Slide 1: ASX cover letter: Tabcorp half year results presentation
Tabcorp Holdings Limited ACN 063 780 709 5 Bowen Crescent Melbourne Australia 3004 GPO Box 1943R Melbourne Australia 3001 Telephone 61 3 9868 2100 Facsimile 61 3 9868 2300 For personal use only Website www.tabcorp.com.au 21 February 2008 To: Australian Securities Exchange Companies Announcements Pla
Slide 2: 2007/08 Half Year Results Presentation
For personal use only 2007/08 Half Year Results Presentation Thursday 21 February 2008 1
Slide 3: Overview
Overview ¾ Operational improvements tracking to plan; first half results impacted by Equine Influenza For personal use only Normalised Net Profit After Tax down 3.1% Reported Net Profit After Tax up 22.0% Clean result ¾ Mixed revenue performance Casinos: Mixed - Queensland recovery offset by
Slide 4: Focus areas for 1H 2008
Focus areas for 1H 2008 For personal use only Priorities Progress Exit China Keno business Completed Fix customer and technology Significant improvement issues in Wagering Strong Spring Carnival performance Deliver on expense Solid first half expense performance programs Full year ex
Slide 5: Group results
Group results ¾ Normalised and pre non-recurring items1 For personal use only Operating revenue down 0.3% to $1,985.1m NPAT down 3.1% to $261.9m EPS down 3.1% to 49.9 cents ¾ Reported Operating revenue up 1.8% to $2,003.5m NPAT up 22.0% to $273.4m EPS up 22.0% to 52.1 cents ¾ Dividend /
Slide 6: Group results
Group results For personal use only Actual Change Normalised Change $m 1H08 on pcp 1H08 on pcp Operating revenue 2,003.5 1.8% 1,985.1 (0.3%) Net operating expenses (504.7) (0.7%) (504.7) (0.7%) EBITDA 551.6 6.5% 535.0 (0.6%) EBIT 478.0 7.2% 461.5 (1.0%) NPAT 273.4 6.7% 261.9 (3.1%) Non-recurring ite
Slide 7: Key drivers of result
Key drivers of result For personal use only 3.7 (12.7) 466.1 3.4 (3.5) 4.5 461.5 External factors impacting performance: EBIT $m Casinos: NSW smoking bans - EGMs 8 Wagering: EI impact 16 Gaming: EGM levy increase 7 Total 31 1 1H07 EBIT Casinos Wagering Gaming Net Operating Other 1H08 EBIT Revenue Re
Slide 8: Divisional results
Divisional results For personal use only Casinos % Wagering % Gaming % $m Normalised Operating revenue 670.5 0.6% 732.8 (5.6%) 584.4 6.3% Net operating expenses (325.4) 1.4% (146.1) (0.8%) (36.2) 0.4% EBITDA 224.6 (0.3%) 156.3 (6.9%) 152.0 2.9% Depreciation & amortisation (34.6) (4.0%) (25.5) 5.2% (
Slide 9: Casinos: KPIs
Casinos: KPIs For personal use only NSW Qld Total ¾ Queensland: Positive recovery Operating Revenue 1H08 % 1H08 % 1H08 % EGMs up 7.3% - recovery from smoking bans; some market share pressure EGMs 96.5 (9.7%) 145.9 7.3% 242.4 (0.1%) MGF up 6.9% PGR down 2.1% - investment required Main Gaming Fl
Slide 10: Casinos: Smoking ban impacts
Casinos: Smoking ban impacts For personal use only Queensland experience Monthly EGM revenue growth vs pcp 12 month recovery period 20% EGMs 1H08 revenue up 7.3% Stronger performance at Gold Coast following full First 12 months 15% smoke-free refurbishment of gaming floor 10% NSW experience 5%
Slide 11: Casinos: Star City investment
Casinos: Star City investment ¾ In principle agreement creates platform for growth For personal use only Extension of exclusivity rights for 12 years Table games expansion Higher bet limits and removal of restrictions on the domestic high roller market ¾ Opportunity for more substantial invest
Slide 12: Wagering: KPIs
Wagering: KPIs For personal use only ¾ EI impact on turnover of $327m Turnover product ($m) 1H08 1H07 % ¾ Continued investment in product and Racing Vic 1,891 1,965 (3.8%) distribution leadership Racing NSW 2,166 2,419 (10.5%) Increased product offering in NSW Sportsbetting 375 323 16.1% Distrib
