Tabcorp EBITDA Jumps 14% on 1% Revenue as Cost Cuts Drive Turnaround

Tabcorp’s first-half FY26 results tell a turnaround story that isn’t about top-line growth. Group revenue rose just 1% to AUD 1.34 billion, according to the company’s ASX filing on February 25. But EBITDA climbed 14.3% to AUD 217.4 million, and EBIT was up 18.9% to AUD 110.2 million. NPAT before significant items jumped 61.5%.

The gap between revenue and earnings growth comes down to cost discipline. Operating expenses fell 1.1%, and underlying costs dropped 3.7%. Leverage came down to 1.5x. CEO Gil McLachlan described the company as “midway through” its turnaround and said there’s still work ahead, but the board wasn’t shy about the progress. It declared an interim dividend of AUD 0.015 per share, 50% higher than the prior year.

Yields took a hit during the half. Customer-friendly outcomes during the AFL finals and Spring Carnival cost roughly AUD 10 million in revenue, which CFO Mark Howell attributed to “an unusually high number of favorites winning major races.”

The Victorian Wagering License contributed AUD 12.2 million to H1 EBITDA. Tabcorp is also building out its product pipeline with a National Tote planned by year-end, TAB Live replay cleared by ACMA for a New South Wales launch, and next-generation EBTs rolling out from July 1. Youth engagement is moving. Turnover among 18-to-24-year-olds rose 14% in the half, with sport up 26% and the youth segment growing 42%. Management has earmarked AUD 5 million in additional marketing spend around the 2026 FIFA World Cup.

For operators watching the Australian wagering market, Tabcorp’s results suggest that margin repair can work even when revenue barely moves. Suppliers pitching products to the company should note the shift toward younger demographics and omni-channel integration. Affiliates partnered with competing Australian brands will want to track whether Tabcorp’s cost advantage starts translating into more aggressive customer acquisition in H2.

TGJ Take

This isn’t a growth story yet, and McLachlan isn’t pretending it is. What Tabcorp is proving is that an operator sitting on a legacy retail network can extract meaningful earnings improvement through cost discipline alone. The 61.5% NPAT jump on 1% revenue growth makes that case clearly. The question for H2 and beyond is whether the product investments, particularly the National Tote and the youth-focused digital push, can turn this into a top-line story as well. The FIFA World Cup signals management thinks it can.