Tabcorp Holdings Limited. Investor Day

Transcription

1 Tabcorp Holdings Limited ABN Investor Day 17 October 2013 Draft version 15 ( ) 1

2 Tabcorp senior leadership team TABCORP CEO & MD David Attenborough CFO Damien Johnston MD Fixed Odds Craig Nugent Exec GM Corporate Legal & Regulatory Kerry Willcock Exec GM Distribution Adam Rytenskild Exec GM Commercial Development Doug Freeman Exec GM Marketing David Ginnane Exec GM Human Resources Merryl Dooley COO Media & International Brendan Parnell CIO Kim Wenn 2

3 Agenda Priorities Capital David Attenborough Damien Johnston Wagering Market Trends Doug Freeman Wagering: A) Customer Wagering: B) Channel Wagering: C) Product Media and International Keno Gaming Services David Ginnane Adam Rytenskild Craig Nugent Brendan Parnell David Ginnane Adam Rytenskild 3

4 Tabcorp has an attractive investment case Quality integrated gambling entertainment businesses Long dated licences Strong trusted brands Unique multi-product / multi-channel distribution Geographic diversification Strong cash generating businesses and defensive earnings profile Product and technology innovation to lead both retail and digital channels Driving growth from new investments Business model underpinned by strong relationships with stakeholders 4

5 Key priorities Capital Optimise the use of and return on invested capital Wagering Lead wagering transformation Media & International Enhance integration with wagering Keno Drive growth through product expansion Gaming Services Grow through venue, product and interstate expansion Underpinned by the ability to attract, develop and retain talent 5

6 Capital - Damien Johnston 6

7 Optimise the use of and return on invested capital Returns Increase return on invested capital Productivity Drive group-wide productivity improvement Balance sheet Maintain strong balance sheet 7

8 Tabcorp s objective is ROIC of at least 14% by FY16 14%+ 12% FY13 FY16 Notes: 1. Return on Invested Capital (ROIC) is calculated as EBIT / Invested Capital (average of opening and closing Invested Capital for a year) 2. EBIT is Earnings Before Interest & Tax before significant items 3. Invested Capital comprises shareholders equity plus Net Debt. Invested Capital at 30 June 2013 was $2,529 million 4. Net Debt includes US$ debt at the A$ principal repayable under cross currency swaps 5. Assumes no material changes to current regulatory, taxation and racing industry arrangements 8

9 Drive group-wide productivity improvement Productivity is a key focus: FY13 opex/revenue of 21% Target opex/revenue of 20-21% FY13 Operating Expenses $423m Employment Project Future Fit commenced in FY13 to identify opportunities to improve operating processes and practices. Initiatives identified include: Property optimisation Renegotiation of certain supplier contracts Continued focus on discretionary expenses Enhancing our people capability in key growth areas Advertising & promotions Other Property 9% 25% 10% 20% 36% Communications & technology Source: Income statement for the year ended 30 June

10 Maintain strong balance sheet $m Well diversified debt structure Investment grade credit rating Refinancing underway with bank facility extended. Focus on May 2014 bond maturities FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 Bank facilities Medium Term notes (May 2014) Tabcorp Retail bonds (May 2014) Tabcorp Subordinated notes US Private Placement Notes Tabcorp Subordinated Notes mature in March 2037, however illustrated above at the first call date in

11 Wagering market trends Doug Freeman 11

12 The wagering market has shown consistent growth Australian Wagering Market Annual Turnover ($b) FY01 - FY07 FY08 - FY13 CAGR 7.9% 4.1% FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Source: ARB Fact Books, internal Tabcorp data, includes some estimates 12

13 Tabcorp s share of wagering turnover Tabcorp market share has remained relatively stable since the recent increase in competition Share of turnover 57.2% 57.5% 55.7% 56.3% 55.6% 56.4% 42.8% 42.5% 44.3% 43.7% 44.4% 43.6% FY08 FY09 FY10 FY11 FY12 FY13 TAH share Other Source: ARB Fact Books, internal Tabcorp data, includes some estimates 13