Slide 13: Wagering: Impact of Equine Influenza
Wagering: Impact of Equine Influenza ¾ Racing turnover growth versus prior year For personal use only EI Period Early Recovery % growth vs pcp 1 25/8/07 - 30/11/07 1/12/07 - 15/2/08 NSW (16.9%) (0.5%) Vic (6.8%) 1.2% Total (12.2%) 0.2% ¾ Good response from racing industry partners and Government wit
Slide 14: Gaming: KPIs
Gaming: KPIs For personal use only Vic Gaming 1H08 1H07 % Gaming Revenue ($m) 522.1 494.7 5.5% ¾ Successful transition to smoke-free environment Venues (period end) 266 266 0.0% ¾ Continued growth in market share EGMs (average) 13,579 13,608 (0.2%) ¾ Continued focus on distribution and customer loya
Slide 15: Gaming: Market share
Gaming: Market share For personal use only 52.0% Vic Gaming Revenue Market Share June 2003 to Dec 2007 TABCORP 51.0% Market Share % 50.0% 49.0% TATTS 48.0% Mar-05 Mar-06 Mar-07 Mar-04 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Sep-03 Dec-03 Sep-04 Dec-04 Sep-05 Dec-05 Sep-06 Dec-06 Sep-07 Dec-07 Share per h
Slide 16: Group: Improved expense control
Group: Improved expense control For personal use only Expense growth % Management action 11.3% ¾ Underlying expense growth contained within CPI Reported performance includes benefit from International exit1 and absence of one-offs Clean result, no non-recurring items 6.9% ¾ Expense programs comp
Slide 17: Group: Capital investments and funding
Group: Capital investments and funding For personal use only Capital programs Group funding Debt structure and maturity profile ($m) ¾ 1H08 capex $m 600 Casinos 31.4 500 Wagering 14.8 400 Gaming 23.1 Corporate & Other 1.6 300 70.9 200 100 ¾ Normal replacement capex $175-200m pa - 2008 2009 2
Slide 18: Outlook
Outlook For personal use only ¾ Tabcorp performance Operational performance improvement programs on plan EI impact largely contained in first half No additional impact from external factors beyond 2008 (EI, smoking bans, increased levies); recovery 2009 ¾ Economy - watch on consumer confidence
Slide 19: Summary
Summary ¾ Operational improvements tracking to plan; first half results impacted by Equine Influenza For personal use only Normalised Net Profit After Tax down 3.1% Reported Net Profit After Tax up 22.0% Clean result ¾ Mixed revenue performance Casinos: Mixed - Queensland recovery offset by
Slide 20: Appendices
Appendices For personal use only 1. Group results 2. Earnings per share and Dividends per share 3. Casinos: Financial data 4. Casinos: Revenue by state and product 5. Wagering: Financial data 6. Wagering: Revenue by state and product 7. Gaming: Financial data 8. Balance sheet 9. Tabcorp Group: Debt
Slide 21: 1. Group results
1. Group results For personal use only Actual Change Normalised Change $m 1H08 on pcp 1H08 on pcp Total operating revenues 2,003.5 1.8% 1,985.1 (0.3%) Other revenue1 18.5 (7.9%) 18.5 (7.9%) Revenue 2,021.9 1.6% 2,003.5 (0.4%) Government taxes & levies (545.4) 1.7% (543.6) 1.0% Operating commissions
Slide 22: 2. Earnings per share and Dividends per share
2. Earnings per share and Dividends per share For personal use only Normalised earnings per share Dividends per share 47 47 53.5 53.5 44 50.7 51.5 49.9 40 35 30.6% 5.5% -% (3.6)% (3.1)% 6.1% 14.3% 10.0% 6.8% -% Growth Growth on pcp on pcp 1H04 1H05 1H06 1H07 1H08 1H04 1H05 1H06 1H07 1H08 Payout Rati
Slide 23: 3. Casinos: Financial data
3. Casinos: Financial data For personal use only Actual Change Normalised Change $m 1H08 1H07 on pcp 1H08 1H07 on pcp Revenue 691.7 646.9 6.9% 673.3 669.3 0.6% Taxes, levies, commissions and fees (125.2) (120.7) 3.7% (123.3) (123.0) 0.2% Net operating expenses (325.4) (320.9) 1.4% (325.4) (320.9) 1.
