Jumbo expects Q1 revenue fall despite sales growth

Speaking at Jumbo’s annual general meeting, its chief executive Mike Veverka said for the three months to 30 September, revenue is set to fall from AU$22.3m (£12.1m/€13.4m/US$15.7m).

However, he also noted a significant improvement in underlying performance, with like-for-like sales for Jumbo’s key lotteries business set to increase by between 26% and 64%.

Veverka also noted a 38% decline in large jackpots compared to Q1 of last year, while the peak jackpot only reached $80m, down from a record $150m in the previous year.

In addition, he said sales from jackpot games under $15m are expected to climb 36% year-on-year.

Aside from financial performance, Veverka said that Jumbo experienced stronger engagement with customers in Q1, helped by improved data analytics, which in turn enhanced customer engagement.

Veverka also said stay-at-home restrictions in Australia drove more customers online during Q1, which allowed the business to engage more with players.

“I am proud of the commitment and performance of our whole team in this challenging environment,” he said.

“We look to the future with the confidence that we have a resilient business in strong financial shape, allowing us to sustainably grow our customer base as we continue to invest in our existing businesses and capitalise on our options for growth.”

The AGM came after Tabcorp in September agreed to sell its 11.6% stake in the Jumbo Interactive business for $97.8m.

Tabcorp managing director and chief executive David Attenborough said there was no longer any need to hold a stake in Jumbo after it formalised a long-term extension of its reseller agreement until August 2030.

This will see Jumbo pay $15m to Tabcorp, as well as a service fee of 4.65% of subscription revenue, for reselling rights for lottery products in New South Wales, Victoria, South Australia, Northern Territory, Australian Capital Territory and Tasmania, as well as international jurisdictions.