TABCORP HOLDINGS LIMITED 2017/18 FULL YEAR RESULTS PRESENTATION 8 A U G U S T A B N

Transcription

1 TABCORP HOLDINGS LIMITED 2017/18 FULL YEAR RESULTS PRESENTATION 8 A U G U S T A B N

2 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

3 FY18 OVERVIEW A COMPANY-DEFINING YEAR Highlights Cmbinatin with Tatts Grup cmpleted and integratin n track Exited lss-making businesses Key pints EBITDA synergies and business imprvements are n track Delivered $8m in FY18 Decisins taken underpin $50m in FY19 Target remains at least $130m in FY21 Sun Bets exit annunced July 2018 Luxbet clsure December 2017 A mre sustainable regulatry envirnment Federal legislatin passed banning synthetic lttery prducts Wagering pint f cnsumptin tax regimes annunced New advertising restrictins and strnger cnsumer prtectins Capital management Refinanced $1.8bn bridge lan int lng-dated maturities in US market Full year dividend f 21.0 cps, including final dividend f 10.0 cps Well psitined fr grwth Psitive 2H18 perfrmance, driven by Wagering & Media and Ltteries & Ken Accelerated digitalisatin acrss the cmpany New prducts launched Licences renewed 3

4 FY18 RESULTS Statutry results 1 Revenues $3,828.7m, up 71.4% EBITDA $529.4m, up 69.5% NPAT $28.7m, up frm $20.8m lss in pcp EPS cents per share, up frm 2.5 cents lss per share in pcp Results impacted by significant items expense after tax f $217.5m frm Tatts cmbinatin, Sun Bets exit and Luxbet clsure Results befre significant items 1,3 Revenues $3,828.7m, up 71.7% EBITDA $736.4m, up 46.1% NPAT $246.2m, up 37.6% EPS cents per share, dwn 22.4% Final dividend 10.0 cents per share, fully franked, taking the full year rdinary dividend t 21.0 cents per share, fully franked Grup pr-frma 4 results befre significant items Revenues $5,109.3m, up 2.5% EBITDA $989.2m, up 2.8% EBIT $695.6m, up 2.0% 4 Ntes: 1. Results include Tatts Grup frm 14 December EPS calculated using weighted average shares fr the perid 3. Tabcrp results befre significant items include the Sun Bets perating result in FY18 (treated as a significant item in FY17) 4. Pr-frma results include varius adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup fr the year, including 12 mnths f Tatts results in FY18 and FY17, and excluding Sun Bets in FY18; refer t slide 12 fr further details

5 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

6 GROUP RESULTS 1,2 $m FY18 FY17 Change n pcp Revenues 3, , % Variable cntributin 1, , % Operating expenses (753.5) (502.2) 50.1% EBITDA befre significant items % D&A (248.6) (178.7) 39.2% EBIT befre significant items % Interest (118.6) (68.3) 73.6% Tax expense (123.0) (78.2) 57.4% NPAT befre significant items % Significant items (after tax) 3 (217.5) (199.7) 8.9% Statutry NPAT 28.7 (20.8) >100.0% Ntes: 1. Results include Tatts Grup frm 14 December Sun Bets was treated as a significant item in FY17 3. Significant items expense (after tax) f $217.5m cmprise Tatts Grup cmbinatin $114.6m, Sun Bets exit $90.5m, and Luxbet clsure $12.4m 6