Slide 24: 4. Casinos: Revenue by state and product
4. Casinos: Revenue by state and product For personal use only NSW Change Qld Change Total Change $m 1H08 on pcp 1H08 on pcp 1H08 on pcp EGMs 96.5 (9.7%) 145.9 7.3% 242.4 (0.1%) Main Gaming Floor 130.4 (1.0%) 61.9 6.9% 192.3 1.4% Private Gaming Rooms 64.0 13.3% 29.2 (2.1%) 93.2 7.9% Non-gaming 50.1
Slide 25: 5. Wagering: Financial data
5. Wagering: Financial data Change For personal use only $m 1H08 1H07 on pcp Operating revenues 1 Wagering - Victoria 280.7 282.0 (0.5%) 1 Wagering - NSW 400.9 450.7 (11.0%) Media 50.3 43.0 16.9% Trackside International 0.9 0.8 6.0% Total operating revenues 732.8 776.5 (5.6%) Other revenue 5.2 6.3 (
Slide 26: 6. Wagering: Revenue by state and product
6. Wagering: Revenue by state and product For personal use only NSW1 Change Vic1 Change Total Change $m 1H08 on pcp 1H08 on pcp 1H08 on pcp Operating revenues Thoroughbred 243.1 (15.8%) 164.5 (8.0%) 407.6 (12.8%) Harness 40.6 (23.8%) 32.4 (12.6%) 73.0 (19.2%) Greyhound 79.7 14.7% 49.5 20.8% 129.2 17
Slide 27: 7. Gaming: Financial data
7. Gaming: Financial data For personal use only Change $m 1H08 1H07 on pcp Operating revenues Victorian network - Hotel 337.6 320.9 5.2% - Clubs 184.5 173.8 6.2% Total Victorian gaming 522.1 494.7 5.5% Keno 59.6 54.9 8.5% Other 2.7 0.3 >100% Total operating revenues 584.4 549.9 6.3% Other revenue 10
Slide 28: 8. Balance sheet
8. Balance sheet As at As at Change For personal use only $m 31 Dec 07 30 Jun 07 on pcp Total current assets 317.8 282.7 12.4% Licences 1,216.2 1,220.8 (0.4%) Other intangible assets 3,675.4 3,680.7 (0.1%) Property, plant and equipment 1,464.4 1,461.8 0.2% Other non current assets 102.4 80.5 27.2% T
Slide 29: 9. Tabcorp Group: Debt key features
9. Tabcorp Group: Debt key features For personal use only Fixed rate swaps and Debt structure and maturity profile ($m) fixed interest medium term notes ($m) 600 2,000 1,800 500 1,600 1,400 400 1,200 300 1,000 800 200 600 400 100 200 - - 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20
Slide 30: 10. Cashflow
10. Cashflow For personal use only Actual Change $m 1H08 1H07 on pcp Net operating flows 470.2 501.5 (6.2%) Net interest payments (79.2) (78.6) 0.8% Income tax paid (73.4) (117.6) (37.6%) Payments for PP&E (76.8) (85.7) (10.4%) Net operating cash flows 240.8 219.6 9.7% Proceeds from sale of assets/b
Slide 31: For personal use only
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