This February's earnings season is continuing with gusto this week. We've heard from another round of popular ASX 200 shares over the last few days, with good, bad, and ugly results all around. This morning, Lottery Corp Ltd (ASX: TLC) joined the throng with its own earnings report card. And it's an interesting one to read for investors who might want to buy Lottery Corp shares for dividends.
Lottery Corp has long been a top choice for ASX investors looking for defensive earnings and a stable dividend. After all, this company has exclusive licenses to run the perennially popular lottery and Keno games in most states and territories. These services tend to be highly resilient to economic maladies like inflation and recessions, given the enduring appeal of the chance to hit the jackpot.
So let's see how this company lived up to that reputation with its latest earnings and dividend, covering the six months to 31 December 2025.
As we covered this morning, it was a bit of a mixed bag for Lottery Cop over the second half of last year. The company told investors that it suffered its least-favourable period for jackpot outcomes since its 2022 spinoff from Tabcorp Holdings Ltd (ASX: TAH). Revenues were up 2% year on year to $1.82 billion. However, the company's earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 0.7% from the same period in 2024 to $367 million. Net profit after tax (NPAT) was also lower, falling 1.4% to $173.3 million.
Earnings per share (EPS) came in at 7.8 cents per share, a drop of 0.1 cents (or 1.3%) from the previous period.
Despite this, investors seem to be relieved. That's going off the current Lottery Corp share price, which is up a healthy 4.17% at the time of writing to $5.38.
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What does the latest Lottery Corp dividend look like?
But let's talk dividends.
Lottery Corp has revealed that its first dividend of 2026 will come in at 8 cents per share. As is the company's habit, it will come with full franking credits attached. This interim dividend matches last year's equivalent payout, also worth 8 cents per share. Together with the final dividend, worth 8.5 cents per share, that was paid out in September of last year, it keeps Lottery Corp's full-year payouts at 16.5 cents per share.
Lottery Corp has nominated 25 February (next Wednesday) as this payout's ex-dividend date. So if any investor doesn't yet own Lottery Corp shares but wishes to receive this dividend, they will need to have shares in their name by market close on 24 February. The dividend pay day has then been set for 26 March next month.
Perhaps concerningly for investors, the interim dividend that was announced today represents a payout ratio of 103% of earnings. That's something you may have clocked, given that Lottery Corp's EPS for the period was just 7.8 cents per share. Perhaps this can be excused, given the apparently erroneous dip in jackpot conditions. However, the company did pay out 100% of its earnings as dividends over the full 2025 financial year. This indicates that it is hitting its speed limit when it comes to dividends. So income investors should certainly keep an eye on Lottery Corp's financials over the rest of 2026.
Lottery Corp shares are currently trading on a (trailing and forward) dividend yield of 3.07%.
