The Lottery Corporation's strong brand presence, extensive retail network, and long-term license agreements provide a solid foundation for continued success. The company’s proactive strategy to enhance digital experiences and expand its game portfolio is positioning it well to capture Future Growth Opportunities. On the other hand, Reliance Worldwide Corporation Limited is anticipating a steady and flat trajectory in sales growth for FY25, yet remaining committed to pursuing substantial operational optimization initiatives.
The Lottery Corporation Limited (ASX: TLC)
The Lottery Corporation Limited (ASX: TLC) announcing its FY24 annual results for the period ended 30 June 2024 reported strong performance, with revenue increasing to $3,996.6 million, up 13.8% from $3,513.1 million in FY23.
NPAT before significant items rose by 21.3% to $411.8 million. After accounting for significant items, NPAT reached $414.0 million, a notable 56.3% increase from $264.8 million in FY23. Earnings per share (EPS) before significant items improved by 21.7% to 18.5 cps, while EPS including significant items increased by 56.3% to 18.6 cps. The fully franked dividend per share (DPS) was 16.0 cps, up 14.3% from 14.0 cps, and a special DPS of 2.5 cps was announced compared to 1.0 cps in the previous year.
The company's consistent track record of growth, underscored by a steadily rising 3-year average turnover, positions it well for the future despite the inherent variability in jackpots.
Looking ahead to FY25, the company aims to strengthen its position as a global leader in the lottery industry. Key priorities include enhancing customer experiences through the implementation of a new data platform, improving onboarding processes, and expanding both digital and retail offerings. The introduction of new retail terminals and cashless options, along with planned changes to Saturday Lotto and future game enhancements, are set to drive Further Growth. Additionally, the company is focused on future-proofing its operations by reimagining digital experiences through the Digitally Enhanced Retail Membership program, boosting operational efficiency, and engaging in federal reviews to enhance license value. These initiatives, coupled with efforts to integrate Charitable Games into digital channels and explore new licensing opportunities, reflect a proactive approach to maintaining its market leadership and driving long-term growth.
Reliance Worldwide Corporation Limited (ASX: RWC)
Reliance Worldwide Corporation Limited (ASX: RWC) released its annual financial results for the fiscal year 2024, concluding on 30 June 2024.
The company reported net sales of $1,245.8 million, reflecting a modest increase of 0.2% compared to the previous corresponding period (pcp). This figure includes a partial contribution from Holman Industries, which was acquired on 1 March 2024. When excluding Holman, sales experienced a decline of 2% relative to the pcp, consistent with the company's guidance.
Operating EBITDA for the fiscal year amounted to $247.5 million, representing a 10% decrease from the pcp. The annual results incorporated one-off expenses totalling $27.1 million, which were associated with the closure of the Supply Smart business in the Americas, restructuring efforts in the EMEA region, impairment of manufacturing assets in Spain, and costs related to the acquisition of Holman. After adjusting for these items, the Adjusted EBITDA stood at $274.6 million, aligning with the pcp. The Adjusted EBITDA margin was recorded at 22.0%, which was largely consistent with the pcp.
The company achieved cost savings of $23 million during the period, primarily driven by previous restructuring in the Americas, procurement efficiencies, EMEA restructuring, and ongoing improvement initiatives.
Cash flow from operating activities rose by 7% to $314.2 million, with an operating cash flow conversion rate of 114% of EBITDA, compared to 107% in the PCP.
The company also reported a distribution of US5.0 cents per share, an unfranked interim dividend of US2.50 cents per share, and an on-market share repurchase totalling US$19.6 million.
The company’s key focus will be on achieving considerable cost reductions by enhancing its global production capabilities to lower manufacturing expenses. Consequently, the company forecasts that these Cost-Saving Strategies will yield savings ranging from $10 to $15 million in FY25.
Source: Company’s Report
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