Slide 1: Investor Presentation - Full-year results announcement
21 August 2024 ASX Market Announcements Office ASX Limited 20 Bridge Street Sydney NSW 2000 INVESTOR PRESENTATION FULL-YEAR RESULTS FOR THE YEAR ENDED 30 JUNE 2024 Attached is the Investor Presentation that will be presented at The Lottery Corporation’s 2024 full-year results briefing today. The bri
Slide 2: FY24 Full Year Results Presentation
FY24 Full Year Results Presentation Full Year ended 30 June 2024 21 August 2024
Slide 3: A world-class lotteries business
® A world-class lotteries business 2
Slide 4: Table of Contents
Table of Contents 04 - 10 Group Overview 12 - 20 Business Results 22 - 25 Strategy & Conclusion 27 - 34 Appendices 3
Slide 5: FY24 highlights
® FY24 highlights Strong FY24 performance demonstrates portfolio resilience and jackpot game strength • Significant growth in active registered Lotteries customers to 4.75 million • Successfully embedded increase to Powerball® subscription price and commission rates Delivering strong • Record Powerb
Slide 6: The Lottery Corporation
® The Lottery Corporation The leader in Australia’s lotteries and Keno market and one of the highest performing lotteries businesses globally Exclusive and/or long dated licences Low-spend, mass participation model underpins wide community acceptance Diversified and balanced portfolio of high-profil
Slide 7: A track record of sustained growth and resilience
® A track record of sustained growth and resilience Growth in the 3-year average turnover has always been positive, notwithstanding short-term fluctuations due to jackpot variability Australian Industry Turnover – Lotteries and Keno (A$bn)1,2 COVID-19 Global Financial Crisis +5.8% p.a. 10.3 9.3 9.5
Slide 8: FY24 Group Results
® FY24 Group Results $m Change FY24 FY23 $ % Revenue 3,996.6 3,513.1 483.5 13.8% Variable contribution 1,126.6 983.6 143.0 14.5% Operating expenses (299.5) (270.4) (29.1) (10.8%) EBITDA (before significant items)1 827.1 713.2 113.9 16.0% D&A (108.3) (98.2) (10.1) (10.3%) EBIT (before significant ite
Slide 9: Group EBITDA
Group EBITDA1 ® Record turnover underpinned by jackpot game outcomes drove result Lotteries Keno +$117.3m -$3.4m 122.7 19.2 (24.6) 4.1 (3.0) (4.5) 827.1 713.2 • Increased employment costs • Impact of completion of separation on technology costs • Increased security and SaaS expenditure • Increased c
Slide 10: Capital Allocation Framework
® Capital Allocation Framework A long-term framework to underpin a disciplined approach to the allocation of shareholders’ capital Driving Operating Game Portfolio A disciplined approach to capital Operating Efficiency Capital Productivity allocation Cash Flow Management • Commitment to a strong inv
Slide 11: Capital and Other Metrics
Capital and Other Metrics ® Retaining balance sheet flexibility Dividends (fully franked) Leverage 2 2.6x Net Debt/EBITDA Ordinary 16.0 cps (+14.3% vs FY23: 14.0 cps) Target: 3.0-4.0x Opex Payout Ratio 86% FY24 NPAT (before significant items) FY24 $299.5m Target: FY24 Opex c.$300m Special 2.5 cps Ex
Slide 12: Table of Contents
Table of Contents 04 - 10 Group Overview 12 - 20 Business Results 22 - 25 Strategy & Conclusion 27 - 34 Appendices
Slide 13: Lotteries: Result Summary
® Lotteries: Result Summary Strong result reflects management actions and highly favourable jackpot outcomes $m FY24 FY23 Change Active portfolio and jackpot sequence management supported record jackpot activity and Revenue 3,708.5 3,232.6 14.7% mitigated the impact of weak consumer spending environ
Slide 14: Lotteries: KPIs – Customers & Channel
