Tabcorp Holdings Limited (ABN ) Tabcorp Holdings Limited (ABN )

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1 1 Tabcorp Holdings Limited (ABN ) Tabcorp Holdings Limited (ABN )

2 Wagering segment of the gambling market Tabcorp has improved market share in a highly competitive environment TOTAL AUSTRALIAN WAGERING SEGMENT ONLINE AUSTRALIAN WAGERING SEGMENT Turnover ($b) (5.1%) 6.1 (25.2%) 6.0 (24.9%) Growth FY10 FY11 Total = 4.6% 12.8% 3.5% 6.7% 1.4 (5.5%) 6.3 (25.2%) (25.4%) % (43.8%) (44.5%) Growth FY11 FY12 Total = 3.1% 16.5% (0.9%) 3.3% 3.6% 1.6 (6.3%) 6.3 (24.2%) 6.6 (25.5%) 11.4 (44.0%) % of All FY10 FY11 FY12 Channels: 32.1% 35.5% 37.6% Turnover ($b) (14.4%) 3.4 (44.5%) 1.3 (17.1%) 1.9 (24.0%) Growth FY10 FY11 Total =15.6% 12.8% 4.9% 37.9% 21.1% 1.3 (14.1%) 3.6 (40.3%) 1.8 (20.4%) 2.2 (25.2%) Growth FY11 FY12 Total = 9.3% 16.5% 6.8% 4.5% 13.3% 1.5 (15.0%) 3.8 (39.4%) 1.9 (19.5%) 2.5 (26.1%) - FY10 FY11 FY12 - FY10 FY11 FY12 Note: The above includes Interstate TAB s Premium Customer turnover in the Online channel. When online premium volume is excluded Tabcorp s market share estimates are 25% in FY10 increasing to 28% in FY12 Betting Exchange Bookmakers Other TABs Tabcorp Source: Tabcorp estimates based on Australian Racing Fact Books FY10-12, Annual Reports, internal data as at March

3 Online Racing and Sport segments Tabcorp has grown turnover in the Racing and Sport segments of the market ONLINE RACING WAGERING SEGMENT % of All FY10 FY11 FY12 Channels: 28.7% 32.1% 33.9% ONLINE SPORTS WAGERING SEGMENT % of All FY10 FY11 FY12 Channels: 52.6% 53.9% 58.4% Turnover ($b) Growth Growth FY10 FY11 FY11 FY12 Total =15.7% Total = 9.3% 0.9 (11.7%) 0.8 (11.0%) 16.5% 0.7 (11.3%) % 2.6 (36.4%) (37.5%) 2.5 (43.0%) 6.1% 0.7% (25.1%) (24.1%) (20.6%) 5.0% 41.2% (25.1%) (26.4%) (27.8%) 14.9% 21.7% FY10 FY11 FY Turnover ($b) Turnover ($b) (65.4%) (7.5%) (27.1%) Growth FY10 FY11 Total =15.1% 16.8% (1.6%) 18.7% 1.0 (65.9%) Growth FY11 FY12 Total = 9.3% 8.4% 1.1 (66.7%) (5.4%) 0.1 (6.4%) 0.1 (5.7%) % (27.7%) (27.6%) FY10 FY11 FY12 Note: Interstate TAB s include large volumes of Premium Customer turnover in Online channel Note: Sports figures exclude Betfair due to inconsistencies in reporting definitions, specifically regarding the inclusion of foreign customers betting on major Australian events Betting Exchange Bookmakers Other TABs Tabcorp Source: Tabcorp estimates based on Australian Racing Fact Books, Annual Reports, internal data 3

4 Wagering channels strong online turnover growth Wagering is shifting to Digital and Tabcorp is capturing its share Turnover ($b) Tabcorp digital turnover (ex Luxbet) on a 52 week rolling basis 2.4 Sep 12 to Mar CAGR = 18% Jul 10 to Aug 11 Sep11 to Aug CAGR = 20% CAGR = 12% Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 Online drivers Digital wagering turnover represents over 20% of Tabcorp s total wagering turnover Growth driven by: Mobile device penetration Consumer shift to mobile transacting Customer convenience Fixed odds expansion 4