7 BUSINESS RESULTS 1,2 FY18 ($m) Wagering Change Ltteries Change Gaming Change Change Change & Media 1a n pcp & Ken 1b n pcp Services 1c n pcp Sun Bets 2 n pcp Grup 3 n pcp Revenues 2, % 1,390.7 >100.0% % 7.4 n/a 3, % Variable cntributin % >100.0% % (11.2) n/a 1, % Operating expenses (480.6) 19.9% (137.0) >100.0% (113.5) >100.0% (25.7) n/a (753.5) 50.1% EBITDA % >100.0% % (36.9) n/a % D&A (135.2) 10.9% (55.9) >100.0% (56.2) 64.3% (1.3) n/a (248.6) 39.2% EBIT % >100.0% % (38.2) n/a % Opex / Revenue (%) 22.0% 0.6% 9.8% (3.7%) 45.5% 9.6% - n/a 19.7% (2.8%) EBIT / Revenue (%) 12.0% (0.2%) 14.4% (8.9%) 26.3% (7.0%) - n/a 12.7% (1.9%) Capex % 17.4 (3.3%) % 10.7 n/a (10.1%) Ntes: 1. The Grup s perating segments include the Tatts Grup frm 14 December 2017: a. Wagering & Media includes the Tatts UBET Wagering business b. Ltteries & Ken includes the Tatts Ltteries business c. Gaming Services includes the Tatts Max and MAXtech businesses 2. Sun Bets was treated as a significant item in FY17 3. Business results d nt aggregate t Grup ttal due t intercmpany eliminatins and unallcated items 7

8 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

9 INTEGRATION ON TRACK Crprate Bard and senir leadership changes implemented New management structures implemented acrss grup Crprate functins cnslidated Back ffice integratin in prgress Prcurement cntract re-negtiatins underway Crprate systems cnslidatin n-track Prperty ratinalisatin cmmenced Wagering & Media Fixed dds trading system integratin cmmenced in 2H18 with further changes in 1H19 t drive imprved risk management and prductivity UBET Fixed Odds and Tte markets expansin underway including intrductin f higher-yielding prducts UBET brand change t TAB acrss retail and digital cmmencing end 1H19, with platfrm enhancements including visin, frm, and flexi-betting UBET custmer migratin t TAB platfrm 2H20 facilitating Trackside and harmnisatin f tte prducts Technlgy Cre technlgy functinal cnslidatin ccurring acrss FY19/FY20, including remval f duplicatin and the renegtiatin f cmmercial cntracts including insurcing where apprpriate Data centre cnslidatin 2H20 Wagering hst systems cnslidatin 2H20 Ltteries & Ken Ken SA brand alignment and game enhancements planned FY20 Cmbined marketing team Gaming Services Dandenng call centre cnslidated in 2H18 Cmbined sales team C-lcatin f field services underway 9

10 SYNERGIES & BUSINESS IMPROVEMENTS Decisins taken t underpin $50m f EBITDA synergies and business imprvements in FY19 EBITDA $m Integratin planning cmpleted and executin cmmenced in a systematic and cnsidered manner t limit disruptin t cre businesses On track t deliver $50m f EBITDA synergies and business imprvements in FY19, with $8m delivered in FY18 Target remains at least $130m f EBITDA synergies in FY21 Revenue synergy estimates include the cst f rlling ut TAB venue arrangements t UBET states, including the payment f digital cmmissins 10

11 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

12 GROUP RESULTS RECONCILIATION TO PRO-FORMA Adjustments FY18 ($m) Reprted Tatts Pre-merger Sun Bets Odyssey Divestment PPA 1 Elims Pr-frma Revenues 3, ,304.4 (7.4) (7.9) - (8.5) 5,109.3 Variable cntributin 1, (5.5) - (7.5) 1,904.4 Operating expenses (753.5) (199.3) (915.2) EBITDA befre significant items (1.1) D&A (248.6) (35.6) (11.6) - (293.6) EBIT befre significant items (0.2) (11.6) Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year Adjustments t FY18 reprted results t arrive at pr-frma results Tatts earnings included frm 1 July 2017 t 13 December 2017 (pre-merger perid) with eliminatins recgnised Sun Bets earnings excluded given exit in July 2018 Odyssey earnings excluded given divestment as part f the merger prcess Full year impact f purchase price allcatin (PPA) 1 12 Ntes: 1. Purchase price allcatin (PPA) refers t the impact f acquisitin accunting cmpleted in 2H18, and the resulting additinal D&A fr the grup frm the net uplift f assets. The reprted results include 6 mnths f PPA D&A. The pr-frma results have been adjusted t include a full year f PPA D&A

