Tabcorp Loses Profits After Reform

One way or another, gambling reforms have been put into practise with varying degrees of success but this has not necessarily been good news for the gambling companies. One group in particular that has suffered is Tabcorp, which has recorded a large loss in its profits over the last financial year. However, its struggle has earned it no sympathy from the Victorian Government.

It seems the primary cause of this loss is the costs associated with gambling reform. As of the end of June, Tabcorp recorded a 12-month after-tax profit of $126.6 million, a large amount in its own right but compared to the year before, it shows a huge 63% drop in revenue.

However Planning Minister Matthew Guy maintains that the gaming industry reforms implemented by the government were a positive move and he praised Gaming Minister-turned-Treasurer Michael O’Brien for his handling of problem gambling. For this reason, he feels there is no reason for the government to apologise for its reforms as the ultimate aim is to fight problem gambling.

Chief executive of Tabcorp David Attenborough found the reforms in Victoria to be hugely challenging as it was the biggest change made to the industry in 20 years and there was no room for error while the company was adapting to these changes. As a result, the Tabaret business had to be discontinued in favour of the new Tabcorp Gaming Solutions to work with the new Victorian betting licence. The drop was also a result of the way its wagering licence was affected regarding the racing industry.

Tabcorp noted that the billions of dollars that went into the state’s abundant pokies machines were previously a major source of revenue, and continue to be, only now that money goes to different commercial treasurers. Anti-gambling campaigners have also noticed that changes have not been made where it really counts and gamblers continue to pour their money away into pokies.

Reverend Tim Costello of the Australian Churches Gambling Taskforce says that even after the end of this duopoly, problem gambling is just as big an issue as it always was. Tabcorp may have lost money but that is only because the revenue from gambling is going elsewhere. The fact is, problem gamblers are as prominent as ever. He admits that the reforms did some good but more serious initiatives should be taken, such as $1 betting limits.

As for Tabcorp, Attenborough expects the company to recover and perform better over the next six months. The company has continued to adapt to the reforms and is expected to grow again with its new investment strategy.

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