14 Tabcorp total wagering revenue CAGR of 4.7% since ,900 1,700 1,500 1,300 1, FY08 FY09 FY10 FY11 FY12 FY13 Growth on pcp % 7.6% 5.2% 0.5% 4.2% 5.9% Fixed odds expansion, yield improvement, Trackside, and international have contributed to the 4.7% CAGR Notes 1 Total revenue includes the Victorian JV partner interest, NSW represents 100% of revenue 14

15 Lead wagering transformation Customer Drive deep customer relationships Channel Digital leadership, underpinned by exclusive retail network Product Expand product and optimise yield 15

16 Wagering customer - David Ginnane 16

17 Drive deep customer relationships Customer Base Channels Brands Total Customers TAB 1 1,850,000 Luxbet 40,000 Trackside 1 220,000 Sky Racing 2 1,500,000 Total Est. customer base 2,000,000+ Unparalleled breadth of customers, channels and brands in the domestic category underpins comprehensive customer insights and relationships Notes 1 Internal Tabcorp data, includes some estimates 2 Represents active viewers 17

18 Customer acquisition and engagement continues to grow 350,000 TAB account customers 300, , ,000 CAGR FY10 FY13 6.4% 5.7% 150, ,000 50,000 0 FY10 FY11 FY12 FY13 Active customers Acquired customers Unique active customers: customers who placed a bet during the financial year Acquired customers: new customers who signed up to a TAB account and placed a bet during the financial year 18

19 The new TAB brand is the category leader in customer preference NSW First Choice Seriously consider Might Consider Never Consider Nearest ranked competitor (1) Nearest ranked competitor (2) VIC First Choice Seriously consider Might Consider Never Consider Nearest ranked competitor (1) Nearest ranked competitor (2) Source: Millward Brown Brand Health Monitor, Autumn

20 Analytics, CRM and loyalty Sophisticated analytics, CRM and loyalty capabilities support Tabcorp s leadership position Scale and analytics tools driving a big data advantage Talent sourced from a range of highly developed CRM categories, including the UK wagering sector Analytics CRM Loyalty Expansive customer and transactional information: Products Customers Transactions Highly targeted messaging and content: Right offer Right channel Right time Expands depth and breadth of customer data: Retail and account NSW and VIC Brings CRM to retail 20

21 Customer retention rates improve as CRM accelerates 90% Customer retention rates 85% 85% 88% 85% 86% 84% 82% 86% 81% 85% 79% 84% 83% 80% 79% 82% 80% 82% 79% 83% 81% 86% 85% 61% 59% Post-SRC effect CY12 retention rate CY13 retention rate Note: seasonality applies Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Uplift in underlying retention despite increasing competition Retained customers worth ~3 times value of new or reactivated customers Retention rate: % contactable customers who placed a bet in a given month, as well as the preceding month 21

22 Loyalty program 1:1 communication to retail cash customers TAB Rewards member base (est FY14) Account members Retail cash members Customer retention rates underpinned by account customer CRM program New loyalty program brings CRM to retail cash customers Newly identified customers are folded into the CRM program 22

23 Our social and digital platforms provide extensive reach Facebook: translates retail and on-course experiences into digital experiences Twitter: rapid communication of product, price, event and service information YouTube: new TAB branded YouTube page launch Social platforms driving extremely high and growing volumes of viewing impressions, further strengthening our customer insights and relationships 23

24 Wagering channel - Adam Rytenskild 24

25 Digital leadership, underpinned by exclusive retail network Wagering Turnover by Channel 9% 11% 17% CAGR 3.5% 10% 8% 24% 63% 58% FY10 FY13 Retail Digital Call centre Other Wagering distribution channels work together for overall growth Customers enjoy the multi-channel offering with 66% of account deposits in cash in retail Rapidly increasing digital turnover driving overall growth Further integration of retail and digital will make both stronger 25