13 GROUP RESULTS (PRO-FORMA) $m 1H18 Change n pcp 2H18 Change n pcp FY18 Change n pcp 1 Revenues 2, % 2, % 5, % Variable cntributin % % 1, % Operating expenses (474.0) 3.3% (441.2) (0.5%) (915.2) 1.4% EBITDA befre significant items (0.9%) % % D&A (145.1) 4.2% (148.5) 5.4% (293.6) 4.8% EBIT befre significant items (2.8%) % % Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year 1H18 pr-frma results (and pcp) have been adjusted t exclude Sun Bets, incrprate the impact f purchase price accunting and sme minr adjustments made t present Tatts' financial results under Tabcrp's accunting plicies Psitive 2H18 perfrmance, the first 6 mnths pst-merger Accelerated digital grwth supprted variable cntributin margin expansin Initial delivery f synergies supprted favurable pex perfrmance in 2H18 Ntes: 1. Pr-frma results in FY17, including a recnciliatin t the pr-frma results in the Tatts Scheme Bklet, are set ut n slide 34 f the Appendices 13

14 BUSINESS RESULTS (PRO-FORMA 1 ) FY18 ($m) Wagering Change Ltteries Change Gaming Change Change Grup 2 & Media n pcp & Ken n pcp Services n pcp n pcp 3 Revenues 2, % 2, % (0.1%) 5, % Variable cntributin % % (0.8%) 1, % Operating expenses (542.0) 1.1% (212.9) (1.5%) (149.1) (2.0%) (915.2) 1.4% EBITDA % % % % D&A (144.8) 4.1% (84.4) 2.6% (65.1) 10.3% (293.6) 4.8% EBIT (1.7%) % 86.9 (5.8%) % Opex / Revenue (%) 22.0% 0.1% 9.1% (0.6%) 47.3% (0.9%) 17.9% (0.2%) EBIT / Revenue (%) 12.5% (0.3%) 13.3% 1.0% 27.6% (1.7%) 13.6% (0.1%) Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details 2. Business results d nt aggregate t Grup ttal due t intercmpany eliminatins and unallcated items. Unallcated items include lease csts f $9.4m fr new Brisbane ffice (FY17: nil) 3. Pr-frma results in FY17, including a recnciliatin t the pr-frma results in the Tatts Scheme Bklet, are set ut n slide 34 f the Appendices 14

15 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

16 WAGERING & MEDIA (PRO-FORMA 1 ) $m 1H18 Change Change Change 2H18 FY18 n pcp n pcp n pcp Wagering Revenue 1, % 1, % 2, % Media Revenue % % % Revenues 1, % 1, % 2, % Variable Cntributin (1.6%) % % Operating Expenses (278.9) 4.2% (263.1) (2.0%) (542.0) 1.1% EBITDA (7.6%) % % EBIT (12.5%) % (1.7%) Pr-frma revenue grwth f 0.6% vs the pcp TAB grwth f 2.5% UBET decline f 0.7% Duble digit earnings grwth in 2H18 VC margin expansin, cycling rllut f digital cmmissins and higher racing industry payments Imprved pex perfrmance fllwing Luxbet clsure and sme early synergy benefits Next phase f digitalisatin New prducts Multiplier (TAB), Tappy (UBET) Cmmercialisatin f digital visin, including licensing Sky Racing visin Luxbet clsure December 2017 FY18 EBIT lss f $7.9m (FY17 -$13.0m) 16 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details

