Jumbo broadens its growth engine with Ontario lottery acquisition

Record earnings withstand weak Australian jackpot cycle

Jumbo Interactive Limited (ASX:JIN) has set its sights on another year of growth after producing record underlying EBITDA of A$85 million in FY26, even as Australia endured what the company described as a 1-in-45-year jackpot environment. Revenue rose 33% to A$194 million, underlying EBITDA increased 25%, and underlying NPATA grew 20% to A$51 million.

“LotteryRetailing”

The result reflects the increasingly international shape of the business. Dream Giveaways became Jumbo’s international B2C growth engine in its first full year, while SaaS and Managed Services continued to contribute. The company said 41% of FY26 revenue came from outside Australia and more than half of EBITDA was generated outside its Lottery Retailing segment, a marked change from the group’s historically concentrated model. The result had already been detailed in record FY26 earnings, which also highlighted A$34 million of debt reduction and A$77 million in available cash and undrawn debt.

FY27 guidance depends on jackpots and international execution

Jumbo reaffirmed FY27 guidance of a 46% to 50% underlying EBITDA margin for Australian Lottery Retailing and SaaS, alongside A$36 million to A$40 million of underlying EBITDA from Managed Services and Dream Giveaways. The international target compares with A$30.3 million in FY26.

The assumptions are not without moving parts. Jumbo expects Dream UK to contribute £11.3 million to £11.8 million, while Dream US is forecast to contribute US$5.6 million to US$6.2 million under its shorter-duration draw model. Australian performance remains sensitive to jackpot frequency and size, with marketing and promotional spending expected to rise to support player engagement. Foreign exchange movements and the continuation of Dream UK’s existing VAT treatment are also identified sensitivities.

Stride targets Ontario with conditional RMG acquisition

Jumbo’s Canadian expansion is advancing through Stride Management Corp’s conditional agreement to acquire Raffle Management Group, a charity lottery manager with more than 20 years of operating history and clients including hospital foundations and elite sports teams. The deal values RMG at up to A$6.45 million, comprising an upfront A$3.95 million payment and an earnout of up to A$2.5 million tied to performance through December 2027.

The upfront consideration implies an enterprise value multiple of 4.4 times RMG’s adjusted FY26 EBITDA, based on unaudited management accounts showing C$0.9 million of adjusted EBITDA. The transaction will be funded from existing cash reserves and remains subject to customary conditions, with completion expected around January 2027. RMG’s team and founders are expected to remain in place, with integration led through Stride’s existing Canadian operating structure.

Capital returns continue as finance chief prepares to depart

The board declared a fully franked FY26 dividend of 27.0 cents per share, representing 49.5% of statutory net profit after tax and sitting at the top of its revised 30% to 50% payout range. Jumbo has also bought approximately A$4.3 million of shares under its on-market buyback since reporting its FY26 result, taking total purchases under the program to A$15.8 million.

Chief financial officer Jatin Khosla is due to leave at the end of the year to pursue another opportunity, with the board beginning the search for a successor. Advance proxy votes supported all listed AGM resolutions, although the proposed one-off equity grant to founder and chief executive Mike Veverka attracted the narrowest margin, with 57.05% voting in favour versus 42.03% against. Those figures are advance votes and may not represent the final AGM outcome.

The near-term test is whether better jackpot conditions can translate into renewed Australian customer activity without diluting the margin profile, while the Dream businesses and the proposed Ontario acquisition add operational complexity. January’s expected RMG completion, the CFO appointment and the next evidence on FY27 trading will give shareholders a clearer measure of how much of Jumbo’s growth is structural rather than cycle-assisted.