26 Digital and retail strategies 1. Digital strategy for TAB and Luxbet Increase capability and scale Enhance mobile Digital pathway 2. Retail and digital integration Self-service Digital information displays Digital incentive program 3. Retail Extract full value from exclusive retail channel 26

27 Increase digital capability and scale In-housing and increasing digital capability to accelerate speed to market Digital team to build to 40 people by January 2014, offset by saving of third party expenses Digital leadership roles recruited in Commercial, Marketing and Technology. Previous expertise: 3 Mobile, Telstra/Big Pond Media Google and BT REA Group (realestate.com.au) External hire, previous experience: REA Group / realestate.com.au Increased agility driving improved speed to market 27

28 Enhance mobile Mobile platform in place, continued enhancement to drive future performance Mobile driving digital growth At least 6 major releases for iphone, ipad and Android each year to drive continuous improvement Luxbet and Sky Mobile integrated to development Tabcorp digital turnover CAGR 16% 49% 51% FY10 FY11 FY12 FY13 Mobile device Desktop Today 28

29 Digital pathway Provide the best experience on chosen device across all TAB channels & Luxbet Continue to enhance current TAB.com.au and Luxbet.com Speed to load on TAB.com.au improved more than 50% in last 12 months New Luxbet site released in September 2013 HTML pathway Lite.TAB.com.au (racing only) website optimised for tablet released October 2013 TAB.com.au Mobile site Self-service and then operator terminals in Retail Developing a consistent experience across all devices Lite.TAB.com.au 29

30 Retail and digital integration Self-service acts as the middle ground for retail and digital transactions Self Service Terminal (SST) expansion has extended reach and improved customer experience Digital platform in place - self-service to be integrated and then operator terminals Digital form/information integration pathway to paperless Digital incentive for top-tier venues (pilot complete) No. of SST s c 4,700 SST turnover $b 3.3 SST % of retail turnover +80% 48% +126% 40% c 2,600 30% % 40% 48% FY10 FY13 FY10 FY13 FY10 FY11 FY12 FY13 30

31 Extract full value from exclusive retail channel Retail foundation secured network expansion complete increasing footprint 13% FY10-FY13 Tiered venue model, supported by an efficient Kiosk offer, has enabled extended reach Sales team re-structured to drive top tier performance Improve channel margin via appropriate venue incentives, e.g. venues legends league Targeted top-tier refresh continues (partly venue funded) 31

32 Fixed odds wagering product - Craig Nugent 32

33 Tabcorp continues to be the fixed odds market leader Tabcorp is Australia s largest bookmaker and is maintaining market leadership via its two brands TAB and Luxbet Our dual brand strategy allows us to offer customers all wagering products, across all distribution channels FY13 Fixed Odds Revenue Tabcorp NT Corporate Bookmakers TAB Fixed Odds Luxbet 9 Wagering Operators $404m $39m *$500m * TAH estimate, excludes Luxbet 33

34 Fixed odds racing - growing tickets, turnover and yields Tickets (millions) Turnover $m 46 1, ,660 Ticket and turnover growth shows the popularity of fixed odds racing 16 FY11 FY12 FY FY11 FY12 FY13 Fixed odds racing accounted for 25% of the win and place racing revenue in FY13 Revenue $m Yield % % Revenue growth is exceeding turnover growth % 12.4% FY11 FY12 FY13 FY11 FY12 FY13 34

35 Fixed odds sport market remains competitive Tickets (millions) Turnover $m ,259 1,326 1,245 Turnover performance impacted by shift in customer mix FY11 FY12 FY13 FY11 FY12 FY13 Revenue $m Yield % % Growth in yields driven by enhanced risk management 11.7% 12.4% FY11 FY12 FY13 FY11 FY12 FY13 35

