Aristocrat hails strategic investments as revenue rises 13% to AU$6.3bn in 2023

Reported revenue was just one of a number of areas of growth for Aristocrat in 2023. The gaming and technology business reported widespread success, with EBITDA and certain measurements of profitability rising.

Reflecting on the full-year, CEO and managing director Trevor Croker praised the impact of recent acquisitions. These include Roxor Gaming in January 2023, which led to the wider development of the Anaxi online arm.

Aristocrat is also closing in on the acquisition of NeoGames, with a $1.20bn deal struck in May. The purchase is expected to complete before the end of H1 in calendar 2024.

Croker said the impact of strategic acquisitions was clear to see in the 2023 results. He also said there is scope for further growth in 2024 and beyond as Aristocrat continues to seek out new opportunities.

“I’m proud of the high-quality result that we are announcing today,” Croker said. The growth Aristocrat delivered over the period demonstrates the ongoing resilience, competitiveness and diversification of our portfolio and sound fundamentals in the markets in which we operate. 

“At the same time, we have been able to accelerate investment behind our successful growth strategy. The benefit of our strategic investments to grow and diversify Aristocrat was particularly evident.

“This was underpinned by an exceptional gaming performance which more than offset an extended industry-wide moderation in mobile game demand, again highlighting diversification and scale as fundamental strengths of our business.

“We continued to invest to grow in attractive adjacencies and verticals, as we build further resilience in our operating portfolio, including through executing our ‘build and buy’ strategy in online RMG.”

Social gaming leads the way in full year

Breaking down the performance in the 12 months to 30 September, Aristocrat said its Pixel United social games business drew the most revenue.

In total, Pixel United represented $2.65bn, or 42.1%, of all revenue in the year. This was up 2.3% on last year, although overall revenue share slipped from 46.5% in 2022. Aristocrat says this reflects a decline in global mobile markets and its exit from Russia.

Gaming growth for Aristocrat

While Pixel United drew the most revenue, Aristocrat said that its other segments reported greater growth. Gaming revenue, derived from contracts with customers in the Americas, was 14.0% higher at $1.85bn.

Aristocrat says gaming growth was helped by North America customers committing more capital to high performing products. In particular, it noted increased penetration of both its Neptune Single and MarsX Portrait cabinets.

Meanwhile, Class III outright sales and other gaming revenue, derived from contracts with customers across the Americas, Australia and New Zealand, and International segments, jumped 32.0% to $1.80bn. 

Aristocrat said it benefitted from faster-than-expected pandemic recovery in Asia and improved conditions in Europe, as well as increased penetration of high performing products in North America.

EBITDA and NPATA growth in 2023

Turning to spending, revenue costs increased 15.2% to $3.55bn. Aristocrat also reported higher expenses across design and development, selling, general and administrative and also finance.

This resulted in a pre-tax profit of $1.67bn, up by 35.8% year-on-year. The business paid $216.3m in income tax but noted a $23.1m positive impact of foreign exchange and a further $5.0m from fair value of interest hedge rate.

This left a net profit of $1.48bn for the year. Aristocrat said this was 4.8% down from the $1.56bn posted in the previous year, although the 2022 figures included a $592.2m positive hit from foreign exchange, thus skewing the year-on-year comparison.

Net profit after tax and before amortisation of acquired intangibles was 46.7% higher for the year at $1.54bn. In addition, normalised EBITDA amounted to $2.11bn, a rise of 33.2% from the previous year. 

“Looking ahead, we will continue to navigate challenges with a focus on portfolio performance and capturing the significant strategic opportunities in front of us, including delivering on our online RMG strategy with the proposed acquisition of NeoGames to close in the first half of calendar 2024,” Croker said.