Well, the major reason for such a big revenue decline lies in the low level of international sales that dropped by 11% year over year to AU$87.8 million. Taking into consideration that 82% of AGT’s sales come from abroad, no wonder, the overall volume fell by 9% to $107.3 million as a consequence of the weaker performance.
Splitting the declines by region, North American sales dropped by 6% in comparison to the same period in 2018. When it comes to Latin America, the efficiency was somewhat weaker with a drop of 8%. In these two cases, the losses resulted from lower unit volume sales.
The situation was a bit different at home...
...where AGT saw the increase of unit sales by 2% yet the revenue was down 1% to AU$19.5 million. Quite naturally, this affected the EBITDA margin (a measure of a company's operating profit as a percentage of its revenue), that was off by 55% for the six-month period with AU$14.6 million. On the bright side, it illustrates a loss per share of AU$0.01, which is far from the worst possible scenario.
AGT CEO Lawrence Levy doesn’t expect further deterioration as he and the rest of the team had already begun studying ways to improve performance. Commenting on the current state of affairs, Levy said:
“The transition is in progress to make AGT more profitable and efficient. We are re-evaluating R&D, increasing our game development resources, sharpening our sales and marketing focus and complementing organic growth with selective acquisitions. We are busy building the foundations and expect a return to profitability to deliver a positive net profit in the second half of FY20, with better results in FY21.”
