Thank you for standing by, and welcome to the Ainsworth Game Technology Limited 2021 AGM. I would now like to hand the conference over to Danny Gladstone, Chairman. Please go ahead.
Thank you. Good morning, ladies and gentlemen. My name is Danny Gladstone, and I'm the Chairperson of Ainsworth Game Technology Limited. I would like to welcome all shareholders and visitors to the 2021 annual general meeting of Ainsworth Game Technology this morning. I'm advised that there is a quorum present, and it is now the designated time for the commencement of the meeting. I declare the meeting open. I thank you all for attending this meeting of shareholders which is being held as a fully virtual meeting. I'm pleased to be able to utilize technology so as to ensure the safety and wellbeing of all the attendees, given the current and potential for further government-mandated restrictions resulting from the COVID-19 pandemic. Today's meeting is being webcast live and provides all shareholders, proxies, and corporate representatives the ability to attend and participate in the meeting virtually.
Firstly, I would like to outline some of the procedural matters for today's meetings. All attendees have the opportunity to either attend via the live webcast of the meeting or through a telephone conference facility established. Participation and the ability to ask questions either online or through the dedicated phone line established is available to all members. To attend the meeting, participants enter a unique link into a web browser on a computer or online device to view the webcast of the meeting. In addition to the live webcast, members and proxy holders can attend and participate in the meeting via a telephone conference, enabling you to hear the live broadcast of the meeting. To ensure all shareholders are given an opportunity to ask questions or make comments, attendees are able to submit written questions through the webcast.
As shown on the screen, a question can be typed and submitted through the webcast. Once your question is typed, press the Submit and Arrow key field. The question submitted will be addressed at a relevant time and during the course of the meeting. In addition to the written submissions of questions through the webcast, members participating via the telephone conference call are provided with the ability to ask questions or make comments. To ask questions through the conference phone facility, members enter star one on your phone to register your question. Once your question is registered, you'll be announced into the conference to ask your question at the designated time. I advise that all questions will be addressed under the relevant item of business and may be amalgamated, should similar questions be received.
I will either address your question or determine the most appropriate person to answer at the relevant time. All shareholders were provided the opportunity to submit questions in advance of the meeting, and these will be similarly addressed under the formal business of the meeting. Submitted questions in advance of the meeting will be addressed first, followed by the written questions through the webcast, then any questions received through the telephone conference facility. I advise that all resolutions at today's meeting will be determined by poll. Shareholders will have the ability to vote online during the meeting via the Lumi platform as outlined on the screen display. To vote during the meeting, shareholders will need to open the Lumi link in a web browser and enter the meeting number.
Once your shareholder details are entered and the poll is open, a vote icon will be displayed, which allows shareholders the opportunity to record their votes for each resolution. To allow all shareholders with sufficient opportunity to vote, I will now declare the voting open. Should you wish to amend your voting during the meeting, you will have that opportunity. I will provide notice prior to the closing of the poll. The results of the poll for the business before this meeting will be advised to ASX later today once determined. Okay. The agenda for today's meeting is outlined on the screen. The first item is to introduce your directors who are in attendance today. Mr. Graeme Campbell, the Lead Independent Non-Executive Director, Chair of the Audit and Risk Committee, and a member of the Remuneration and Nomination Committee. Mr.
Colin Henson, Independent Non-Executive Director, member of the Audit and Risk Committee, chair of both the Remuneration and Nomination Committee and the Regulatory and Compliance Committee. Mr. Harald Neumann, the company's recently appointed Chief Executive Officer and executive director. Harold is currently in the U.S. and is attending the meeting online. Also in attendance today is Mark Ludski, the company's Chief Financial Officer and Company Secretary. I welcome Julie Cleary, who is in attendance representing the company's auditors, KPMG, who is available to answer any questions relevant to the conduct of their audit. I will now provide my chairman's address. Ladies and gentlemen, I'd like to present the annual review of the 2021 financial year. 2021 has clearly been a challenging year for our customers, communities, and colleagues, and I'm proud of the support Ainsworth has provided through these difficult times.
We have delivered a strong recovery in results in the second half of the financial year, and with progress in vaccine rollouts and the gradual reopening of customers' venues across our major markets. We look forward to further improvement in trading conditions in FY 2022 and beyond. For FY 2021, AGT reported a loss before tax of AUD 59.2 million. The loss reflects the impact of the pandemic and the government-imposed mandatory closures of customers' venues, particularly in the first six months of FY 2021. The results also included AUD 42.1 million relating to currency impacts and other one-off non-recurring items, including a non-cash impairment charges of AUD 41.7 million. Excluding currency translation impacts and one-off items noted above, the loss before tax for the year was AUD 17.1 million.