36 TAB has increased people and technology capability Risk Management Structure 64 Employees Enhanced risk management structure driving more quality product at better yields Racing Team Sport Team Fixed odds risk management employees have increased by over 50% since FY11 Algorithm based customer scoring system provides real time risk Harness, Greyhounds & International NSW Victoria Queensland Live Domestic Football and Other Soccer Tennis US Sports assessment Intercept and partialling selected bets across all channels Analysts Algorithm based scoring system 36

37 Fixed odds products expansion Expansion of fixed odds products - a key driver of revenue growth FY14 fixed odds product expansion: Expanded books in greyhounds and harness to maintain market leadership Automated Market Management (AMM) Sports books scaled to match global offering thousands No. of Racing Books thousands No. of Sport Books FY11 FY12 FY13 - FY11 FY12 FY13 37

38 Multi-bets remain a key driver of fixed odds performance The sports turnover to revenue conversion remained strong in FY13 Multi-bets represented 38% of turnover, converting to 66% of revenue due to the higher yields 100.0% 80.0% Single bets Single bets 60.0% 40.0% 20.0% Multi- bets Multi- bets 0.0% Turnover Revenue 38

39 International sports product continues to grow in popularity American sports growth is outperforming domestic sports A diversified sports offering leaves Tabcorp less susceptible to a series of abnormal results in any one sport Product fees to sports controlling bodies are payable on domestic sports A key focus in FY14 will be the Soccer World Cup in partnership with Football Federation Australia and broadcaster SBS 25.0% TAB Sports Product Sales Share 20.0% 15.0% 10.0% 5.0% 0.0% AFL Rugby League Soccer Tennis US Sports Cross Sport Multi FY12 FY13 Other 39

40 Yield optimisation will continue to be a focus Fixed Odds Racing Revenue $m Yield Customer demand for fixed odds % racing increasing % Higher levels of pari-mutuel % substitution in < $20 range, with favourable impact on yields <= $20 > $20 to <=$200 > $200 Fixed Odds Sport Revenue $m <= $20 > $20 to <=$200 > $200 Yield < $20 bets made up 41% of parimutuel win and place turnover in FY % 16.5% In sport, the yield for bets up to $20 is the highest at 27.3%, largely driven by multi bets 6.9% <= $20 > $20 to <=$200 > $200 <= $20 > $20 to <=$200 > $200 40

41 The Luxbet offering differs to TAB and growth is continuing Turnover $m Revenue $m FY10 FY11 FY12 FY FY10 FY11 FY12 FY13 68% of Luxbet Sales are derived from Credit and Tote derivative products which are not able to be offered by TAB Wagering 3.8% Yield % 4.9% 6.1% EBITDA $m FY10 FY11 FY12 FY13 42% Revenue growth in FY13 was best in Corporate Bookmaker category 2.5% FY10 FY11 FY12 FY

42 Key drivers of Luxbet s performance Significant growth in active customers in FY13 following the successful relaunch of the Luxbet brand in 2012 Active customers increased 37% while average cost per acquisition (CPA) fell ~6% Direct customer acquisition of 63% in FY13, up from 45% in FY12, has driven an improved customer mix and better net yields Luxbet Performance Customer Acquisition Channel Active customers (year end) 28,700 39,448 Average Revenue per active customer $970 $1,012 Average CPA $268 $251 Affiliate Customer Acquisition 1 Direct Customer Acquisition Notes 1 Customers who are acquired through third parties 42

43 Luxbet has a broad and innovative product range Best of the best in racing AFL and NRL markets expanded AFL Fantasy football Integrated with social wagering site favourit 43

44 Media and International - Brendan Parnell 44

45 Enhance integration with wagering Product Secure rights and broaden product base Customer experience Expand digital media and optimise content International Expand international co-mingling and export of racing 45