17 WAGERING KPIs (PRO-FORMA 1 ) Turnver by distributin ($m) 2 FY18 Change n pcp FY18 Change n pcp FY18 Change n pcp Retail 8,019.4 (3.9%) 6,033.3 (3.3%) 1,986.1 (5.5%) Digital 6, % 5, % 1, % Call Centre (20.3%) (23.6%) (11.4%) Other 3 1,398.1 (5.4%) 1,007.7 (4.1%) (8.4%) Ttal 16, % 12, % 3,789.7 (0.8%) Revenue by prduct ($m) 2 Ttalisatr 1,300.3 (5.5%) 1,037.5 (5.2%) (6.5%) Fixed Odds % % % Ttal Racing 2, % 1, % (1.2%) Sprts % % % Trackside 76.6 (6.0%) 76.6 (6.0%) - - Ttal 2, % 2, % (0.5%) Other KPIs Cmbined TAB UBET Strng digital and fixed dds perfrmance in TAB Digital turnver grwth f 16.3% (FY17: 13.9%) Fixed dds revenue grwth f 13.1% (FY17: 15.0%) TAB active custmers up 10.5% t 525K, supprted by Sccer Wrld Cup campaign and venue sign-ups UBET revenue grwth turned psitive in 2H18 up 1.2% (1H18: -1.9%) TAB perfrmance relative t UBET highlights business imprvement pprtunity acrss Channel and prduct Yield management FO Racing yield 14.6% (0.1%) 15.0% (0.2%) 13.6% 0.2% FO Sprts yield 13.4% 0.8% 14.2% 1.2% 9.6% (0.4%) Active Custmers 4 719, % 525, % 194, % % Digital frm mbile 67.9% 4.2% 71.2% 3.3% 55.1% 8.0% % Retail frm SST 53.0% 3.3% 69.1% 2.9% 5.9% 5.4% 17 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details 2. Cmbined and TAB turnver and revenue includes Victrian Racing Industry interest 3. Other turnver includes Oncurse, Premium Custmers and PGI 4. Active Custmers are measured n a rlling 12 mnth basis

18 FIXED ODDS WAGERING (PRO-FORMA 1 ) Change n pcp % Fixed Odds Turnver and Revenue Grwth FY16 FY17 FY18 TAB UBET TAB UBET TAB UBET Turnver 16.7% 24.0% 14.7% (0.7%) 11.8% 5.7% Revenue 9.9% 6.9% 15.0% 5.8% 13.1% 6.3% 14.6% 14.6% 14.7% 12.1% Fixed Odds Yield 12.8% 12.9% UBET fixed dds yield grwth is a key business imprvement initiative Cmbined TAB/UBET fixed dds bk strengthens risk management and revenue pprtunities Tabcrp has cmmenced deplying its systems and prcesses int UBET Risk management racing technlgy Cmmn TAB/UBET pricing Expansin f racing/sprts markets Custmer segmentatin UBET fixed dds revenue grwth imprved in 2H18 t 9.6% (1H18: 3.5%) FY16 FY17 FY18 TAB UBET 18 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details

19 LOTTERIES & KENO (PRO-FORMA 1 ) $m 1H18 Change Change Change 2H18 FY18 n pcp n pcp n pcp Ltteries Revenue 1, % 1, % 2, % Ken Revenue % % % Revenues 1, % 1, % 2, % Variable Cntributin % % % Operating Expenses (109.0) 1.5% (103.9) (4.4%) (212.9) (1.5%) EBITDA % % % EBIT % % % Pr-frma revenues up 4.7% vs. the pcp Ltteries benefited frm a favurable jackpt sequence vs the pcp, particularly in 1H18 Ken revenue grwth skewed t 2H18 given less favurable jackpt sequence in 1H18 vs the pcp Strng EBITDA grwth driven by VC margin expansin due t digital grwth, cst cntrl, and early synergy benefits Pwerball game change launched April 2018, increasing prize frequency and pprtunity fr bigger jackpts Ken Mega Millins launched in Qld in March 2018, pling with NSW 19 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details

20 LOTTERIES & KENO KPIs (PRO-FORMA 1 ) Jackpt perfrmance $29.0m 39 6 $25.7m 36 $25.3m $28.8m 45 6 $24.2m 31 2 $28.4m FY13 FY14 FY15 FY16 FY17 FY18 Number f jackpts $50m r mre Number f jackpts $15m r mre Average value f jackpt at $15m r mre 32 4 Ltteries Sales grwth in retail netwrk New digital POS displays installed in mre than 1,000 utlets Strng digital perfrmance Digital sales up 27.8% 2.9m registered players New Victrian ltteries licence cmmenced 1 July 2018 Digital Share f Sales 2 Ken Digital share f Ken sales 3.8%, up frm 0.7% in the pcp 58,000 digital accunt hlders, >50% under 35 years ld Ken Mega Millins expected t launch in Victria in FY19 20 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details 2. Excludes Suth Australia. If Suth Australia included, ltteries digital share f sales was 16.8% in FY18 vs 13.7% in FY17

