Aristocrat shares leap on buyback proposal

POKER machine giant Aristocrat plans to return up to $500m to investors via an onmarket share buyback, after raising $1.3bn for its failed takeover tilt at British gaming software company Playtech.

Chief executive Trevor Croker said the buyback would be completed on an “opportunistic basis” – starting from June – and the group would advance its own real money gaming (RMG) strategy.

Aristocrat’s shares closed 6.7 per cent higher at $33.73 on the ASX on Thursday, giving it a market capitalisation of $22.59bn, following news of the buyback. This compares with a 1.7 per cent slump across the broader share market.

It came as the group’s net profit in the six months to March 31 surged 46.5 per cent to $530.7m. Meanwhile, revenue jumped 23.1 per cent to $2.75bn.

Mr Croker said the company was now pursuing its own “build and buy” strategy to develop “scale in online RMG, while also returning cash to shareholders”. And he believes that Aristocrat can become the global leader in the RMG market, the total revenue of which is expected to surge 13 per cent to $US112bn ($160.14bn) by 2025.