46 Sky Racing world leader in race broadcasting Sky and Wagering a symbiotic relationship Betting stimulated by synchronised racing vision and commentary Promoting betting through data, vision and audio display International and local relationships foster wagering and sustain racing Business overview Sky Racing: a multi-platform, multi-media network Sky Racing channels Sky Sports Radio Sky Racing digital (web, apps, media services) TV Channels Radio Extensive network coverage 5,400 retail outlets hotels, clubs and TABs Pay TV across 2.4 million homes International growth Export to 51 countries Importing international race content from 10 countries Co-mingling Retail Homes Digital 46

47 Secure rights and broaden product base Aim to secure and extend rights Renew TVN media rights Extend media rights portfolio Broaden base of product Expanded wagering day Sports betting content integration Thoroughbred Type Race Meets Media Rights Overview Rights Held New Media QLD/NT 517 WA 259 SA 177 ACT 26 TAS 70 Internat l 1,854 Greyhound & Harness AUS & Internat l 5761 NSW and VIC t breds X 2 Note: 1. TVN content is 16.6% of Australian race meetings FY13 (excludes International races) 2. Telstra currently holds TVN s New Media rights. 47

48 Expand digital media and optimise content Expand digital media Seeking TVN digital content Unique digital services - Watch & Bet Customisable products i.e. Dual screen player TAB-SKY Watch & Bet Optimise content to support wagering Race scheduling enhancement Wagering display enhancements Fixed odds integration Dual Screen Media Centre Weekly Digital Stats 1 # s 1 Growth on pcp Internet Page Views 851k +33% Internet Visits 153k +74% Digital Visitors All 2 413k +4% Note: 1. Weekly figures for w/c 29 September 2013; 2. App, web and Sky Form consumers 48

49 Expand international co-mingling and export of racing Co-mingling includes Direct or Indirect as well as Hosting and Guesting. Benefits include: Increased pool liquidity Enhanced viability of product Tabcorp International provides a 1 stop shop Integrated form, data & vision (multi-language, multi-media) Co-mingling Co-mingling expansion plans PGI the global tote gateway Expanded Hosting and Guesting Connecting Asia Chinese digital form guide Continued focus on strategic partnerships (HK, NZ, Sth Africa, Singapore) 49

50 Keno - David Ginnane 50

51 Drive Keno growth through product expansion Customer Increase participation by lotteries and EGM players Product Extend and develop product range Channel Drive optimal retail experience 51

52 Increase participation by lotteries and EGM players Tabcorp s Keno customers are awarded more than $68m per month in prizes Games are offered on average every 3 minutes Prizes range from $1 to multi million dollar jackpots 8,000 Australian Lotteries FY13 Turnover ~$6.9 billion Turnover ($m) 7,000 6,000 5,000 4,000 3,000 2, ,008 1,064 CAGR FY07 FY13 Total 5.1% 4.3% 6.9% 4.8% 1,000 0 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Lotteries TAH Keno Non TAH Keno Source: Tabcorp estimates based on Annual Reports, internal data 52

53 Increase participation by lotteries and EGM players There are opportunities to shift share of the gambling wallet with a compelling Keno product and prize offers Keno customer cross-product utilisation (%) Play Trackside 14% Play poker machines 65% Bought scratch cards 60% Play Lotto 84% Source: Millward Brown Health Monitor Spring

54 Extend and develop product range Product innovation is core to refreshing the Keno proposition to existing and new customers Keno Racing Jackpot Pooling Keno Roulette Pilot underway in QLD Animated racing offer Fixed odds pay table Intention to pool jackpots Accelerates win frequencies Regulatory approvals being sought NSW only Traditional roulette bet types Targets younger hotel patron 54

55 Drive optimal retail experience Leveraging the strengths of our expansive Keno retail channel of 3,500+ outlets continues to be a major focus Keno Touch Keno Player Card Brand Engagement VIC, NSW and QLD Expanded transaction points TAB self-service familiarity Favourite games and numbers Customer win notifications Powerful CRM enabler New sales team structure Engagement & product adoption Brand ambassador teams 55

