Tabcorp Holdings Limited

FY26 group revenue increased 0.8% to $2.64 billion. EBITDA rose 10.3% to $432 million and EBIT increased 15.9% to $219 million. NPAT before significant items grew 44% to $71.1 million. Mark Howell said the new retail commercial model delivered a positive EBITDA impact of $22 million in FY26, and the reformed Victorian wagering license added $12 million of EBITDA; OpEx adjusting for the Victorian license decreased by 80 basis points and EBITDA margin improved 140 basis points to 16.4%. Return on capital improved to 12% from 9.6%, underlying cash conversion was 98%, leverage was 1.2x, liquidity was $1.2 billion, and the final dividend was $0.015 per share, taking the FY26 dividend to $0.03 per share. For FY27, management said wagering turnover environment should be similar to FY26, CapEx will rise to up to $160 million with about $65 million for new EBTs, and OpEx is expected to grow 3% to 3.5%.

Gillon McLachlan said FY26 reflected meaningful progress against the plan set out two years ago, with better execution, stronger cost discipline, and an omnichannel wagering and sports entertainment offer that customers are responding to. He emphasized strategic milestones such as the National Tote, Sky’s expanded rights position, the retail commercial model reset, and the BetMakers acquisition as part of building a modernized technology-led business. His tone was upbeat but disciplined, repeatedly stressing that the company is still focused on capability, culture, compliance, and trust.

Mark Howell focused on the financial translation of the strategy: $22 million of EBITDA from phase 1 of the new retail commercial model, $12 million from the Victorian wagering license, 80 basis points of OpEx reduction excluding the license, and a 140-basis-point EBITDA margin increase to 16.4%. He highlighted strong cash conversion of 98%, improved ROIC of 12%, and balance-sheet progress including a $300 million AMTN at a 5.9% fixed coupon, extension of syndicated facilities, and leverage down to 1.2x. He also framed FY27 investment as deliberate, with CapEx up to $160 million, including around $65 million for new EBTs, and said liquidity of $1.2 billion gives flexibility for growth and BetMakers.

Analysts pressed on how much incremental benefit remains in the retail commercial model, and management said all of the additional EBITDA implied by the rollout should be realized in FY27, while also noting the net benefit includes reinvestment, lost rental fees, and loyalty spend. Questions on the National Tote focused on what remains before launch; management said the main items are done, with regulatory timing still to run in New South Wales, and that a significant marketing campaign will follow at launch. Analysts also asked about wagering mix, World Cup effects, ad reform, retail partner support, and cost growth; management said sport grew about 8%, estimated the World Cup contributed about 30 to 50 basis points of FY26 turnover growth, said ad reforms are already reflected in outlook, and confirmed the major retail groups are on board while one agreement still has a few long-form items to resolve.