Tabcorp swings to loss on fines, merger costs

Australian wagering giant, Tabcorp swung to a loss of A$20.8 million ($16.5 million) in the year ending June 30, hurt by the costs of its merger with rival Tatts and legal costs.

The group had $199.7 million of one-off items, including $61.8 million in fines and legal costs after regulator Austrac ruled the company had not complied with Anti Money Laundering rules and $1.9 million costs over a probe into a deal in Cambodia. Costs related to the Tatts combination were $53.9 million.

Revenues gained 1.9 percent to $2.22 billion, in line with the company’s guidance.

“FY17 was a strategically important year for Tabcorp as we reshaped the business for growth. We made investments in acquiring Intecq, establishing Sun Bets and progressing the combination with Tatts, which we expect to complete by the end of the year,” Tabcorp Managing Director and CEO, David Attenborough, said. “We also strengthened Tabcorp’s risk management and regulatory compliance capability, which is scalable in the context of the proposed combination with Tatts.”

“These are significant initiatives we have undertaken to better position Tabcorp to deliver sustainable growth.”

Revenue from wagering and media was flat, while revenue from the gaming services division was up 34.2 percent. Keno revenue gained 2 percent. Media revenues grew 1.9 percent and all key racing broadcast rights were secured for continued broadcast on Sky Racing.