Tabcorp Holdings Limited · ASX:TAH
Tabcorp — H1 FY2004 Earnings Presentation
33 slides from Tabcorp's earnings presentation, Feb 19, 2004
Slide 1: ASX cover letter: Half Year Results Presentation
TABCORP Holdings Limited TABCORP AN 06 76008 5 Bowen Crescent eN Melbourne Australia 3004 GPO Box 1943R, Melbourne Australia 3004 Telephone 61 3 9868 2100 Facsimite 61 3 9868 2300 19 February 2004 Website — www.tabcorp.com.au To: Australian Stock Exchange Companies Announcements Platform 20 Bridge S
Slide 2: TABCORP Holdings Limited Half Year Results
TABCORP Holdings Limited Half Year Results 19 February 2004 Qatc TABCORP |
Slide 3: Agenda
Agenda * Matthew Slatter — Key features * David Elmslie — Financial performance *« Matthew Slatter — Performance in current half — 2004 outlook 4 TABCORP ELLE LLANE interim Results 2004
Slide 4: Key features
Key features 4 TABCORP HOLL LLL Net profit after tax (before goodwill and non recurring items) up 20.6% on pcp to $173.2 million Increased interim dividend from 33 cents to 35 cents per share on pcp Net operating revenue from wagering and network games increased 7.6% on a pro forma basis Victorian g
Slide 5: Financial performance
Financial performance 6& months to 6 months to % 31 Dec 2002 31Dec 20031 change Net operating revenue ($m) 983.4 1,118.5 13.8 Net profit after tax - Before goodwill amort” and 143.6 173.2 20.6 norrecurring items ($m) - Before nomrecurring items ($m) 134.5 155.4 15.5 - Basic ($m) 134.2 155.4 18.4 Ear
Slide 6: Summary divisional results
Summary divisional results Pro forme Pro forma % $m Gmonths ta 6monthsto Change 34 Dec 20022 31 Dec 2003 Net operating revenue Wagering & Network Games 270.3 290.7 7.6 Gaming 458.6 435.8 (5.0) Casinos 583.9 619.2 6.0 EBITA? Wagering & Network Games 55.0 14.8 Gaming 110.2 (5.2) Notes: * Actual result
Slide 7: Wagering and Network Games — Key features
Wagering and Network Games — Key features 4 TABCORP HOLL LLL Net operating revenue increased 7.6% to $290.7m on a pro forma basis Revenue growth in all racing codes Rugby World Cup drove 23.7% increase in sportsbetting revenue Keno now in 2,004 venues nationally following Jupiters merger 23.1% incre
Slide 8: Wagering and Network Games — Key features
Wagering and Network Games — Key features Breakdown of account sales Lower cost distribution 100% 90% 80% 70% 60% 50% 40% 30% % of account sale transactions 20% 10% 0% 2000 2001 2002 2003 20044 Operator MIVR/INLSR glnternet Probet Notes 1 Figures for the 6 months ended 34 December 2003 4 TABCORP ERL
Slide 9: Gaming — Key features
Gaming — Key features * Net operating revenue $435.8m, down 5.0% ona pro forma basis — Victorian gaming down 5.3% ~— Qld monitoring up 10.2% ¢ Effective cost control with operating expenses down 2.7% ¢ Introduction of Cash Express Hyperlink machines — 215 rolled out across 26 venues — total of 502 m
Slide 10: Gaming — Key features
Gaming — Key features Gaming division revenue 2003 vs 2004 % change (vs pcp) 10.0% 4 5.0% ty aa eg, Pa " “ 0.0% ; Saccaiean (5.0%) + —_ (10.0%) ~ (15.0%) + Impact of smoking ban (20.0%) ~ Jul Aug Sep Oct Nov Dec cameo Month hy —Year to date 4 TABCORP i Interim Results 2004
Slide 11: Gaming — Key features
Gaming — Key features ¢ Venue upgrades — 20 venues refurbished — Stoney’s Club (Darley FC) opened with 40 EGM’s ~ 198 venues (of 270) have now been modified with our ‘Optimum (Grade 4)’ smoking area solution ¢ Customer service — ‘Capitalising on New Customers’ training program introduced ~ Venue Per
