Industry veteran Harald Neumann was named chief executive officer at Ainsworth Game Technology in September 2021, following a five-year tenure in the same position at Novomatic, Ainsworth’s majority shareholder. Since his appointment, Neumann has been focused on growing the North and Latin American markets, and the company’s historical horse racing (HHR) revolution has been a big part of that growth. Neumann spoke with GGB Editor Frank Legato at the Ainsworth booth at the G2E trade show in October. (Listen to podcast above, or see video below.)
GGB: Let’s start with some of the results—your earnings for fiscal year 2022 are up 38 percent, net income up to $11.8 million. What were the most critical contributors to these results?
Neumann: Well, the most critical was that the world recovered from Covid—I think that was the most important one. And of course, our U.S. piece has contributed more than 50 percent of our success; Latin America has recovered, Australia is becoming better and better, so in total, the recovery from Covid and of course our HHR business in the U.S., which also contributed a lot to our profitability.
How important are the Americas for Ainsworth, and what do you do to maintain growth in these markets?
We have defined three key markets for us: No. 1, U.S.; No. 2, Latin America; and No. 3, Australia. So you can see U.S. and Latin America are the first two. The U.S. is the biggest market by far in the casino area—we are quite successful already in the high-denomination area, and we want to increase our installed bases in the low-denomination area, and of course HHR should increase. Latin America is important for us, even though there are always some challenges, like in Mexico with the recent tax increase and smoking ban. But nevertheless, these markets are very important.
How has your commitment to R&D expanded and improved your product roadmap?
When I joined the company, this was priority No. 1, because the company will only survive if we are providing the right games to our clients. We hired a new CTO, David Bollesen, and we have two new studio heads in Vegas and in Australia. All of them are already contributing to our success. We debuted three games at G2E, Treasure Spirits, Ca$h Stacks Gold and Ultra Shot Gold, which are already indicative of the direction Ainsworth is going.
What have been the initial results back from the low-denomination additions?
We have already launched the games I mentioned in Sydney, and they are showing quite good results at the Star Sydney. We have had the experience that there’s a high probability that games which are successful in Australia will be successful in the U.S. We’ve really gotten quite positive feedback about the performance of our games, so I believe that we are going in the right direction.
Of course, we have to talk about HHR, where you’ve dominated the space. How have you been able to implement HHR development alongside your traditional offerings?
It’s a new game style in the U.S. which is really performing, and we recently announced an agreement for expansion to Kentucky Downs. Our improved performance in game development will, of course, also have an impact on our HHR games. So, everything is connected together, and as we are not co-developing a game just for HHR or just for Class III, this is connecting the features for both markets. This also brings an added revenue stream because we’re connecting games from Aristocrat, IGT, Konami and so on to our system, which generates added revenue and profitability.