Tabcorp expects 31% fall in net profits

The company has taken measures to reinforce its balance sheet.
The company has taken measures to reinforce its balance sheet.

The Australian gaming company is factoring in the impact of Covid-19 on its business, as the economy sees a retail contraction and continuing uncertainty.

Australia.- Tabcorp Holdings has announced it is expecting a fall in net profits of around 31 per cent for the year ending June 30, compared to the previous 12 months.

The gaming company is expecting EBITDA to total between AU$990 million (US$705.3 million) and AU$1 billion (US$712.5 million), falling from AU$1,124 million (US$800.7 million) in previous year.

Net profit after tax, according to the unaudited results, will be between AU$267 million (US$190.2 million) and AU$273 million (US$194.4 million), between 31 per cent and 32 per cent below 2019 results of AU$396 million (US$282,1 million).

In line with these results the company expects to incur non-cash goodwill impairment charges in the range of AU$1 billion (US$712.5 million) to AU$1.100 billion (US$783.6 million).

These charges are related to Tabcorp’s Wagering & Media and Gaming Services businesses, which was impacted by lockdown measures due to the Covid-19 pandemic.

Tabcorp said it was factoring in a “possible acceleration of retail contraction and uncertainty regarding any longer term impacts as an indirect result of the pandemic,” as well as a “potential decline in consumer confidence and increased economic uncertainty.”

Tabcorp’s Managing Director and CEO, David Attenborough said in a press release: “Covid-19 has materially impacted our Wagering & Media and Gaming Services businesses. We are facing into a challenging and uncertain environment, and the current operating conditions and those expected into the future are relevant factors in assessing the value of the goodwill in those businesses at this time.

“We remain confident in the strength and resilience of Tabcorp’s diversified portfolio of assets and are pleased that integration is now substantially complete. We are focused on supporting our people and partners during these challenging times while ensuring that Tabcorp emerges strongly post Covid-19.”

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