Slide 12: Casinos — Key features
Casinos — Key features ¢ Net operating revenue $619.2m, up 6.0% on a pro forma basis ¢ All properties recorded strong overall revenue growth with above theoretical win rates in the rebate play business ¢ Strong improvements in hotel performance ¢ NSW Casino Control Authority triennial review gave a
Slide 13: Casinos — Key features
Casinos — Key features ¢ Products — New table game and electronic gaming products — Improved product ‘mix’ ¢ Facility improvement — Extensive refurbishment program in all properties —~ Qid Government announces extension of Gold Coast Convention and Exhibition Centre 4 TABCORP ALLL Interim Results 20
Slide 14: Casinos — Star City licence review
Casinos — Star City licence review ¢ NSW Casino Control Authority triennial review represents positive recognition of TABCORP casino management approach and capabilities ~ “a thorough, comprehensive and impressive (compliance) system which is overseen in a highly competent and focused manner” — Rate
Slide 15: TABCORP social responsibility
TABCORP social responsibility Responsible gambling Community support e @elg TABCORP Proactive strategies to address problem gambling Research focus KPMG audit of compliance with TABCORP Responsible Gambling Code found: — High level of compliance overall, behaviour change a weakness ~ Self-exclusion
Slide 16: Integration of the Jupiters group
Integration of the Jupiters group ¢ All business units integrated ¢ Jupiters’ corporate office functions integrated into TABCORP Corporate ¢ Annual synergies/efficiencies identified are $24.6m, $14.4m above the Jupiters’ scheme booklet estimate ¢ The 2004 expected synergies/efficiencies are $9.5m co
Slide 17: Integration of the Jupiters group
Integration of the Jupiters group ¢ Discussions continue with Caesar’s Entertainment on the future management arrangements for Conrad Jupiters and Conrad Treasury Casinos ¢ Post implementation review conducted by Deloitte ¢ Project team continues to drive completion of integration with a focus on ca
Slide 18: Financial Performance
4 TABCORP Financial Performance LLL ALLEL Interim Results 2004 17
Slide 19: Financial performance
Financial performance Gmonths to 6 months to % $m 31 Dee 2002 31 Dec 2003 change Net operating revenue 983.1 1,118.5 13.8 Other revenue? 75 10.1 35.9 Taxes on gambling (306.13 (322.6) 5.4 Operator commissions (446.0) (144.9) (0.7) Racing industry fees (68.6) 4.0 Other operating expenses’ : (258.8) 3
Slide 20: Group structure
Group structure Wagering and Network Games { Technical Services Keno and vic Jupiters vic QLD Network Wagering | |International 13,684 14,929 Businesses 566 outlets, EGMs EGMs intemet and 128 Motels monitored phone betting 142 Clubs —_] VIC Keno ~ 103 venues QLD Keno — 867 venues NSW Keno — 1,034 ve
Slide 21: Segmented earnings
Segmented earnings $m . W&NG Gaming' Casinos? Unallocated Total . 6 mths to 31 Dec 2003 Operating revenue 253.3 . 432.4 44 Total revenue 259.5 . 434.0 5.4 EBITA Goodwill EBIT & mths to 34 Dec 2062 Operating revenue EBITA odwill Notes: '6 months to 31 December 2002 excludes non-recurring expenses of
Slide 22: Wagering & Network Games — Financial data
Wagering & Network Games — Financial data Pro forma Pro forma émonths fo 6 months to % $m. oppose 34 Dec 2002" 31 Dec 20037 change _ Revenue from ordinary activities 280.2 302.2 7.9 R.1., taxes & op. commissions (172.1) (179.1) 44 Other operating expenses EBITAY Net operating revenue (%) Notes: (50.