21 GAMING SERVICES (PRO-FORMA 1 ) Change Change Change $m 1H18 2H18 FY18 n pcp n pcp n pcp Revenues % (2.1%) (0.1%) Variable Cntributin % (2.7%) (0.8%) Operating Expenses (74.7) (8.9%) (74.4) 6.0% (149.1) (2.0%) EBITDA % 71.8 (10.2%) % EBIT % 36.8 (27.0%) 86.9 (5.8%) 21 Max / MAXtech TGS ebet 2H18 impacted by lwer prject wrk vs. pcp New NSW mnitring licence which cmmenced Dec-17 resulted in an increase in D&A f $7.5m fr 7 mnths New Vic gaming arrangements nw prvide industry certainty t 2032 (previusly 2022) TGS is seeking t transitin existing Vic custmers t lnger term cntracts beynd 2022 (at lwer margins) and attract new sign-ups acrss Vic and NSW 2H18 impacted by decline in Vic cntracted EGMs. Current cntracted EGMs are 7,800 (FY17: 8,700) f which 87% are cntracted t 2022, and 11% are cntracted beynd 2022 NSW cntracted EGMs 1,960 (FY17: 1,960) Perfrmance adversely impacted by uncertainty assciated with the merger, cmpetitive pressures, and the divestment f Odyssey Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details

22 SUN BETS $m FY18 FY17 1 Change n pcp Turnver % Revenues % Variable Cntributin (11.2) (14.6) (23.4%) Operating Expenses (25.7) (31.5) (18.5%) EBITDA (36.9) (46.2) 20.1% EBIT (38.2) (78.3) 51.1% Sun Bets ceased trading in July 2018 Tabcrp will make a payment t News UK f 39.5m (apprximately A$71m) t exit the agreement Significant items expense f $90.5m (after-tax) in respect f Sun Bets recrded in FY18 (FY17: $68.3m) which includes the exit fee payable t News UK and asset impairments FY19 clsure csts expected t be up t $10m Nte: 1. Sun Bets results fr FY17 were reprted as a significant item as the business was in the establishment phase, FY17 has been restated t shw a like-fr-like cmparisn 22

23 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

24 CAPITAL EXPENDITURE (PRO-FORMA 1 ) BAU Capex Nn-BAU prjects acrss FY19 and FY20 Integratin capex expected t be $70m $m Systems cnslidatin Retail enhancements Data centre relcatin $38m Cnslidate legacy data centres int new lcatin in Brisbane Cst is $31m less than the planned cmbined spend by Tabcrp and Tatts standalne prir t merger f $69m Ann St Brisbane ffice fit ut $34m Fit ut f 7 flrs Prceeds frm planned divestment f Brisbane prperties in FY19 expected t ffset the cst f Ann St fit ut 24 Ntes: 1. Pr-frma results include adjustments t Tabcrp s reprted results t permit investrs t examine the financial perfrmance f the cmbined grup as if the Tatts cmbinatin had been in place fr the full year; see slide 12 fr details

25 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

26 $millins CAPITAL MANAGEMENT DEBT STRUCTURE ($m) Headrm available under bank facilities f $1.0bn at 30 June Refinanced $1.8bn bridge lan int lng-dated maturities in US market Tabcrp and Tatts existing USPP ntes kept n ft fllwing successful amendment prcesses Victrian ltteries licence $120m paid June Grss Debt 1 /EBITDA 2 rati f 3.4x at 30 June 2018; target range f x Tabcrp intends t maintain an investment grade credit rating Ntes: 0 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY34 FY35 FY36 USPP (Existing) Retail Bnds Bank Debt USPP (New) 1. Grss debt includes USPP debt at the A$ principal repayment under crss currency swaps, plus an additinal $71m payable t News UK fr the Sun Bets exit 2. FY18 pr-frma EBITDA as set ut n slide 12 Full year dividend f 21.0 cps with a final dividend f 10.0 cps. Reflecting the phasing f integratin benefits, FY19 dividend target f 100% f NPAT befre significant items, amrtisatin f the Victrian wagering and betting licence and PPA The Dividend Reinvestment Plan will perate fr the final dividend 26