5 Customers get mobile Tabcorp is enhancing the mobile customer experience to maintain its leadership position 40.0% Mobile % of Tabcorp s Online Turnover 41.6% Tabcorp s initiatives Rich experience created for ios and Android devices 30.0% 27.7% Simple, fast betting Integrated form, data and vision 20.0% 10.0% 9.2% 12.9% Customer payment solutions Account opening convenience 0.0% FY12H1 FY12H2 FY13H1 FY13Q3 5

6 Wagering online Customer intelligence & what drives operator choice Tabcorp has a program of customer research that helps drive digital strategy Why bet online? Who bets online? Which channels do online customers use? What drives operator choice? What is the TAB website experience? What is the TAB mobile experience? How can the experience be enhanced? My world Fast Convenient Content Time Focus Privacy Customer typologies Nostalgic sentimentalists Baby steps Confident onliners Digital entertainers Customer channel usage 12% Online only 23% Online and cash 65% Cash only 94% computer 70% mobile phone 43% tablet Brand Speed Reliability Vision Simplicity Product Security Price Website strengths Security Product range Reliability Vision Website improvements Speed Simplicity Mobile Strengths Security Simplicity Product range Vision Mobile improvements Speed Reliability Faster, simpler, easier Tailoring, personalising customising More information, more social, more accessible 6

7 Digital Strategy 1. Utilise cross-channel integration of digital and retail Digital convergence with retail is an opportunity for Tabcorp to identify more customers and communicate with them via CRM Our customers bet with us through multiple channels and expect a consistent experience Retail is an advantage: 70% of account deposits occur in cash in retail outlets 23% of customers use both retail cash and digital Self service terminals remain a key part of our integrated digital strategy consistent with customer devices 7

8 Digital Strategy 2. Simplicity and speed for all interfaces on all devices Samsung IPTV App Improvements to tab.com.au website New simplified Tab.mobi site in 2H13 TAB/Sky Watch & Bet on same ipad screen A world first Samsung Smart TV Overlay App Expanded choice of digital payments TAB/Sky watch and bet Tab.mobi TAB iphone app 8

9 Digital strategy 3. Engage our customers individually Deliver a one-to-one relationship through CRM to increase retention and personalise the betting experience for customers Intelligent personalised wagering interfaces, via customer device of choice Betting wizards and tools Betting tool MY TAB Mini statement, messages, blackbook, coupons iphone app preference settings 9

10 Digital strategy 4. Generation next Integration with social networks and social gaming where appropriate Social media initiatives: Twitter talent, Facebook Likes and exploiting YouTube popularity Tabcorp Talent Twitter - and growing Twitter followers 10

11 Digital strategy 5. Luxbet has a competitive digital offer Use Luxbet to compete on a level playing field with the NT based corporate bookmakers with a highly competitive digital offer Luxbet in FY12 had approximately 10% share of turnover in the corporate bookmaker segment Luxbet is expanding the number of markets covered in AFL and NRL Step up of functionality including: 4 digit pin login Sky audio in app Fixed odds fluctuations Racing form 11

12 Digital strategy 6. Sky is an integral part of Tabcorp s digital strategy Sky media centre skyracing.tv Customers access Sky Racing digital media via internet and mobile including apps (ios and Android) as well as Pay TV (TAB Active) End to end solution with integrated digital media racing assets and integrated wagering Live streams 1 of Sky Racing1, Sky Racing2 and Sky Sports Radio Access to race replays, expert tips, catch up TV, Sky Form and editorial, Sky Predictor tipping service TAB customers access to Sky media centre Integration of media into wagering experience drives digital stickiness, turnover and customer loyalty Digital Media consumption Feb 13 Web videos viewed 1.15m Live streams viewed 0.83m TAB Active red button push 1.21m Notes: 1. Excludes vision of Sydney and Victorian thoroughbred races (TVN). Audio is available 12

