Tabcorp Holdings Limited · ASX:TAH
Tabcorp — Debt Investor Presentation (March 2009)
32 slides from Tabcorp's debt investor presentation, Mar 24, 2009
Slide 1: Tabcorp Bonds
For personal use only Tabcorp Bonds Presentation to brokers and institutional investors 1
Slide 2: Important notice
Important notice This presentation has been prepared by Tabcorp Holdings Limited (ABN 66 063 780 709) ("Tabcorp"), in connection with the offer of Tabcorp Bonds in Australia ("Offer"). For personal use only The Offer is made under a prospectus which was lodged with the Australian Securities and Inve
Slide 3: Agenda
Agenda For personal use only 1 Summary of Tabcorp Bonds 2 About Tabcorp 3 Risks 4 Offer structure and timetable 3
Slide 4: Summary of Tabcorp Bonds
Summary of Tabcorp Bonds Tabcorp Bonds ¾ A new debt security issued by Tabcorp – different to Tabcorp shares For personal use only ¾ Tabcorp is a top 50 ASX listed company and a leading Australian gambling and entertainment group Ranking ¾ Ranks equally with Tabcorp’s current bank lending arrangemen
Slide 5: Features of Tabcorp Bonds
Features of Tabcorp Bonds For personal use only 1 Regular return ¾ Interest paid quarterly ¾ $100 issue price to be repaid after five years 2 Attractive rate of ¾ Implied interest rate of 7.03–7.53%1 based on 3 month BBSW as at interest 23 March 2009 Investors may also qualify for bonus interest o
Slide 6: Rationale for issuing Tabcorp Bonds
Rationale for issuing Tabcorp Bonds For personal use only ¾ Tabcorp has a flexible and pro-active approach to financing 1 Prudent capital ¾ The proceeds of the issue of Tabcorp Bonds will be used to repay some of management Tabcorp’s existing bank debt 2 Improved debt ¾ By repaying bank debt maturin
Slide 7: Ranking of Tabcorp Bonds
Ranking of Tabcorp Bonds For personal use only ¾ Tabcorp Bonds are unsecured debt obligations ranking equally with Tabcorp’s existing debt funding, including A$ bank debt, US$ and A$ institutional bonds Category of funding Existing Tabcorp funding Higher ranking Secured debt None Tabcorp Bonds Unsub
Slide 8: Comparison of Tabcorp Bonds with recent issues
Comparison of Tabcorp Bonds with recent issues For personal use only Westpac SPS II AMP Notes Tabcorp Bonds Ranking ¾ Deeply subordinated ¾ Subordinated ¾ Higher ranking (compared with ranking of Westpac SPS II and AMP Notes) ¾ Ranks equally with Tabcorp’s existing bank facilities and other debt Cre
Slide 9: Opportunity to invest in Australian corporate debt
Opportunity to invest in Australian corporate debt For personal use only ¾ Tabcorp Bonds represent the first major public issue of corporate bonds listed on ASX in many years Dec 2007 Last corporate Tabcorp Corporates Issues by issue (hybrid) Bonds Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Iss
Slide 10: Agenda
Agenda For personal use only 1 Summary of the Offer 2 About Tabcorp 3 Risks 4 Offer structure and timetable 10
Slide 11: About Tabcorp
About Tabcorp For personal use only ¾ A leading Australian gambling and entertainment group Tabcorp is one of Australia’s top 50 ASX listed companies with a market capitalisation of c.$3.8 billion Tabcorp operates leading Casino, Wagering and Gaming businesses in Australia ¾ Unique portfolio of
Slide 12: Defensive earnings and strong cashflows
Defensive earnings and strong cashflows For personal use only ¾ Tabcorp has a defensive earnings profile and generates strong cashflows EBITDA Operating cashflow and dividends declared 1,200 800 1,075 1,000 652 1,000 609 600 800 494 494 A$m A$m 600 548 400 345 400 187 200 200 0 0 FY2007 FY2008 1H09
Slide 13: Diversified operations
Diversified operations For personal use only ¾ Tabcorp has diversified operations, both by business and geography Summary of key licences held by Tabcorp FY2008 EBITDA by business1 NSW Other Vic Year of licence expiry ~0% Wagering Gaming Casinos division & Media 24% Star City 2093 19% Vic Keno Conra
Slide 14: Casinos
Casinos Tabcorp owns and operates four of Australia’s premier casino destinations For personal use only ¾ Star City Casino, Sydney Operating revenue EBITDA1 ¾ Conrad Jupiters Casino, Gold Coast 1,600 600 ¾ Conrad Treasury Casino, Brisbane 1,336 1,316 ¾ Jupiters Townsville Casino 456 433 1,200 450 ¾
Slide 15: Casinos—Star City expansion
Casinos—Star City expansion For personal use only ¾ Project scope New 250 room 5 star hotel Sydney Harbour orientation 30 restaurants and bars Expanded and refurbished ballroom Over 30% increase in gaming product ¾ Exclusivity secured for a further 12 years to 2019 ¾ Investment of $475 mil
Slide 16: Wagering
Wagering Tabcorp operates tote and fixed odds wagering in Victoria and New South Wales For personal use only ¾ Operates exclusive tote wagering in Victoria and New Operating revenue EBITDA South Wales and fixed odds betting ¾ Conducts betting at 267 racecourses, 2,567 TAB retail 1,600 1,466 1,470 60