27 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

28 AN EVOLVING REGULATORY LANDSCAPE Regulatry refrm has created a better regulated and mre sustainable gambling industry 1 Synthetic ltteries ban Synthetic ltteries are prducts where custmers bet n the utcme f a lttery rather than buying a ticket and directly participating in the draw. Online betting n the utcme f a lttery r Ken draw will be prhibited fllwing amendments t the Interactive Gambling Act passed by the Federal Senate in June There is a six-mnth adjustment perid. 2 Pint f cnsumptin taxes Wagering pint f cnsumptin (POC) taxes are levied based n the lcatin f the custmer. Intrduced in SA in July Queensland s POCT regime cmmences 1 Octber NSW, Victria, the ACT and WA have annunced a POCT n wagering revenues frm 1 January Tabcrp is wrking with gvernments and racing industries t ensure the significant fees and taxes already paid under its state wagering licences are recgnised, in line with the principles annunced. 3 Cnsumer prtectins Amendments t Australia's gambling legislatin have been intrduced r prpsed t imprve cnsumer prtectin. These include prhibitins n wagering peratrs ffering nline in-play betting, credit and certain frms f inducements. 4 Advertising restrictins Frm March 2018, new restrictins prhibited gambling advertising during live televisin, radi and nline sprts bradcasts between 5:00am and 8:30pm. Live bradcasts f racing events and the advertising f ltteries are exempt. The prhibitin f wagering advertising n rads, public transprt and assciated infrastructure in Victria has als been annunced. 28

29 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

30 CONCLUSION FY18 A cmpany-defining year Tatts cmbinatin cmpleted and integratin n track Exited lss-making Luxbet and Sun Bets businesses Key regulatry refrms prgressed creating fairer playing field W A G E R I N G & M E D I A FY19 Key pririties Deliver expected benefits frm the cmbinatin with Tatts Cntinue t execute n grwth pprtunities acrss all businesses Enhance digital capability and imprve cnsistency f custmer digital experience L O T T E R I E S & K E N O Deepen integratin f digital technlgy int retail netwrk Deply new prducts acrss all markets fr all businesses Strengthen CRM capability by effectively integrating systems and custmer data platfrms Ensure the highest levels f regulatry cmpliance Maintain disciplined apprach t perating expenditure, capital investment and balance sheet management G A M I N G S E R V I C E S 30

31 TABLE OF CONTENTS FY18 Overview 3-4 Grup Results 6-7 Integratin Update 9-10 Grup Results - Pr-frma Divisinal Results Capital Expenditure 24 Capital Management 26 Regulatry Update 28 Cnclusin 30 Appendices

32 APPENDICES 1. Significant items 2. FY17 Pr-frma Recnciliatin t Scheme Bklet 3. Wagering: TAB & UBET KPIs 4. Balance sheet 5. Cash Flw 32

33 1. SIGNIFICANT ITEMS (AFTER-TAX) FY18 $m Cmbinatin with Tatts Grup 1 Transactin csts 62.1 Implementatin csts 30.0 Nn-cash write-ffs / impairments 12.5 Surplus lease space prvisin Sun Bets significant item includes the exit fee payable t News UK f apprximately $71m Luxbet clsure includes $11.2m f asset write-ffs Sun Bets exit 90.5 Luxbet clsure 12.4 Ttal Significant Items (after tax) Ntes: 1. Transactin csts includes an amunt f $2.2m in respect f an agreement with Racing Queensland Limited (RQL). In 2017, Tabcrp and RQL entered int a cmmercial arrangement in relatin t the cmbinatin with the Tatts Grup, under which the parties made varius cmmitments, including that RQL cnsent t the Scheme f Arrangement. Tabcrp guaranteed a minimum amunt f fees that RQL will receive under its deed with UBET QLD in each calendar year frm 2018 t Tabcrp currently expects that it will be required t make a payment t RQL in relatin t the 2018 calendar year which is nt material t the Grup and, while necessarily uncertain, depending n the perfrmance f the business in future r the ccurrence f unexpected circumstances, further payments may need t be made that may be material 33

