Tabcorp Holdings Limited · ASX:TAH
Tabcorp — FY2016 Earnings Presentation
24 slides from Tabcorp's earnings presentation, Aug 4, 2016
Slide 1: Full Year Results Presentation 2015/16
Tabcorp Holdings Limited ABN 66 063 780 709 2015/16 Full Year Results Presentation 4 August 2016 Draft version 15 (01-08-13)
Slide 2: FY16 overview
FY16 overview Statutory results NPAT $169.7m, down 49.3% EPS 20.4 cents per share, down 51.9% Results adversely impacted by significant items after tax of $16.2m, compared to one-off tax benefits of $163.2m in the pcp Results before significant items EBITDA $515.8m, up 1.5% NPAT $185.9
Slide 3: Group Results
Group Results $m FY16 FY15 Change Revenues 2,188.7 2,155.5 1.5% Variable contribution 984.5 966.7 1.8% Operating expenses (468.7) (458.6) 2.2% EBITDA before significant items 515.8 508.1 1.5% D&A (178.6) (173.5) 2.9% EBIT before significant items 337.2 334.6 0.8% Interest (69.9) (78.5) (11.0%) Tax e
Slide 4: Business results
Business results Wagering Change Gaming Change Change Change Keno Group $m & Media on pcp Services on pcp on pcp on pcp Revenues 1,873.0 0.9% 107.2 7.6% 208.5 4.8% 2,188.7 1.5% Variable contribution 760.3 0.4% 106.1 7.4% 118.1 7.0% 984.5 1.8% Operating expenses (378.2) (0.9%) (36.0) 15.4% (47.8) 8.6
Slide 5: Wagering & Media: KPIs
Wagering & Media: KPIs Change Change Change $m 1H16 on pcp 2H16 on pcp FY16 on pcp Growth in customer activity with Turnover by distribution improved momentum across 2H16 Retail 3,388.4 (1.4%) 3,137.0 (0.8%) 6,525.4 (1.1%) TAB turnover growth +2.8% Digital 1,926.0 9.2% 1,901.9 15.0% 3,827.9 12.0
Slide 6: Wagering & Media: Ongoing initiatives for market leadership
Wagering & Media: Ongoing initiatives for market leadership Providing customers with unique experiences across all channels Continued integration of digital into the retail experience Driving customer acquisition by utilising TAB’s unique assets, including the retail network, live racing visio
Slide 7: Wagering & Media: Strengthening TAB's leading mobile offer
Wagering & Media: Strengthening TAB’s leading mobile offer Mobile remains the key growth driver for digital (mobile now 65% of digital turnover) The strong TAB mobile offer will be further enhanced with the release of a new app design in 1Q17 Focus on improved navigation, further integration o
Slide 8: Wagering & Media: Sun Bets
Wagering & Media: Sun Bets New online wagering and gaming business established in the UK Attractive, well regulated market of ~A$7bn online revenue Combines Tabcorp’s expertise in wagering with News UK’s vast customer base and market-leading media assets Agreement runs for an initial term of
Slide 9: Wagering & Media: Regulatory update
Wagering & Media: Regulatory update NSW Greyhound Racing industry to close June 2017 (subject to legal challenge) NSW greyhound racing represents approximately 5% of total wagering turnover Mitigation strategies to focus on substitution to other racing products Illegal Offshore Wagering Revi
Slide 10: Gaming Services: KPIs
Gaming Services: KPIs $m FY16 FY15 Change Continued investment in capability to Revenues 107.2 99.6 7.6% drive venue performance and expand in EBITDA 70.1 67.6 3.7% NSW EBIT 41.0 41.6 (1.4%) Victoria: 8,820 EGMs under contract, with 87% contracted through to 2022 Loyalty system covering 75%
Slide 11: Gaming Services: Proposed acquisition of INTECQ
Gaming Services: Proposed acquisition of INTECQ Agreement to acquire INTECQ for $7.15 per share. This implies an enterprise value of $115m Funded from existing bank facilities Unanimously recommended by the Directors of INTECQ Completion expected in 1H17, subject to certain terms and conditi
Slide 12: Keno: KPIs
