Australian operator Tabcorp's plans to demerge its business are clearly on track following positive financial results for the second half of last year.
The company announced in October that it would be splitting its casino and wagering businesses. For the six months to December 31, the company recorded a three per cent increase in net profit after tax and before demerger costs of AU$272m.
Tabcorp’s casinos division achieved a 5.2 per cent rise in EBITDA of $201m, with both Star City in New South Wales and the company’s three Queensland properties performing more strongly. Last year, the operator announced a AU$625m investment in its Queensland casinos – a move it says will increase EBITDA by AU$90m per year once completed.
Tabcorp’s wagering business, meanwhile, reported a 3.5 per cent jump in EBITDA to AU$187.7m and its gaming business saw EBITDA increase three per cent AU$172.6m.
“In the first half, we saw the benefits of our investment in the casinos business,” chief executive officer Elmer Funke Kupper said. “The redevelopment of Star City casino is on track and management was again able to minimise the disruption from construction activity. It was encouraging to see growth return to our Queensland casinos. At the same time, wagering and gaming continued to deliver revenue growth in highly competitive markets and maintained good expense discipline.
“With the further investments we announced in the first half in Queensland and in wagering, each of the businesses now has a clear set of growth and performance priorities for the coming years. This will put them in a stronger position in their respective markets and make them attractive investment propositions after the proposed demerger.”
The demerger is due to be implemented on June 30 and is subject to a number of regulatory approvals.
