Due to COVID-19 shutdowns and ‘the possible acceleration of retail contraction’, Tabcorp Holdings is set to write down its wagering and media business by at least AUD$1bn (€605m).
Making a statement to the ASX Exchange, the company revealed that it had undertaken a ‘review of assets’ in which it expects to incur an AUD $1bn to AUD$1.1bn write-down in its financial results for the year ending 30 June 2020.
This follows on from the ‘the potential decline in consumer confidence and increased economic uncertainty’ in the pandemic’s wake, and ‘the possible acceleration of retail contraction and uncertainty regarding any longer term impacts as an indirect result of the pandemic’.
Issuing its preliminary unaudited results for the year ended 30 June 2020, the operator expects EBITDA to be in the range of AUD$990m to AUD$1bn – down from AUD$1.12bn in 2019.
Tabcorp’s Managing Director and CEO, David Attenborough said: “COVID-19 has materially impacted our Wagering & Media and Gaming Services businesses. We are facing into a challenging and uncertain environment, and the current operating conditions and those expected into the future are relevant factors in assessing the value of the goodwill in those businesses at this time.
“We remain confident in the strength and resilience of Tabcorp’s diversified portfolio of assets and are pleased that integration is now substantially complete. We are focused on supporting our people and partners during these challenging times while ensuring that Tabcorp emerges strongly post COVID-19.”
The full extent of the COVID-19 impact is as of yet unknown however, measures to contain the spread of the virus in Australia saw closures of hotels, clubs and betting shops as well as the widespread cancellation of sporting events.
The news regarding Tabcorp’s write down follows on from last week’s announcement that saw Attenborough stepped down from his position as chief executive .
Tabcorp is now in the process of succession planning for a new Chief Executive who will take over from Attenborough in the first half of 2021.
