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Aristocrat faces 'please explain'
SYDNEY, Australia (CNN) -- Gambling equipment maker Aristocrat Leisure has confirmed it is being investigated by Australia's corporate watchdog over its profit warning last week. Aristocrat, which on Tuesday announced a 7 percent fall in full-year net profit to Aust. $80.2 million ($47.3 million), has seen its share price take a beating in recent days. The shares, which closed 1 percent down at A$1.94 on Tuesday, have more than halved in the past two weeks. That follows Aristocrat's announcement on February 7 that it had lost a key South American contract for 3,000 electronic gambling machines. The company was also forced to admit last week that its North American operations were trading below expectations. It cut its net profit target by A$28 million, shocking investors and prompting a selloff that cut its market capitalization by A$1 billion . Aristocrat chairman John Ducker said Tuesday the board had ordered an immediate and full review of the company's businesses in North and South America, to be overseen by CEO Des Randall. 'Disappointing performance'Randall called the performance of the American businesses "disappointing". But he said that while the Americas had not met expectations, all other regions were either in line or ahead of management forecasts. Revenue for the year ended December 2002 rose 26 percent to A$976.5 million. In a statement released to the Australian Stock Exchange on Tuesday afternoon, following the posting of its earnings in the morning, Aristocrat said it had received a notice from the Australian Securities and Investments Commission (ASIC). It said the notice required Aristocrat to produce documents "in connection with a number of South American contracts and its profit announcements". Aristocrat said it would "cooperate fully" with the corporate watchdog. Key shareholders are calling for changes in the Aristocrat board and management following the poor performance in the American markets. Shareholders include Perpetual Trustees with 8.5 percent, AMP with 5.2 percent and the founding Ainsworth family with about 40 percent.
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