Tabcorp H1 FY26: Revenue $1.345B, Adjusted NPAT $35.7M, Dividend Up 50%
Tabcorp Holdings reported a modest 1% revenue increase for the half year ending December 2025, while adjusted net profit after tax jumped 61.5%, prompting a 50% rise in the interim dividend.
- Revenue grew 1% to $1.345 billion
- Adjusted NPAT rose 61.5% to $35.7 million
- EBITDA increased 9.3% to $199.9 million
- Interim dividend increased 50% to 1.5 cents per share, unfranked
- Issued $300 million in 5.5-year notes to extend debt maturity and boost liquidity
Solid Revenue Growth Amid Challenging Conditions
Tabcorp Holdings Limited has released its half-year results for the six months ended 31 December 2025, reporting a 1% increase in revenue to $1.345 billion. This modest growth was underpinned by the full six-month contribution from the reformed Victorian Wagering and Betting Licence, which commenced in August 2024, partially offset by softer wagering yields during the period.
Profitability and Margins Show Strong Improvement
While statutory net profit after tax (NPAT) declined 14% to $21.7 million due to a higher tax expense, the company’s adjusted NPAT before significant items surged 61.5% to $35.7 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 9.3% to $199.9 million, and earnings before interest and tax (EBIT) increased 8.5% to $92.7 million. The adjusted earnings per share climbed 42.1% to 2.7 cents, reflecting operational improvements and disciplined cost management.
Segment Performance: Wagering & Media and Integrity Services
The Wagering and Media segment delivered revenue of $1.253 billion, up 0.8%, with EBITDA up 15.8% to $181.4 million and EBIT rising 20% to $95.3 million. This segment benefited from improved wagering turnover, cost efficiencies, and enhanced integration of digital, retail, and media assets, including popular promotions like TAB Time and AFL Miss-by-One.
Integrity Services, which provides electronic gaming machine monitoring and related services, posted revenue growth of 4.1% to $91.7 million, with EBITDA increasing 7.5% to $36 million and EBIT up 12% to $14.9 million. Growth was driven by increased project activity, fee escalations linked to inflation, and a larger monitored gaming machine base.
Capital Management and Dividend Policy
Capital expenditure was $50.8 million, down from $57.4 million in the prior period, with 71% allocated to growth and transformation initiatives. In November 2025, Tabcorp issued $300 million of 5.5-year medium term notes at a fixed coupon of 5.99%, extending debt maturity and increasing liquidity to over $1 billion. The company’s leverage ratio remains conservative at 1.5 times EBITDA, well below its target ceiling.
Reflecting confidence in ongoing cash flow, Tabcorp declared an interim unfranked dividend of 1.5 cents per share, a 50% increase over the prior period. The unfranked status is due to limited franking credits, a consequence of prior tax refunds and expected minimal cash tax payments in the near term.
Outlook and Strategic Considerations
Tabcorp’s results highlight the benefits of the reformed Victorian Licence and disciplined cost control, positioning the company well for future growth. However, the variability in Victorian race field fees and the unfranked dividend policy introduce some uncertainties. The company’s strong balance sheet and extended debt maturity profile provide flexibility to pursue strategic opportunities.
Bottom Line?
Tabcorp’s improved adjusted earnings and strengthened balance sheet set the stage for navigating regulatory and market challenges ahead.
Questions in the middle?
- How will Tabcorp manage the impact of Victorian race field fee fluctuations on future earnings?
- What strategic initiatives will Tabcorp prioritise with its enhanced liquidity and extended debt maturity?
- Will the company’s unfranked dividend policy affect investor sentiment and shareholder returns going forward?
