Key Highlights

  • A 40-year extension of the Victorian lottery licence reduces a long-standing structural risk.
  • Revenue before significant items was $3,582.5 million, down 2.7 per cent.
  • Keno Revenue rose 3.0 per cent to $364.3 million.
  • From FY27 the Dividend payout policy changes to 80 to 100 per cent of NPATA before significant items.

The Lottery Corporation Limited (ASX:TLC), a constituent of the S&P/ASX 50, has had a mixed year. A 40-year extension of the Victorian lottery licence lowers a long-standing structural risk, yet the financial year to 30 June 2026 delivered lower revenue and profit. Whether the longer licence outweighs a weak jackpot run depends largely on how much of the shortfall proves temporary.

What the company does

The Lottery Corporation operates Australia's major lottery brands, including Powerball, Oz Lotto, Saturday Lotto and Set for Life, alongside the Keno Business and instant-win games. Management describes its strategy as "Where Australia Comes to Play", with an emphasis on digital engagement, product refreshes and converting casual players into registered customers. Sales occur online, too.

Latest developments

On 19 August 2026 the company reported results for the year ended 30 June 2026. Revenue before significant items was $3,582.5 million, down 2.7 per cent, while EBITDA was $736.1 million, down 1.8 per cent. The full-year dividend was 16.5 cents per share, fully franked, unchanged from the previous year.

The Victorian licence extension of 40 years was announced alongside these results. Management says it reduces risk and supports the investment-grade Credit rating, although the arrangement has drawn criticism because it was not subject to a competitive tender.

From FY27 the dividend policy changes to a payout of 80 to 100 per cent of net profit after tax before Amortisation (NPATA), before significant items. Future dividends remain a board decision.

Separately, Parliament has passed amendments to the Interactive Gaming Act, mainly targeting advertising. The changes ban foreign matched lotteries, which is regarded as helpful for the company, and digital keno, which is a setback for that product.

Financial and operational evidence

Net profit after tax before significant items for FY26 was $342.5 million, down 6.3 per cent.

The cause was largely jackpot luck. There was no $100 million Powerball draw, the first such absence since FY21, and no $50 million Oz Lotto jackpot. Chief executive Wayne Pickup put the revenue effect at around $350 million. Price increases and cost control softened the impact, and operating expenses fell by $11.2 million to $295.9 million.

Keno was a bright spot, with FY26 revenue up 3.0 per cent to $364.3 million and EBITDA up 6.2 per cent to $109.5 million. For FY27 the company targets operating expenses of $305 million to $315 million as it invests in digital, terminals and product changes.

Milestones to watch

Jackpot dependence is the principal Earnings risk, and management expects jackpot-driven revenue to keep fluctuating.

Regulatory risk is also significant. The digital keno ban removes a growth avenue, and campaigners continue to press for stronger harm measures. The licence extension carries political and reputational risk because of the absence of competitive tender. Higher costs could pressure margins if revenue disappoints.

Milestones to watch

Investors will probably focus on several items over the coming months. These include the progress of the digital strategy, including registered customer growth, the regulatory approval of the new Oz Lotto variant, the effect of Set for Life price changes, and the rollout of retail terminals.

Jackpot outcomes for Powerball and Oz Lotto will matter for first-half FY27 revenue, with the half-year result expected in February 2026 terms of the usual reporting cycle, likely in the new calendar year. The company's actual first dividend under the new payout policy will also show how the board applies its range.

Lastly, any further legislative detail on Advertising limits or online gambling will be worth tracking.