
The company further added to investor cheer by telling the ASX that second half growth is expected to be in line with the first half.
“This outlook assumes stable trading conditions and prevailing exchange rates relative to the first half of 2016," Aristocrat said in the statement.
“It anticipates moderate growth across key North American segments and further growth in Digital, while the ANZ business will cycle over a strong earnings period that is not expected to be repeated in the second half of fiscal 2016.
"The strong performance of Aristocrat in 1H2016 has been driven by significant share and profit growth across core markets and segments, particularly US Class III premium gaming operations, Australian outright sales and the Digital social gaming segment."
Aristocrat CEO Jamie Odell said in the statement “Aristocrat delivered outstanding results over the first half of fiscal 2016, powered by industry leading content, talent, hardware and technology that translated into exceptional operational performance.
“Our focus on growing share and profitability by investing in compelling product portfolios, targeted to priority segments and supported by improving execution, is delivering tangible and sustained results, despite generally flat and highly competitive market conditions” Mr Odell said.
