Industry Update

- Australia -

Sue van der Merwe

General Manager Group Lottery Operations

Tatts Lotteries

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2013 Annual Regional Conference

Presentation Outline

• Australian Gambling Market

• Australian Lotteries Market

• Key Developments

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Australian Gambling Market

- Expenditure 2009-10 -

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• 2009/10 total Gambling Expenditure = AUD$18.4 billion

• 2009/10 total Lottery Expenditure = AUD$1.5 billion

• Per capita spend = AUD$1,081.48

• Gaming machines dominate; sports betting fastest growing sector

Source: Australian Gambling Statistics, 28th Ed. 2009/10 published Dec 2012

4

Australian Gambling Market

- Expenditure – Long Term Trends

Source: Australian Gambling Statistics, 28th Ed. 2009/10 published Dec 2012

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Australian Gambling Market

- Percentage Share -

Source: Australian Gambling Statistics, 28th Ed. 2009/10 published Dec 2012

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Australian Lottery Industry

Western Australia

Lotteries Commission / Lotterywest

Lotteries Commission Act (1990)

Northern Territory

Tatts NT Lotteries Pty Ltd

20 year Operator Agreement to 2032

Queensland

Golden Casket Lottery Corporation Limited

Licensed Lottery Operator Agreement—65 years to 2072

New South Wales

New South Wales Lotteries Corporation Pty Ltd

Operator Licence —40 years to 2050

Australian Capital Territory (ACT)

(Serviced by NSW Lotteries)

Approval under the Lotteries Act 1964 and Pool Betting Act 1964 (ongoing)

Victoria

Tattersall’s Sweeps Pty Ltd

Category One Public Lottery Licence—10 years to 2018

Intralot Australia Pty Ltd

Category Two Public Lottery Licence – 10 years to 2018

Tasmania

Tattersall’s Sweeps Pty Ltd

Foreign Games Permit—5 years to 2015

South Australia

Tatts Lotteries SA Pty Ltd

Master Agency Agreement—40 years to 2052

Australian Lottery Industry

- Products -

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Source: La Fleur’s 2013 World Lottery Almanac 21st Edition

• 2012 Australian Lottery Sales of US$5.707 billion

• Lotto games account for 87% of sales

• Instants are also an important category

• Traditional draw game strong in NSW

Lotto/

Numbers

87%

Keno

2%

Pools

0%

Draw

2%

Instants

9%

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Australian Lotteries

- Rankings in the Global Lottery Industry

2012 World Rankings - Lotto Per Capita (US$)

Rank Lottery Per Capita

1. Lotterywest $305

3. Tattersall’s $236

4. Golden Casket $212

6. NSW Lotteries $187

7. South Australian Lotteries $184

(Tatts Lotteries overall ranks as number 3 at US$208)

Sales Trends

- Last 4 years -

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Source: La Fleur’s World Lottery Almanacs

$-

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

2009 2010 2011 2012

Lotto/Numbers Keno Pools Draw Instants

US$M

Australian Lottery Industry

- Lotto Portfolio -

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Source: La Fleur’s 2013 World Lottery Almanac 21st Edition

Maintaining a balance between base

week and jackpot games is important for

long term success

Lotto

- Saturday, Monday and Wednesday

- 6/45 matrix

- 6 prize divisions

Oz Lotto

- Tuesday

- 7/45 matrix

- 7 prize divisions

Powerball

-Thursday

-6/40 and 1/20 matrix

-8 prize divisions

Key Trends and Developments

• Lotto portfolio growth has been driven by regular

game changes which are always done with the

portfolio impact in mind

• Small and regular price increases are a regular

part of the way we manage the lotto portfolio

• Instants sales have been under some pressure –

disposable income issue

• Responsible Play is an integral part of our lottery

operations

Key Trends and Developments

- Powerball relaunch-

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1. New Game Structure

WAS NOW

2. New prize divisions and prize pool distribution

5/45 1/45 6/40 1/20

Key Trends and Developments

- Powerball relaunch-

3. New chances of winning

Chance of winning a Division One prize in Powerball

changed from 1 in 54,979,152 to 1 in 76,767,600. The

chance of winning any prize in Powerball improved

from 1 in 119 to 1 in 78.

4. Price Increase

The price per game increased by ten cents from 75

cents to 85 cents, plus agent commission.

Key Trends and Developments

- Powerball relaunch-

5. New jackpot sequence

In an attempt to reach bigger jackpots much faster

and more often, the $15M level was removed from

the sequence.

WAS

NOW

Key Trends and Developments

- Powerball relaunch-

6. Early Results

•Jackpot rolled to $60 million early on but since then

jackpots have been a little under expectation (the game

is being won at lower levels).

•New Division 8 has delivered 3,096,888 MORE

WINNERS, in the first 6 months compared to the

previous divisional structure (average division 8 prize

payment is $13.66 ).

•Players are positive about the change

Thank You

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