34 2. FY17 PRO-FORMA RECONCILIATION TO SCHEME BOOKLET FY17 ($m) Adjustments Scheme Bklet 1 Sun Bets PPA Accunting Plicy Alignment Pr-frma Revenues 4,992.0 (4.0) - (1.3) 4,986.7 Variable cntributin 1, (9.4) 1,864.6 Operating expenses (944.0) (902.4) EBITDA befre significant items D&A (261.6) 5.0 (23.4) (0.2) (280.2) EBIT befre significant items (23.4) Ntes: 1. See the Tatts Scheme Bklet published 8 September

35 3. WAGERING: TAB & UBET KPIs TAB 1H18 Change n pcp 2H18 Change n pcp FY18 Change n pcp UBET 1H18 Change n pcp 2H18 Change n pcp FY18 Change n pcp Turnver by distributin ($m) Turnver by distributin ($m) Retail 3,192.6 (3.3%) 2,840.7 (3.3%) 6,033.3 (3.3%) Digital 2, % 2, % 5, % Call Centre (21.2%) (26.2%) (23.6%) Other (1.2%) (7.6%) 1,007.7 (4.1%) Ttal 6, % 5, % 12, % Revenue by prduct ($m) Ttalisatr (5.5%) (4.8%) 1,037.5 (5.2%) Fixed Odds % % % Ttal TAB Racing % % 1, % TAB Sprts % % % Retail 1,061.4 (5.5%) (5.5%) 1,986.1 (5.5%) Digital % % 1, % Call Centre 86.2 (11.6%) 75.4 (11.2%) (11.4%) Other (11.3%) (4.8%) (8.4%) Ttal 2,008.4 (1.0%) 1,781.3 (0.5%) 3,789.7 (0.8%) Revenue by prduct ($m) Ttalisatr (6.7%) (6.4%) (6.5%) Fixed Odds % % % Ttal UBET Racing (2.3%) % (1.2%) UBET Sprts % % % Trackside 39.9 (9.6%) 36.7 (1.8%) 76.6 (6.0%) Ttal 1, % % 2, % Ttal (1.9%) % (0.5%) Other KPIs FO Racing yield 15.3% (0.3%) 14.6% (0.2%) 15.0% (0.2%) FO Sprts yield 15.1% 1.4% 13.4% 1.0% 14.2% 1.2% TAB Active Custmers 499, % 525, % 525, % % Digital frm mbile 71.1% 3.9% 71.3% 2.7% 71.2% 3.3% % Retail frm SST 67.8% 3.0% 70.6% 2.8% 69.1% 2.9% Other KPIs FO Racing yield 13.5% (0.4%) 13.7% 0.9% 13.6% 0.2% FO Sprts yield 10.1% (0.8%) 9.2% (0.1%) 9.6% (0.4%) UBET Active Custmers 187,600 (13.8%) 194, % 194, % % Digital frm mbile 53.9% 8.0% 56.3% 7.9% 55.1% 8.0% % Retail frm SST 3.3% 2.9% 8.7% 8.0% 5.9% 5.4% 35

36 4. BALANCE SHEET $m Jun 18 Jun 17 Change n pcp Ttal current assets % Licences 2, >100.0% Other intangible assets 9, ,058.1 >100.0% Prperty, plant and equipment % Other nn current assets % Ttal assets 12, ,740.9 >100.0% Ttal liabilities 5, ,257.5 >100.0% Sharehlders funds 7, ,483.4 >100.0% Net debt (reprted) 3, ,554.0 >100.0% Net debt (ecnmic) 1 3, ,468.5 >100.0% Shares n issue (m) 2, >100.0% Ratis Grss debt 2 / EBITDA 3 (x) EBIT 4 / Net interest (x) Ntes: 1. Net debt (ecnmic) includes USPP debt at the A$ principal repayment under crss currency swaps, and excludes ltteries prize fund cash f $242m 2. Grss debt includes USPP debt at the A$ principal repayment under crss currency swaps, plus an additinal $71m payable t News UK fr the Sun Bets exit 3. FY18 pr-frma EBITDA as set ut n slide EBIT is calculated n a full year reprted basis

