Earlier this year, Tatts Group was put into a very difficult situation. After the Victorian government disbanded the company’s duopoly with TabCorp, Tatts Group anticipated losing a great deal of revenue. Fortunately for the pokies provider, reports show that Tatts Group is doing just fine in the Australian gambling market.
During the first three months of the financial year, Tatts Group has seen some generous profits. Based on these numbers, the company predicts that it will earn a net profit of about $215 million by the time the 2012-2013 financial year is over. Despite losing a great deal of business in Victoria, this is a hugely positive financial forecast for Tatts.
Tatts’ head office was previously located in Victoria, the state in which the company earned the most revenue for the company from pokies. Now that Tatts Group no longer has a foothold on the poker machine market in Victoria, the company has planned to move its head office to Brisbane this year. This marks the first of many changes that Tatts Group will undergo in the year 2013.
Chief executive Dick McIlwain will be retiring next year while chief financial officer Ray Gunston will also resign. As such, Tatts Group can look forward to bringing a number of fresh new faces on board to forge ahead, looking for new ways to make up for profits lost from the Victoria gambling market. When it comes to the duopoly, Tatts Group remains tight-lipped.
The group recently launched a lawsuit worth nearly $600 million in order to make up for the money it would be losing as a result of having its monopoly disbanded. ''At this stage it is not possible to know how long these proceedings will take or the likelihood of success,'' says a Tatts Group spokesperson. TabCorp, the other party in the former duopoly has launched a similar lawsuit, seeking $600 million in damages.
The Victoria government maintains that the way in which the situation was handled was above board, but Tatts and TabCorp are convinced that they are owed money as a result of their duopoly being disbanded.