“In the near term, we expect the macroeconomic environment to remain challenging. Given expectation of the interest rates remaining elevated and the high inflation levels that persist, the regulatory environment will also continue to tighten,” he said.

The company will pay a final dividend of 0.3¢ per share, taking its payout to shareholders for the year to 1.3¢ per share, down 43.5 per cent from last year’s return.

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McLachlan replaced former chief Adam Rytenskild, who left in disgrace after an external law firm found he’d spoken inappropriately about a Victorian regulator. Rytenskild denies the allegations and is now suing Tabcorp for unfair dismissal.

Rytenskild says he was forced to resign and as a result was paid under half his $2.1 million salary for the 2024 financial year, $839,540 when accounting for annual leave and long service leave. All up he was paid $3.3 million for the year when accounting for a $500,000 termination payment, but could have been entitled to significantly more if he had not stepped down.

Taylor Collison analyst Andrew Orbach said the wagering market wasn’t playing out as expected, with big operators such as Tabcorp and Sportsbet underperforming, while smaller firms such as PointsBet have gained market share.

“Tabcorp needs a second brand. The TAB brand will not resonate with 20-something-year-old sports punters. Ever,” Orbach said in a note to his clients.

“It’s unlikely Tabcorp can turn this around organically in any period of time,” he continued, arguing the group needs to consider acquiring another business over the next six to 12 months.

“[They] need it for brand, team, tech and scale reasons. Seems obvious,” Orbach said.

Barrenjoey analyst Matt Ryan said it was a mixed result. “On the positive side, wagering performance looks better than expected, while cost growth appears higher than expected,” he told clients. Barrenjoey has a 78¢ price target on Tabcorp.

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