Tabcorp announced that Gillon McLachlan was appointed as the new CEO and managing Director of Tabcorp. He is the former Chief Executive of the Australian Football League.
McLachlan is expected to join Tabcorp on the 5th of August and take over as CEO, subjected to regulatory approval.
After a decade of leading the Australian Rules Football competition, the AFL, he takes on the role. As CEO, McLachlan oversaw the expansion of the league to 18 teams, while revenue more than doubled to AU$1.06bn (PS553.4m/EUR655.6m/US$701.8m) during his time in charge.
McLachlan takes over for Adam Rytenskild who quit in March after allegations that he used “inappropriate” and “offensive” language at work. Rytenskild was CEO and MD of Tabcorp since May 2022.
Bruce Akhurst, the chairman of Tabcorp took on an additional role as executive chairperson while Tabcorp searched for a new replacement. Akhurst is expected to continue in this role until McLachlan takes official control of Tabcorp’s operations.
Akhurst stated that “Gill is a name you’re already familiar with.” He is recognized as Australia’s top CEO and Tabcorp is fortunate to have him. Gill has a growth-oriented mindset, and is able to capitalize on opportunities that are ahead.
Gill has a unique perspective for us as he was responsible for the largest media rights agreements in Australian sporting history. “We’re very excited by the growth potential for our media and wagering business under his direction.”
McLachlan discusses “enormous” opportunities at Tabcorp
McLachlan, when asked about his new role, said that he would focus on the acceleration of Tabcorp’s growth. McLachlan also praised Tabcorp’s omnichannel offering of entertainment across retail, digital and media.
McLachlan stated that “Tabcorp’s business is wagering, broadcasting and integrity service and it has a lot of growth potential.” Tabcorp, a proudly Australian business, contributed more than $1 billion to Australia’s racing industry in the past year. It is also the betting licensee for all but WA.
This is an important part of my decision. The opportunities are endless and I look forward to driving in the sports category, among others.
Tabcorp has already begun its transformation. “I’m excited to work with the management team to deliver growth on the opportunities.”
Akhurst said: “In two years, since the demerger of Tabcorp and Queensland we have improved our offering to customers and implemented key structural reforms.” Tabcorp’s transformation isn’t complete, and I welcome Gill to help us continue driving change and growth.
Tabcorp aims to improve H1 performance
McLachlan is set to take over Tabcorp following a difficult H1 period for the Group. The revenue for the six-month period ending 31 December fell 5.1%, to AU$1.21bn. This decline was seen across both of Tabcorp’s core businesses.
The overall betting market has declined by 4.2%, resulting in a decline of $1.12bn for wagering and media revenues. In this same segment, the revenue of Media and International fell by 5.4%.
Gaming services revenue fell 14.5%, to $93,0m. Tabcorp stated that this was due to the effects of selling eBet, Max Performance Solutions and eBet.
There was also the problem of increased expenses, the most important being the $852.0m impairment charges. In combination with the lower revenues, this resulted to a net loss of $641.7m, as opposed to $53.2m in profit from last year. EBITDA also fell 34.7%, to $131.7m.
However, there were some positive developments in H1. Tabcorp settled a dispute over tax with the Australian Taxation Office in September. The business is set to receive 83 million dollars of tax refund.
Regulations: Good and Bad
Tabcorp also has had its share of regulatory problems in the last year. Last week, it received a $370 417 fine in Victoria for failing to stop a minor gambling.
This is not the first time Victoria authorities has taken action against underage gambling or failure to monitor EBTs. The Victoria Gambling and Casino Control Commission charged Tabcorp and a number of venues with underage gambling in September. Between September 2022 to October 2023, there were breaches.
Tabcorp is facing 72 total charges. The operators could face fines of up to $1m if found guilty. Tabcorp could be fined $969,236.
Tabcorp has been subjected to other actions in Victoria. Tabcorp was ordered by the VGCCC in January to convert most of their EBTs into cashless transactions. The VGCCC ordered Tabcorp to make most of its EBTs in the state cashless.
Tabcorp was fined a record-breaking $1.0m by the VGCCC for its actions during the major system failure in 2020. Tabcorp’s Wagering and Betting System failed on 7th November 2020 during the Spring Racing Carnival.
Tabcorp was granted exclusive betting and wagering rights in Victoria in December for 20 years. Tabcorp’s license period begins in August 2024 – immediately following the expiration of its exclusive licence.
Last week, the New South Wales government (NSW), announced that it would consider Tabcorp’s proposal to raise the point of consumption taxes (POCTs) to 20% in the state.
In NSW, wagering operators pay the POCT rate at 15%. Tabcorp proposes that the NSW government increase POCT to align NSW with other states who charge 20%.
Tabcorp’s proposal includes other aspects related to the reform of legislative requirements and licensing for betting. The Tabcorp proposal also includes other points related to reforming legislative and licence requirements for wagering. These reforms will be considered by the government as part of a wider potential reform in NSW.