This compares to a loss of AUD 34 million in the previous FY 2020 on a similar basis. The results for the second half of FY 2021 show a significant improvement on the first half results. Our performance has followed the progress of vaccination programs and increased customer activity compared to the AUD 56.6 million loss before tax reported for the H1 of FY 2021. AGT delivered a performance for the H2 of the financial year with a loss of AUD 2.6 million. While macro conditions have been volatile, our long-term strategies have remained consistent. Our goals are to expand our international footprint, invest in technology to enhance the product suite, and build our participation fleet to improve the quality of earnings. These are foundations for our future success.
International markets contributed AUD 120.5 million in revenue for FY 2021, representing 76% of the group's total revenue. This delivered an improved performance overall, with the H2 representing AUD 67.6 million, up 28% on the H1 . Recurring revenues continued to grow, accounting for 28% of the total revenue compared to 26% in the previous corresponding period. AGT's units under gaming operation increased by 9% to 7,052 units, generating annuity-style recurring revenues. Operating costs were well-controlled in FY 2021, with a decrease of 20% on the AUD 122.7 million in the prior year. Current economic challenges resulted in the instigation of effective management and control of operational expenses, including agreed rental concessions, voluntary employee salary reductions, and receipt of available government subsidies.
Despite these significant operational challenges, we remain focused on innovation and developing superior products for our customers. The effectiveness of our R&D investment will continue to be a primary objective, with the efficient production of innovative, high-performing products being the key to our future success. The recent appointment of David Bollesen as Chief Product Officer will assure our commitment to innovation and excellence. David has a significant experience within the gaming industry and will be responsible for building on the existing game studios to drive and increase game performance and market share in all regions. AGT's leading historical horse racing products and HHR system continued to perform well in the year. AGT is pursuing new revenue opportunities in current established markets and new jurisdictions where legislation has recently been passed, including New Hampshire, Wyoming, and Louisiana. The previously launched A-STAR cabinet is another example of Ainsworth at its best.
We successfully exhibited the A-STAR at the National Indian Gaming Association trade show in July 2021, the first to take place since the declaration of the pandemic. The positive customer response and interest bode well for the future growth. In line with the strategic priority to protect AGT during this challenging period, the company's balance sheet and liquidity has been strengthened. As of June 30, 2021, AGT had a cash balance of AUD 42.4 million, and since then, the cash balance has further increased. As a result of the exclusive distribution agreement for real money gaming within the U.S., AGT received the initial $5 million contribution from GAN Limited in July 2021. Given the focus on liquidity and ensuring AGT is well-placed during challenging market conditions, the dividend program remains suspended.
While FY 2021 results were significantly affected by the pandemic. The proactive measures which we have implemented to strengthen AGT and position the company for further recovery should lead to improved performance as customer activity continues to increase. As you have heard me say before, we have a professional workforce, an excellent industry reputation, and a well-established footprint across our markets. We also have a new CEO to lead our growth and recovery. Harald Neumann commenced as the CEO on the October 1, 2021. As the former successful CEO of NOVOMATIC AG, our major shareholder and a director of AGT, he brings a wealth of knowledge and experience to the role with a thorough understanding of AGT. I welcome him to his first AGM in his new role.
On behalf of the board, I would like to acknowledge Lawrence Levy for his contribution prior to his resignation in September for personal reasons. I would like to close by thanking my fellow directors, our capable executive team in Australia and the Americas, as well as our dedicated loyal employees, my fellow shareholders, and of course, our customers. Thank you, and I will now hand you over to Harald to provide his CEO address. Harald.
Thank you, Danny. Dear shareholders, I'm pleased to provide my first report as your new CEO. It's a privilege to be appointed to this executive leadership position at Ainsworth at such an important and challenging time in the company's development. As many of you will know, I started in my new role on October 1 this year. I have been a director of your company since 2017, and this will be my fifth annual general meeting of shareholders. It is a pleasure to present to you today, and I add my welcome to all shareholders and guests. Given my experience in the industry and directorship of Ainsworth, I have been able to build a strong knowledge of the business and a good understanding of our strengths and opportunities.
Our key strengths include our trusted brand, our highly capable staff, the company's enduring commitment to developing superior game technologies, and our customer relationships across our major markets, particularly in the Americas. It is the potential to leverage these strengths into large market opportunities to deliver sustained growth and improved returns for shareholders. That appeals to me about the role and excites me about Ainsworth. I have recently visited a number of our operations to review our capabilities and opportunities. I have also had the benefit of talking with customers and many of my colleagues, including management, sales and marketing teams, and product developers. It is very clear to me that we have the ability, as pandemic restrictions are removed, to deliver our potential to be a larger and more profitable company in our major markets.
