New Zealand’s Tab NZ has reported NZ$26.5m (£13.4m/€15.7m/US$18.5m) in comprehensive profit for the first half of its financial year, thanks to growth in staking and revenue.
Overall revenue for the six months to 31 January 2021 amounted to $193.5m, up 3.8% on the previous year, when the Racing Industry Transition Agency (RITA) oversaw operations. RITA transitioned to Tab NZ in August of 2020 in line with the country’s 2020 Racing Industry Act.
Net betting revenue climbed 12.0% year-on-year to $164.7m, helped by favourable results in racing and fixed-odds sports, as well as a rise in turnover.
However, net gaming revenue slipped 2.7% to $14.6m, which Tab NZ said was consistent with a decline in gaming turnover. Other revenue was also down 41.8%, mainly due to an $8.0m fall in venue service cost recoveries to support the industry’s post-lockdown reopening.
Overall betting and gaming turnover was up 5.9% from $1.50bn in the first half of the previous year to $1.59bn. Tab NZ noted this was 14% ahead of expectations for the period.
In terms of expenses, turnover-related costs for the first half stood at $40.5m, up 2.8% on last year, but operating costs were reduced from $71.5m to $58.5m.
This left $94.5m in profit before distributions, an increase of 25.2% on the previous year.
Distributions to racing codes totalled $63.2m and Tab NZ also noted $4.8m in provision for undistributed gaming surplus, which left a net profit of $26.5m, up from a $15.6m loss in H1 of 2020.
Tab NZ said the three racing codes actually received $83.2m in distributions and other funding in H1. This comprised the $63.2m from Tab NZ’s operations, as well as $9.8m from betting information use charges; $3.5m from the repeal of the Betting Duty and $6.6m via a government support package for the racing industry.
More than $6.2m was distributed in commission payments to national sporting organisations, down 5% from FY20 due to reduced sport content during the year as a result of Covid-19.
“With this strong start, combined with the positive performance during the first half of this year, Tab NZ operated with a strong working capital and balance sheet position enabling it to further invest into the future and continue supporting the racing industry and sport,” Tab NZ said.