Tatts braces for betting battering

The company yesterday posted a net profit of $277 million, up 8 per cent on a year ago, because of strong earnings growth in its wagering business in Queensland, South Australia and the Northern Territory as well as its lotteries in three states and two territories.

The result was slightly below analysts' expectations.

In its UNiTAB wagering business, earnings grew by 13 per cent to $148 million, while lotteries earnings grew by the same amount to $119 million.

The growth in lotteries was boosted by a one-in-27-year Oz Lotto jackpot at the end of the financial year that produced the equivalent of three weeks of sales.

However, earnings in the company's largest division, its 13,000 poker machines in Victorian clubs and hotels, grew just 6 per cent to $239 million.

Gaming machine turnover remained strong as petrol prices fell late last year, and personal tax cuts and extra government hand-outs trickled down to punters' wallets.

Tatts chief executive Dick McIlwain said he expected growth would slow in this financial year, as the benefits from the stimulus packages, lower petrol prices and falling interest rates disappeared and unemployment bites.

"Overall, we don't expect to see the top-line growth that we got over the last 12 months in all of our businesses," Mr McIlwain said. "That doesn't mean that the business will go backwards."

Tats shares fell 10?, or 4 per cent, to $2.51.