13 Summary For Tabcorp, digital wagering is: enhancing customer experience and convenience fast growing higher margin Digital wagering is important as part of our unique multi-channel strategy cross channel integration of Retail, Luxbet and Sky is a key part of our digital future We are continually enhancing our digital offering to enable meaningful one-on-one relationships with customers We will continue to remain at the forefront of emerging consumer and technology trends that support our Digital strategy 13

14 Tabcorp s Business Profile Tabcorp has a unique multi-product, multi-channel gambling entertainment business Product Brand Licence expiry %EBITDA Retail / Live Events Digital / Account International NSW 2097 Vic 2024 NSW 2,130 outlets Vic 750 outlets 270 racecourses Internet, mobile devices, interactive TV, phone Co-mingling with 4 jurisdictions Wagering NSW 2097 Vic % NSW 2,000 outlets Vic 700 outlets NT 2015 Internet, mobile devices, phone Keno NSW 2022 Qld 2022 Vic % Qld 1,120 outlets NSW 1,780 outlets Vic 680 outlets TGS N/A 11% 8,500 + EGMs contracted 170 outlets Media & International N/A 14% 5,400 commercial outlets across Australia Internet, mobile devices, pay TV Exporting to 51 countries (as at Feb 2013) Note: Above statistics are as at 31 December 2012 unless otherwise stated, rounded. % of EBITDA based on 1H13 results for continuing operations 14

15 Disclaimer This presentation has been prepared by Tabcorp Holdings Limited (ABN ) (Tabcorp). Summary information This presentation contains summary information about the current activities of Tabcorp and its subsidiaries (Tabcorp Group). The information in this presentation does not purport to be complete. It should be read in conjunction with Tabcorp Group s other periodic and continuous disclosure announcements lodged with the Australian Securities Exchange (ASX), which are available at No member of the Tabcorp Group gives any warranties in relation to the statements or information contained in this presentation. 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 in relation to the accuracy or completeness of the information. Not an offer 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. Not financial product advice This presentation is not a recommendation to acquire Tabcorp shares. 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 which recipients may require in order to make an investment decision regarding Tabcorp shares. Tabcorp is not licensed to provide financial product advice in respect of Tabcorp shares. Before making an investment decision, prospective investors should conduct their own independent investigation and assessment of the information contained in this presentation (as well as the additional information available regarding Tabcorp, as referred to under the heading 'Summary Information' above). Financial data All dollar values are in Australian dollars (A$). The historical information in this presentation is, or is based upon, information that has been released to the market. For further information, please see past announcements released to ASX. Future performance Neither Tabcorp nor any other person warrants or guarantees the future performance of Tabcorp shares or any return on any investment made in Tabcorp shares. This presentation may contain certain 'forward-looking statements'. The words 'anticipate', 'believe', 'expect', 'project', 'forecast', 'estimate', 'likely', 'intend', 'should', 'could', 'may', 'target', 'plan' and other similar expressions are intended to identify forward-looking statements. Indications of, and guidance on, financial position and performance are also forward-looking statements. Any forecasts or other forward looking statements contained in this presentation are subject to known and unknown risks and uncertainties and may involve significant elements of subjective judgement and assumptions as to future events which may or may not be correct. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of Tabcorp, that may cause actual results to differ materially from those expressed or implied in such statements. There can be no assurance that actual outcomes will not differ materially from these statements. You are cautioned not to place undue reliance on forward looking statements. Except as required by law or regulation (including the ASX Listing Rules), Tabcorp undertakes no obligation to update these forward-looking statements. Past performance 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. Tabcorp Tabcorp and its related bodies corporate and affiliates and their respective officers, employees agents and advisors, to the maximum extent permitted by law, expressly disclaim all liabilities (including, without limitation, liability for negligence) in respect of, make no representations regarding, and take no responsibility for, any part of this presentation. 15

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