Ainsworth Game Technology Limited

Second Half of FY 17 is expected to be stronger than the first half: Ainsworth Game Technology Limited (ASX: AGI) is expecting growth in revenue and profitability from international markets. New hardware, games, contribution from acquired Nova Technologies, growth from the new facility in Las Vegas and expected synergies with Novomatic would contribute to this growth. AGI is expecting positive outcome from the new product release in G2E events.

 

Historical Financial Performance (Source: Company Reports)
 
However, in the domestic market the unit volume are said to be down 30% in 1H FY17 against 1H FY16 impacted by challenging industry conditions. The normalized pre-tax profit, excluding currency gains, for 1H FY17 is thus expected to be A$15 million as compared to $35 million last year. But AGI is expecting stronger second half with significant improvement in profits in the second half as compared to 2HFY16. For FY16, the sales revenue increased by 19% to $285.5m versus the prior corresponding period. This reflected the strong underlying growth in international markets, which represented 71% of total revenue compared to 61% in FY15. Moreover, AGI’s acquisition of Nova and a Class II product offering has enabled the company to leverage the technology allowing greater access to new markets in the Americas. AGI has reported 68% of segment profits from the Americas.

New Hope Corporation Limited

Production grew on year on year basis: New Hope Corporation Limited (ASX: NHC) has reported a 40% growth in the total raw coal production on year on year (yoy) basis in the October quarter. The group delivered a 57% growth in the total saleable coal production during the quarter. Bengalla operations (40% owned) enhanced NHC production and sales volumes for the first quarter. The rally in thermal coal prices during the quarter will have a positive impact on earnings for the FY 17. During the October quarter, the drilling activity was focused on New Acland tenements with 73 holes drilled for a total of 5,573 metres. NHC’s acquisition of the Greater Kenmore Bodalla oil producing assets got completed in October. In addition, NHC got settlement proceeds of $12.95 million (plus GST) from Peabody Wilkie Creek Australia in respect of a Coal Port Services Agreement dispute. NHC got QCA approval of the QR access undertaking that led to a lower access charge of over 12% going forward and recovery of over $20 million in overcharges by QR in prior periods. The land court proceedings for Colton got concluded in August and the recommendations regarding the grant of the Mining Lease is pending. The company has also reported for an incident at QBH Coal Terminal with regard to damage to shiploader.

 

October quarter activity report (Source: Company Reports)
 
The group otherwise reported for positive FY16 EBITDA of $81.3 million during challenging market conditions. The group has highlighted that FY17 first quarter EBITDA (unaudited) for three months to October 31, 2016 has been up 52.7% to $40 million.

Ruralco Holdings Ltd

Restructuring Business: Ruralco Holdings Ltd (ASX: RHL) posted a 10% growth in the revenue to $1.8 billion in FY 16 and reported NPAT of $4.2m as compared to $14.1m in FY15 after $14m restructuring and divestment activities (net impact $9.1m). The profit is in line with the guidance provided to the market in August 2016. Moreover, RHL has enhanced the rural supplies network with strategic acquisitions adding 14 new points of presence both during the year. This includes two recently announced acquisitions in the Hunter region of New South Wales and the Murray Darling basin in South Australia. The rural supplies gross profit for FY16 has been up 16%. RHL is growing live export business to new markets, like Cambodia and China. Additionally, RHL has come to an agreement to merge the assets forming the Ruralco Insurance business with established insurance brokers, Ausure Consolidated Brokers (ACB), part of Steadfast Group Limited, and consolidating its insurance network across rural Australia.
 
 
FY 16 Financial Performance (Source: Company Reports)

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