Aristocrat Leisure stock slumps 17% on profit forecast

Wednesday 30th July 2008

Shares of Aristocrat Leisure, the world's No. 2 manufacturer of slot machines, slumped after the company cut its earnings forecast because of weakening demand in North America and Australia.

Aristocrat stock slumped 17% to A$505 on the ASX today. After the close of trading yesterday, the company said full-year operating profit would be A$190 million to A$200 million, down from previous guidance of A$247 million. First-half profit was about A$70 million, it said.

The outlook has been "significantly impacted by deteriorating economic conditions in North America and Australia," the company said in the statement. "The timing of new venue openings in emerging markets and the strengthening Australian dollar" also hurt earnings.

Demand in the US has stumbled as consumer confidence has waned. Revenue from casinos on the so-called Las Vegas Strip casino dropped 16% in May, the fifth monthly decline, according to Nevada's Gaming Control Board said.

By Jonathan Underhill

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