Tatts on track to lift second half profit

February 23, 2012

Gambling firm Tatts Group has lifted its first half profit by 11 per cent and says it is encouraged by the outlook for the rest of the financial year.

The group on Thursday said its net profit rose to $166.88 million for the half year to December 31, from $149.9 million in the previous corresponding period.

Revenue from continuing operations rose to $1.97 million from $1.89 million.

"The outlook for the second half of the current financial year is encouraging," the company said in a statement.

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"Nothing we can see suggests that our first half performance is not sustainable into the second half, largely because of our confidence in the foundations laid for each of the businesses over the past two years.

"Additionally, the results for the second half of the previous financial year were affected by two very significant weather events in Queensland during January."

However, Tatts said there would be some one-off restructuring costs associated with the replacement of the third party lottery system in NSW with the Tatts system and the integration of Tote Tasmania during the second half.

It said the costs would be partly offset by the anticipated earnings from Tote Tasmania.

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The group's first half profit rise was partly driven by a strong performance by its lotteries business, which was underpinned by Saturday lotto sales and an unprecedented jackpot roll in NSW.

The group's fixed odds betting business, TattsBet, also increased its earnings, despite a fall in sports betting win rates.

The company said it expected even stronger revenue and profit growth for the betting business in the second half.

Tatts declared a fully-franked interim dividend of 11 cents a share, up 4.8 per cent on the previous corresponding period.