Keno: KPIs $m FY16 FY15 Change Total turnover up 4.1% Revenue performance Revenues 208.5 199.0 4.8% Vic up 20.4% EBITDA 70.3 66.4 5.9% NSW up 7.4% EBIT 50.7 47.5 6.7% Qld up 0.8%, reflecting unfavourable jackpot activity Venues 3,568 3,612 (1.2%) in the pcp Ticket Count (m) 100.0 98.6 1.4%
Slide 13: Keno: Digital offering launched
Keno: Digital offering launched New Keno iOS app released to ACT customers for game play Digital play in-venue coming in NSW (subject to regulatory approvals) 13
Slide 14: Operating expenses and capital investments
Operating expenses and capital investments Opex / Revenue Ratio Capex Trend 152 143 124 133 21.1% 21.2% 21.3% 21.4% FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 Keno Gaming Services Wagering & Media FY17 opex to revenue ratio expected to be FY17 D&A expected to be approximately $185m, approximately 2
Slide 15: Key capital features
Key capital features Balance Sheet Dividends Bank facilities Ordinary dividend 1 (cps, fully franked) Tabcorp Subordinated notes US Private Placement 24.0c 20.0c 16.0c $400m $400m $150m $250m $127m $84m FY17 FY18 FY19 FY20 FY21 FY22 3 FY14 FY15 FY16 Undrawn bank facilities of $410m at 30 June 2016
Slide 16: Conclusion
Conclusion Strategic agenda advanced during the year ACTTAB integration successfully completed VRC sponsorship extended to 2024 Investment in technology platforms and digital development capabilities Sun Bets, new online wagering and gaming business established in the UK Keno returned to
Slide 17: Appendices
Appendices 1. Wagering & Media: Financial data 2. Wagering & Media: Revenues by state & product 3. Wagering & Media: Additional information 4. Balance sheet 5. Cashflow 17
Slide 18: Appendix 1: Wagering & Media – Financial data
Appendix 1: Wagering & Media – Financial data $m FY16 FY15 Change Revenues 1,873.0 1,856.9 0.9% Taxes, levies, commissions and fees (1,112.7) (1,099.4) 1.2% Variable contribution 760.3 757.5 0.4% Operating expenses (378.2) (381.7) (0.9%) EBITDA 382.1 375.8 1.7% D&A (129.9) (128.6) 1.0% EBIT 252.2 24
Slide 19: Appendix 2: Wagering & Media – Revenues by state & product
Appendix 2: Wagering & Media – Revenues by state & product NSW Change Vic Change ACT Change Total Change $m FY16 on pcp FY16 on pcp FY16 on pcp FY16 on pcp Racing 903.6 1.3% 411.5 2.6% 24.6 34.4% 1,339.7 2.2% Sports 131.5 (3.5%) 38.5 (5.8%) 2.0 53.8% 172.0 (3.6%) Trackside 42.8 (3.6%) 25.9 (6.5%) 0.
Slide 20: Appendix 3: Wagering & Media – Additional information
Appendix 3: Wagering & Media – Additional information Turnover - TAB Fixed Odds Racing ($m) Yield - TAB Fixed Odds Racing 1,000 20% FY14 growth: 33.3% FY15: 22.1% FY16: 21.7% 14.6% 15.9% 15.2% 900 800 15% 700 600 500 10% 400 300 5% 200 100 0 0% 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16
Slide 21: Appendix 4: Balance Sheet
Appendix 4: Balance Sheet $m Jun 16 Jun 15 Change Total current assets 197.1 296.2 (33.5%) Licences 682.4 700.9 (2.6%) Other intangible assets 1,945.3 1,924.7 1.1% Property, plant and equipment 311.7 325.1 (4.1%) Other non current assets 166.3 137.1 21.3% Total assets 3,302.8 3,384.0 (2.4%) Total li
Slide 22: Appendix 5: Cashflow
Appendix 5: Cashflow $m FY16 FY15 Change Net operating flows 458.1 507.6 (9.8%) Net interest payments (68.4) (77.8) (12.1%) Income tax refund 11.4 2.8 >100% Payments for PP&E and intangibles (183.1) (131.6) 39.1% Sub-total 218.0 301.0 (27.6%) Ordinary dividends paid (173.3) (127.9) 35.5% Special div
Slide 23: Disclaimer
Disclaimer This Presentation contains summary information about the current activities of Tabcorp Holdings Limited (Tabcorp) and its subsidiaries (Tabcorp Group). It should be read in conjunction with the Tabcorp Group’s other periodic and continuous disclosure announcements lodged with the Australi
Slide 24: Draft version 14 (29-07-13)
24 Draft version 14 (29-07-13)