Lotteries: KPIs – Customers & Channel ® Continued growth and lift in proportion of total active registered customers increases opportunity for greater personalisation; growth in share of higher margin digital sales Number of Active Registered Customers – last 52 weeks1 (000’s) Turnover by Channel ($
Slide 15: Lotteries: KPIs – Product
® Lotteries: KPIs – Product Resilience of demand evident in strong portfolio performance; softness in base games amid weak consumer spending environment and some transference to jackpot games Turnover by Product Type ($m) Turnover Growth 7,347 +11.1% vs pcp FY24 (v FY23) 6,716 6,614 6,125 Actual1 Li
Slide 16: Lotteries: KPIs – Jackpot Games
Lotteries: KPIs – Jackpot Games ® Highly favourable year for jackpot outcomes – estimated FY24 turnover benefit of c.$500m from variation to expected (model) outcomes1,2 Cumulative Jackpot Value Offered ($m) Powerball® and Oz Lotto® Major Jackpots +40.2% 2,690 vs pcp 55 +53.0% 14 2,084 932 43 vs pcp
Slide 17: Record $200m Powerball jackpot
® Record $200m Powerball jackpot1 ® Turnover of $320m; equivalent of 1 in 2 Australian adults purchased an entry; digital sales 47% Marketing and operational strategy geared to Continuous engagement to maximise ongoing maximise benefits of jackpot event benefits • Flexible and scalable media and com
Slide 18: Successful launch of Weekday Windfall lottery
® Successful launch of Weekday Windfall lottery Addition of new Friday draw and price increase currently delivering c.$135m1 in annualised estimated additional turnover Scale of new Annualised Total increase Friday Draw Friday Turnover from Weekday Windfall lottery c.60% c.$120M +36% of average of M
Slide 19: Keno: Result Summary
® Keno: Result Summary Strong in-venue performance, with Queensland continuing to lead the way; cycling record profitability in FY23 $m FY24 FY23 Change Increased footfall in venues underpinned growth in Queensland and New South Wales Revenue 288.1 280.5 2.7% Variable contribution 151.5 150.4 0.7% C
Slide 20: Keno: KPIs
® Keno: KPIs Strong retail performance, especially in Queensland; digital grew in 2H24 following initial impact in 1Q24 of competition in Victoria Turnover by Channel ($m) Keno Turnover by Product ($m) +3.5% +3.5% vs pcp vs pcp 1,551 1,551 -3.4% 1,499 1,499 204 85 vs pcp 1,365 209 -2.4% 88 (13.2%) 1
Slide 21: New Keno brand campaign
New Keno brand campaign Campaign emphasises Keno is a social game that can bring everyone together 20 20
Slide 22: Table of Contents
® Table of Contents 04 - 10 Group Overview 12 - 20 Business Results 22 - 25 Strategy & Conclusion 27 - 34 Appendices 21
Slide 23: Key initiatives delivered in FY24
® Key initiatives delivered in FY24 Continued progress in customer-centred initiatives to deliver long-term sustainable growth Successfully embedded increase to Powerball® subscription price and commission rates Successful Weekday Windfall lottery launch – major Monday & Wednesday lotto refresh, inc
Slide 24: Our strategy to continue to deliver long-term growth and value
® Our strategy to continue to deliver long-term growth and value Our Vision Our Purpose VISION AND PURPOSE To be the world’s best lottery operator To create positive impacts DRIVE DEVELOP DISCOVER Customer centred initiatives to Guiding strategies to Complementary new STRATEGIC support sustainable g
Slide 25: A bright future: FY25 key priorities
A bright future: FY25 key priorities ® Our Vision: To be the world’s best lottery operator Responsibly deliver seamless and • Implement new customer data platform to drive personalisation across channels personalised customer experiences • Improve customer onboarding processes DRIVE Continue to resh
