Tabcorp’s FY25: $36.6M Profit, 11.8% Revenue Growth, and Cost Savings
Tabcorp Holdings Limited has reported a significant financial turnaround for FY25, driven by the new Victorian Wagering and Betting Licence and strategic operational improvements. The company posted $2.6 billion in revenue and a net profit after tax of $36.6 million, reversing last year's substantial loss.
- Revenue up 11.8% to $2.615 billion
- Statutory net profit after tax of $36.6 million vs prior year loss
- New Victorian Wagering and Betting Licence boosts earnings
- Operating expenses controlled with $38.8 million savings
- Unfranked dividend of 2.0 cents per share declared
Financial Turnaround and Licence Impact
Tabcorp Holdings Limited has delivered a remarkable turnaround in its financial performance for the full year ended 30 June 2025. The company reported revenue of $2.615 billion, an 11.8% increase on the prior year, and a statutory net profit after tax (NPAT) of $36.6 million, reversing a net loss of $1.36 billion in FY24. This improvement was largely driven by the commencement of the new exclusive Victorian Wagering and Betting Licence in August 2024, which allowed Tabcorp to fully consolidate 100% of Victorian wagering operations, compared to the previous 50% joint venture arrangement.
Strategic Leadership and Operational Efficiency
Under new leadership, including Managing Director and CEO Gillon McLachlan and Chief Wagering Officer Michael Fitzsimons, Tabcorp has evolved its strategy and operating model. The company appointed five new executives to its leadership team, enhancing wagering and media capabilities. Operationally, Tabcorp implemented a zero-based cost design, removing approximately 230 roles and achieving $38.8 million in operating expense savings. Capital expenditure was disciplined, reduced by 23.6% to $115.2 million, supporting a leaner and more agile business.
Omnichannel Innovation and Retail Evolution
Tabcorp has focused on delivering unique omnichannel wagering experiences, launching initiatives such as TAB Takeover and TAB Time, which integrate digital, retail, and media assets. The company also commenced phase one of a new retail commercial model aimed at creating a structurally profitable retail business, with expectations to increase venue patronage through personalized offers and technology investments. Digital wagering revenues grew 16%, while cash wagering revenues increased 17.5%, outperforming digital channels.
Integrity Services and Media Growth
The Integrity Services segment, anchored by the MAX business, showed resilience with revenue stable at $175.8 million and EBITDA before significant items slightly down due to the sale of the MAX Performance Solutions business. Excluding this sale, Integrity Services revenue and EBITDA grew modestly, supported by fee increases and growth in monitored electronic gaming machines. The Media business, including Sky Racing, expanded its domestic and international distribution, contributing to a 2.7% revenue increase.
Commitment to Sustainability and Player Safety
Tabcorp continues to prioritize sustainability and responsible gambling. The company advanced its Player Safety Promise and Framework, investing in technology to identify and intervene in harmful gambling behaviors more rapidly. Environmental initiatives included a 43% reduction in Scope 1 and 2 greenhouse gas emissions since 2019, installation of solar panels at its media facility, and relocation to a carbon-neutral office. Governance enhancements and compliance improvements remain a focus, despite regulatory fines related to historical issues.
Financial Position and Shareholder Returns
Strong cash flow conversion of 99% enabled Tabcorp to reduce net debt to $609.4 million, lowering leverage to 1.6 times EBITDA, well within target ranges. The Board declared an unfranked final dividend of 1.0 cent per share, bringing total dividends for FY25 to 2.0 cents per share, reflecting a payout ratio of 51% of NPAT before significant items. The Dividend Reinvestment Plan will operate for the final dividend with no discount applied.
Bottom Line?
Tabcorp’s FY25 results mark a pivotal step in its transformation, but execution of its retail model and regulatory developments in NSW will be critical to sustaining momentum.
Questions in the middle?
- How will Tabcorp navigate ongoing regulatory reforms in New South Wales wagering?
- What impact will the new retail commercial model have on long-term venue profitability and customer engagement?
- Will the FY23 Long Term Incentive plan vest given preliminary indications of unmet performance targets?