Tabcorp Holdings Limited (ASX: TAH) shares were up 8% today after the company released its full year FY 2018 results.
Having issued disappointing half year results at the beginning of the year, Tabcorp surprised the market with an upswing in profits and as expected, the impact of the merger with Tatts Group took centre stage.
The raw numbers*
- Revenues for the year were $3,828.7 million, up 71.4%
- EBITDA was $529.4 million, up 69.5%
- Net Profit After Tax was $28.7 million, up from a $20.8m loss last year
- Earnings Per Share of 1.9 cents per share, up from a 2.5 cents loss per share last year
- The results also included significant expense items after tax of $217.5m from the Tatts combination,
Sun Bets exit and Luxbet closure
* The amounts above include Tatts Group from 14 December 2017.
What did management have to say?
Management were pretty upbeat over the potential synergies from the Tatts merger.
The company's CEO David Attenborough said, "FY18 was a company-defining year for Tabcorp. The integration of the two businesses is on track, with initial business improvements and cost initiatives implemented. We have taken decisions to underpin $50 million of EBITDA synergies and business improvements in FY 19 and are on target to deliver at least $130 million in FY 21."
Outlook
Looking ahead, a combination of digitalisation, new product launches, synergies from the merger as well as industry reforms have set the company up well for future success.
Mr Attenborough said, "FY18 has also been a year of positive change for the gambling sector. A number of reforms have been introduced which aim to make the industry more sustainable. The introduction of point of consumption taxes, the prohibition of synthetic lottery products, advertising restrictions and improved consumer protection measures are creating a fairer playing field. Tabcorp is very well placed to perform in this improved environment."
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