Australian gaming machine manufacturer Ainsworth Game Technology has indicated that its AU$13 million ($8.4 million) investment in Argentina will be fully written down in the financial results for the first half of this year.
Such investments were made to hedge the devaluation of the Argentinian peso against the US dollar and were undertaken in response to the increased limitations within Argentina to restrict the transfer of monies held in this region.
The group highlighted that it is still expecting profit before tax – excluding currency impacts and one-off items – of ‘approximately AU$23 million ($14.75 million)’, excluding any possible write-down.
In a dispatch to the ASX, Ainsworth’s board highlighted that, despite preliminary legal advice indicating a high likelihood of recoverability, administrative delays in court proceedings, and the ability to access further information pertaining to the proposed reorganization petition filed by the trustor, the write-down was considered necessary at the present time.
‘The write-down will be re-evaluated as more information becomes available to reliably assess the extent of recoverability,’ the company announcement added.
The gaming machine manufacturer also warned that macro-economic uncertainties and political instability within Argentina have
continued since June 30, with the Argentinian Peso experiencing significant depreciation.
The Argentinian government has decided to devalue the peso by 22 percent against the US dollar one day after the primary elections, taking the official exchange rate to 350 pesos.
Ainsworth said that due to delays caused by the write-off, the company now expects to release its Financial Report on Thursday on August August 31st, 2023, after the market closes.
