Tabcorp Q1 revenues up 5.7%

Business News

Tabcorp lifted first-quarter revenue 5.7 per cent to $578.8 million, after gaming services revenue surged 47.8 per cent to $41.4 million for the first quarter of 2018, chief executive David Attenborough said.

Mr Attenborough told shareholders, at the company’s AGM in Melbourne on Friday, that total wagering turnover for the three months to September 30 was up 3.5 per cent at $3.1 billion.

While wagering and media was up 4.5 per cent and Keno revenue had slipped 5.3 per cent, Tabcorp’s FY18 priorities were centre on the successful completion of the proposed Tatts combination, Mr Attenborough said.

Tabcorp chairman Paula Dwyer said the Australian Competition Tribunal had this week finished considering the proposed transaction for a second time after originally approving the merger in a June decision that was challenged by the Australian Competition and Consumer Commission and rival CrownBet.

Crownbet’s claim had been dismissed, while an aspect of the ACCC’s grounds for review was upheld and the matter referred back to the Tribunal for redetermination, she said.

Ms Dwyer conceded to shareholders that the drawn-out union with Tatts Group was accumulating costs but the board was prepared for the outcome with the redetermination ruling expected at any time.

“These costs have not been incurred lightly,” Ms Dwyer said.

“While this is a complex transaction, it is the result of a considered decision by the board, weighing the inherent risks in undertaking a transformational transaction of this size against the significant benefits of the proposed combination.”

Meanwhile, Tabcorp’s Sun Bets investment with News UK, opening up the UK online wagering and gaming market has “so far disappointed,” despite revenue lifting 5.3 per cent.

Ms Dwyer said the business did not deliver according to plan and had been reset for growth, or earmarked for exit.

“If performance does not improve to meet forecast expectations, we will give serious consideration to exercising our contractual right to exit operations from 31 December 2019,” Ms Dwyer said.