Australian racing and wagering firm Tabcorp has reported a 2.4% increase in revenue from continuing operations to AU$2.43 billion (US$1.56 billion) in the 12 months to 30 June 2023, the vast majority coming from its Wagering and Media division.
Group EBITDA of AU$391.0 million (US$251 million) was also 8.4% higher year-on-year, with Tabcorp reporting a net profit after tax of AU$66.5 million (US$42.7 billion). FY22 profit of AU$6.78 billion (US$4.35 billion) had benefited from the demerger of the company’s lucrative lotteries and keno business, now listed on the ASX as The Lottery Corporation.
In Wagering and Media, segment revenue grew by 2.2% to AU$2.23 billion (US$1.43 billion) and EBITDA by 7.3% to AU$308 million (US$198 million) on the back of increased efforts to improve the company’s competitiveness in the digital wagering space. Tabcorp said that active account customers increased 3% to a record 805,000 in FY23.
“After the first year of our three-year transformation, we have increased total revenue market share and seen a stabilization in our digital market share,” the company explained. “We delivered increased digital turnover share and racing revenue market share, while 4Q23 sport yields relative to competitors negatively impacted our sport and total digital revenue market share.
“This is a pleasing result given the impacts in FY23 from new entrants, highly competitive generosity levels, and smaller scale operators targeting near term profitability.
In the Gaming Services segment, revenue grew by 3.4% year-on-year to AU$204 million (US$131 million) while EBITDA increased by 13.5% to AU$83 million (US$53.2 million), “reflecting a strong year for the business as it cycled negative COVID impacts in the pcp.”
“Today’s earnings and record active customers highlight the successful completion of the foundation year in the TAB25 transformation strategy,” said Tabcorp Managing Director and CEO Adam Rytenskild.
“We’ve built this foundation for growth by creating the right products, policy settings and attracting the people needed to transform our business. Our earnings, revenue and active TAB customers have all increased on last year and these strong metrics lay the platform to achieve our TAB25 ambitions.
“We are the only one of the large wagering operators in the Australian market to increase revenue and EBITDA in FY23.
“Our total revenue market share grew, highlighting the strength of our wagering ecosystem. Despite a distorted market which included the introduction of an aggressive new operator and increased generosity and marketing spend by competitors, our digital revenue share remained relatively stable, highlighting the strength of our new products.”
Addressing the recent introduction of Point of Consumption tax increases for corporate bookmakers in multiple states, including a planned increase in Victoria in 2024, Rytenskild added, “Queensland TAB has outperformed the Group TAB results on almost every metric since it commenced competing on a level playing field with our competitors. I’m looking forward to having a level playing field in Victoria next year.”
Tabcorp has declared a final dividend of 1.0 cents per share fully franked, to be paid to shareholders on 18 September 2023.
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