Tatts Looks to Online Gambling After Poker Machine Losses
As online gambling becomes more popular, the lotteries group Tatts is approaching the Internet market with an eye toward growing its operations in the area. The group’s own online holdings are becoming more successful all the time, and Tatts is now preparing to expand and move its operations to Brisbane.
Just recently, Tatts announced that its profits had dropped somewhat in the six months prior to December 31. Previously, it had made $166.9 million, but a net profit reduction of 23.1 percent brought profits down to $128.3 million in this latest period. The group said that the main reason for its sudden drop in profits was the loss of their Victoria pokies license in August 2012. As a result of the license loss, the group had been forced to discontinue their poker machines business.
The Future Looks Bright
Despite the downturn related to the loss of its poker machine operations, Tatts saw its net profits climb for activities that continued. The total increase for those areas was 25.8 percent up to $108.7 million. At the same time, revenue from online lotteries rose by a staggering 52 percent. Meanwhile, online wager sales increased to the tune of 22 percent.
The chief executive of Tatts, Robbie Cooke, has commented that the group’s online future is promising. Growing profits and developing opportunities online are paving the way for the group to fulfill big plans. Naturally, Tatts is already developing a host of new ideas about how it can extend its holdings in this market, but it is keeping these ideas under wraps in order to secure the market first.
Key Areas That Stand Out
There is no doubt that Tatts gambling holdings are rising on the whole, but certain parts of their group are growing faster than others. Part of its progress has been bolstered by the leadership of Robbie Cookie, who left his head position at Wotif.com for the opportunity at Tatts. According to Mr. Cooke, Tatts has had massive success early in the 2012-13 financial year, and lotteries were a major player in those profits. In terms of numbers, lotteries profits rose by 20 percent all the way to $1.1 billion, with much of the rise occurring thanks to a fantastic year for Powerball and the Oz Lotto.
The increased profits resulting from online lotteries are backed up by numbers. For example, TattsBet had revenue increases of seven percent that brought its total to $344.9 million. This was partly thanks to the greater win rates associated with TOTE Tasmania, a group bought by Tatts in March 2012.
Better Than Last Year
According to market values and group calculations, the financial year’s second half is already off to a good start. Compared to last year, win rates are also getting significantly better. This is a major cause for optimism for Tatts executives. Just yesterday, Tatts market shares closed slightly lower than it opened, being reduced by 6c to $3.25 at the end of the day. Ultimately, an 8c interim dividend per share was declared.