Slide 26: Conclusion: A resilient, world-class lotteries business
® Conclusion: A resilient, world-class lotteries business ✓ Strong result in FY24 ✓ Proactive management initiatives delivering results ✓ Ongoing strategic execution ✓ Delivering value for stakeholders responsibly ✓ A track record of sustainable growth and resilience 25
Slide 27: Table of Contents
® 26 Table of Contents 04 - 10 Group Overview 12 - 20 Business Results 22 - 25 Strategy & Conclusion 27 - 34 Appendices 26
Slide 28: Appendix 1: Significant Items
® Appendix 1: Significant Items1 Settlement of pre-demerger tax litigation matters Significant Items ($m) FY24 FY23 • On 11 September 2023 The Lottery Corporation Limited (TLC) and Tabcorp Settlement of pre-demerger tax litigation Holdings Limited resolved a dispute with the Australian Tax Office re
Slide 29: Appendix 2A: Group Results
® Appendix 2A: Group Results $m 1H24 1H23 Change 2H24 2H23 Change FY24 FY23 Change Revenue 1,884.9 1,920.2 (1.8%) 2,111.7 1,592.9 32.6% 3,996.6 3,513.1 13.8% Variable contribution 534.3 535.9 (0.3%) 592.3 447.7 32.3% 1,126.6 983.6 14.5% Operating expenses (135.2) (126.5) (6.9%) (164.3) (143.9) (14.2
Slide 30: Appendix 2B: Lotteries Results
® Appendix 2B: Lotteries Results $m 1H24 1H23 Change 2H24 2H23 Change FY24 FY23 Change Revenue 1,738.3 1,772.8 (1.9%) 1,970.2 1,459.8 35.0% 3,708.5 3,232.6 14.7% Variable contribution 456.6 455.9 0.2% 518.5 377.3 37.4% 975.1 833.2 17.0% Operating expenses (113.5) (106.3) (6.8%) (137.1) (119.7) (14.5
Slide 31: Appendix 2C: Keno Results
® Appendix 2C: Keno Results $m 1H24 1H23 Change 2H24 2H23 Change FY24 FY23 Change Revenue 146.6 147.4 (0.5%) 141.5 133.1 6.3% 288.1 280.5 2.7% Variable contribution 77.7 80.0 (2.9%) 73.8 70.4 4.8% 151.5 150.4 0.7% Operating expenses (21.7) (20.2) (7.4%) (27.2) (24.2) (12.4%) (48.9) (44.4) (10.1%) EB
Slide 32: Appendix 3: Lotteries – Turnover by product
® Appendix 3: Lotteries – Turnover1 by product Turnover by Game ($m) FY24 Turnover by Game Change FY24 FY23 Game $ % Powerball® 3,098 2,483 615 24.8% 5.7% 1.5% ® Oz Lotto 1,165 882 283 32.1% 4.3% 2.3% Powerball® Jackpot Games 4,263 3,365 898 26.7% 5.6% Oz Lotto® Saturday lotto 2 42.2% Saturday lotto
Slide 33: Appendix 4: Balance Sheet and Debt
® Appendix 4: Balance Sheet and Debt Balance Sheet Debt $m Jun-24 $m Jun-24 Total current assets 706.3 Gross debt – excluding lease liabilities (at spot)1 2,391.1 Licences 681.4 Less: Benefit of FX hedges on USPP principal2 (260.6) Other intangible assets 2,247.3 Gross debt – excluding lease liabili
Slide 34: Appendix 5: Cash Flow, Capex and Debt
® Appendix 5: Cash Flow, Capex and Debt Cash Flow Debt Structure & Maturities2($m) $m Jun-24 800 • USPP (A$1,821m drawn) Interest margins/rates Net operating cash flows 747.8 700 • Bank Facility (A$310m drawn) • Average hedged USPP rate: 5.7% Net interest paid (105.7) 600 • Bank facility margin over
Slide 35: Appendix 6: Glossary
® Appendix 6: Glossary Term Definition Term Definition 1H/2H Six months ended 31 December/30 June of the relevant financial year Gross Debt Defined as per Appendix 4 AAS Australian Accounting Standards IFRS International Financial Reporting Standards ACT Australian Capital Territory Jackpot games Po
Slide 36: Disclaimer
® Disclaimer This presentation (Presentation) contains summary information about the current activities of The Lottery Corporation Limited (The Lottery Corporation) and its subsidiaries. It should be read in conjunction with The Lottery Corporation’s other periodic and continuous disclosure announce
Slide 37: he SS
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