Tabcorp Posts 23% EBITDA Growth and Halves EBIT Losses in FY25

Strong Financial Performance Backed by Licence Reform

Tabcorp Holdings Limited closed FY25 with a compelling financial performance, reporting group revenue of $2.615 billion, an 11.8% increase from the prior year. More notably, earnings before interest and tax (EBIT) surged by 93.7% to $188.7 million, nearly doubling the previous year’s figure. This uplift was largely attributed to the benefits stemming from the reformed Victorian Wagering and Betting Licence, which positively impacted earnings and margins over 10.5 months of the financial year.

The company’s EBITDA also rose 23.2% to $391.5 million, reflecting strong operational leverage despite a 13.6% increase in operating expenses. Tabcorp’s ability to deliver $39 million in cost savings ahead of guidance and reduce capital expenditure from $151 million to $115 million underscores its disciplined approach to cost and capital management.

Strategic Evolution and Leadership Refresh

FY25 marked a period of strategic evolution for Tabcorp, highlighted by a refreshed leadership team and a clear focus on omnichannel wagering and media capabilities. The company appointed new executives, including a Chief Wagering Officer and Chief Commercial and Media Officer, to drive growth and accountability. Key initiatives such as the Tap-In-Play trial in New South Wales and the development of a National Tote platform are underway, aiming to modernize wagering experiences across digital and retail channels.

Tabcorp also emphasized the structural profitability of its retail business and the growth potential of its standalone racing and sports media segment. The media business, supported by investments like the Dabble Sports platform, showed rapid scaling with a 133% revenue increase and positive earnings contribution in FY25.

Operational Discipline and Market Outlook

Operational discipline was a recurring theme, with Tabcorp implementing zero-based cost design and removing approximately 230 roles during the year. The company achieved an underlying cash conversion rate of 99%, reflecting strong cash flow generation. Leverage was reduced to a comfortable 1.6 times net debt to EBITDA, well below the target ceiling of 2.5 times, providing financial flexibility for future growth.

Looking ahead, Tabcorp expects modest growth in the wagering market for FY26. While initial benefits from the new retail commercial model are anticipated, these will largely be reinvested to enhance customer offerings. Capital expenditure is forecast between $120 million and $140 million, with tax expenses influenced by non-deductible Victorian licence amortisation, though cash tax payments are expected to remain minimal due to carry-forward losses and tax offsets.

A Fitter Company Poised for Growth

Tabcorp’s FY25 results demonstrate a company that has become fitter and more focused. The combination of regulatory reform, cost discipline, and strategic execution has positioned Tabcorp to capitalize on its unique assets and deliver shareholder value. The company’s emphasis on omnichannel experiences, retail innovation, and media growth reflects a forward-looking approach in a competitive wagering landscape.