Tsogo Sun (TSG) H2 2025 earnings summary

Executive summary

• Income for the year ended 31 March 2025 was R11.16 billion, down from R11.50 billion year-over-year, reflecting pressure on discretionary spend and customer behavior changes.

• Adjusted EBITDA declined to R3.47 billion from R3.90 billion, with margin dropping to 31.1% from 33.9% due to lower revenue despite cost controls.

• Adjusted headline earnings were R1.47 billion, down from R1.72 billion, with the second half impacted by once-off items; excluding these, earnings would have been flat half-on-half.

• Net finance costs decreased to R687 million from R732 million, aided by lower NIBD and interest rates.

• Strong positive net cash was generated from operations, supporting a solid financial position for future growth.

Financial highlights

• Net gaming win: R9.25 billion (2024: R9.67 billion); food & beverage revenue: R675 million; rooms revenue: R536 million.

• Operating profit: R2.44 billion (2024: R2.88 billion); profit for the year: R1.19 billion (2024: R1.54 billion).

• Basic and diluted EPS: 120 cents (2024: 147 cents); adjusted headline EPS: 142 cents (2024: 169 cents).

• Final dividend per share: 30 cents (2024: 40 cents); total dividend for the year: 60 cents.

• Capex cash outflow: R700 million; investment cash flow: R186 million.

Outlook and guidance

• Trading environment remains challenging; a sudden turnaround is not expected, but sentiment is improving.

• Focus remains on debt reduction, with a medium-term target of NIBD below R6.0 billion and leverage below 1.8x adjusted EBITDA.

• Emerald Resort upgrade to complete in FY26, expected to improve results from FY27.

• Online and LPM divisions expected to contribute positively; further product and technology development planned.

• Dividend reduction seen as supporting accelerated debt reduction.