The improved results we delivered in the H2 of 2021 highlights this recovery potential. Revenue in half two increased by 21% compared to the H1 . Loss after tax for half two, including AUD 12.5 million of non-cash impairments, was AUD 3.3 million compared to a loss of AUD 50.1 million in the first six months. Underlying EBITDA, a maybe more reflective measure of operational performance, vastly improved in half two of year 2021 and increased year-on-year. AGT reported underlying EBITDA of AUD 15.5 million for full year 2021 compared to AUD 5.8 million in the prior corresponding period. Underlying EBITDA for half two of 2021 was AUD 14.4 million compared to AUD 1.1 million in the H1 .
While these results don't reflect Ainsworth's real earning potential, they are much better results than we reported for the H1 . The North America region was once again the highlight of the results. The region reported revenue of AUD 88.5 million, up 23%. Customer activity is recovering strongly as many markets reopened once vaccination programs advanced. Assets on participation were up 17% to AUD 271.2 million. Participation and lease revenue increased by 66% year-over-year and now contribute a greater share of overall regional revenue at 44% in comparison to last year, which was 32%. Following the close of the financial year, AGT completed a cash sale to Kentucky Downs of 400 machines previously under participation. The sale represents a mixture of hardware configurations, including a portion of the newly released A-STAR Curve cabinets.
The agreement provides for AGT to receive connection fees in 2022 and beyond. These sales gives us a good start to the new financial year. Australia delivered a good result in 2021 with solid growth over the PCP. The new A-STAR Curve cabinet and suite of innovative games were launched in the year. The revenues grow by 38% and EBITDA by 15% to AUD 5.4 million, PCP AUD 4.7 million. Revenue increased in all states except Victoria. While the latest lockdowns in some states of Australia created uncertainty, customers are now looking to progressively invest in their gaming floors to ensure they are competitively placed and appropriately resourced. I am pleased to report venues are now reopening and activity levels are slowly recovering. Latin America was heavily impacted by the pandemic with high transmission rates.
Government-mandated closures and access restrictions to customer venues in Mexico, Argentina, and Peru. These restrictions affected performance. Revenue for the regions were AUD 18.3 million, a reduction of 56%. Results in half two of 2021 saw some recovery with revenues of AUD 13.5 million compared to AUD 4.8 million reported in half one. Of the 625 machines AGT sold in the region last year, 82% were in the H2 . As these markets increase vaccination rates, it is expected that government restrictions will ease within 2022, and further revenue opportunities can be expected as previously deferred purchasing decisions are progressed across the region.
Online revenue grew by 28% to AUD 5.9 million in the year following the launch of Real Money Gaming in New Jersey in April 2020, and progressively going live with AGT content within seven major operators. The success of this business led to the U.S. exclusivity agreement AGT executed with GAN Limited, ensuring continued growth for 2021 and beyond. The gross margin in 2021 was 56%, an increase on the 52% reported in the first half. However, an overall reduction on the 61% in the PCP. The reduced margin was primarily due to further written down of older style cabinets, higher production overhead costs resulting from lower production units and sales forecasts in most jurisdictions. Despite all the challenges of the pandemic across our regions, AGT today is well-placed for further recovery and long-term growth.
We proactively took the opportunities the pandemic presented to enhance product development, streamline our cost base, expand our market presence, and strengthen our balance sheet. These initiatives have improved our financial results. We are conducting a broad review of our operations and investments to ensure we are maximizing our assets opportunities so that we are well-positioned for the future. We have an optimistic outlook. Our North American business is performing well. Markets have effectively reopened over there with social distancing. We are pursuing new growth opportunities for our markets, leading historical horse racing, HHR products in new jurisdiction following the passing of new legislations. We are excited by the opportunities to extend MTD, which was acquired in 2020 .
Across our jurisdictions to drive new sales, and we can promote the A-STAR cabinet, which is still relatively new in the U.S., given so many trade shows and exhibitions were canceled last year. Our Australian business is also making progress after the recent lockdowns. The commitment to employing the best talent available to drive effective and efficient product development is critical to our success. To enhance our efforts in this area, and as Danny outlined, we welcome David Bollesen as our new Chief Product Officer. David commenced on October 7 this year and has a wealth of industry knowledge, having held senior positions in his career spanning over 25 years. Most recently, David held the position as Vice President of game studios of a major international gaming company within Australia, as well as several key roles within the U.S.
