Bulletin: Lottery Corp.'s Earnings Hot Streak Underscores Resilience

This report does not constitute a rating action. MELBOURNE (S&P Global Ratings) Feb. 23, 2023--Australia-based Lottery Corp. Ltd.'s strong earnings reinforce the stability of its lotteries cash flow. Group EBITDA increased 15.8% during the six months to Dec. 31, 2022, illustrating the resilience of its earnings through economic cycles. The Lottery Corp. Ltd.'s (TLC; BBB+/Stable/--) stronger-than-expected earnings followed a COVID-related earnings boost in fiscal 2022 (year end June). However, given the favorable jackpot outcomes in the past six months, we expect there will be a level of normalization in earnings during the remainder of fiscal 2023. In addition, we believe Keno and Instant Scratch-Its products remain more susceptible to a reduction in consumer spending, given they are more discretionary. We

...MELBOURNE (S&P Global Ratings) Feb. 23, 2023--Australia-based Lottery Corp. Ltd.'s strong earnings reinforce the stability of its lotteries cash flow. Group EBITDA increased 15.8% during the six months to Dec. 31, 2022, illustrating the resilience of its earnings through economic cycles. The Lottery Corp. Ltd.'s (TLC; ###+/Stable/--) stronger-than-expected earnings followed a COVID-related earnings boost in fiscal 2022 (year end June). However, given the favorable jackpot outcomes in the past six months, we expect there will be a level of normalization in earnings during the remainder of fiscal 2023. In addition, we believe Keno and Instant Scratch-Its products remain more susceptible to a reduction in consumer spending, given they are more discretionary. We believe TLC has ample financial capacity within its credit metrics to accommodate the increase in its target dividend payout ratio to 80%-100% of net profit (after tax, before significant items). The high-quality nature of the company's...

Bulletin