56 Gaming Services - Adam Rytenskild 56

57 Grow through venue, product and interstate expansion Customer Expand value added services Expand in Victoria Drive performance to generate new venue sign-ups Expand interstate Expand TGS into other jurisdictions, an initial focus on NSW 57

58 Solid foundation laid in first year TGS Model: Built on core gaming expertise Long term contracts; 75% 10 years, 25% minimum 6 years Transportable to other jurisdictions, especially where other Tabcorp businesses exist Product: over 3,000 new EGMs and Game upgrades deployed since April13 Loyalty: The Diamond Rewards program is unique, with 130,000 active members Service offer: 30 TGS venues refurbished, supported by TGS 58

59 Value added services EGM procurement - large scale purchase and exclusivity of key machines EGM advice and business intelligence floor analysis, product mix and predictive analytics Loyalty - Customer behaviour analytics - tailor product and service to local customer Venue design and project management Responsible Gambling - Dow Jones Sustainability global index leader Provider EGMs Supply EGMs Business Intelligence Break Fix Loyalty BDMs Venue Design TGS 8,440 Competitor 1 1,817 Competitor 2 1,793 Competitor 3 1,388 Competitor 4 1,024 Competitor Competitor RSG Source: Tabcorp estimates 59

60 Expand value added services In-EGM loyalty will further differentiate TGS TGS expected to gain first-mover advantage in the Victorian market for in-egm loyalty, with exclusive distribution of the IGT Advantage system First with Voluntary Pre-Commitment capability in Victoria The system provides differentiation for TGS via: Loyalty points for customers redeemable in-venue Advertising and messaging on EGMs Ability to promote offers to customers Provides platform for Voluntary Player Pre Commitment 60

61 Drive performance to generate new sign-ups TGS growth levers include machine top ups, key account expansion and new account acquisition Performance drivers in place and building Focus on value for Key Account partners to drive performance Product mix and speed to market Expert new machine/game advice and seamless deployment Diamond Rewards and in-egm launch Loyalty Zone Customer service program Venue design expertise with a whole-of-venue focus TGS targeted Victorian expansion In-EGM Loyalty expansion a key initiative to capture increased market share Build scale and team capability to deliver growth post foundation year 61

62 Expand TGS into other jurisdictions An initial focus on NSW Well understood market due to existing wagering and keno business Mid-sized Clubs a sizeable immediate market 2-3 TGS venues initially to demonstrate performance 1,186 EGM s 42,730 EGMs NSW Key Milestones Dealer s Licence Gaming Services Agreement Industry Engagement Venue Readiness Status Formal approval pending 0 EGM s 12,744 EGM s EGMs do not include casinos 26,202 EGMs 2,379 EGMs 93,933 EGMs 62

63 Conclusion Long term licences Unique multi product / multi channel customer proposition Experienced management team Focus on increasing returns 63

64 Appendix: Business overview Product Brands Licence expiry % EBITDA Retail distribution Wagering NSW 2097 Victoria 2024 NSW 2,130 outlets Victoria 750 outlets 260 with oncourse wagering facilities NSW 2097 Victoria % NSW 2,100 outlets Victoria 750 outlets NT 2015 Keno NSW 2022 Queensland 2047 Victoria % Queensland 1,170 outlets NSW 1,800 outlets Victoria 680 outlets TGS n/a 13% 8,440 EGMs contracted 166 outlets Media n/a 14% 5,400 retail outlets Broadcasting from 200 Australian racetracks Above statistics are as at 30 June 2013, rounded % EBITDA based on FY13 results 64

