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Aristocrat Changes US Strategy

16 May 2003

LAS VEGAS – As reported by the Las Vegas Business Press: "Australian-based Aristocrat Technologies Inc., one of the largest poker machine manufacturers in the world, is abandoning its `grow-at-all-costs' approach to its U.S. and North American markets for a more `structured,' efficient way of business.

"And that means getting products to market quicker and having better synergism between its Australian and American operations, new North America operations CEO Gavin Isaacs said.

"…After five American-born CEOs failed to bring desired results for its North American operations in the past six years, Aristocrat Leisure Ltd.'s board of directors tapped Isaacs, an Australian who previously ran Aristocrat's European operations, doubling revenue and tripling profits within a year.

"…Company-wide, Aristocrat has purged top-level leadership since a $28.8 million earnings shortfall pre-announcement to investors in February turned the Australian investment community sour towards it. The main reasons given for the earnings shortfall was a failed South American contract and general weakness in the North American market, the company said.

"…Currently, Aristocrat, which has about 6 percent of the U.S. slot market, is awaiting approval in Mississippi, New Jersey and Nevada, for a `full complement of video products,' according to the new U.S. president.

"…Aristocrat's Systems Business unit, which consists of its OASIS casino management system, will become a renewed focus as well. `We've disappointed with some of our products (in this area). But with our new plans, we will delight most casinos. ... There's been a concern Aristocrat is not taking this business seriously. There will now be a commitment from the board level down for supporting companies with our (casino management) products,' the new boss said.

"…But in what appears to be a firm mandate, Isaacs said the North American operations will need to have better communications with the Australian headquarters, and have the same forecasting systems in place…"

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