Tabcorp has detailed a successful end to 2021 trading as the ASX betting group completes the demerger of its lottery and keno business.
Updating its investors, Tabcorp group revenues increased by 8.8% to AUS $5.6m (2020: $870m), whilst EBITDA also rose by 11.3% to AUS $1.1m ($985,230).
A unit breakdown saw the Wagering & Media unit, consisting of the firm’s flagship TAB sports betting brand as well as the Premier Gateway International (PGI) and Sky Racing holdings, record revenue of AUS $2.3m ($2m) an increase of 10.3%.
Additionally, EBIT for the division stood at $216m, an increase of 23.4% on the 2020 figure of $215,9m. The unit’s overall success was attributed by Tabcorp to the strengthening of its omni-channel offering using ‘customer-driven initiatives’.
Overall digital wagering via TAB grew by 27% to $9.5bn, whilst the number of active customers rose by 9.7% to 784,000 – helping offset retail turnover results that were down 0.9% to $5.3bn, as TAB venues emerged from COVID-19 lockdown conditions.
Further betting and media developments saw Tabcorp double its shareholding in PGI from 50% to 100%, whilst further expansion for the Sky Media brand was achieved through content and distributions deals, and the number of Sky Racing Active registered customers rose by 55.3%.
“The 2020/21 financial year (FY21) saw the COVID-19 pandemic continue to disrupt our way of life and challenge our businesses,” read a joint statement from Chairman Steven Gregg, and Managing Director and CEO, David Attenborough.
“Tabcorp’s priority has been ensuring the safety and wellbeing of our people and supporting our business partners and the community.
“While Tabcorp’s operations were impacted by various government-imposed lockdowns and other restrictions, our businesses proved resilient and delivered a strong operational result and earnings growth.”
Year trading saw Tabcorp complete the demerger of its Tatts Lotteries and Keno business as a separate entity from its wagering unit – the two divisions will respectively operate as The Lottery Corporation and New Tabcorp.
Outlining the rationale for the investment in its trading update, Tabcorp maintained that the plans pose several key opportunities for the company, such as creating ‘two market leading businesses’, allowing shareholders to benefit from Tatts current and future scale and diversification.
Additionally, Tabcorp stated that the demerger would allow The Lottery Corporation and New Tabcorp to ‘adopt a more focused operating profile’ and an ‘optimised capital structure more aligned to its core operations’.
Reporting on full year revenue for its lottery holding, Tabcorp explained that total income had risen by 8.3% to AUS $2.9m ($2.4m), with the firm asserting that game changes in its Saturday Lotto and Set for Life had been ‘well received by customers’ and had contributed to ‘at least half of the growth’ for some of its lottery tities.
Commenting on the merger, Gregg and Attenbourgh remarked: “The two businesses are expected to be leaders in their respective markets, creating great experiences for millions of customers.
“They will both build on their heritage of sharing the benefits of their commercial success with governments, the racing industry, licensed venues, newsagents and other retail and business partners.”
The demerger is targeted for completion by the end of this month, subject to relevant apporvals inclduing a shareholder vote, which will take place at a general meeting expected soon.
Although wagering’s recovery from the pandemic was more steady, lottery retail turnover proved slightly more robust with revenue growth of 0.9%, whilst digital continued to accelerate by 26.6% to account for 32.8% of all lottery turnover.
Lastly, keno revenues rose by 33.5% to AUS $255m ($169.6m), also bolstered by a retail bounceback from COVID-19 venue closures and a ‘very strong digital performance’, with turnover from this sector rising by 73.8% to represent 15.5% of Keno earnings.
Presenting 2021/2022 financial results, David Attenborough and Steven Gregg declared their final statements as Tabcorp leaders, both having been replaced by the new duo of Adam Rytenskild (CEO) and Bruce Akhurst (Chairman).