Tabcorp Holdings Ltd on Thursday reported a stronger-than-expected FY2026 financial performance, with net profit before significant items rising 44% to A$71.1 million, despite a 0.8% increase in revenue to A$2.64 billion.
Underlying earnings before interest, tax, depreciation and amortization (EBITDA) climbed 10.3% to A$432 million, lifting the EBITDA margin to 16.4% from 15% a year earlier. Net profit after tax (NPAT) before significant items rose to A$219 million, up 15.9%, while return on invested capital improved to 12% from 9.6% in FY2025.
Cost management played a key role in the results, with operating expenses adjusted for the Victorian wagering licence declining by 80 basis points. Total cost reductions reached A$27.3 million, including A$18 million in structural savings and A$9.3 million in tactical measures. Net interest expense fell 5.8%, and cash conversion remained high at 98%.
The company maintained a conservative balance sheet with net leverage at 1.2 times and extended its average debt maturity to 4.9 years. In November 2025, Tabcorp issued A$300 million in new debt under a AMTN program at a fixed coupon of 5.9% over 5.5 years.
Tabcorp also increased its full-year dividend by 50% to 3 cents per share, representing a 58% payout ratio and a dividend yield of 2.76%. The final dividend was set at 1.5 cents per share.
Management highlighted growth in sport wagering, which rose about 8% in FY2026, while parimutuel betting continued to decline at 5% to 6% annually. Retail turnover for the FIFA World Cup surged 57%, with digital turnover up 53%, and digital in-venue turnover for the 18–34 age cohort increasing 23%.
Looking ahead, Tabcorp forecast FY2027 operating expenses to rise 3% to 3.5%, with half of the increase tied to regulatory and risk programs and loyalty investments. Capital expenditure is expected to climb to as much as A$160 million, driven largely by the rollout of next-generation electronic betting terminals, with A$65 million allocated for FY2027 alone. The company also plans to launch the national tote during the Spring Carnival and complete the acquisition of BetMakers in Q3 FY2027, subject to regulatory approvals.
Tabcorp shares fell 3.59% to A$0.873 following the results, leaving the stock about 25.8% below its 52-week high of A$1.19 and roughly 32.3% above its low of A$0.66.
