Tabcorp plunges after swinging to loss
Make us a preferred source
Make us a preferred source on Google
More news: Tabcorp shares had plunged 12.8% to $0.63 by 1:03pm AEDT following the release of its latest earnings.
The company posted a net loss of $636.8 million for the six months to December 2023, compared to a $52 million profit a year ago.
What they said: Jarden analysts held an “overweight” rating for Tabcorp and said “downside risks included increased competitor promotions/ higher customer acquisition costs, ability to take share through refreshed betting app, ongoing softer consumer discretionary spend potential, a decline in racing turnover, and changing regulatory ESG-related environment”.
“Upside risks include a level playing field reducing competition from online players, delivery of Tabcorp’s FY25 forecasts and market share gains.”
Tabcorp swings to net loss on impairment charge
The news: Wagering giant Tabcorp has swung to a first-half net loss after heavily writing down the value of assets amid softer trading conditions.
The numbers: The company posted a net loss of $636.8 million for the six months to December 2023, down from a $52 million profit a year ago.
Group revenue dropped 5% to $1.2 billion while group earnings fell 14% to $170 million. It will pay an interim dividend of 1 cent a share, down from 1.3 cents a year ago.
The context: The result was mainly impacted by a $731.9 million impairment in the company’s main wagering and media business, which it blamed on lower consumer spending, higher interest rates and higher taxes in NSW.
Earnings in the business were down 13%, while those in gaming services slid 17% during the period. The trend has carried over into the second half, with revenue in January down 3.9%, Tabcorp said.
What they said: Despite the weak result, the company’s total market share and digital market share had grown compared to the previous half, CEO Adam Rytenskild said.
"We have become a more digital business, underpinned by recent investments in AI, data and new technology platforms. Combined with our TAB brand embedded in over 4,000 venues, we see a significant omni-channel opportunity that we are yet to capitalise on," he said.
The source: ASX announcement