Slide 17: Wagering—recent developments
Wagering—recent developments For personal use only Market changes Response ¾ New race fields fees ¾ Tabcorp’s market response Imposition of product fees on wagering Product/distribution leadership operators by each state racing industry Pari-mutuel price promotions announced last year Expand
Slide 18: Gaming
Gaming Tabcorp operates electronic gaming machines in Victoria and Keno in New South For personal use only Wales, Queensland and Victoria Operating revenue EBITDA ¾ Owns and operates electronic gaming machines (”EGMs”) under the Tabaret brand in Victoria 1,600 600 1 of 2 licensed EGM operators in
Slide 19: Victorian licences
Victorian licences For personal use only ¾ Tabcorp has Victorian gambling licences expiring in FY2008 EBITDA split1 August 2012 $120m (12%) Victorian Gaming licence – relating to the Victorian Victorian Wagering Gaming and Keno businesses Victorian Gaming Victorian Wagering licence – relating to
Slide 20: Victorian licences
Victorian licences For personal use only Important factors to consider when assessing the position of Tabcorp post 2012 (continued) 5 Cash flow, earnings growth and dividends 8 New Victorian licences Tabcorp generates strong cashflows Tabcorp has submitted an expression of interest Objective i
Slide 21: Tabcorp 1H09 Group results
Tabcorp 1H09 Group results For personal use only ¾ Tabcorp delivered a solid 1H09 result despite current economic conditions Actual Change Normalised Change $m 1H09 on pcp 1H09 2 on pcp Operating revenue 2,114.5 5.5% 2,112.6 6.4% Net operating expenses (529.3) 4.9% (529.3) 4.9% EBITDA 548.8 (0.5%) 5
Slide 22: Tabcorp 1H09 divisional results
Tabcorp 1H09 divisional results For personal use only Casinos Change Wagering Change Gaming Change $m 1 Normalised on pcp on pcp 2 on pcp 2 Operating revenue 672.0 0.2% 828.1 13.0% 615.6 5.3% Revenue 674.7 0.2% 834.0 13.0% 628.8 5.7% Variable contribution 545.8 (0.8%) 327.7 8.4% 204.2 8.5% Net opera
Slide 23: Summary of Tabcorp's financial position
Summary of Tabcorp’s financial position ¾ For personal use only Tabcorp had net debt of $2,320 million (as at 31 December 2008) and a market capitalisation of $3.8 billion (as at 23 March 2009) ¾ Since 31 December 2008 Tabcorp has raised net proceeds of $379 million of new equity via a placement and
Slide 24: Debt maturity profile and facilities available
Debt maturity profile and facilities available For personal use only ¾ Average debt maturity is 4.3 years (as at 31 December 2008) No debt maturing in calendar year 2009 ¾ Funds raised from the issue of Tabcorp Bonds will be used to repay some existing bank debt Pro forma debt facilities available
Slide 25: Tabcorp's financial ratios
Tabcorp’s financial ratios For personal use only ¾ Tabcorp has demonstrated prudent financial discipline and has strong credit metrics ¾ Standard & Poor’s has confirmed Tabcorp’s investment grade BBB+ credit rating (with a stable outlook) Pro forma adjustments . Pro forma as As at Equity Tabcorp at
Slide 26: Agenda
Agenda For personal use only 1 Summary of the Offer 2 About Tabcorp 3 Key risks 4 Offer structure and timetable 26
Slide 27: Key risks
Key risks For personal use only ¾ Risks associated with Tabcorp Bonds include: Fluctuations in the market price of Tabcorp Bonds The market for Tabcorp Bonds may be less liquid than the market for Tabcorp shares or other securities That the interest rate will fluctuate (both increasing and dec
Slide 28: Agenda
Agenda For personal use only 1 Summary of the Offer 2 About Tabcorp 3 Key risks 4 Offer structure and timetable 28
Slide 29: Offer structure
Offer structure For personal use only Institutional Offer ¾ Institutional Investors who have been invited by the Joint Lead Managers to bid for Tabcorp Bonds through the Bookbuild Broker Firm Offer ¾ Open to all Australian resident clients of a Syndicate Broker who apply for a firm Allocation from t
Slide 30: Indicative timetable
Indicative timetable Key Dates for the Offer For personal use only Lodgment of the Prospectus with ASIC Tuesday 24 March 2009 Bookbuild to determine the Margin Tuesday 31 March 2009 Broker bids due at 11.00am (Melbourne time) Institutional bids due at 1.00pm (Melbourne time) Announcement of the Marg
Slide 31: Syndicate contacts
Syndicate contacts For personal use only Joint Lead Managers & Joint Bookrunners Angelos Giannakopoulos +61 3 9273 1774 Adam Vise +61 3 9273 3880 Alex Allegos +61 3 8643 9709 Kevin Roche +61 2 9321 1438 Sean Hogan +61 2 9321 8950 Nicola Monteiro +61 2 9237 9970 Ana Ivkosic +61 2 9237 1505 Kelvin Bar
Slide 32: For personal use only
For personal use only Front cover: Images from Tabcorp's Casino, Wagering and Gaming businesses.The Phantom of the Opera photograph is courtesy of Jeff Busby. 32
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