65 Disclaimer This Presentation contains summary information about Tabcorp Holdings Limited (Tabcorp) and its subsidiaries (Tabcorp Group). It should be read in conjunction with the Tabcorp Group s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange (ASX), which are available at The information contained in this Presentation is of a general nature and has been prepared by Tabcorp in good faith and with due care but no representation or warranty, express or implied, is provided as to the correctness, quality, accuracy, timeliness, adequacy, reliability or completeness of any statements, estimates or opinions or other information contained in this Presentation. To the maximum extent permitted by law, each member of the Tabcorp Group and their respective directors, officers, partners, employees, advisers and agents and any other person involved in the preparation of this Presentation (each a Disclaiming Party) disclaim all liability and responsibility (including, without limitation, any liability arising from the fault or negligence on the part of any Disclaiming Party) for any direct, indirect or consequential loss or damages which may be suffered by a recipient through the use of or reliance on anything contained in or omitted from this Presentation. This Presentation is for information purposes only and is not a prospectus, product disclosure statement or other disclosure or offering document under Australian or any other law. This Presentation does not constitute an offer, invitation or recommendation to subscribe for or purchase any security and neither this Presentation nor anything contained in it shall form the basis of any contract or commitment. This Presentation is not a recommendation to acquire Tabcorp securities. The information provided in this Presentation is not financial product advice and has been prepared without taking into account any recipient's investment objectives, financial circumstances or particular needs, and should not be considered to be comprehensive or to comprise all the information a recipient may require in order to make an investment decision regarding Tabcorp securities. All dollar values are in Australian dollars (A$) unless otherwise stated. No Disclaiming Party warrants or guarantees the future performance of Tabcorp or any return on any investment made in Tabcorp. This Presentation may contain certain 'forward-looking statements'. The words 'anticipate', 'aim', 'believe', 'expect', 'project', 'forecast', 'estimate', 'will', 'likely', 'intend', 'should', 'could', 'may', 'target', 'plan' and other similar expressions (including indications of 'objectives') are intended to identify forward-looking statements. Indications of, and guidance on, financial position and performance are also forward-looking statements. These statements may involve significant elements of subjective judgement and analysis. No Disclaiming Party makes any representation or warranty, express or implied, as to the fairness, accuracy, completeness, correctness, likelihood of achievement or reasonableness of any forecasts, forward-looking statements or projections contained in this Presentation. Such forecasts, forward-looking statements or projections are not guarantees of future performance. Any such forecasts, forward-looking statements or projections contained in this Presentation have been based on Tabcorp's intent, belief or current expectations with respect to its business and operations, market conditions, results of operations and financial condition, risk management practices and other future events as at the date of this Presentation and are subject to significant uncertainties, risks and contingencies, many of which are beyond the control of the Tabcorp Group, that could cause actual results to differ materially from the intentions, beliefs and expectations expressed or implied. You are cautioned not to place undue reliance on forecasts, forward-looking statements or projections. Except as required by law or regulation (including the ASX Listing Rules), Tabcorp undertakes no obligation to publicly update these forward-looking statements. In particular, forward-looking statements are underpinned by certain market, operational, financial, regulatory and other assumptions. An investment in Tabcorp is also subject to investment risks including possible loss of income and principal invested. Certain key risks that may affect the Tabcorp Group, its financial and operating performance and the accuracy of any forward-looking statements included in this Presentation include (without limitation): (i) changes in the regulatory environment (including taxes and levies), (ii) changes to race field fees, (iii) the suspension, cancellation or termination of the Tabcorp Group's wagering, gaming and other licences, (iv) relevant racing industries failing to provide programs of events, (v) the minimum financial performance arrangements applying in favour of the Victorian racing industry under the Victorian joint venture, and (vi) Tabcorp being able to renegotiate its key broadcast arrangements on satisfactory terms. For further information, see section 5.3 (Risk factors associated with the Tabcorp Group) of the prospectus, dated 22 February 2012, relating to the issue of Tabcorp Subordinated Notes. Past performance information given in this Presentation is given for illustrative purposes only and should not be relied upon as (and is not) an indication of future performance. 65

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