Tabcorp’s revenue fell across multiple verticals during the first quarter of its 2024 financial year, covering trading between 1 July 2023 to 30 September 2023.
An update to the ASX stock exchange revealed that Tabcorp’s total group revenue had fallen 6%, with wagering turnover down 0.9% and wagering and media revenue declined by 5% too.
Things were not much better on the online betting side of the business, consisting of the flagship TAB sportsbook app, with digital wagering revenue down 4%, despite a 1% increase in turnover.
The firm attributed this to ‘the adverse impact of lower fixed odds yields due to racing and sports results’. Fixed odds yields for the quarter fell year-on-year from 15% in 2022 to 14.8%, with the average over the previous three years having stood at 15.6%.
“Given the softer trading environment, I’m pleased we grew digital wagering turnover, which highlights that customers are responding to our new digital customer offering,” said Adam Rytenskild, Tabcorp Managing Director and CEO.
“We continue to be relentless in the way we execute our TAB25 strategy and remain focused on making the right decisions for the long-term success of the business. As we head into the Spring Carnival and the start of the NBA season, I’m excited to have released our 13th update to the TAB App since it was launched last spring.”
Additionally, gaming services revenue also fell by 13% during the three month period, attributed by the group to ebet sales and fewer electronic gaming machine (EGM) contracts.
Contracted EGMs fall under the remit of Tabcorp’s Max Performance Solutions (MPS) business, which the group plans to sell by the end of H1 2024, marking further transformation for the company.
The past two years have been a time of significant development for Tabcorp and the wider Australian betting and gaming landscape, with the company divesting its lottery and keno business in May last year. This saw the creation of a separate enterprise, The Lottery Corporation, which like Tabcorp also trades on the ASX.
However, the past year has also seen the group encounter some hurdles, notably recently receiving fines from both the Victoria Gambling and Casino Control Commission (VGCCC) and Liquor and Gaming New South Wales (L&GNSW), although the firm did also secure a refund from the Australian Tax Office (ATO).
Meanwhile, Australia is set to enter a new regulatory era, with the state governments of New South Wales and Victoria and the federal government – all presided over by the Labour Party – looking to adopt new rules and requirements, particularly around player protection.
“We’re in the midst of implementing significant change as a company and industry,” Rytenskild continued. “Our strategy is on track as a level playing field and licence reforms commence, our customer reputation grows, and cost base reduces.
“Our transformation continues at pace and I am confident we will deliver the value laid out in our TAB25 Strategy.”