Tabcorp Holdings has delivered EBITDA growth of 10.3% to $431.7 million despite revenue climbing just 0.8% to $2,636.3 million, demonstrating that operational leverage and cost discipline are beginning to pay dividends from the company’s turnaround strategy. The earnings-before-interest-tax-depreciation-amortisation figure outpacing revenue growth signals improving unit economics across the business, a development that should encourage investors watching whether the company can continue this trajectory.
The standout metric is the 140 basis points improvement in EBITDA margin to 16.4%, underpinned by underlying cost reduction of 0.8% on a like-for-like basis. This margin expansion on relatively flat topline revenue suggests that Tabcorp’s focus on strategy execution is yielding tangible results. Within the wagering and media segment, the company achieved revenue growth of 0.7% while EBITDA expanded 9.9%, while the integrity services division showed stronger momentum with 3.3% revenue growth and 12.0% EBITDA expansion. These divergent trends within each division point to effective operational management in core wagering and faster growth opportunities in the compliance and integrity space.
Net profit after tax before significant items surged 43.6% to $71.1 million, substantially outpacing the EBITDA growth rate and reflecting both improved operational performance and lower finance costs as the company worked down leverage. Net debt stands at $533 million, down meaningfully on the prior year, with financial leverage contracting to 1.2 times EBITDA. This strengthened balance sheet provides meaningful flexibility for shareholder returns and capital deployment, areas where the board is already signalling intent through a 50% increase in the full year dividend to 3.0 cents per share, including a final dividend of 1.5 cents per share.
Operationally, the company made progress on several fronts. Domestic wagering turnover inched up 0.9%, though underlying strength in sports betting, which grew 8.3%, and digital-in-venue product, up 9.1%, was partially offset by softer traditional channels. The business is also rolling out new betting terminals, implementing a revamped retail commercial model, and introducing the TAB LIVE in-play product, all of which could support growth momentum if consumer adoption follows expectations. Outside the half-year close, the company secured industry agreement on a National Tote and announced a conditional acquisition of wagering technology provider BetMakers, suggesting management is confident in deploying capital toward growth initiatives.
Investors should monitor execution on the new product rollout and whether the BetMakers acquisition delivers the technology uplift and competitive advantage implied by the transaction. The path to sustaining or accelerating EBITDA growth beyond cost savings will ultimately depend on whether these strategic initiatives arrest the modest revenue headwinds Tabcorp has faced. The announcement is price sensitive and has been classified as material by the ASX.
View the full ASX announcement (PDF)
About Tabcorp Holdings Limited (ASX: TAH)
Tabcorp Holdings Limited is Australia’s leading wagering and lotteries operator, providing betting services on racing, sports, and other events. The company operates The Lott, which manages official lotteries across Australia, and offers wagering products through various channels including digital platforms. It operates primarily in Australia and is a major provider of gambling services to the Australian market.
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