We look forward to David's involvement at Ainsworth and positive contributions across development strategies in coming periods. Our strong financial model supports our growth ambitions. 28% of the group revenues recur and 76% of our sales are from offshore markets. In 2021, we refinanced a AUD 50 million flexible loan facility and closed the year with a cash balance of AUD 42.4 million. Since June 30, our financial position has strengthened further, as Danny explained. We received the $5 million initial payment from GAN. Churchill Downs paid us $9.4 million for the sale of 400 participation machines in July, and we have been able to repay $18 million of borrowings. AGT is purposely a different company to the one we were before the pandemic.
We have deliberately taken advantage of the opportunities available to us over the last year to become more streamlined, more efficient, and more competitive. We are well-positioned for recovery and growth. I am pleased to report AGT's momentum in the H2 of the last financial year has continued into full year 2022. Our revenue for the H1 of 2022 is expected to be ahead of both the prior corresponding period and the previous six months. AGT expects to deliver profit before tax, excluding currency impact and one-off items for the H1 of 2022 of around AUD 10 million. While domestic markets have been adversely impacted by extended lockdowns, our North American and Latin America operations are delivering growth and improved earnings. AGT's online activities are also contributing positively following the exclusive distribution partnership announced with GAN Limited.
I wish to express my appreciation to Danny Gladstone as the Chairman for his ongoing contribution to the company. Danny has tremendous industry knowledge and proven expertise, and we look forward to working closely together with him. I would also like to thank the other directors on the board, Mark Ludski, our CFO, the executive team from North America, Latin America, and Australia, and our talented employees supporting shareholders and, importantly, our customers for their trust and continued support. I will now hand over back to Danny.
Thank you, Harald. I will now address the formal businesses of the meeting. The notice of the meeting was lodged with ASX on October 27, 2021, and provided electronically to all shareholders. As advised in the notice of meeting, the board recommends shareholders vote in favor of all resolutions, with Colin Henson abstaining on the resolution for his re-election. In addition, as outlined in the notice of meeting, I intend to vote undirected proxies in favor of resolutions one and two. I remind shareholders that the poll is open and you are able to vote online by logging in to the Lumi platform and recording your votes. The first item, which does not require to be voted on, the 2021 annual financial report, including the directors and audit reports in respect of the financial year ended June 30, 2021.
As advised, we have Julie Cleary, representing KPMG, in attendance to answer any relevant questions on the conduct of their audit. I will now ask Mark Ludski to advise whether any questions have been submitted or received via the webcast or the phone line established as previously noted. We will address any written submitted questions first, and then any questions received via the phone line. Thank you, Mark.
Danny, we have no submitted questions or questions through the conferencing facility on this particular item.
Thanks, Mark. The next item of formal business is the re-election of Mr. Colin John Henson, who retires in accordance with the company's constitution and ASX listing rule 14.4. Mr. Colin John Henson offers himself for re-election as a non-executive director of the company. I refer to the screen outlining the proxies received for this item. I will now ask Colin to address the meeting.
Thank you, Chairman. Good morning, ladies and gentlemen. My name is Colin Henson. Information regarding my involvement with Ainsworth, together with my background and professional qualifications, is covered in the annual report and the notice of this meeting. In short, throughout my corporate life, I've held many senior executive positions. In addition, I've been an executive and non-executive director, as well as an executive and non-executive chairman of large and small Stock Exchange-listed and unlisted companies in many industries. As stated in the notice of meeting, in my role as an independent non-executive director, I serve on three committees of the board and am chairman of two of them. I enjoy my position on the board, the company, and the people I work with. With your agreement, I would like to continue. Back to you, Mr. Chairman.
Thank you, Colin. Mark, is there any questions relevant to this resolution?
Danny, we have no submitted questions or questions through the telephone conferencing facility on this item.
Okay. Thank you, Mark. The next item of business is the approval of the Remuneration Report for the year ended June 30, 2021. I note that this resolution is advisory only and does not bind the directors of the company. I refer to the screen outlining the proxies received on this item. I draw shareholders' attention to the voting restrictions on this item as contained in the Notice of Meeting. Mark, have we any submitted questions or other questions for this item?
Danny, we have no submitted questions or written questions or questions through the telephone conferencing facility on this item.
Thank you, Mark. I wish to advise that if you haven't already recorded your votes and wish to vote on the applicable items raised at this meeting, please do so as I intend to close the poll shortly. The last item today is general business. Does any shareholder wish to raise any questions under business? Mark, are there any questions?
Danny, we have no written questions or questions through the telephone conferencing facility.