Business Description:
Tatts Group Limited (TTS) is a provider of leisure and entertainment products and services in the gaming, wagering and lotteries segments of the Australian gambling industry and has an investment in UK gaming venues.

Strategy Analysis:
TTS´s strategy is built around two key objectives - expansion of the company´s gambling businesses and lowering operating costs. Organic growth is low so TTS is primarily focused on bidding for new long-life quality gambling licences and acquiring state-owned lotteries and wagering businesses. By winning new licences and acquiring state-owned businesses TTS can leverage existing strengths and capabilities to achieve strong profitability. TTS´s management is deeply experienced in both lotteries and wagering which strongly assists cash flow growth. TTS lowers operating costs through the development and leverage of proprietary technology systems across its existing and acquired businesses. The company has developed a strong core in-house gambling systems capability, which is currently being used to integrate NSW Lotteries into the TTS business model. Tatts Group reported NPAT of $275.43m for the year ended 30 June 2011. Revenues from ordinary activities were $3.67bn, up 11.3% from last year. This result incorporates the inclusion of 12 months revenue from NSW Lotteries in the 2011 results compared to three months revenue in the 2010 results following the acquisition of NSW Lotteries on 31 March 2010. Basic and Diluted EPS was 21.2 cents compared to 8.2 cents last year. Net operating cash flow was $391.85m compared to $369.24m last year. The final dividend declared was 11 cents, taking the full year dividend to 32.5 cents (including a special dividend of 11 cents) compared with 10 cents last year.