Lottery Corp Holds FY26 Ordinary Dividend at 16.5 Cents

The Lottery Corporation (ASX:TLC) reported results for the full year ended 30 June 2026. Revenue was $3,582.5 million, down 2.7 per cent, and variable contribution was $1,032.0 million, down 2.3 per cent. The company notes that the presentation of lottery franchise fee and Keno venue fee charges has been revised, decreasing revenue and variable costs by $65.1 million in FY26, with FY25 comparatives presented on a consistent basis for a $66.2 million decrease in both, and that the change has no impact on EBITDA. Operating expenses were $295.9 million, $11.2 million or 3.6 per cent lower. EBITDA before significant items was $736.1 million, down 1.8 per cent, and EBIT before significant items was $622.3 million, down 4.2 per cent. Net profit after tax before significant items was $342.5 million, down 6.3 per cent, and net profit after tax including significant items was $284.6 million, down 22.1 per cent, after $57.9 million of after-tax significant items. Earnings per share before significant items were 15.4 cents against 16.4 cents, and 12.8 cents including significant items. The company marks its before significant items measures as non-IFRS information and unaudited. The Board determined a final ordinary dividend of 8.5 cents per share, in line with the prior corresponding period, bringing the total ordinary FY26 dividend to 16.5 cents per share fully franked, also in line with the prior year, representing a payout ratio of 107 per cent of FY26 net profit after tax before significant items. The final dividend is payable on 24 September 2026 to shareholders registered at 27 August 2026, with an ex-dividend date of 26 August 2026.

In Lotteries, revenue was $3,218.2 million, down 3.3 per cent, and EBITDA was $626.6 million, down 3.0 per cent. The company said there was no $100 million Powerball jackpot for the first time since FY21 and no $50 million Oz Lotto jackpot for the first time since FY17, and that these jackpot outcomes negatively impacted revenue by about $350 million and variable contribution by about $90 million, against about $50 million and about $10 million respectively in the prior corresponding period. It described the period as a 1 in about 45 year outcome, which a footnote defines as the probability of combined turnover for the jackpot games being equal to or less than the actual FY26 outcome of $3,254 million, based on internal modelling. This was partly offset by price retention of 63 per cent on the November 2025 Powerball price change and 100 per cent on the full-year impact of the May 2025 Saturday lotto change. The Lotteries EBITDA to revenue margin was 19.5 per cent against 19.4 per cent, and digital share of turnover, excluding products not sold digitally, rose to 46.6 per cent from 45.7 per cent. Keno revenue was $364.3 million, up 3.0 per cent, with EBITDA of $109.5 million, up 6.2 per cent, at a margin of 30.1 per cent against 29.2 per cent. The leverage ratio, measured as net debt to EBITDA before significant items for the 12 months to 30 June 2026, was 3.1 times at the end of FY26 and the company said leverage will increase materially in the first half of FY27 after the payment of $1,145 million relating to the 40-year extension of the Victorian lotteries licence, likely to beyond its long-term target range of 3.0 to 4.0 times. From FY27 the dividend policy will change to 80 to 100 per cent of net profit after tax and amortisation before significant items, from 80 to 100 per cent of net profit after tax before significant items, with the total licence amortisation after tax that is added back forecast at about $43 million in FY27. FY27 guidance is for operating expenses of $305 million to $315 million, subject to jackpot outcomes, depreciation and amortisation of $125 million to $130 million and capital expenditure of about $100 million. The company also said proposed amendments to the Interactive Gambling Act are before Federal Parliament and, if the Bill is passed without amendment, would commence from 1 January 2027 and would impact online Keno, which represented about 2 per cent of Group turnover and contributed about $25 million of EBITDA in FY26.