Horse flu costs Tabcorp

TABCORP Holdings' ability to contain costs will be in focus on Thursday with the gambling group tipped to book a $240.6 million half-year net profit.

Tabcorp has already flagged the outbreak of equine influenza will shave about $30 million from its wagering division's pretax earnings.
Analysts expect solid gaming revenue, based on recent industry statistics showing 4 per cent growth in Victoria, with the introduction of smoking bans having a limited effect.
A major focus is likely to be cost control after the fiscal 2007 results were hit by a cost blowout, forcing Tabcorp to scrap international expansion plans.
Chief executive Elmer Funke Kupper was appointed in March to replace Matthew Slatter after the profit slump. Tabcorp has targeted expenses growth within inflation.
Before equine influenza, management guidance was for a full-year flat net profit, before significant items, of more than $515.6 million for the year.
"We expect Tabcorp will be able to maintain or nominally upgrade its previous full year 2008 guidance for flat earnings adjusted for the impact of equine influenza," ABN AMRO analysts said in a note to clients.
Citi has forecast a net profit of $241.6 million for the six months to December 31, which it says is just shy of consensus at $240.6 million, up 7.4 per cent on the $224.1 million reported a year ago.
Consensus expectations for the full year are for a net profit of $495.7 million, according to Thomson Financial survey of 11 brokers.