Australian racing and wagering giant Tabcorp revealed Wednesday that cash spending at its retail venues outgrew that on the company’s digital platforms in the 12 months to 30 June 2024, highlighting a change in preferences by customers given domestic inflationary pressures.
It also shows that more people are returning to in-person venues, particularly pubs and clubs, in the wake of the COVID-19 pandemic, according to Tabcorp Chairman Bruce Akhurst.
Akhurst provided the update during Tabcorp’s Annual General Meeting on Wednesday, his last before stepping aside and handing the reins over to incoming chair Brett Chenoweth.
While Tabcorp has faced significant challenges to its digital business from corporate bookmakers like Sportsbet and Ladbrokes in recent years, its retail business – where it holds exclusivity to provide retail wagering across most Australian states – remains a knight in shining armour. The company was also recently awarded a new 20-year exclusive Wagering and Betting Licence in Victoria.
In his address, Akhurst revealed that digital wagering revenue had declined by 2.2% year-on-year in the first half of the financial year before flattening out in the second half, however cash wagering revenue increased by 5.3% in the second half, “out-performing the digital market and highlighting the value in our retail business – particularly as people return to pubs and clubs post COVID and in a higher inflationary environment that makes more cost effective entertainment appealing.”
Cash turnover in 31 “Next Gen” venues in NSW, Victoria and Queensland that were upgraded during the year was up 18%, he added, with more of these upgrades on the way “to drive performance and leverage the potential of our unique integrated wagering ecosystem.”
The improvement in the cash wagering business, he added, “highlights the value in winning licences like Victoria. To experience growth in cash wagering in a softer economic environment is testament to our improved retail offering.”
Despite this, Tabcorp – which previously reported a 3.9% decline in FY24 revenues to AU$2.34 billion and an 18.7% decline in Group EBITDA to AU$317.7 million – confirmed it will embark on a cost-cutting program throughout the current financial year that will likely include a reduction in its workforce.
“I acknowledge much work has been done in reducing headcount, management layers and outsourcing transactional work but I am clear more can and will be done,” said recently appointed CEO Gillon McLachlan.
“This time next year I’m confident that we will be a simpler, more cost-effective organization.”
Tabcorp also addressed shareholder concerns around its share price, down around 50% over the past year, which Akhurst described as “not where we want it to be”.
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