Australian gaming operator Tabcorp profits fell more than one-quarter in its fiscal H1 in part due to startup costs of its new UK-facing online betting joint venture.
Figures released Thursday showed Tabcorp revenue rising 2.1% to A$1.16b in the six months ending December 31. Earnings rose 1.7% to $270.4m and pre-tax profit gained 5.3% to $102.7m, but $43.8m of significant items drove actual profits after tax down 28.1% to $58.9m.
Those significant items included $17.9m related to the launch of Sun Bets, the UK-facing online betting joint venture with Rupert Murdoch’s News UK. The site, which went live last August, has signed up 85k customers who generated turnover of $96.8m. But Sun Bets’ revenue totaled just $1.5m, reflecting “mid-single digit” margins that were offset by major bonus and promo offers. Tabcorp expects Sun Bets will lose an additional $15m in H2 2017.
Sun Bets wasn’t included in Tabcorp’s core Wagering & Media division, which reported H1 revenue rising 1.4% to $987m. The gains were attributed in part to a record Spring Racing Carnival, which saw turnover rise 4.7% over the 57-day period (spurred by a 17.6% rise in digital betting).