The Lottery Corporation (TLC) H2 2025 earnings summary

Executive summary

• Delivered resilient FY 2025 results despite a 13% reduction in Division 1 prize offerings, below-average jackpots, and economic pressures impacting discretionary spend.

• Digital share of lottery sales rose to 42%, up from 23% six years ago, driven by enhanced digital experiences and new product launches.

• Keno retail achieved record growth, while digital Keno was impacted by spend limits.

• Board increased full-year ordinary dividend to AUD 0.165 per share, up from AUD 0.16, reflecting confidence in outlook and supported by strong cash flow.

• CEO Sue van der Merwe announced retirement; Wayne Pickup to succeed as MD and CEO.

Financial highlights

• FY25 revenue declined 6.2% year-over-year to $3,748.9m, with EBITDA (before significant items) down 9.4% to $749.3m.

• Net profit before significant items fell 11.2% to $365.5m; EPS (before significant items) dropped 11.4% to 16.4cps.

• Final fully franked dividend of AUD 0.085 per share, full-year AUD 0.165 per share, a 3.1% increase, maintaining a 100% payout ratio.

• Operations generated AUD 2.4 billion in returns to state/territory governments and retail businesses.

• Net debt/EBITDA at 2.9x, within target range.

Outlook and guidance

• Powerball price increase planned for November 2025, expected to drive higher jackpots and revenue.

• CapEx to rise to around AUD 100 million in FY 2026 and remain elevated through FY 2028 for digital transformation and infrastructure.

• OpEx growth targeted to remain below normalized revenue growth over time.

• Focus on digitalisation, customer growth, and operational efficiency to drive sustainable growth.

• Ongoing advocacy for industry sustainability and licence value enhancement.