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- Aristocrat Leisure (ALL) has withdrawn its February 2020 outlook statement due to uncertainties around the impact of the COVID-19 pandemic
- Softer demand across the gaming industry is becoming evident as social distancing and lockdown measures affect Aristocrat’s customer base
- As ALL’s clients suffer and reduce capital expenditure, the company expects some damage to its bottom line
- The group still maintains long-term confidence, underpinned by a conservatively geared balance sheet and a diversified operations base
- Aristocrat Leisure is down 12.4 per cent on the market, with shares falling to $18.68 apiece
Casino gaming provider Aristocrat Leisure (ALL) has withdrawn its February 2020 outlook statement due to uncertainties around the impact of the COVID-19 pandemic.
Softer demand across the gaming industry is becoming evident as social distancing and lockdown measures affect Aristocrat’s customer base.
Venue closures and general fiscal downturns have meant the company’s clients are adopting a more cautious approach to capital expenditure — causing injury to Aristocrat’s projected bottom line.
The company says it has been monitoring and putting in place appropriate responses to COVID-19 for several months. In executing comprehensive short and longer term risk management and mitigation plans, Aristocrat intends to position the business to emerge from the challenges caused by COVID-19 as quickly and strongly as possible.
Financially, the group believes its outstanding fundamentals will continue to underpin its strategy and long-term confidence, via a conservatively geared balance sheet. In addition, Aristocrat’s term loan facility is not due until October 2024 and is covenant lite, providing significant financial flexibility.
Diversification in Aristocrat’s operations also serves to add strength and flexibility going forward. Over the 2019 financial year, digital games delivered over 40% of total Group revenue, while land-based gaming operations and outright sales contributed around 30% each. Operations are also spread across key global and regional markets, addressing a range of segments and genres.
The group says it will continue to closely monitor developments related to COVID-19, and provide further disclosures as required, in line with its obligations.
Above all else, the health and wellbeing of Aristocrat’s staff, their families and the broader communities in which it operates remain the company’s first priority. In addition to implementing broad travel bans and social distancing measures across its global operations, well over 80% of Aristocrat’s more than 6,400 staff members are currently being supported to work from home, consistent with the advice of local health authorities.
Aristocrat Leisure is down 12.4 per cent on the market, with shares falling to $18.68 apiece as at 3.30 pm AEDT.
