Poker machine maker Ainsworth Game Technology Ltd is expecting to report a net loss of approximately $11 million in 2004/05.
The Ainsworth board said it would pursue a restructuring and cost rationalisation program to return the company to profitability and position it to take advantage of opportunities in emerging markets in 2005/06.
Ainsworth executive chairman and founder Len Ainsworth said that a number of factors had contributed to the revised outlook, including lower than expected sales volume to customers in Europe, South Africa and Australia.
Mr Ainsworth said the company also posted a substantial $3.5 million increase in overhead costs during the second half of the year.
He said the cost increases were linked to research and development expenditure, applications for licences in new markets and staff increases.
Mr Ainsworth said a number of one-off expenses totalling approximately $5 million were included in the expected loss.
These expenses included costs from the discontinued merger with Russia's Unicum Group, restructuring costs in Europe and the UK, as well as legal costs.
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