Lottery sector profit record was not enough to offset the deficit of frequent lockdowns across Australia for Tabcorp as the firm saw its EBITDA slash by 5.5% in H1.
Publishing its half-year report, Tabcorp revealed total group revenue of $2.93bn, an increase of 2.2% on the same period last year, attributing the slow growth to adverse trading conditions brought on by the COVID-19 pandemic.
The operator noted that its lottery business headlines its performance, with lottery revenues increasing 10.5% up to $1.78bn from last year’s $1.61bn.
Lottery operations exceeded initial expectations given Tabcorp’s Keno retail network was forced into closures in the state of New South Wales, the operator’s largest active state. As a result, Keno revenues were $119m, down 9.8% on H1 of 2021, largely impacted by the shutdown of NSW venues.
Mitigating Keno retail impacts, the lottery division registered a 5% increase in active customers to 3.8 million, as consumers engaged with larger PowerBall and OZ Lotto jackpot draws.
Mirroring wider global trends, digital lottery sales took a bigger slice of total sales, making up 36.7% of all lottery stakes. Furthermore, the Tatts lottery registered a 28% increase in online sales, helping the Lottery and Keno unit achieve a period EBITDA of $358m up 15% on corresponding H12021 results of $311m.
“The record result from the Lotteries & Keno business again showcased the broad appeal of the business’ much-loved products and brands, and the success of its omni-channel strategy,” commented Tabcorp Managing Director and CEO, David Attenborough.
Whilst lottery operations performed resiliently during the period, Tabcorp struggled in its other divisions. COVID-19 impacts damaged Tabcorp’s recovering wagering and media unit that registered a 10% decline in revenues to $1.07bn.
As a result, TAB’s H1 2022 EBITDA result declined by 35% to $148m from last year’s H1 result of $227m.
“The Wagering & Media business, and its digital performance, is much stronger when venues are open and customers can participate fully in the omni-channel experience, which is a key strategic point of difference,” added Attenborough.
“As we have throughout the pandemic, our focus was on managing the operational and financial impacts on our businesses, as well as prioritising our people’s wellbeing and supporting the recovery of our business partners.”
Despite the difficulties endured with COVID-19 impacts, Tabcorp highlighted the development of the wagering business, which received technical upgrades to its online platform, improving product personalisation and expanding its racing content with Sky Media.
Further operational highlights saw Tabcorp maintain that the business was on course to deliver on its target of $25m in yearly EBIT savings.
Closing a tough H1 trading period, Tabcorp declared net profits of $175m, a 5% decrease on the same period last year, which garnered results of $185m.