Slide 23: Wagering & Network Games — Financial data
Wagering & Network Games — Financial data Pro forma Pro forma 6months to 6 months to $m : : 3° G4 Dec 2002" 31 Dec 20037 change Net operating revenue % Racing Thoroughbred 150.9 154.9 2.6 Harness 29.3 30.9 5.2 __ Greyhound _ 30.1 32.6 8.6 Total racing 10. 218.4 3.8 Sportsbet 5.4 23.7 Keno J 48.3 3.9
Slide 24: Gaming — Financial data
Gaming — Financial data $m Pro forma Pro forma 6months to 6 months to % ' 81 Dec 2002* 31 Dec 20037 change Taxes & operator commissions Other operating expenses? Depreciation & amortisation EBITAS EBITA’/ Net operating revenue (%) 460.3 436.9 (5.1) (306.7) (290.8) (22.2) (21.6) Notes: 1 Actual resul
Slide 25: Gaming — Financial data
Gaming — Financial data 6 months $m 34 Gee 20 Pro forma Pro forma 6émonths to 6 months to 4 Dec 2002" 31 Dec 2003? change Net operating revenue Victorian network Hotels Clubs Qld monitoring & other Total net operating revenue Otherrevenue Revenue from ordinary activities EGMs (period end) (VIC) EGMs
Slide 26: Casinos — Financial data
Casinos — Financial data Pro forma Pro forma 6months to 6 months to % $m om on _ ' B41 Dec 2002* 31 Dec 2003? change Revenue from ordinary activities 586.4 622.8 5.8 Taxes (109.2) (114.3) 4.7 Other operating expenses* (284.7) (283.2) (0.6) Depreciation & amortisation E13) (87.2) (9.8) EBITA? 364 7 1
Slide 27: Casinos — Financial data
Casinos — Financial data $m Pro forma Pro forma 6émonths to 6 months to % 3' 84 Dec 2002* 31 Dec 2003? change Net operating revenue Table games Rebate play Other EGMs & other Total gaming Accommodation Food & Beverage and other Total operating revenue Overall win/tablelday ($) NMRIEGMIday ($) Occupa
Slide 28: Casinos —
Casinos — Net operating revenue i Pro forma Pro forma 6émonths to 6 months to % $m 3% bt Dec 2002" 31 Dec 2003? change Star City Table games PGR MGF EGMs & other gaming Jupiters casinos Rebate play Other table games EGMs & other gaming Total Jupiters casinos Totaleasines Notes: iy ‘ Actual results f
Slide 29: TABCORP Group - Financial position
TABCORP Group - Financial position AS at As at As at $m 34 Dee 2002 30Jun2003 31 Dec 2003 Current assets 155.3 158.4 303.0 Licences/management agreement 1,037.3 1,081.8 1,122.4 Goodwill 301.8 292.9 1,320.8 Property, plant & equipment 783.2 759.2 1,483.8 Other non current assets 107.7 N72 203.6 Total
Slide 30: Focus for FY2004 and Outlook
4 TABCORP Focus for FY2004 and Outlook LEO ELLE Interim Results 2004 29
Slide 31: Focus for FY2004
Focus for FY¥2004 ¢ Continue to maximise synergies/efficiencies through the integration of Jupiters ¢ Cultural integration and building people capability ¢ Customer focus and execution of brand strategy ¢ Implementation of identified responsible gambling initiatives ¢ Conclusion of negotiations with
Slide 32: Conclusion
Conclusion ¢ Existing businesses performing well and have robust growth ¢ Have undertaken significant investment in capabilities which will allow us to take advantage of future opportunities ¢ Integration of Jupiters ahead of schedule and synergy/efficiency targets ¢ Strong start to second half, wit
Slide 33: Australia's Premier Gambling and Entertainment Group
ee, tab sp®rtsbet fatytip Australia’s Premier Gambling and Entertainment Group 4 TABCORP a Interim Results 2004 32