37 5. CASH FLOW $m FY18 FY17 Change n pcp Net perating cash flws >100% Net interest paid (148.6) (75.1) 97.9% Incme tax paid (122.4) (61.5) 99.0% Payments fr PP&E and intangibles (291.7) (197.4) 47.8% Sub-ttal >100% Ordinary dividends paid (313.8) (194.5) 61.3% Prceeds/payment fr cash-settled equity swap (317.5) (>100%) Payment fr business acquisitin, including net debt acquired (1,451.8) (113.2) >100% Prceeds frm business divestment, net f cash divested (>100%) Settlement f dividends payable by business acquired (235.0) - >100% Other (0.1) 3.7 (>100%) Net cash flw (1,531.5) (596.4) >100% FY18 net perating cash flws include cash utflws f $10.1m relating t significant items (FY17 cash utflws f $159.8m relating t significant items) 37 Net debt at beginning f perid 1, % Nn cash mvements 60.3 (6.8) (>100%) Net debt at end f perid 3, ,544.0 >100%

38 DISCLAIMER This Presentatin cntains summary infrmatin abut the current activities f Tabcrp Hldings Limited (Tabcrp) and its subsidiaries (Tabcrp Grup). It shuld be read in cnjunctin with the Tabcrp Grup s ther peridic and cntinuus disclsure annuncements ldged with the Australian Securities Exchange (ASX), which are available at N member f the Tabcrp Grup gives any warranties in relatin t the statements r infrmatin cntained in this Presentatin. The infrmatin cntained in this Presentatin is f a general nature and has been prepared by Tabcrp in gd faith and with due care but n representatin r warranty, express r implied, is prvided in relatin t the accuracy r cmpleteness f the infrmatin. This Presentatin is fr infrmatin purpses nly and is nt a prspectus, prduct disclsure statement r ther disclsure r ffering dcument under Australian r any ther law. This Presentatin des nt cnstitute an ffer, invitatin r recmmendatin t subscribe fr r purchase any security and neither this Presentatin nr anything cntained in it shall frm the basis f any cntract r cmmitment. This Presentatin is nt a recmmendatin t acquire Tabcrp shares. The infrmatin prvided in this Presentatin is nt financial prduct advice and has been prepared withut taking int accunt any recipient's investment bjectives, financial circumstances r particular needs, and shuld nt be cnsidered t be cmprehensive r t cmprise all the infrmatin which recipients may require in rder t make an investment decisin regarding Tabcrp shares. All dllar values are in Australian dllars (A$) unless therwise stated. Neither Tabcrp nr any ther persn warrants r guarantees the future perfrmance f Tabcrp shares r any return n any investment made in Tabcrp shares. This Presentatin may cntain certain 'frward-lking statements'. The wrds 'anticipate', 'believe', 'expect', 'prject', 'frecast', 'estimate', 'likely', 'intend', 'shuld', 'culd', 'may', 'target', 'plan' and ther similar expressins are intended t identify frward-lking statements. Indicatins f, and guidance n, financial psitin and perfrmance are als frward-lking statements. Any frecasts r ther frward lking statements cntained in this Presentatin are subject t knwn and unknwn risks and uncertainties and may invlve significant elements f subjective judgement and assumptins as t future events which may r may nt be crrect. Such frward-lking statements are nt guarantees f future perfrmance and invlve knwn and unknwn risks, uncertainties and ther factrs, many f which are beynd the cntrl f Tabcrp, that may cause actual results t differ materially frm thse expressed r implied in such statements. There can be n assurance that actual utcmes will nt differ materially frm these statements. Yu are cautined nt t place undue reliance n frward lking statements. Except as required by law r regulatin (including the ASX Listing Rules), Tabcrp undertakes n bligatin t update these frward-lking statements. Past perfrmance infrmatin given in this Presentatin is given fr illustrative purpses nly and shuld nt be relied upn as (and is nt) an indicatin f future perfrmance. 38

39 TO ADVANCE THE WAY WE PLAY